Document:

TGN S1-Ex10.11 Danotek 5300 APA AMD5

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

ASSET PURCHASE AGREEMENT

This Asset Purchase Agreement (the “Agreement”) is made as of January 8, 2013 (the “Effective Date”), by and between Danotek (assignment for the benefit of creditors), LLC, a Delaware limited liability company, in its sole and limited capacity as Assignee for the Benefit of Creditors of Danotek Motion Technologies, Inc. (the “Seller”), with principal offices located at 1100 La Avenida Street, Building A, Mountain View, California 94043, United States, and Tecogen, Inc., a Delaware corporation (the “Buyer”), with principal offices located at 45 First Avenue, Waltham, MA 02451.

RECITALS

A.    By resolution of the board of directors (the “Board”) of Danotek Motion Technologies, Inc., a Delaware corporation (the “Assignor”), as memorialized in the duly executed minutes, Assignor has transferred ownership of all its right, title and interest in and to tangible and intangible assets (the “Assets”) to Seller, and in so doing has also designated Seller to act, pursuant to Delaware law, as the Assignee for the Benefit of Creditors of Assignor. The General Assignment agreement (the “General Assignment”) between Assignor and Seller, as assignee, is attached hereto as Exhibit A.

B.    Seller and Buyer have identified a subset of the Assets that Buyer desires to purchase from Seller (the “Required Assets”).  The Required Assets are listed in Section 1.2 below and means the design, development, and manufacturing equipment that is solely related to the 5300 line of  high power density permanent magnet generators product line (“5300 PM Generator Business”).  After consummation of the Closing contemplated under this Agreement, Seller will liquidate any remaining Assets that are not Required Assets (the “Remaining Assets”), and will undertake the winding down of Assignor, which shall ultimately include, but shall not be limited to, the distribution of net funds, after payment of fees and costs associated with the liquidation and winding down, to Assignor’s creditors, which are generated from the sale of the Assets.

C.     Seller desires to sell to Buyer, and Buyer desires to purchase from Seller, the Required Assets, on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the above recitals and the mutual covenants hereinafter set forth, Buyer and Seller hereby agree as follows:

1.    PURCHASE AND SALE OF REQUIRED ASSETS.

1.1    Agreement to Sell and Purchase Required Assets.  Subject to the terms and conditions of this Agreement, and in reliance on the representations, warranties and covenants set forth in this Agreement, Seller agrees to sell, assign, transfer and convey to Buyer at the Closing (as defined in Section 2.2 below), and Buyer agrees to purchase and acquire from Seller at the Closing, all of Seller’s right, title and interest in and to all of the Required Assets.  The Required Assets will be sold, assigned, transferred and conveyed to Buyer (subject to Section 1.3) on the Closing Date “as is” and “where is”, with no representations or warranties other than those specifically set forth below, and subject to any and all pledges, liens, licenses, rights of possession, security interests, restrictions, encumbrances, charges, title retention, conditional sale or other security arrangements of any nature whatsoever (collectively, “Encumbrances”). other than: (i) the Encumbrances to Silicon Valley Bank; (ii) the Encumbrances granted to KFT Trust, as collateral agent for KFT Trust, Khosla Ventures III, L.P., CMEA Ventures VII, L.P. and CMEA Ventures VII (Paralell), L.P. and (iii) the Encumbrances granted to Michigan Strategic Fund (clauses (i), (ii) and (iii), collectively, the “Released Encumbrances”). 

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

1.2    Required Assets Defined.  As used in this Agreement, the term “Required Assets” means, collectively, Seller’s right, title and interest in and to the assets listed in Exhibit B attached hereto, provided, however, that the Required Assets shall not, under any circumstances, include Seller’s or Assignor’s (i) cash, (ii) accounts receivable, (iii) claims or preference or fraudulent conveyance recoveries under applicable law, (iv) state or federal tax refunds, (v) insurance refunds or recoveries, (vi) utility or leasehold security deposits, and (vii) the “Excluded Assets” (defined below).  Buyer shall promptly execute and deliver to Seller any and all such further assignments, endorsements and other documents as Seller may reasonably request for the purpose of effectuating the terms and conditions of this Section.

For the avoidance of doubt, it is the intent of the parties hereto that none of the Excluded Assets shall be transferred to Buyer.  The parties hereto acknowledge and agree that the Required Assets only comprise a limited and narrowly defined portion of the overall Assets and that the Excluded Assets comprise the majority of the Assets. 

For purposes of this Agreement, the term “Excluded Assets” means any and all properties, rights, contracts, claims or other assets other than those specifically listed or described in Exhibit B.  For the avoidance of doubt, Excluded Assets include (and Required Assets do not include), any and all properties, rights, contracts, claims or other assets owned by either Assignor or Seller, except for the Required Assets, including, but not limited to, any business conducted by Assignor and its subsidiaries that is not primarily engaged in the 5300 PM Generator Business, including the design, development, research, licensing, distribution, sale, support and maintenance of all products and services (including, but not limited to, 6000, 7000, 8000 and 9000 series generators, converters or motors), other than the Products.

1.3    Asset Transfer; Passage of Title; Delivery.

                       (a)    Title Passage.  Except as otherwise provided in this Section, upon the Closing, title to all of the Required Assets shall pass to Buyer; and Seller shall make available to Buyer possession of all of the Required Assets as provided in subsection 1.3(b), and shall further, upon Buyer’s request, execute assignments, conveyances and/or bills of sale reasonably requested to convey to Buyer title to all the Required Assets, subject to the Encumbrances, in accordance with Section 1.1 of this Agreement, as well as such other instruments of conveyance as counsel for Buyer may reasonably deem necessary to effect or evidence the transfers contemplated hereby.

(b)Delivery of Required Assets.  On the Closing Date (as defined in Section 2.2), Seller shall make available to Buyer possession of the Required Assets, provided however, that the expenses of retrieving, removing and transferring the Required Assets shall be borne exclusively by Buyer. 

(c)Retention of Documents.  As Assignee, Seller is responsible for maintaining business records during the assignment process and, among other things, will have to prepare and file final tax returns.  To the extent Buyer requires business records of Assignor that Seller requires to administer the assignment estate, Buyer shall, at its own expense, arrange to obtain copies of such records from Seller.

2.    PURCHASE PRICE; PAYMENTS.

2.1    Purchase Price.  In consideration of the sale, transfer, conveyance and assignment of all the Required Assets, except for certain Electrical Test Equipment as listed under “Electrical Test Equipment – List B” in Exhibit B attached hereto, to Buyer at the Closing. Buyer shall, as of the Closing, assume only those liabilities, if any, expressly set forth as Assumed Liabilities in Section 3.1 of this Agreement and shall pay by wire transfer [****] (the “Purchase Price”) to the Seller at the Closing.

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Seller will retain title of assets listed in “Electrical Test Equipment – List B” in Exhibit B attached hereto until Seller determines [****] within 90 days, Seller agrees sell the the Electrical Test Equipment-List B assets to Buyer for [****], which shall be paid by wire transfer to the Seller upon transfer of title of such assets.

2.2    Closing.  The consummation of the purchase and sale of the Required Assets contemplated hereby will take place at a closing to be held at the offices of the Assignee (the “Closing”), on January 8, 2013 (the “Closing Date”), or at such other time or date, and at such place, or by such other means of exchanging documents, as may be agreed to by the parties hereto.  If the Closing does not occur on or prior to January 14, 2013, or such later date upon which Buyer and Seller may agree in writing, this Agreement shall terminate upon written notice of termination given by either party hereto that is not in default of its obligations hereunder, and thereupon this Agreement shall become null and void and no party hereto will have any further rights or obligations hereunder, except that Sections 6.1 and 7.3 shall survive such termination.

3.    OBLIGATIONS ASSUMED.

3.1    Liabilities.  Buyer agrees, upon consummation of, and effective as of, the Closing, to assume those (and only those) liabilities of Seller and of Assignor expressly listed below in this Section 3.1 (collectively, the “Assumed Liabilities”):  No Assumed Liabilities.

3.2    Liabilities and Obligations Not Assumed.  Except as expressly set forth in Section 3.1 above, Buyer shall not assume or become obligated in any way to pay any liabilities, debts or obligations of Seller or of Assignor whatsoever, including but not limited to any liabilities or obligations now or hereafter arising from Assignor’s business activities that took place prior to the Closing or any liabilities arising out of or connected to the liquidation and winding down of Assignor’s business.  All liabilities, debts and obligations of Seller and of Assignor not expressly assumed by Buyer hereunder are hereinafter referred to as the “Excluded Liabilities.”

3.3    No Obligations to Third Parties.  The execution and delivery of this Agreement shall not be deemed to confer any rights upon any person or entity other than the parties hereto, or make any person or entity a third party beneficiary of this Agreement, or to obligate either party to any person or entity other than the parties to this Agreement.  Assumption by Buyer of any liabilities or obligations of Seller under Section 3.1 shall in no way expand the rights or remedies of third parties against Buyer as compared to the rights and remedies such parties would have against Seller if the Closing were not consummated.

