LEASE AGREEMENT

EXHIBIT 99.2

LEASE AGREEMENT

THIS LEASE AGREEMENT is made and entered this ___ day of _________ 200_, by and between WAL-PAT, LLC, a North Carolina limited liability company (the “Lessor’’); and FLANDERS/PRECISIONAIRE CORP., a North Carolina corporation (the “Lessee”).

W I T N E S S E T H :

1.              PREMISES LEASED . Lessor hereby leases to Lessee that certain tract or parcel of land located in the County of Fort Bend, State of Texas, and being more particularly described on Exhibit A attached hereto and incorporated herein by reference together with any and all improvements thereon (the “Premises”).

a.              The term of this lease shall commence __________, 20__ and shall continue for a period of twenty (20) Lease Years until ______________, 20__. As used herein, the term “Lease Year” shall mean a period of one (1) year, with the first Lease Year beginning on the date hereof and expiring on the day preceding the first anniversary of this Lease and each subsequent Lease Year commencing upon the expiration of the prior Lease Year and continuing until the next subsequent anniversary of the Commencement Date.

b.              The lease term shall expire at the end of the term specified above unless the term ends on a day other than the last day of the month, in which case the term shall expire at 12:00 midnight on the last day of the month in which the term would otherwise end.

a.               Base Rent . Subject to any specific provision of this Lease, Lessee shall pay to Lessor annual rent during Lease Year 1 in the sum of ____________________ and __/100 Dollars ($___________) payable in monthly installments of ______________________ and __/00 Dollars ($__________) each, all such rental installments to be due and payable in advance on the 1 ^st day of each calendar month for and during the Term of this Lease. Rental for any partial month shall be prorated on the basis of a thirty (30) day month.

b.               Adjusted Base Rent . At the beginning of Lease Year 2 and each successive Lease Year thereafter, the rent shall be increased by the greater of (i) three percent (3%) over the prior Lease Year, or (ii) an amount determined by multiplying the rent paid during the prior rent period by a fraction, the denominator of which shall be the Consumer Price Index (“CPI” as defined below) for the first month of the prior Lease Year and the numerator of which shall be the same CPI for the first month of the current Lease Year. Notwithstanding anything herein to the contrary, the adjusted rent amount determined hereunder shall never be less than the rent amount paid during the immediately preceding Lease Year. The term “CPI” means the Consumer Price Index - U.S. City Averages for All Urban Consumers - All Items (1982-84 = 100), of the United States Bureau of Labor Statistics. If the Bureau of Labor Statistics revises the manner in which such CPI is determined, Lessor may adjust the revised index to produce results equivalent, as nearly as possible, to those which would have been obtained if the CPl had not been so revised. If the 1982-84 average shall no longer be used as an index of 100, such change shall constitute a revision. If the CPI shall become unavailable to the public because publication is discontinued, or otherwise, Lessor will substitute therefor, a comparable index based upon changes in the cost of living or purchasing power of the consumer dollar published by any other governmental agency or, if no such index shall be available then a comparable index published by a major bank or other financial institution.

c.              The increased rent to be paid on account of the rent adjustment shall be paid in equal monthly installments in the same manner as provided for Base Rent.

d.              If a rental payment becomes overdue Lessee agrees to pay, in addition to such payment, as liquidated damages for such delay, a “late charge” in the amount often percent (10%) of the agreed rental payment for each month or fraction thereof that the rental payment becomes overdue. The parties agree that such late charge represents a fair and reasonable estimate of the costs Lessor will incur by reason of such late payment.

e.              All rental shall be paid to Lessor or its authorized agent at the address set out in the NOTICE paragraph below or at such other place as may be designated by Lessor from time to time. Delivery and payment of rent shall be deemed made only upon receipt of the applicable rent payment at the address of the Lessor set out in the NOTICE paragraph below; placing a rent payment in the mail shall not constitute delivery or payment of the rent.

a.              Lessee shall use the Premises for warehouse purpose and for other uses permitted under applicable zoning ordinances and restrictive covenants. Lessee shall not use the Premises for personal habitation or any unlawful purpose.

b.              The Premises shall be open and accessible to Lessee twenty-four hours per day, seven days per week, including holidays. Lessee shall comply with all applicable statutes, ordinances, rules and regulations of federal, state and municipal government is applicable to Lessee’s use of the Premises.

6.              ALTERATIONS AND IMPROVEMENTS . Lessee may alter, improve and change the Premises with the written consent of Lessor which Lessor will not unreasonably withhold; provided, however, that the locating and relocating of moveable partitions, telephone and electrical outlets, light fixtures, equipment, and trade fixtures shall not be deemed alterations, improvements or changes to the Premises.

