OFFICE LEASE AGREEMENT

Exhibit 10.47

OFFICE LEASE AGREEMENT

CATALYTICA ENERGY SYSTEMS, INC.
WARNER COURTYARDS
301 WEST WARNER RD.
Suite # 132

Page
ARTICLE 1.		SUMMARY AND DEFINITION OF CERTAIN LEASE PROVISIONS AND EXHIBITS			1
ARTICLE 2.		PREMISES/RIGHT TO USE COMMON AREAS			1
ARTICLE 3.		TERM			2
ARTICLE 4.		MINIMUM MONTHLY RENT			2
ARTICLE 5.		ADDITIONAL RENT/EXPENSE STOP			2
ARTICLE 6.		PARKING			2
ARTICLE 7.		RENT TAX AND PERSONAL PROPERTY TAXES			3
ARTICLE 8.		PAYMENT OF RENT/LATE CHARGES			3
ARTICLE 9.		SECURITY DEPOSIT			3
ARTICLE 10.		CONSTRUCTION OF THE PREMISES			3
ARTICLE 11.		ALTERATIONS			3
ARTICLE 12.		PERSONAL PROPERTY/SURRENDER OF PREMISES			3
ARTICLE 13.		LIENS			3
ARTICLE 14.		USE OF PREMISES/RULES AND REGULATIONS			3
ARTICLE 15.		RIGHTS RESERVED BY LANDLORD			4
ARTICLE 16 .		QUIET ENJOYMENT			4
ARTICLE 17.		MAINTENANCE AND REPAIR			4
ARTICLE 18.		UTILITIES AND JANITORIAL SERVICES			4
ARTICLE 19.		ENTRY AND INSPECTION			4
ARTICLE 20.		ACCEPTANCE OF THE PREMISES/LIABILITY INSURANCE			4
ARTICLE 21.		CASUALTY INSURANCE			5
ARTICLE 22.		DAMAGE AND DESTRUCTION OF PREMISES			5
ARTICLE 23.		EMINENT DOMAIN			5
ARTICLE 24.		ASSIGNMENT AND SUBLETTING			5
ARTICLE 25.		SALE OF PREMISES BY LANDLORD			5
ARTICLE 26.		SUBORDINATION/ATTORNMENT/MODIFICATION/ASSIGNMENT			5
ARTICLE 27.		LANDLORD’S DEFAULT AND RIGHT TO CURE			6
ARTICLE 28.		ESTOPPEL CERTIFICATES			6
ARTICLE 29.		TENANT’S DEFAULT AND LANDLORD’S REMEDIES			6
ARTICLE 30.		TENANT’S RECOURSE			6
ARTICLE 31.		HOLDING OVER			6
ARTICLE 32.		GENERAL PROVISIONS			6
ARTICLE 33.		NOTICES			7
ARTICLE 34.		BROKER’S COMMISSIONS			7
ARTICLE 35.		INDEMNIFICATION /WAIVER OF SUBROGATION			7
ARTICLE 36.		ADDENDUM		ADDENDUM-1
EXHIBITS:
(A)		PREMISES
(B)		RULES AND REGULATIONS
(C)		PARKING RULES AND REGULATIONS

OFFICE LEASE AGREEMENT
CATALYTICA ENERGY SYSTEMS, INC.

THIS OFFICE LEASE AGREEMENT , dated August 28, 2006 is made and entered into by WARNER COURTYARDS, LLC, an Arizona Limited Liability Company, PARK 3020, LLC, an Arizona Limited Liability Company, PARK 3030, LLC, an Arizona Limited Liability Company, and METZGER WARNER COURTYARDS, LLC, a Delaware Limited Liability Company, (Collectively the “Landlord”) and CATALYTICA ENERGY SYSTEMS, INC., a Delaware Corporation (the “Tenant”). In consideration of the mutual promises and representations set forth in this Lease, Landlord and Tenant agree as follows:

ARTICLE 1. SUMMARY AND DEFINITION OF CERTAIN LEASE PROVISIONS AND EXHIBITS

1.1

The following terms and provisions of this Lease, as modified by other terms and provisions hereof, are included in this Section  1.1 for summary and definitional purposes only. If there is any conflict or inconsistency between any term or provision in this Section  1.1 and any other term or provision of this Lease, the other term or provision of this Lease shall control:

		(a)		Landlord:		Warner Courtyards, LLC
						Park 3020, LLC
						park 3030, LLC
						Metzger Warner Courtyards, LLC
		(b)		Address of Landlord for Notices:		c/o Hannay Investment Properties, Inc.
						2999 N. 44 th Street
						Suite 400
						Phoenix, Arizona 85018
		(c)		Tenant:		Catalytica Energy Systems, Inc.
		(d)		Address of Tenant for Notices:		Catalytica Energy Systems, Inc.
				(Include Main/Hdq. Address)		301 West Warner Rd. Suite 132
						Tempe, Arizona 85284

	(e)		Lease Term : September 15, 2006, through September 30, 2007, as further defined in Article 3 .
	(f)		Building: The office building known as WARNER COURTYARDS , located at 301 West Warner Rd., Tempe, Arizona 85284 (the “Building”).
	(g)		Premises: Suite 132 on the first floor of the Building, as shown on Exhibit A , consisting of approximately 1,893 Rentable Square Feet.
	(h)		Minimum Monthly Rent : $1,971.88 plus applicable sales tax for September 15, 2006 through September 30, 2006, $3,943.75 plus applicable sales tax for each full calendar month commencing on October 1, 2006 through September 30, 2007.
	(i)		Tenant’s Base Share: (see Article 5 ).
	(j)		Intentionally Deleted.
	(k)		Security Deposit : A Security Deposit of $3,800.00 is required at the time the Lease is signed by Tenant.
	(l)		Parking : Two (2) covered reserved spaces at $30 each per month. Uncovered, unreserved spaces in the project shall be available at no charge. The overall parking ratio of the project is six (6) spaces per 1000 square feet of rentable area.
	(m)		Building Hours : 7:00 am to 6:00 p.m. Monday through Friday; 7:00 am to 12:00 p.m. Saturday. Closed Sundays and all legal holidays. Tenant shall have twenty-four (24) hour, seven (7) day a week access to the Premises.

1.2		The following exhibits (the “Exhibits”) and addenda are attached hereto and incorporated herein by this reference:
		Exhibit A      Premises
		Exhibit B       Building Rules and Regulations
		Exhibit C      Parking Rules and Regulations
		Addendum to Office Lease Agreement (the “Addendum”), dated of even date herewith. The Office Lease Agreement, the Addendum, and the Exhibits are collectively referred to herein as the “Lease.”

ARTICLE 2. PREMISES/RIGHT TO USE COMMON AREAS

2.1

Landlord leases to Tenant and Tenant leases from Landlord the Premises, for and subject to the terms and provisions set forth in this Lease. This Lease is subject to all liens, encumbrances, parking and access easements, restrictions, covenants, and all other matters of record, the Rules and Regulations described in Article 14 and the Parking Rules and Regulations described in Article 6 . Tenant and Tenant’s agents, contractors, customers, directors, employees, invitees, officers, and patrons (collectively, the “Tenant’s Permittees”) have a non-exclusive privilege and license, during the Lease Term, to use the non-restricted Common Areas in common with all other authorized users thereof.

2.2

For purposes of this Lease, the following terms have the definitions set forth below:

	(a)		“Automobile Parking Areas” means all areas designated for automobile parking upon the Land. Automobile Parking Areas are Common Areas, but certain parking areas are restricted, (See Parking Rules & Regulations).
	(b)		“Common Areas” means those areas within the Building and Land not leased to any tenant and which are intended by Landlord to be available for the use, benefit, and enjoyment of all occupants of the Building.
	(c)		“Interior Common Facilities” means lobbies, corridors, hallways, elevator foyers, restrooms, mail rooms, mechanical and electrical rooms, janitor closets, and other similar facilities used by tenants or for the benefit of tenants on a non-exclusive basis. Access to certain Interior Common Facilities is restricted.
	(d)		“Land,” means the parcel of land containing the Building;
	(e)		“Load Factor” means the quotient of the Rentable Square Footage of the Building divided by the aggregate Usable Square Footage of all premises and occupiable space in the Building, and is subject to change from time to time.
	(f)		“Rentable Square Footage” means (l) with respect to the Building, the sum of the total area of all floors in the Building (including Interior Common Facilities but excluding stairs, elevator shafts, vertical shafts, parking areas and exterior balconies), computed by measuring to the exterior surface of permanent outside walls; and (2) with respect to the Premises, the Usable Square Footage of the Premises multiplied by the Load Factor.
	(g)		“Usable Square Footage” means the area of the Premises (or other space occupiable by tenants as the case may be) computed by measuring to the exterior surface of permanent outside walls, to the midpoint of corridor and demising walls and to the Tenant side of permanent interior walls and Interior Common Facilities walls (other than corridor walls).