4.    REPRESENTATIONS AND WARRANTIES OF BUYER. 

Buyer hereby represents and warrants to Seller that all the following statements are true, accurate and correct:

4.1    Due Organization.  Buyer is a corporation duly organized, validly existing, and in good standing under the laws of the State of Delaware.  Buyer has all necessary power and authority to enter into this Agreement and all other documents that Buyer is required to execute and deliver hereunder, and holds or will timely hold all permits, licenses, orders and approvals of all federal, state and local governmental or regulatory bodies necessary and required therefore. 

4.2    Power and Authority; No Default.  Buyer has all requisite power and authority to enter into and deliver this Agreement and to perform its obligations hereunder.  The signing, delivery and 

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

performance by Buyer of this Agreement, and the consummation of all the transactions contemplated hereby, have been duly and validly authorized by Buyer.  This Agreement, when signed and delivered by Buyer, will be duly and validly executed and delivered and will be the valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, subject to the laws relating to bankruptcy, insolvency and relief of debtors, and rules and laws governing specific performance, injunctions, relief and other equitable remedies.  

4.3    Authorization for this Agreement.  No authorization, approval, consent of, or filing with any governmental body, department, bureau, agency, public board, authority or other third party is required for the consummation by Buyer of the transactions contemplated by this Agreement.

4.4    Litigation.  To the best of Buyer’s knowledge, there is no litigation, suit, action, arbitration, inquiry, investigation or proceeding pending or, to the knowledge of Buyer, threatened, before any court, agency or other governmental body against Buyer (or any corporation or entity affiliated with Buyer) which seeks to enjoin or prohibit or otherwise prevent the transactions contemplated hereby.

5.       REPRESENTATIONS AND WARRANTIES OF SELLER.

Seller represents and warrants to Buyer that all of the following statements are true, accurate and correct:

5.1    Corporate Organization.  Seller is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware.  

5.2    Power and Authority; No Default Upon Transfer.  As Assignee, Seller has all requisite power and authority to enter into and deliver this Agreement and to perform its obligations hereunder and under the General Assignment.  The signing, delivery and performance by Seller of this Agreement, and the consummation of all the transactions contemplated hereby, have been duly and validly authorized by Seller.  To the best of Seller’s knowledge and belief, the General Assignment was duly authorized by Assignor’s Board and is a valid agreement binding on the Assignor and Seller.  This Agreement, when signed and delivered by Seller, will be duly and validly executed and delivered and will be the valid and binding obligation of Seller, enforceable against Seller, as Assignee, in accordance with its terms as governed by applicable law, regulations and rules.  Neither the signing and delivery of this Agreement by Seller, nor the performance by Seller of its obligations under this Agreement, will (i) violate Seller’s Articles of Organization or Operating Agreement, or (ii) to the best of Seller’s knowledge and belief, violate any law, statute, rule, regulation, order, judgment, injunction or decree of any court, administrative agency or government body applicable to Seller.

5.3    Title.  To the best of Seller’s knowledge and belief after reasonable inquiry, including, without limitation, competent assessment of a UCC search in Assignor’s state of incorporation, Seller, as Assignee, has good and marketable title to all of the Required Assets.  Seller sells, assigns, transfers and conveys the Required Assets to Buyer “as is” and “where is”, with no representations or warranties as to merchantability, fitness or use, and the Required Assets shall be subject to the Encumbrances.

(a)    AS-IS SALE; DISCLAIMERS; RELEASE. IT IS UNDERSTOOD AND AGREED THAT, UNLESS EXPRESSLY STATED HEREIN, SELLER IS NOT MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE REQUIRED ASSETS, INCLUDING BUT NOT LIMITED TO, ANY WARRANTIES OR REPRESENTATIONS AS TO MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.  

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

(b)    BUYER ACKNOWLEDGES AND AGREES THAT UPON CLOSING SELLER SHALL SELL AND CONVEY TO BUYER AND BUYER SHALL ACCEPT THE PROPERTY “AS IS, WHERE IS, WITH ALL FAULTS.”  BUYER HAS NOT RELIED AND WILL NOT RELY ON, AND SELLER IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTEES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE REQUIRED ASSETS OR RELATING THERETO MADE OR FURNISHED BY SELLER OR ITS REPRESENTATIVES, TO WHOMEVER MADE OR GIVEN, DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, EXCEPT AS EXPRESSLY STATED HEREIN.  BUYER ALSO ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS AND TAKES INTO ACCOUNT THAT THE REQUIRED ASSETS ARE BEING SOLD “AS IS, WHERE IS, WITH ALL FAULTS.”  

(c)    BUYER ACKNOWLEDGES TO SELLER THAT BUYER WILL HAVE THE OPPORTUNITY TO CONDUCT PRIOR TO CLOSING SUCH INSPECTIONS AND INVESTIGATIONS OF THE REQUIRED ASSETS AS BUYER DEEMS NECESSARY OR DESIRABLE TO SATISFY ITSELF AS TO THE REQUIRED ASSETS AND ITS ACQUISITION THEREOF.  BUYER FURTHER WARRANTS AND REPRESENTS TO SELLER THAT BUYER WILL RELY SOLELY ON ITS OWN REVIEW AND OTHER INSPECTIONS AND INVESTIGATIONS IN THIS TRANSACTION AND NOT UPON THE INFORMATION PROVIDED BY OR ON BEHALF OF SELLER, OR ITS AGENTS, EMPLOYEES OR REPRESENTATIVES WITH RESPECT THERETO. BUYER HEREBY ASSUMES THE RISK THAT ADVERSE MATTERS INCLUDING, BUT NOT LIMITED TO, LATENT OR PATENT DEFECTS, ADVERSE PHYSICAL OR OTHER ADVERSE MATTERS, MAY NOT HAVE BEEN REVEALED BY BUYER’S REVIEW AND INSPECTIONS AND INVESTIGATIONS.

(d)    BUYER ACKNOWLEDGES THAT SOME ASSETS DESCRIBED   IN EXHIBIT B MAY CONTAIN THIRD-PARTY INTELLECTUAL PROPERTY THAT MAY HAVE BEEN LICENSED BY ASSIGNOR OR OTHERWISE ACQUIRED BY ASSIGNOR.  BUYER UNDERSTANDS THAT SELLER IS UNABLE TO TRANSFER INTELLECTUAL PROPERTY BELONGING TO A THIRD-PARTY WITHOUT THE EXPRESS WRITTEN CONSENT OF THAT PARTY, WHICH WILL NOT BE OBTAINED OR SOUGHT BY SELLER AS A PART OF THIS AGREEMENT.  BUYER SHALL ACCEPT FULL RESPONSIBILITY FOR COMMUNICATING WITH THIRD-PARTIES WHOSE INTELLECTUAL PROPERTY MAY BE INCLUDED IN THE REQUIRED ASSETS TRANSFERRED HEREBY AND SHALL PAY ANY AND ALL LICENSING OR OTHER FEES, COSTS, EXPENSES OR CHARGES THAT MAY BE ASSOCIATED WITH USING SAID ASSETS.

5.4    Litigation.  To the best of Seller’s knowledge, there is no claim, action, arbitration, inquiry, investigation, suit or proceeding pending or, to Seller’s knowledge, threatened, against Seller or Assignor that might affect in any way any Required Asset or the transaction contemplated by this Agreement, nor is Seller aware or have grounds to know of any reasonable basis therefor.  To the best of Seller’s knowledge, there are no judgments, decrees, injunctions or orders of any court, governmental body, department, commission, agency, instrumentality or arbitrator against Seller or Assignor affecting the Required Assets. 

5.5    Authorization for this Agreement.  To the best of Seller’s knowledge, no authorization, approval, consent of, or filing with any governmental body, department, bureau, agency, public board, authority or other third party is required for the consummation by Seller of the transactions contemplated by this Agreement. 

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

5.6    Assignee.  All rights of Seller with regard to the ownership and possession of the Required Assets are rights held as Assignee pursuant to the General Assignment made by Assignor.  Pursuant to the General Assignment, Assignor has informed Seller that it transferred all of Assignor’s right, title and interest in and to the Required Assets to Seller.  Pursuant to this Agreement, Seller, solely in its capacity as Assignee, sells, assigns, and transfers all of its right, title and interest in and to the Required Assets to Buyer.

6.    COVENANTS OF BUYER.

6.1    Confidential Information.  All copies, if any, of financial information, pricing, marketing plans, business plans, and other confidential and/or proprietary information of Assignor and/or Seller disclosed to Buyer in the course of negotiating the transaction contemplated by this Agreement, including the terms of this Agreement (“Seller Confidential Information”), will be held in confidence and not used or disclosed by Buyer or any of its employees, affiliates or stockholders, except to any public or private lender, for a period of six (6) months from the Effective Date and will be promptly destroyed by Buyer or returned to Seller, upon Seller’s written request to Buyer; provided, however that from and after the Closing, the foregoing covenant shall not be applicable to any Seller Confidential Information included in the Required Assets.  It is agreed that Seller Confidential Information will not include information that:  (a) is proven to have been known to Buyer prior to receipt of such information from Seller; (b) is disclosed by a third party having the legal right to disclose such information and who owes no obligation of confidence to Seller; (c) is now, or later becomes part of the general public knowledge or literature, other than as a result of a breach of this Agreement by Buyer; or (d) is independently developed by Buyer without the use of any Seller Confidential Information.  

