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Exhibit 10.1
LICENSE AGREEMENT This License Agreement
(“Agreement”) is made this 2nd day of January, 2008
(“Effective Date”) by and between Let’s Go Aero,
Inc. a Colorado corporation located at 3380 N. El Paso St., Suite
G, Colorado Springs, Colorado (“LGA”) and Cequent
Towing Products, Inc., located at 47774 Anchor Court
West, Plymouth MI 48170, on behalf of itself and its parent,
subsidiaries, sister companies and any current or future related
companies (collectively, “Cequent”).
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1.
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LGA has developed, will develop and will continue to develop and
is the sole owner of all right, title and interest in and to such
intellectual property, including certain patents, patent
applications, complete designs and designs in process, that relate
to the design, manufacture and sale of products specified on
Exhibit A, as well as all future cargo management and towing
products that will be added by the parties as a signed addendum to
Exhibit A (collectively, the “Products”), all of which
will be attached to this Agreement and made part of it in its
entirety.
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2.
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LGA will provide to Cequent written notification of all future
cargo management and towing products that LGA designs, develops or
continues to develop during the Term (as later defined), which
writing will be signed by the parties and added to Exhibit A, as
subsequent A-1, A-2, etc.
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3.
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The intellectual property owned by LGA and related to the
design, manufacture and sale of Products is collectively referred
to in this Agreement as the “Licensed Technology.”
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4.
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Cequent desires to acquire a license for the Licensed
Technology, in order to manufacture, make, have made, use,
distribute, offer to sell, import and sell Products utilizing the
Licensed Technology, referred to in this Agreement as the
“Licensed Products.”
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The parties agree that the recitals above are binding on
the Parties and further agree as follows: 1. License
Grant
1.1 LGA
grants to Cequent a worldwide limited exclusive license for the
Licensed Technology and all improvements thereto developed, owned
or controlled by LGA to make, manufacture, have made, use, import,
offer for sale and sell the Licensed Products set forth on Exhibit
A under Cequent trademarks or trade names or such other brands as
Cequent may determine in its sole discretion, for a period
beginning as of the Effective Date and ending December 31, 2009
(the “Exclusive License”). The Parties
acknowledge and agree that should LGA develop or design a Product
during the Term (as defined below), LGA will grant to Cequent a
worldwide limited exclusive license as stated in this paragraph 1
for the new Licensed Product, which two year period will begin upon
the execution of the signed addendum to Exhibit A and the
exclusivity will end two years thereafter, which license will also
be designated as the “Exclusive License” as the term is
used throughout this Agreement.
1.2 Upon
expiration of any Exclusive License period, LGA grants to Cequent a
worldwide nonexclusive license for the Licensed Technology and all
improvements thereto owned or controlled by LGA to make,
manufacture, have made, use, import, offer for sale and sell the
Licensed Products under Cequent trademarks or trade names or such
other brands as Cequent may determine in its sole discretion, for a
period beginning as of the expiration of any Exclusive License
period through the expiration or cancellation of any patents (the
“Non-Exclusive Period”) covering the Licensed
Technology and Products (the “Non-Exclusive
License”). The Exclusive License(s) and the
Non-Exclusive License(s) are collectively referred to in this
Agreement as the “License”.
1.3 Cequent
shall have the right to grant sublicenses under this Agreement to
third parties for the manufacture of the Licensed Product on behalf
of Cequent, provided that Cequent requires such third party to
enter into a nondisclosure agreement protecting the confidentiality
of the Licensed Technology and the License. For a two
year period beginning upon the expiration of any Exclusive License
period for Licensed Products and for a period not greater than the
first two years of any Non-Exclusive period, should LGA solicit
direct sales of Licensed Products, LGA agrees to purchase
exclusively from Cequent all required parts to manufacture and
assemble the Licensed Products at the lowest price that Cequent
gives to any other customer. All rights not specifically
granted to Cequent under this Agreement shall be reserved to LGA.
2. Term
& Termination Unless earlier terminated by Cequent,
this Agreement will be effective as of the Effective Date or the
date of execution by the parties of any written Addendum(s) to
Exhibit A and shall expire simultaneously with the cancellation or
expiration of the patents covering the Licensed Technology for the
Licensed Products (the
“Term”). Cequent shall have the right
to terminate this Agreement without penalty or consideration of any
kind. LGA may terminate this Agreement only upon
Cequent’s failure to cure a material breach of the Agreement
within 60 days after receipt of written notice of the material
breach from LGA.
3. Royalties
and Other Payments
3.1 Within
30 days from the date of this Agreement, Cequent shall pay a
$400,000 fee to LGA, which fee will include payment for the
transition of existing Product sales to current customers from LGA
to Cequent and services related to the commercialization and
transition of the Products to Cequent. Additionally, as
further consideration for the License during the Term, Cequent will
pay to LGA a royalty in the amount of 7% of the Net Sales Price for
the Licensed Products, as s
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