ARTICLE 3. TERM

The term of this Lease shall be Twelve (12) months, plus the remainder of any partial calendar month in which the Lease Term commences, commencing on September 15, 2006, the Commencement Date, and expiring September 30, 2007.

ARTICLE 4. MINIMUM MONTHLY RENT

Tenant shall pay to Landlord, without deduction, setoff, prior notice, or demand, the Minimum Monthly Rent, payable in advance on the first day of each calendar month during the Lease Term. If the Lease Term commences on a date other than the first day of a calendar month, the Minimum Monthly Rent for that month shall be prorated on a per diem basis and be paid to Landlord on or before the Commencement Date.

ARTICLE 5. Intentionally Deleted.

ARTICLE 6. PARKING

Nothing contained herein shall be deemed to create liability upon Landlord for any damage to motor vehicles of Tenant’s Permittees, or from loss of property from within such motor vehicles while parked in the Automobile Parking Areas. Landlord has the right to establish and to enforce against all users of the Automobile Parking Areas, reasonable rules and regulations (the “Parking Rules and Regulations). Landlord shall assign and identify Reserved Parking Spaces. Landlord will not police nor be responsible for any vehicle parked in Tenant’s reserved parking space.

ARTICLE 7. RENT TAX AND PERSONAL PROPERTY TAXES

Tenant shall pay to Landlord, in addition to, and simultaneously with, any other amounts payable to Landlord under this Lease, a sum equal to the aggregate of any municipal, county, state, or federal excise, sales, use, or transaction privilege taxes now or hereafter legally levied or imposed against, or on account of, any amounts payable under this Lease by Tenant or the receipt thereof by Landlord. Tenant shall pay, prior to delinquency, all taxes levied upon fixtures, furnishings, equipment, and personal property placed on the Premises by Tenant.

ARTICLE 8. PAYMENT OF RENT/LATE CHARGES

Tenant shall pay the rent and all other charges specified in this Lease to Landlord at the address set forth on Section 1.1(b) of this Lease, or to another person and at another address as Landlord from time to time designates in writing. Minimum Monthly Rent, additional rent, or other charges payable by Tenant to Landlord under the terms of this Lease not received within ten (10) days after the due date (the “Delinquency Date”) thereof shall automatically (and without notice) incur a late charge of five percent (5%) of the delinquent amount.

ARTICLE 9. SECURITY DEPOSIT

Tenant shall, upon execution of this Lease, deposit with Landlord the Security Deposit, as security for the performance of term and provisions of this Lease by Tenant, which shall be returned to Tenant at the termination of the Lease if it has discharged its obligations to Landlord in full. The Security Deposit shall not be used to pay the last month’s lease payment.

ARTICLE 10. Intentionally Deleted.

ARTICLE 11. ALTERATIONS

Tenant shall not make or cause to be made any further additions to, or alterations of, the Premises or any part thereof without the prior written consent of Landlord, which consent shall not be unreasonably withheld. Tenant shall be allowed to install a card access or security system in accordance with the Building Guidelines.

ARTICLE 12. PERSONAL PROPERTY/SURRENDER OF PREMISES

All personal property located in the Premises shall remain the property of Tenant and may be removed by Tenant not later than the Expiration Date or the earlier termination of the Lease Term. Tenant shall promptly repair, at its own expense, any damage resulting from such removal. All cabinetry, built-in appliances, wall coverings, floor coverings, window coverings, electrical fixtures, plumbing fixtures, conduits, lighting, and other special fixtures that may be placed upon, installed in, or attached to the Premises by Tenant shall, at the termination of this Lease be the property of Landlord. At the Expiration Date or upon the earlier termination of the Lease Term, Tenant shall surrender the Premises in good condition, reasonable wear and tear excepted, and shall deliver all keys to Landlord.