6.2    Press Releases and Public Announcements.  Buyer shall not issue any press release or make any disclosure or public announcement relating to the financial terms of this Agreement without the prior written approval of Seller, which shall not be unreasonably withheld.  Notwithstanding the foregoing, Buyer may disclose certain information relating to this Agreement if required to do so by law or applicable governmental regulation.  

6.3    Taxes and any Other Charges Related to the Sale.  Buyer agrees to promptly pay all sales, transfer, use or other taxes, duties, claims or charges imposed on and/or related to the sale of the Required Assets to Buyer under this Agreement by any tax authority or other governmental agency and to defend, indemnify and hold Seller harmless from and against any such taxes, duties, claims, or charges for payment thereof by any tax authority or other governmental agency.

6.4    Survival of Covenants.  The covenants set forth in Sections 6.1, 6.2, 6.3, and this Section 6.4 shall survive the Closing.  The covenants set forth in Section 6.1 above shall, in addition, survive the termination of this Agreement for any reason.

7.    COVENANTS OF SELLER.

Seller covenants and agrees with Buyer as follows:

7.1    Further Assurances.  From and after the Closing Date, Seller shall cooperate with Buyer and promptly sign and deliver to Buyer any and such additional documents, instruments, endorsements and related information and take actions as Buyer may reasonably request for the purpose of effecting the transfer of Seller’s and/or Assignor’s title to the Required Assets to Buyer, and/or carrying out the provisions of this Agreement, provided, however, that Seller shall be reimbursed for its reasonable costs and expenses incurred in providing such documents, instruments, endorsements or related information, which additional documents, instruments, endorsements or related information shall be prepared solely by Buyer.  

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

7.2    Press Releases and Public Announcements.  Seller shall not issue any press release or make any disclosure or public announcement relating to the financial terms of this Agreement or identify the Buyer without the prior written approval of the Buyer, which shall not be unreasonably withheld.  Notwithstanding the foregoing, Seller may disclose certain information relating to this Agreement if required to do so by law or applicable governmental regulation and Seller shall be permitted, at its discretion, to prepare and distribute a tombstone regarding the General Assignment and the Agreement without mentioning the identity of Buyer or the terms of the Agreement.

7.3    Survival of Covenants.  Each of the covenants set forth in Sections 7.1, 7.2, and this Section 7.3 shall survive the Closing.

8.    CONDITIONS TO CLOSING.

8.1    Conditions to Buyer’s Obligations.  The obligations of Buyer hereunder shall be subject to the satisfaction and fulfillment of each of the following conditions, except as Buyer may expressly waive the same in writing:

(a)    Accuracy of Representations and Warranties on Closing Date.  The representations and warranties made herein by Seller shall be true and correct in all material respects, and not misleading in any material respect, on and as of the date given, and on and as of the Closing Date with the same force and effect as though such representations and warranties were made on and as of the Closing Date.

(b)    Compliance.  As of the Closing Date, Seller shall have complied in all material respects with, and shall have fully performed, in all material respects, all conditions, covenants and obligations of this Agreement imposed on Seller and required to be performed or complied with by Seller at, or prior to, the Closing Date.

(c)    Delivery of Required Assets.  Seller shall have made the Required Assets available to Buyer as set forth in Section 1.3 above.

(d)    Delivery of Closing Documents.  Seller shall have delivered, and Buyer shall have received, the documents described in Section 9.2 hereof. 

8.2    Conditions to Seller’s Obligations.  The obligations of Seller hereunder shall be subject to the satisfaction and fulfillment of each of the following conditions, except as Seller may expressly waive the same in writing:

(a)    Accuracy of Representations and Warranties on Closing Date.  The representations and warranties made herein by Buyer in Section 4 hereof shall be true and correct in all material respects, and not misleading in any material respect, on and as of the date given, and on and as of the Closing Date with the same force and effect as though such representations and warranties were made on and as of the Closing Date.

(b)    Compliance.  Buyer shall have complied in all material respects with, and shall have fully performed, the terms, conditions, covenants and obligations of this Agreement imposed thereon to be performed or complied with by Buyer at, or prior to, the Closing Date.

(c)    Payment.  Buyer shall have transmitted by wire transfer and Seller shall have received payment of the Purchase Price.

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

9.    CLOSING OBLIGATIONS.

9.1    Buyer’s Closing Obligations.  At the Closing, Buyer shall deliver to Seller the following:

(a)    Payment of [****] by wire transfer to Seller; and, if title to assets listed in “Electrical Test Equipment-List B” are transferred to Buyer, an additional payment of [****] by wire transfer to Seller will be made at that time.

(b)    The Assignment and Bill of Sale Agreement, in the form attached hereto as Exhibit C, signed by an authorized officer of Buyer on behalf of Buyer.  

9.2    Seller’s Closing Obligations.  At the Closing, Seller shall deliver to Buyer the following:

(a)    The Required Assets in accordance with Section 1.3; and 
(b)       The Assignment and Bill of Sale Agreement, in the form attached hereto as Exhibit C, signed by an authorized manager of Seller on behalf of Seller. 

10.    SURVIVAL OF WARRANTIES AND INDEMNIFICATION.

10.1    Survival of Warranties.  All representations and warranties made by Seller or Buyer herein, or in any certificate, schedule or exhibit delivered pursuant hereto, shall survive the Closing for a period of one (1) year after the Closing.

10.2    Indemnified Losses.  For the purpose of this Section 10.2 and when used elsewhere in this agreement, “Loss” shall mean and include any and all liability, loss, damage, claim, expense, cost, fine, fee, penalty, obligation or injury including, without limitation, those resulting from any and all actions, suits, proceedings, demands, assessments, judgments, award or arbitration, together with reasonable costs and expenses including the reasonable attorneys’ fees and other legal costs and expenses relating thereto.

10.3    No Indemnification by Seller.  Seller is selling to Buyer the Required Assets defined in this Agreement “as is” and “where is”, with no representations or warranties as to merchantability, fitness or usability or in any other regard (except for the limited representations and warranties specifically set forth above) and does not agree to defend, indemnify or hold harmless Buyer, any parent, subsidiary or affiliate of Buyer or any director, officer, employee, stockholder, agent or attorney of Buyer or of any parent, subsidiary or affiliate of Buyer from and against and in respect of any Loss which arises out of or results from the transaction described herein.  
    
10.4    Indemnification By Buyer.  Subject to the provisions and limitations set forth in this Section 10, Buyer agrees to defend, indemnify and hold harmless Seller, any parent, subsidiary or affiliate of Seller and any manager, employee, member, agent or attorney of Seller or of any parent, subsidiary or affiliate of Seller (collectively, the “Seller Indemnitees”) from and against and in respect of any Loss which arises out of or results from:

(a)    any breach by Buyer of any covenant, or the inaccuracy or untruth of any representation or warranty of Buyer made herein; or

(b)    the use of the Required Assets after the Closing;

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

provided, however, that nothing in this Section 10.4 shall impose on Buyer any duty to indemnify Seller for any Excluded Liabilities.

10.5    Period for Making Claims.  A claim for indemnification by Seller under this Section 10 may be brought, if at all, at any time after the Closing Date, with respect to any claim or claims for indemnification under this Section 10, provided, however, that any claim under Section 10.4(a) with respect to the inaccuracy or untruth of any representation or warranty must be brought, if at all, prior to the time such representation or warranty expires pursuant to Section 10.1.

11.    MISCELLANEOUS.

11.1    Expenses.  Each of the parties hereto shall bear its own expenses (including without limitation attorneys’ fees) in connection with the negotiation and consummation of the transaction contemplated hereby.

11.2    Notices.  Any notice required or permitted to be given under this Agreement shall be in writing and shall be personally or sent by certified or registered United States mail, postage prepaid, or sent by nationally recognized overnight express courier and addressed as follows:

(a)    If to Seller:

Danotek (assignment for the benefit of creditors), LLC
1100 La Avenida Street, Building A
Mountain View, California 94043
Telephone: (650) 329-9996
Facsimile: (650) 329-0980
Email:  mam@shrwood.com
Attention:  Michael A. Maidy

With copy to:
     
Scott B. Lepene
Thompson Hine LLP
3900 Key Center, 127 Public Square
Cleveland, Ohio 44114 
Telephone:    (216) 566-5692
Facsimile:      (216) 566-5800
Email:   Scott.Lepene@ThompsonHine.com
Attention:  Scott B. Lepene

(b)    If to Buyer:

Tecogen, Inc.
45 First Avenue
Waltham, MA 02451
Telephone: (781) 466-6400
Facsimile:  (781) 466-6466
Email: robert.panora@tecogen.com
Attention:  Robert A. Panora

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Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

With copy to:

William O. Flannery    
945 Lenox Road
Richmond, MA  01254
Telephone: (413) 698-2997
Facsimile: (413) 698-3506   
Email: woflan@ix.netcom.com 
Attention: William O. Flannery 

11.3    Entire Agreement.  This Agreement, the Exhibits hereto (which are incorporated herein by reference) and any agreements to be executed and delivered in connection herewith, together constitute the entire agreement and understanding between the parties and there are no agreements or commitments with respect to the transactions contemplated herein except as set forth in this Agreement.  This Agreement supersedes any prior offer, agreement or understanding between the parties with respect to the transactions contemplated hereby.  