7.              MAINTENANCE AND REPAIRS; NET LEASE . During the term of this Lease Agreement, Lessee shall be responsible for all repairs and maintenance to the Premises, including without limitation, all repairs and maintenance of all structural components, all walls, doors and windows, the roof, the heating, ventilation and air conditioning systems, all parking and landscaped areas, all mechanical systems, and the plumbing and electrical systems, and shall return the Premises to the Lessor at the expiration of the term of the Lease in as good a state of repair as when the Lessee’s occupancy started, reasonable wear and tear excepted. Lessee further shall be responsible for all snow and ice removal from the Premises. If Lessee fails to make any repairs promptly and adequately, Lessor may, but need not, make the repair. In the event Lessor makes the repairs, Lessee shall promptly pay the reasonable costs of the repair incurred by Lessor. Lessee acknowledges that it is the intention of Lessor and Lessee that this is an absolute net lease, that the rental being paid under this lease is net to the Lessor, and that Lessor shall not be responsible for any repairs, maintenance, insurance, taxes, utilities or other costs arising from or related to the Premises.

8.              COMPLIANCE WITH CODES . All repairs, alteration, additions, or improvements made by Lessee shall comply with applicable building codes.

9.              TRADE FIXTURES AND SURRENDER OF PREMISES . All trade fixtures, merchandise, supplies, and equipment owned by Lessee and installed in the Premises shall remain the property of Lessee and at the end o[the term or any final extension thereof Lessee shal1 remove the same and peaceably yield up the Premises to Lessor in as good repair and condition as when delivered to it, excepting ordinary wear and tear, damage by fire, elements or casualty, or any damage not due to the negligence of Lessee; provided, however, that Lessee shall repair any damage to the Premises caused by the removal of its property.

10.             LESSEE’S SIGNS . Lessee may install its customary and usual signs on and adjacent to the Premises, subject to applicable zoning ordinances and restrictive covenants. All signs located on the Premises shall be in good taste so as not to detract from the general appearance of the Premises.

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11.             UTILITY SERVICE .

a.              Lessee shall pay all charges for utility services including heat, air conditioning, water, gas, and electricity used on the Premises by Lessee.

b.              Lessee shall pay all charges for telephone installation and services to the Premises.

12.             MECHANIC’S LIENS . Any mechanic’s lien filed against the Premises for work or materials furnished to either Lessor or Lessee shall be discharged by such respective party responsible therefor prior to the commencement of any legal action to perfect the same.

a.              Lessor, at reasonable times and frequency, shall have the right to enter the Premises to examine the same, to show them to prospective purchasers, mortgagees, or lessees and to make such repairs, alterations, improvements or additions required hereunder without the same constituting an eviction of Lessee in whole or in part. Rent shall not abate while any repairs, alterations, improvements or additions are being made provided that Lessor shall proceed expeditiously with the same and without unreasonable interference or interruption to Lessee’s use of the Premises.

b.              If Lessee shall not have exercised its right to extend the term within the required time, Lessor may post a customary sign on the Premises advertising the property for lease or sale, but no sign shall be posted in any window or doorway of the store portion of the Premises.

a.              During the term of this Lease, as additional rental, Lessee shall be responsible for the payment of all real estate and personal property taxes (“Property Taxes”) levied against the Premises including such taxes for the year 2007. Lessor shall furnish Lessee with a copy of each tax statement, and Lessee shall promptly pay when due all Property Taxes and special assessments lawfully levied against the Premises.

b.              Lessee shall pay promptly all personal property taxes lawfully levied against personal property of any kind upon or about the Premises.

a.              Lessee shall indemnify Lessor and save it harmless from and against any and all claims, liability and expense for damages to any person or property in, on, or about the Premises arising out of the acts or neglect of Lessee. As additional rental, Lessee shall procure and keep in effect during the entire term hereof public liability and property damage insurance in which the limits of public liability shall be at least One Million Dollars ($1,000,000.00) combined single limit coverage, and shall cause Lessor to be named as an insured party therein to the extent of its interest.

b.              As additional rental, Lessee shall carry fire and extended coverage insurance on all of the buildings and improvements on the Premises in an amount equal to the replacement value thereof and such insurance coverage shall be adjusted as needed to reflect change in property values. Said insurance shall insure against such hazards as arc included in a standard extended coverage endorsement.

c.              Lessee shall cause Lessor to be named as an additional insured on all insurance policies described in this section 15 and shall provide Lessor with certificates of insurance or copies of all such policies as evidence thereof.

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a.              In the event the Premises or any material portion thereof or any adjoining property shall be damaged by fire or other casualty during the term hereof so as to render the Premises untenantable, Lessee shall promptly restore the Premises to its previous condition, and rent shall not abate during any such period.

b.              Lessor and Lessee hereby release and discharge each other and any employee or representative of each from liability whatsoever hereafter arising from loss, damage, or injury caused by fire or other casualty for which insurance is required to be carried hereunder by the injured party at the time of such loss, damage, or injury to the extent of any recovery by the injured party under such insurance, provided such insurance permits a waiver of liability and subrogation rights.

17.           EMINENT DOMAIN . If the whole or any material pan of the Premises or any building in which the Premises are located, or more than fifty percent (50%) of any parking area which is a part of the Premises, shall be taken by or conveyed to any public authority under the power of eminent domain or by private purchase in lieu thereof, then and in that event:

a.              Lessee shall be entitled to terminate this lease in its discretion;

b.      &