ARTICLE 13. LIENS

Tenant shall keep the Premises, Building, and the Land free from any liens arising out of work performed, material furnished, or obligations incurred due to the actions of Tenant or Tenant’s Permittees or the failure of Tenant to comply with any law. In the event any such lien does attach against the Premises, Building, or Land, and Tenant does not discharge the lien or post bond (which under law would prevent foreclosure or execution under the lien) within ten (10) days after demand by Landlord, such event shall be a default by Tenant under this Lease and , in addition to Landlord’s other rights and remedies, Landlord may take any action necessary to discharge the lien.

ARTICLE 14. USE OF PREMISES/RULES AND REGULATIONS

14.1		Without the prior approval of Landlord, Tenant shall not use the Premises for any use other than for general business office purposes and Tenant agrees that it will use the Premises in such manner as to not interfere with or infringe on the rights of other tenants in the Building. Tenant agrees to comply with all applicable laws, ordinances and regulations in connection with its use of the Premises, agrees to keep the Premises in a clean and sanitary condition, and agrees not to perform any act in the Building which would increase any insurance premiums related to the Building or would cause the cancellation of any insurance policies related to the Building.
14.2		Tenant shall not use, generate, manufacture, store, or dispose of, in, under, or about the Premises, the Building, the Land, or the Project or transport to or from the Premises, the Building, the Land, or the Project, any Hazardous Materials. For purposes of this Lease, “Hazardous Materials” includes, but is not limited to: (i) flammable, explosive, or radioactive materials, hazardous wastes, toxic substances, or related materials; (ii) all substances defined as “hazardous substances,” “hazardous materials,” “toxic substances,” or “hazardous chemical substances or mixtures” in the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended, 42 U.S.C. § 9601, et seq., as amended by Superfund Amendments and Re-authorization Act of 1986; the Hazardous Materials Transportation Act, 49 U.S.C. § 1901. et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601, et seq.; (iii) those substances listed in the United States Department of Transportation Table (49 CFR 172.10 and amendments thereto) or by the Environmental Protection Agency (or any successor agent) as hazardous substances (40 CFR Part 302 and amendments thereto); (iv) any material, waste, or substance which is (A) petroleum, (B) asbestos, (C) poly-chlorinated biphenyl’s, (D ) designated as a“ hazardous substance” pursuant to § 311 of the Clean Water Act, 33 U.S.C. S 1251 et seq . (33 U.S.C. § 1321) or listed pursuant to the Clean Water Act (33 U.S.C. § 1317); (E) flammable explosives; or (F) radioactive materials; and (v) all substances defined as “hazardous wastes” in Arizona Revised Statutes § 36-3501 (16).

Notwithstanding the foregoing. Tenant may use and store reasonable amounts of substances normally associated wish general office duties (such as copier toner, cleaning supplies, glue and other materials) which are specifically approved in advance by Landlord.

ARTICLE 15. RIGHTS RESERVED BY LANDLORD

In addition to all other rights, Landlord has the following rights, exercisable without notice to Tenant and without effecting an eviction, constructive or actual, and without giving right to any claim for set off or abatement of rent: (a) to decorate and to make repairs, alterations, additions, changes, or improvements in and about the Building during Building Hours (b) to approve the weight, size, and location of heavy objects in and about the Premises and the Building, and to require all such items to be moved into and out of the Building and Premises in such manner as Landlord shall direct in writing; (c) to prohibit the placing of vending machines in or about the Premises without the prior written consent of Landlord; (d) to take all such reasonable measures for the security of the Building and its occupants; and (e) to temporarily block off parking spaces for maintenance or construction purposes.

ARTICLE 16. QUIET ENJOYMENT

Landlord agrees that, provided a default by Tenant has not occurred, Landlord will do nothing that will prevent Tenant from quietly enjoying and occupying the Premises during the Lease term. Tenant agrees this Lease is subordinate to the Rule and Regulations described in Article 14 , and the Parking Rules and Regulations described in Article 6.