11.4    Amendment; Waiver.  Any term or provision of this Agreement may be amended only by a writing signed by Seller and Buyer.  The observance of any term or provision of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only by a writing signed by the party to be bound by such waiver.  No waiver by a party of any breach of this Agreement will be deemed to constitute a waiver of any other breach or any succeeding breach.

11.5    No Third Party Beneficiaries.  Nothing expressed or implied in this Agreement is intended, or shall be construed, to confer upon or to give any person, firm or corporation, other than the parties hereto, any rights or remedies under or by reason of this Agreement. 

11.6    Execution in Counterparts.  For the convenience of the parties, this Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.  Delivery of the Agreement that includes an executed counterpart of the signature page by telecopier or electronic mail shall be as effective as delivery of an originally manually executed counterpart.

11.7    Benefit and Burden.  This Agreement shall be binding upon, shall inure to the benefit of, and be enforceable by and against, the parties hereto and their respective successors and permitted assigns.

11.8    Governing Law.  This Agreement shall be governed by and construed in accordance with the internal laws of the State of California (excluding application of any choice of law doctrines that would make applicable the law of any other state or jurisdiction) and, where appropriate, applicable federal law.

11.9    Severability.  If any provision of this Agreement is for any reason and to any extent deemed to be invalid or unenforceable, then such provision shall not be voided but rather shall be enforced to the maximum extent then permissible under then applicable law and so as to reasonably effect the intent of the parties hereto, and the remainder of this Agreement will remain in full force and effect.  

11.10    Attorneys’ Fees.  Should a suit or arbitration be brought to enforce or interpret any provision of this Agreement, the prevailing party shall be entitled to recover reasonable attorneys’ fees to be fixed in amount by the Court or the Arbitrator(s) (including without limitation costs, expenses and fees on any appeal).  

- 12 -

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

The prevailing party will be entitled to recover its costs of suit or arbitration, as applicable, regardless of whether such suit or arbitration proceeds to a final judgment or award.

[Signature page follows]

- 12 -

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

IN WITNESS WHEREOF, Buyer and Seller executed and delivered this Asset Purchase Agreement by their duly authorized representatives as of the Effective Date.

SELLER:        BUYER:

Danotek (assignment for the benefit of creditors),        Tecogen, Inc. 
LLC, solely as Assignee for the Benefit
of Creditors of Danotek Motion Technologies, Inc.    
     
/s/ Michael Maidy        /s/ Robert A. Panora

By: Michael Maidy                    By: Robert A. Panora                    

Its: Manager                                Its: President                                  

- 12 -

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

EXHIBIT A

General Assignment

This Assignment is made as of the 27th day of November, 2012, by Danotek Motion Technologies, Inc. a Delaware corporation, with offices at 8680 N. Haggerty Rd, Canton, MI 48187 hereinafter referred to as “Assignor”, to Danotek (assignment for the benefit of creditors), LLC, a Delaware limited liability company, hereinafter referred to, along with any successors and assigns, as “Assignee”.
RECITALS
WHEREAS, Assignor has determined that, based upon its business prospects, entering into this Assignment is in the best interests of the Assignor's creditors; and 
WHEREAS, Assignor believes that Assignee is well qualified to efficiently administer the Assignment for the benefit of the Assignor's creditors;
NOW, THEREFORE, for valuable consideration, the receipt of which is duly acknowledged, the parties agree as follows:
AGREEMENT
1.    Assignment of Assets.  
(a)    Assignor, for and in consideration of the covenants and agreements to be performed by Assignee, as hereinafter contained, and for good and valuable consideration, receipt whereof is hereby acknowledged, does hereby grant, bargain, sell, assign, convey and transfer to Assignee, its successors and assigns, in trust, for the benefit of Assignor's creditors generally, all of the property of Assignor of every kind and nature and wheresoever situated, both real (but not facility lease arrangements) and personal, and any interest or equity therein not exempt from execution, including, but not limited to, all that certain stock of merchandise, equipment, furniture, fixtures, accounts, books, cash on hand, cash in bank, deposits, patents, copyrights, trademarks and trade names and all associated goodwill, source codes, software, and related documentation, insurance policies, and choses in action that are legally assignable, together with the proceeds of any existing non-assignable choses in action that may hereafter be recovered or received by Assignor.  Assignor agrees to execute such additional documents as shall be necessary to accomplish the purposes of this Assignment.
(b)    This Assignment specifically includes and covers all claims for refund or abatement of all excess taxes heretofore or hereafter assessed against or collected from Assignor by the U.S. Treasury Department or any other taxing agency, and Assignor agrees to sign and execute power of attorney or such other documents as required to enable Assignee to file and prosecute, compromise and/or settle, all such claims before the Internal Revenue Service, U.S. Treasury Department or any other taxing or other Governmental agency.
(c)    Assignee is to receive said property, conduct said business, should it deem it proper, and is hereby authorized at any time after the signing hereof by Assignor to sell and dispose of said property upon such time and terms as it may see fit, and is to pay to creditors of Assignor pro rata, the net proceeds arising from the conducting of said business and sale and disposal of said property, after deducting all moneys which Assignee may at its option pay for the discharge of any lien on any of said property and any indebtedness 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

which under the law is entitled to priority of payment, and all expenses, including a reasonable fee to Assignee and its attorneys.
2.    Payment of Fees.  Assignee shall be entitled to be paid the fees and recover the costs set forth in the Compensation and Expense Reimbursement Agreement dated as of the date hereof between the Assignor and the Assignee (the “Fee Letter”). 
3.    Appointment of Agents.  Assignee is authorized and empowered to appoint and compensate such agents, field representatives and/or attorneys and/or accountants as it may deem necessary, and such agents and/or field representatives shall have full power and authority to open bank accounts in the name of Assignee or its nominees or agents and to deposit assigned assets or the proceeds thereof in such bank accounts and to draw checks thereon and with the further power and authority to do such other acts and to execute such papers and documents in connection with this Assignment as Assignee may consider necessary or advisable.
4.    Certain Acknowledgments Regarding Transfer.  Assignor acknowledges that certain of the assets being assigned under this General Assignment may be subject to restrictions on the use or transfer of such assets, the unauthorized use or transfer of which may result in further damages or claims.  Such assets may include, without limitation, intellectual property rights of the Assignor (e.g., trade names, service names, registered and unregistered trademarks and service marks and logos; internet domain names; patents, patent rights and applications therefor, copyrights and registrations and applications therefor; software and source code (and software licenses with respect thereto); customer lists and customer information; know-how, trade secrets, inventions, discoveries, concepts, ideas, methods, processes, designs, formulae, technical data, drawings, specifications, data bases and other proprietary assets (collectively, “Intellectual Property”)).  Assignor represents and warrants that its officers, directors, shareholders, employees, agents, customers and other third parties have been advised not to use, remove or cause a transfer (other than pursuant to this General Assignment) of any of the assets of Assignor, including without limitation the Intellectual Property, either prior or subsequent to this General Assignment, except as expressly authorized in writing in advance, which written authorization is not inconsistent with or otherwise may constitute a breach of any other written agreement.  Except as authorized in writing, which has been disclosed in writing to Assignee, Assignor further represents and warrants that no asset (including, without limitation, the Intellectual Property) has been transferred, used, or removed, in whole or in part, in a manner that interferes with the rights and interests of a third party(ies) in such asset or otherwise may constitute a breach of any contract with such third party(ies).
5.    Representations and Warranties of the Assignor.  Assignor represents and warrants to Assignee that as of the date hereof:  
(a)    Assignor has all requisite power and authority to execute, deliver and perform its obligations under this Assignment, including, without limitation, to transfer the property transferred to the Assignee hereby;
 (b)    the execution, delivery and performance by the Assignor of this Assignment has been duly authorized by all necessary corporate and other action and does not and will not require any registration with, consent or approval of, or notice to or action by, any person (including any governmental authority) in order to be effective and enforceable;
(c)    this Assignment constitutes the legal, valid and binding obligation of the Assignor, enforceable against it in accordance with their respective terms; and

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

(d)    all claims for wages, expense reimbursements, benefits and other compensation with priority over the Assignor's other creditors accrued or otherwise arising prior to the date hereof have been satisfied in full.
6.    Resignation and Replacement of Assignee.  The Assignee may resign and be discharged from its duties hereunder at any time; provided that such resignation shall not become effective until a successor Assignee has been appointed by the resigning Assignee and such successor has accepted its appointment in writing delivered to the resigning Assignee.  Any successor Assignee appointed hereunder shall execute an instrument accepting such appointment hereunder and shall deliver one counterpart thereof to the resigning Assignee.  Thereupon such successor Assignee shall, without any further act, become vested with all the estate, properties, rights, powers, trusts, and duties of his predecessor in connection with the Assignment with like effect as if originally named therein, but the resigning Assignee shall nevertheless, when requested in writing by the successor Assignee, execute and deliver an instrument or instruments conveying and transferring to such successor Assignee all of the estates, properties, rights, powers and trusts of such resigning Assignor in connection with the Assignment, and shall duly assign, transfer, and deliver to such successor Assignee all property and money held by it hereunder.
7.    Limitation of Liability.  Assignor acknowledges that Assignee is acting solely as Assignee in connection with this Assignment and not in its personal capacity.  As a result, Assignor expressly agrees that Assignee, its members, officers and agents shall not be subject to any personal liability whatsoever to any person in connection with the affairs of this Assignment, except for its own misconduct knowingly and intentionally committed in bad faith.  No provision of this Agreement shall be construed to relieve the Assignee from liability for its own misconduct knowingly and intentionally committed in bad faith, except that:
(a)    The Assignee shall not be required to perform any duties or obligations except for the performance of such duties and obligations as are specifically set forth in this Assignment, and no implied covenants or obligations shall be read into this Assignment against the Assignee.
(b)    In the absence of bad faith on the part of the Assignee, the Assignee may conclusively rely, as to the truth, accuracy and completeness thereof, on the statements and certificates or opinions furnished to the Assignee by the Assignor and conforming to the requirements of this Assignment.
(c)    The Assignee shall not be liable for any error of judgment made in good faith.
(d)    The Assignee shall not be liable with respect to any action taken or omitted to be taken by it in accordance with a written opinion of legal counsel addressed to the Assignee.
In connection with the foregoing, the assignment estate shall defend, indemnify and hold the Assignee and its past and present officers, members, managers, directors, employees, counsel, agents, attorneys, parent, subsidiaries, affiliates, successors and assigns, including without limitation Sherwood Partners LLC (collectively, the "Indemnified Persons") harmless from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, charges, expenses and disbursements (including reasonable attorneys' fees and costs) of any kind or nature whatsoever which may at any time be imposed on, incurred by, or asserted against any such Indemnified Person in any way relating to or arising out of this General Assignment, the Fee Letter, any other document contemplated by or referred to herein or therein, the transactions contemplated hereby or thereby, or any action taken or omitted by any Indemnified Person under or in connection with any of the foregoing, including, without limitation, with respect to any investigation, litigation or proceeding related to or arising out of any of the foregoing, whether or not any Indemnified Person is a party thereto, and including, without limitation, any other Indemnified Claims 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

(defined below), provided, that the assignment estate shall have no obligation hereunder to any Indemnified Person with respect to indemnified claims to the extent resulting from the willful misconduct or gross negligence of any Indemnified Person.  The foregoing indemnification shall survive any termination of this General Assignment or the transactions contemplated hereby.  For purposes hereof, "Indemnified Claims" means any and all claims, demands, actions, causes of action, judgments, obligations, liabilities, losses, damages and consequential damages, penalties, fines, costs, fees, expenses and disbursements (including without limitation, fees and expenses of attorneys and other professional consultants and experts in connection with investigation or defense) of every kind, known or unknown, existing or hereafter arising, foreseeable or unforeseeable, which may be imposed upon, threatened or asserted against, or incurred or paid by, any Indemnified Person at any time and from time to time, because of, resulting from, in connection with, or arising out of any transaction, act, omission, event or circumstance in any way connected with this General Assignment, the Fee Letter, any other document contemplated by or referred to herein or therein, the transactions contemplated hereby or thereby, or any action taken or omitted by any Indemnified Person under or in connection with any of the foregoing, including but not limited to economic loss, property damage, personal injury or death in connection with, or occurring on or in the vicinity of, any assets of the assignment estate through any cause whatsoever, any act performed or omitted to be performed under this General Assignment, any other document contemplated by or referred to herein, the transactions contemplated hereby, or any action taken or omitted by any Indemnified Person under or in connection with any of the foregoing, any breach by Assignor of any representation, warranty, covenant, agreement or condition contained herein or in any other agreement between Assignor and Assignee.
8.    Reliance.
(a)    The Assignee may rely and shall be protected in acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties.
(b)    The Assignee may consult with legal counsel to be selected by it, and the Assignee shall not be liable for any action taken or suffered by it in accordance with the advice of such counsel.
(c)    Persons dealing with the Assignee shall look only to the assignment estate to satisfy any liability incurred by the Assignee in good faith to any such person in carrying out the terms of this Assignment, and the Assignee shall have no personal or individual obligation to satisfy any such liability.  
9.    Headings.  The headings used in this Assignment are for convenience only and shall be disregarded in interpreting the substantive provisions of this Assignment.  
10.    Forwarding of Mail.  Assignor authorizes the forwarding of its mail by the U.S. Postal Service as directed by Assignee.
11.    Counterparts.  This Assignment agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same document.
12.    Attorneys fees and costs.  Except as set forth in the Fee Letter, the parties agree that each of them shall bear its own legal costs and expenses in connection with the negotiation, drafting, execution or enforcement of this Assignment.
13.    Entire Agreement.  This Assignment and the Fee Letter contain the entire agreement of the parties hereto with respect to the matters covered and the transactions contemplated hereby, and no other agreement, statement, representation, warranty or promise made prior hereto or contemporaneously herewith 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

by any party hereto, or any employee, officer, agent, or attorney of any party hereto shall be valid or binding or relied upon by any party as an inducement to enter into, or as consideration for, this Assignment.
14.    Governing Law.  This General Assignment shall be governed by and construed in accordance with the laws of the State of Delaware without regard to conflicts of law principles.
15.    Severability.  In case any provision of this General Assignment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this General Assignment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
16.    Cooperation.  Each party cooperated in the drafting of this General Assignment and therefore this General Assignment shall not be construed more strictly against any of the parties.  
17.    Time is of the Essence.  Time is of the essence in the performance of and conditions set forth in this General Assignment.
18.    No Adequate Remedy at Law.  Each party hereto acknowledges and agrees that damages will not adequately compensate the other party for a breach of the terms of this General Assignment and that, as such, each party shall be entitled to specific performance of this General Assignment.

IN WITNESS WHEREOF the parties hereunder set their hands the day and year first above written.
	
					
	Assignor's Federal Tax I.D. Number:
	 
	Danotek Motion Technologies, Inc. a Delaware Corporation, Assignor

	Federal #
	26-7410224
	 
	 

	 
	 
	 
	By:
	/s/ Donald C. Naab

	 
	 
	 
	Its:
	Donald C. Naab

President and CEO

	 
	 
	Danotek (assignment for the benefit of creditors), LLC, a Delaware limited liability company, Assignee

	 
	 
	 
	 

	 
	 
	 
	By:
	/s/ Michael A. Maidy

	 
	 
	 
	Its:
	Michael A. Maidy

Manager

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

EXHIBIT B

Required Assets

Seller is not making any representation, expressed or implied with regard to the availability of the Required Assets due to additional expenses that may be incurred to retrieve them, expressed or implied liens that may be asserted by vendors, former employees or consultants holding inventory, raw materials or other Required Assets.  Buyer, at its own expense, may elect to pursue such Required Assets or use whatever means necessary to obtain them. Some assets described in this Exhibit may contain third-party intellectual property that may have been licensed by, or otherwise acquired, by Assignor. Buyer acknowledges that Seller may be unable to transfer certain intellectual property belonging to a third party without the express written consent of that third party which shall not be obtained or sought by Seller as part of this Agreement. Buyer accepts full responsibility for communicating with third parties whose intellectual property may be included in the Required Assets and Buyer shall be responsible for paying all licensing fees, costs, expenses, or other charges associated with using said assets.

The Required Assets solely include, as of the Closing Date, the intangible assets and intellectual property rights that relate specifically to 5300 PM Generator Business of the Danotek Motion Technologies, Inc., namely, the Patent License (as defined in Exhibit B-1 attached hereto), and Copyrights (as defined below) owned or developed by Assignor (or that have been assigned to Seller), which the Seller has in its possession, Intellectual Property, and specific equipment.  For the avoidance of doubt, Required Assets do not include any other rights, including any and all properties, rights, contracts, claims or other assets owned by either Assignor or Seller, including, but not limited to, Assignor’s Excluded Assets.