ARTICLE 17. MAINTENANCE AND REPAIR

Landlord shall maintain the Premises and Building in good condition and repair, reasonable wear and tear excepted. Tenant waives all rights to make repairs at the expense of Landlord. If Landlord would be required to perform any maintenance or make any repairs because of: (a) modifications to the roof, walls, foundation, and floor of the Building from that set forth in Landlord’s plans and specifications which are required by Tenant’s design for improvements, alterations and additions; (b) installation of Tenant’s improvements, fixtures, or equipment; (c) a negligent or wrongful act of Tenant or Tenant’s Permittees; or, (d) Tenant’s failure to perform any of Tenant’s obligations under this Lease, Landlord may perform the maintenance or repairs and Tenant shall pay Landlord the cost thereof. Tenant agrees to: (a) Pay Landlord’s cost of maintenance and repair, including additional janitorial costs of any Non-Building Standard Improvements and Non-Building Standard materials and finishes and (b) Repair or replace all celling and wall finishes (including painting) and floor or window coverings which require repair or replacement during the Lease Term, at Tenant’s sole cost. Notwithstanding anything in this Lease to the contrary, to the extent the terms and provisions of Article 22 conflict with, or are inconsistent with, the terms and provisions of this Article 17 , the terms and provisions of Article 22 shall control. Tenant shall take all reasonable precautions to insure that the Premises are not subjected to excessive wear and tear, i.e. chair pads should be utilized by Tenant to protect carpeting. Tenant shall be responsible for touch-up painting in the Premises throughout the Lease term.

ARTICLE 18. UTILITIES AND JANITORIAL SERVICES

Landlord agrees to furnish to the Premises during normal Building Hours as defined in Article 1.1 (m), (the “Building Hours”), and subject to the Rules and Regulations, electricity suitable for the intended use of the Premises, heat and air conditioning required in Landlord’s judgment for normal use and occupation of the Premises, and janitorial services for the Premises and Common Areas. Landlord further agrees to furnish hot and cold water to those areas provided for general use of all tenants in the Building. Landlord will use diligent efforts to provide continuous elevator service for the Building. If Tenant shall require electric current, water, heating, cooling, or air which will result in excess consumption of such utilities or services, Tenant shall first obtain the written consent of Landlord to the use thereof, if, in Landlord’s reasonable discretion. Tenant consumes any utilities or services in excess of the normal consumption of such utilities and services for general office use, Tenant agrees to pay Landlord for the cost of such excess consumption of utilities or services, currently at the rate of $.0026 per square foot, per hour, upon receipt of a statement of such costs from Landlord at the same time as payment of the Minimum Monthly Rent is made. Landlord may install separate electrical meters to, at Tenant’s expense, to measure excess consumption or establish another basis for determining the amount of excess consumption of electrical current. Further, Landlord has installed electronic HVAC over-time hour meters for Tenant’s convenience. These meters shall be used, in part, by Landlord to determine Tenant’s excess HVAC consumption for purposes of billing Tenant for such excess charges. Landlord shall not be liable for damages nor shall rent or other charges abate in the event of any failure or interruption of any utility or service supplied to the Premises or Building by a regulated utility or municipality, or any failure of a Building system supplying any such service to the Premises (provided Landlord uses diligent efforts to repair or restore the same) and no such failure or interruption shall entitle Tenant to abate rent or terminate this Lease. Overtime HVAC charges shall be billed to Tenant at the rate of $.0026 per hour, per square foot.

ARTICLE 19. ENTRY AND INSPECTION

Landlord shall have the right to enter into the Premises at reasonable times for the purpose of inspecting the Premises and reserves the right, during the last three months of the term of the Lease, to show the Premises with reasonable prior notice at reasonable times to prospective tenants. Landlord shall be permitted to take any action under this Article without causing any abatement of rent or liability to Tenant for any loss of occupation or quiet enjoyment of the Premises, nor shall such action by Landlord be deemed an actual or constructive eviction.

ARTICLE 20. ACCEPTANCE OF THE PREMISES/LIABILITY INSURANCE

20.1

All personal property and fixtures belonging to Tenant shall be placed and remain on the Premises at Tenant’s sole risk. Upon taking possession of the Premises and thereafter during the lease Term, the Tenant shall, at Tenant’s sole cost and expense, maintain insurance coverage with limits not less than the following: (a) Worker’s Compensation Insurance, minimum limit as defined by applicable laws; (b) Employer’s Liability Insurance, minimum limit $1,000,000; (c) Commercial General Liability Insurance. Bodily Injury/Property, Damage

Insurance (including the following coverages: Premises/Operations, Independent Contractors, Broad Form Contractual in support of the indemnification obligations of Tenant under this Lease, and Bodily and Personal Injury Liability), minimum combined single limit $1,000,000; (d) Automobile Liability Insurance, minimum limit $1,000,000. All such policies shall include a waiver of subrogation in favor of Landlord and shall name Landlord and such other party or parties as Landlord may require as additional insureds. Tenant