Tangible Assets Include:

Manufacturing Assets and Test Equipment
Rotor insertion jig & stand
Bearing press & Table
Work table
Work bench with rack
Hand cart/tool chest with tools
Stator stands (3)
General assembly table
Bed Plate & Hardware
Mounting Plate & hardware
Lift tables
Drive Motor with coupling
ABB Drive Controller
Part storage rack (1 set) - Blue rack with rollers

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Oven
Pneumatic rivet gun
Hardware bins
Large C-Clamps for housing assembly (3)
Material handling straps
Complete Instrumented Unit
Re-Manufactured Unit
Go/No Go housing to stator gages/Fixtures
Go/No Go Stator keyway gage
Failed Equipment (Cage)
Rotor Wrapping machine 
Heat lamp for rotor wrapping
Wire stripper-Electric eraser model IR7000 with attachment DCF 4 AR4401 

Electrical Test Equipment - List A 
Amprobe PRM-4, Phase rotation tester 
2 PC's with design software and any non-standard software needed to process documentation preloaded including licenses for all software

Electrical Test Equipment - List B**
Scope: Tektronix DPO4054
High voltage probes (x3): BK Precision PR-60 Active Differential Probe x10/x100   
Hi-pot tester
Megger DLRO10HD Micro Ohm Meter 
Fluke 1550B, 5KV MEGOHMMETER 
Temperature/humidity meter
Vibration measurement set in rack: monitor, keyboard, LabView base PC, probes and data acquisition cards 

** Delivery of the the items listed in List B above is subject to Section 2.1 and payment as defined in Section 9.1 (a)

Manufacturing Documentation (electronic, in native format whenever possible)
CAD Drawings
Inspection Procedures
Inspection Reports: Blank & Historical (Test procedure/Test report)
Test sheets/Test Reports: Blank & Historical
Procedures
Travelers: Blank & Historical
Deviations: Blank & Historical
Drawings
-PDF
-Historical
-Native Solid Models
-.Step and/or .IGES of all models
Corrective Actions: Internal & External
Complete Vendor Info
PPAP Documentation for all parts
Supplier Qualification information

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Supplier Quality Manual
Site Assessments/Audits
Supplier Deviations
Part Lead-times
Historical Unit tracking data
Mounting plate new design sketches
Current Paint Specifications
Engineering change order form: blank & historical
Engineering change request form: blank & historical
RMA form and historical
Assembly instructions (& historical)
Import broker information
Any user names or passwords required to use software for design or documentation

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

EXHIBIT B-1

PATENT LICENSE AGREEMENT
            THIS PATENT LICENSE AGREEMENT ("Agreement") is made and entered into as of this 8th day of January, 2013 ("Effective Date"), by and between Danotek (assignment for the benefit of creditors), LLC ("Licensor" or “Danotek ABC”), a Delaware corporation, with a principal place of business at 1100 La Avenida St., Building A, Mountain View, CA 94043 and Tecogen, Inc., a Delaware corporation (“Tecogen”), with principal offices located at 45 First Avenue, Waltham, MA 02451.
1.    DEFINITIONS.
1.1    "Affiliate" means an entity that now or hereafter directly or indirectly controls, is controlled by, or is under common control with Tecogen for so long as the control exists. The term "control" (and its correlative meanings) means possession, direct or indirect, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of voting securities, by contract or otherwise.
1.2    "Licensee" means Tecogen and its Affiliates.
1.3    "Licensee Product" means the product sold to Licensee in the Asset Purchase Agreement Dated January 8, 2013.
1.4    "Listed Patents" means the provisional patent applications, patent applications, and patents listed in Schedule A, a copy of which is attached hereto.
1.5    "Retained Patents" means the provisional patent applications, patent applications, and patents listed on Schedule B, a copy of which is attached hereto, including any patents or patent applications to which the patents listed in Exhibit B to that certain Asset Purchase Agreement dated January 8, 2013 between Danotek ABC and Tecogen (the "Asset Purchase Agreement") form a basis for priority, or are co-owned applications that incorporate by reference, or are incorporated by reference into the patents or patent applications in the foregoing categories or reissues, reexaminations, extensions, continuations, continuations in part, continuing prosecution applications, requests for continuing examinations, divisions, and registrations of any item in any of the foregoing categories or foreign and multinational patents, patent applications and counterparts relating to any item in any of the foregoing categories, including, without limitation, certificates of invention and utility models; rights provided by multinational treaties or conventions for any item in any of the foregoing categories and any item in any of the foregoing categories, whether or not claims in any of the foregoing have been rejected, withdrawn, cancelled, or the like.
2.         LICENSE.

2.1    Grant. For good and valuable consideration, the receipt of which is hereby acknowledged, Licensor hereby grants to Licensee an irrevocable, fully paid up, non exclusive, non-transferable (except as set forth in Section 9.7 hereof), worldwide license, under the Listed Patents, to make, use, sell, offer for sale, 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

and import Licensee Products and to practice all processes and methods in connection therewith. The license granted herein shall be sub-licensable to developers, end users and customers lawfully using Licensee's products and services to the extent of such use.
2.2    No Implied Licenses. Except for the express licenses granted in this Agreement, Licensor reserves all right, title and interest in the Listed Patents. No rights or licenses are granted under this Agreement, whether by implication, estoppel or otherwise, except as expressly set forth herein. No rights or licenses are granted under this Agreement with respect to the Retained Patents.
3.    PAYMENT.
3.1    Fees. [****]
3.2    Taxes. Tecogen is responsible for all taxes, assessments and charges of any kind imposed upon or with respect to (i) the licensing of the Listed Patents to Licensee and (ii) the payment of fees to Licensor hereunder, except taxes based on Licensor's net income.
4.    TERM.
4.1    Term. The term of this Agreement will commence upon the Effective Date and will expire upon expiration of the last to expire of the Listed Patents.
4.2    Survival. The definitions and the rights, duties and obligations of the parties in the following Sections will survive any termination or expiration of this Agreement: 2.2 (NO IMPLIED LICENSES), 4.2 (SURVIVAL), 5 (REPRESENTATIONS AND WARRANTIES OF LICENSOR), 6 (CONFIDENTIALITY), 7 (DISCLAIMER OF WARRANTIES), and 9 (GENERAL). All other rights, licenses, and obligations of the parties under this Agreement will immediately cease upon any expiration of this Agreement.
5.    REPRESENTATIONS AND WARRANTIES OF LICENSOR. Licensor is a corporation duly formed, validly existing, and in good standing under the laws of the jurisdiction of its formation. Licensor has the full corporate power and authority and has obtained all third party consents, approvals, and/or other authorizations required to enter into this Agreement and to carry out its obligations hereunder, including, without limitation, the licensing of the Listed Patents to Licensee.
6.    CONFIDENTIALITY. Neither party will disclose any terms of this Agreement to anyone other than its attorneys, accountants, and other professional advisors under a duty of confidentiality until the earlier of: (a) five (5) years, (b) as required by law; or (c) in connection with a proposed merger, financing, or sale of that party's assets or business, on condition that the third party to whom the terms of this Agreement are to be disclosed signs a confidentiality agreement that contains terms consistent with those of this paragraph.
7.DISCLAIMER OF WARRANTIES. LICENSOR MAKES NO REPRESENTATIONS OR WARRANTIES OF ANY KIND IN CONNECTION WITH THIS AGREEMENT EXCEPT AS SET FORTH IN SECTION 4, AND DISCLAIMS AND EXCLUDES ALL WARRANTIES, WHETHER STATUTORY, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, THE IMPLIED WARRANTIES OF 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE, AND NON-INFRINGEMENT OF THIRD PARTY RIGHTS. WITHOUT LIMITING THE FOREGOING, LICENSOR MAKES NO WARRANTY OR REPRESENTATION THAT ANY MANUFACTURE, USE, IMPORTATION, OFFER FOR SALE OR SALE OF ANY PRODUCT OR SERVICE WILL BE FREE FROM INFRINGEMENT OF ANY PATENT OR OTHER INTELLECTUAL PROPERTY RIGHT OF ANY THIRD PARTY OR AS TO THE VALIDITY AND/OR SCOPE OF ANY PATENT OR PATENT CLAIMS LICENSED BY LICENSOR TO LICENSEE UNDER THIS AGREEMENT.
3
8.NO OBLIGATION TO OBTAIN OR MAINTAIN PATENTS. Licensor is not obligated to (a) file any patent application or to secure any patent or patent rights, or (b) maintain any patent in force.
9.GENERAL.
9.1    Relationship. Nothing in this Agreement will be deemed or construed as creating a joint venture or partnership between the parties or is intended or shall be construed to create any third party beneficiaries. 
9.2    Amendments. This Agreement, and the terms and provisions hereof, may not be modified, waived or amended except by an instrument or instruments in writing signed by the party against whom enforcement of any such modification or amendment is sought (or, in the case of a waiver, by the intended beneficiary of the waived term or provision).
9.3    Modification and Waiver. No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law.
              9.4          Indemnified Losses.  For the purpose of this Section 9.4 and when used elsewhere in this agreement, “Loss” shall mean and include any and all liability, loss, damage, claim, expense, cost, fine, fee, penalty, obligation, or injury including, without limitation, those resulting from any and all actions, suits, proceedings, demands, assessments, judgments, award, or arbitration, together with reasonable costs and expenses, including the reasonable attorneys’ fees and other legal costs and expenses relating thereto.
             9.5          No Indemnification by Licensor.  Licensor is licensing to Licensee a worldwide license under the Listed Patents with no representations or warranties, including the implied warranties of merchantability, fitness for a particular purpose, title, and non-infringement of third-party rights.  Licensor does not agree to defend, indemnify, or hold harmless Licensee, any parent, subsidiary, or affiliate of Licensee, and/or any director, officer, employee, stockholder, agent, or attorney of Licensee or of any parent, subsidiary, or affiliate of Licensee from and against and in respect of any Loss, which arises out of or results from the license described herein.  
            9.6          Indemnification by Licensee.  Licensee agrees to defend, indemnify, and hold harmless Licensor and any parent, subsidiary, or affiliate of Licensor, and/or any manager, employee, member, agent, 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

or attorney of Licensee or of any parent, subsidiary, or affiliate of Licensee from and against and in respect of any Loss, which arises out of or results from (i) Licensee’s failure to comply with the terms set forth in this Agreement, and/or (ii) the use of the Listed Patents that are the subject of this Agreement.
9.7    Assignment. Except in connection with its merger, acquisition or sale of all or substantially all of its assets, Tecogen may not assign or transfer any of its rights under this Agreement without Licensor's prior written consent, not to be unreasonably withheld. Tecogen may also transfer or assign its rights under this Agreement to any Affiliate. Any attempted assignment or transfer in violation of this paragraph is void. This Agreement will be binding upon and inure to the benefit of the parties and their respective successors and permitted assigns.
9.8    Governing Law. The laws of the State of California will govern all matters arising out of or relating to this Agreement.
9.9    Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other conditions and provision of this Agreement will nevertheless remain in full force and effect, and the parties hereto will negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner.
9.10    Third Party Beneficiaries. Nothing in this Agreement, express or implied, is intended or shall be construed to create any third party beneficiaries.
9.11    Entire Agreement. This Agreement, including any exhibits hereto, constitute the entire agreement among the parties hereto with respect to the subject matter hereof and supersede all other prior and contemporaneous agreements, understandings or communications, either written and oral, between the parties with respect to the subject matter hereof.
9.12    Counterparts. This Agreement may be signed in any number of counterparts, each of which shall be deemed an original, with the same effect as if the signatures were upon the same instrument.  Delivery of the Agreement that includes an executed counterpart of the signature page by telecopier or electronic mail shall be as effective as delivery of an originally manually executed counterpart.
[Signature Page Follows]

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

    
IN WITNESS WHEREOF, the parties have caused their duly authorized representatives to execute this Agreement as of the Effective Date.
"Licensor"    "Tecogen"
DANOTEK (ASSIGNMENT FOR THE    TECOGEN, INC.
BENEFIT OF CREDITORS), LLC

/s/ Michael A. Maidy                                                                 /s/ Robert A. Panora                      
Name:     Michael A. Maidy    Name: Robert A. Panora
Title:     Manager, Danotek (assignment for the    Title: President and COO
benefit of creditors), LLC, in its sole and
limited capacity as assignee for Danotek 
Motion Technologies, Inc.

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Schedule A
Listed Patents

[****]

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Schedule B
Retained Patents
[****]

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

EXHIBIT C

ASSIGNMENT AND BILL OF SALE AGREEMENT

This Assignment and Bill of Sale Agreement (the “Agreement”) is made as of  January 8, 2013, by and between Danotek (assignment for the benefit of creditors), LLC, a Delaware limited liability company, in its sole and limited capacity as Assignee for the Benefit of Creditors of Danotek Motion Technologies, Inc. (the “Seller”), and Tecogen, Inc. a [corporate or business identity of purchaser] (the “Buyer”).  Seller and Buyer are parties to a certain Asset Purchase Agreement dated as of January 8, 2013, (the “Asset Purchase Agreement”).  Capitalized terms used without definitions herein shall have the meanings ascribed to such terms in the Asset Purchase Agreement.  

1.    Sale and Assignment of Required Assets.  Pursuant to the Asset Purchase Agreement, Buyer has on the date hereof purchased the Required Assets from Seller.  In accordance with and subject to the terms and conditions set forth in the Asset Purchase Agreement, for good and valuable consideration, the receipt of which is hereby acknowledged, Seller does hereby sell, assign, bargain, transfer, convey and deliver unto Buyer all of its right, title and interest in and to the Required Assets.

2.    Assumption of Assumed Liabilities.  In accordance with and subject to the terms and conditions set forth in the Asset Purchase Agreement, in partial consideration for such transfer of the Required Assets by Seller to Buyer, Buyer hereby undertakes to assume, pay, perform, satisfy and discharge, all of the Assumed Liabilities.  Buyer does not agree to assume or pay any Excluded Liabilities or any other debts, obligations or liabilities of Seller or Assignor not expressly assumed by Buyer in the Asset Purchase Agreement.

3.    Cooperation.  Buyer and Seller agree to cooperate with each other to execute and deliver such other documents and instruments and to do such further acts and things as may be reasonably requested by the other to evidence, document or carry out the sale of the Required Assets and the assumption of the Assumed Liabilities.

4.           Effect of Agreement.  Nothing in this Agreement shall, or shall be deemed to, modify or otherwise affect any provisions of the Asset Purchase Agreement or affect the rights of the parties under the Asset Purchase Agreement.  In the event of any conflict between the provisions hereof and the provisions of the Asset Purchase Agreement, the provisions of the Asset Purchase Agreement shall govern and control.

[Signature Page Follows]

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

IN WITNESS WHEREOF, Seller and Buyer have caused this Assignment and Bill of Sale Agreement to be executed on the date first written above.  

SELLER:        BUYER:

Danotek (assignment for the benefit of creditors),         Tecogen, Inc. 
LLC, solely as Assignee for the Benefit
of Creditors of Danotek Motion Technologies, Inc.

/s/ Michael Maidy                                                            /s/ Robert A. Panora                              

By:  Michael Maidy                                            By: Robert A. Panora                            

Its: Manager                                                         Its: PresidentTGN S1-EX-10.12 Wisconsin Foundation AMD5

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

EXHIBIT 10.12
EXCLUSIVE LICENSE AGREEMENT

This Agreement is made effective the 5th day of February, 2007, by and between Wisconsin Alumni Research Foundation (hereinafter called “WARF”), a nonstock, nonprofit Wisconsin corporation, and Tecogen Inc. (hereinafter called “Licensee”), a corporation organized and existing under the laws of
Delaware;

WHEREAS, WARF owns certain intellectual property rights to the inventions described in the “Licensed Patents” defined below, and WARF is willing to grant a license to Licensee under any one or all of the Licensed Patents and Licensee desires a license under all of them;

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below, the parties covenant and agree as follows:

Section l.     Definitions.

For the purpose of this Agreement, the Appendix A definitions shall apply.
    
Section 2.     Grant.

A.License.

WARF hereby grants to Licensee an exclusive license under the Licensed Patents to make, have made, use and sell Products in the Licensed Field and Licensed Territory. For a period of six (6) months following the date of this Agreement, the license to Licensee shall include any Improvements developed by Professor Robert Lasseter which are assigned to WARF during such six (6) month period.

B.     License to WARF.

(i)     Licensee hereby grants to WARF a non-exclusive, royalty-free, irrevocable, paid-up license, with the right to grant sublicenses to non-profit research institutions and governmental agencies, to practice and use any Improvements developed by or on behalf of Licensee for Non-Commercial Research Purposes. Licensee shall provide WARF with a written, enabling disclosure of each such invention, unambiguously identifying it as an invention governed by this paragraph, within six (6) months of the issuance of a patent thereon.

(ii)     In the event that Licensee discontinues the use or commercialization of the Licensed Patents or any Improvements provided for under this Agreement, Licensee hereby agrees to grant to WARF an option to obtain a nonexclusive, royalty—bearing license, with the right to grant sublicenses, to practice and use said Improvements for commercial purposes. Licensee shall provide to WARF written notice that Licensee intends to discontinue such use or commercialization immediately upon making such a decision. WARF’s option with respect to each Improvement shall expire sixty (60) days after WARF’s receipt of said written notice from Licensee or, if WARF exercises its rights hereunder, one hundred and eighty (180) days after such exercise if WARF and Licensee are unable to agree on the terms of such royalty—bearing license. The failure of WARF to timely exercise its option under this paragraph shall be deemed a waiver of WARF’s option, but only with respect to the Improvement(s) so disclosed.

C.     Reservation of Rights.

1 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

WARF hereby reserves the right to grant non-profit research institutions and governmental agencies non-exclusive licenses to practice and use the inventions of the Licensed Patents for Non-Commercial Research Purposes. WARF, the University of Wisconsin and the inventors of the Licensed Patents shall have the right to publish any information included in the Licensed Patents.

D.     Option.

To the extent legally available, WARF shall grant Licensee an option to negotiate a license, having the same scope of the license granted to Licensee herein, to any Improvements developed by Professor Robert Lasseter which are assigned to WARF after July 31, 2007. WARF shall promptly notify Licensee of any such Improvement. Licensee’s option with respect to each Improvement shall expire sixty (60) days after Licensee’s receipt of said written notice from WARF or, if Licensee exercises its rights hereunder, one hundred and eighty (180) days after such exercise if WARF and Licensee are unable to agree on the terms of a license. The failure of Licensee to timely exercise its option under this paragraph shall be deemed a waiver of Licensee’s option, but only with respect to the Improvement(s) so disclosed.

Section 3.     Development.

A.     Licensee shall use reasonable commercial efforts to develop, manufacture, market and sell Products in the Licensed Field and the Licensed Territory throughout the term of this Agreement. Such activities shall include, without limitation, those activities listed in the Development Plan attached hereto as Appendix E. Licensee agrees that said Development Plan is reasonable and that it shall take all reasonable commercial steps to meet the development program as set forth therein.

B.     Beginning in calendar year 2007 and until the Date of First Commercial Sale, Licensee shall provide WARF with a written Development Report summarizing Licensee’s development activities since the last Development Report and any necessary adjustments to the Development Plan. Licensee agrees to provide each Development Report to WARF on or before thirty (30) days from the end of each semi-annual period ending June 30 and December 31 for which a report is due, and shall set forth in each Development Report sufficient detail to enable WARF to ascertain Licensee’s progress toward the requirements of the Development Plan. WARF agrees that the contents of each Development Report shall constitute “Confidential Information” for purposes of Section 18 of this Agreement. WARF reserves the right to audit Licensee’s records relating to the development activities required hereunder. Such record keeping and audit procedures shall be subject to the procedures and restrictions set forth in Section 6 for auditing the financial records of Licensee.

C.     Licensee agrees to and warrants that it has obtained, or will obtain, the expertise necessary to independently evaluate the inventions of the Licensed Patents and to develop Products for sale in the commercial market and that it so intends to develop Products for the commercial market. Licensee acknowledges that a failure by Licensee to reasonably implement the Development Plan, or to make timely submission to WARF of any Development Report, or the providing of any materially false information to WARF regarding Licensee’s development activities hereunder, shall be a material breach of this Agreement in accordance with Section 7D of this Agreement.

Section 4.     Consideration.
    
A.     License Fee.

Licensee agrees to pay to WARF a license fee of [****], due within thirty (30) days of Licensee’s execution of this Agreement.

B.     Royalty.

2 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

In addition to the Section 4A license fee, Licensee agrees to pay to WARF as “earned royalties” a royalty in accordance with the terms and conditions of this Agreement. The royalty is deemed earned as of the earlier of the date an invoice is sent by Licensee or the date a Product is transferred to a third party for any promotional reasons. The royalty shall be a fixed amount for each Product sold or transferred while this Agreement is in effect according to the following schedule: [****] for the first [****] Product units sold or transferred in a calendar year and [****] for each additional Product unit thereafter until the conclusion of that year.

C.     Minimum Royalty.

Licensee further agrees to pay to WARF a minimum royalty of [****] per calendar year (prorated for any partial year during which this Agreement is in effect) starting in calendar year 2009, against which any earned royalty paid for the same calendar year will be credited. The minimum royalty for a given year shall be due at the time payments are due for the calendar quarter ending on December 31. It is understood that the minimum royalties will apply on a calendar year basis, and that sales of Products requiring the payment of earned royalties made during a prior or subsequent calendar year shall have no effect on the annual minimum royalty due WARF for any given calendar year.

D.     Patent Fees and Costs.

(i)     In consideration of Licensee’s collaboration with the Inventor, the Patent Fees and Costs in the United States and Canada normally required are waived. Licensee agrees to pay WARF [****] for each European country in which Licensee desires WARF to pursue patent protection. Licensee shall pay to WARF such costs within thirty (30) days of receiving an invoice from WARF.

(ii)     WARF is not obligated to make or maintain any other foreign filings of the Licensed Patents. lf Licensee desires WARF to obtain foreign protection in specific countries in Europe, Licensee must notify WARF in writing three (3) months prior to the expiration of the deadline for making such election, indicating those countries in which Licensee desires WARF to obtain European patent protection. Any country for which WARF files for such patent protection at Licensee’s request shall be included in the Licensed Territory under this Agreement. WARF reserves the right to file a patent application, at its own expense, in any countries not requested by Licensee pursuant to this Section 4D. Licensee acknowledges that if the United States Government (through any of its agencies or otherwise) has funded research, during the course of or under which any of the inventions of the Licensed Patents were conceived or made, the United States Government is entitled, as a right, under the provisions of 35 U.S.C. § 200-212 and applicable regulations of Chapter 37 of the Code of Federal Regulations, to make and maintain foreign filings in those countries not selected by Licensee and/or WARF.

(iii)     WARF will prosecute all national applications it files at Licensee’s request pursuant to this Section 4D until WARF determines that continued prosecution is unlikely to result in the issuance of a patent in that country. If WARF decides to abandon prosecution or maintenance of any patent or patent application under the Licensed Patents in a country in which Licensee has requested WARF to make and maintain such filing, WARF shall provide Licensee notice of WARF’s intent to abandon such application. In such event, Licensee shall have the right to continue prosecution of said application, at its own expense, on behalf of WARF and Licensee, to the extent allowed under applicable law.

E.     Accounting Payments.

(i)     Amounts owing to WARE under Section 4B shall be paid on a quarterly basis, with such amounts due and received by WARE on or before the thirtieth day following the end of the calendar quarter ending on March 31, June 30, September 30 or December 31 in which such amounts were earned. The balance of any amounts which remain unpaid more than thirty (30) days after they are due to WARE shall accrue interest until paid at the rate of the lesser of one percent (1%) per month or the maximum amount allowed under 

3 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

applicable law. However, in no event shall this interest provision be construed as a grant of permission for any payment delays.

(ii)     Except as otherwise directed, all amounts owing to WARE under this Agreement shall be paid in U.S. dollars to WARE at the address provided in Section l6(a). WARE is exempt from paying income taxes under U.S. law. Therefore, all payments due under this Agreement shall be made without deduction for taxes, assessments, or other charges of any kind which may be imposed on WARE by any government outside of the United States or any political subdivision of such government with respect to any amounts payable to WARF pursuant to this Agreement. All such taxes, assessments, or other charges shall be assumed by Licensee.

(iii)     A full accounting showing how any amounts owing to WARE under Section 4B have been calculated shall be submitted to WARE on the date of each such payment. Such accounting shall be on a per-country and product line, model or trade name basis and shall be summarized on the form shown in Appendix C of this Agreement. In the event no payment is owed to WARE, a statement setting forth that fact shall be supplied to WARE. WARE agrees that the contents of each such accounting shall constitute “Confidential Information” for purposes of Section 18 of this Agreement.

Section 5.     Certain Warranties.

A.     WARE warrants that (i) except as otherwise provided under Section 14 of this Agreement with respect to U.S. Government interests, it is the owner of the Licensed Patents or otherwise has the right to grant the licenses granted to Licensee in this Agreement, and (ii) to the best of WARF’s knowledge, no third party has made any claim or initiated any litigation or other proceeding that challenges the validity or scope of the Licensed Patents. Nothing in this Agreement shall be construed as:

(i)     except as provided above, a warranty or representation by WARE as to the validity or scope of any of the Licensed Patents;

(ii)     except as provided above, a warranty or representation by WARE that anything made, used, sold or otherwise disposed of under the license granted in this Agreement will or will not infringe patents of third parties; or

(iii) an obligation to furnish any know—how not provided in the Licensed Patents or any services other than those specified in this Agreement.

B.     WARF MAKES NO REPRESENTATIONS, EXTENDS NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR IMPLIED, AND ASSUMES NO RESPONSIBILITIES WHATSOEVER WITH RESPECT TO USE, SALE, OR OTHER DISPOSITION BY LICENSEE OR ITS VENDEES OR OTHER TRANSFEREES OF PRODUCTS INCORPORATING OR MADE BY USE OE INVENTIONS LICENSED UNDER THIS AGREEMENT.

C.     Licensee represents and warrants that Products produced under the license granted herein shall be manufactured substantially in the United States as required by 35 U.S.C § 204 and applicable regulations of Chapter 37 of the Code of Federal Regulations.

Section 6.     Recordkeeping.

A.     Licensee shall keep books and records sufficient to verify the accuracy and completeness of Licensee’s accounting referred to above, including without limitation inventory, purchase and invoice records relating to the Products or their manufacture. In addition, Licensee shall maintain documentation evidencing that Licensee is in fact pursuing development of Products as required herein. Such documentation may include, but is not limited to, invoices for studies advancing development of Products, laboratory notebooks, internal job cost 

4 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

records, and filings made to the Internal Revenue Department to obtain tax credit, if available, for research and development of Products. Such books and records shall be preserved for a period not less than six (6) years after they are created during and after the term of this Agreement.

B.     Licensee shall take all steps necessary so that WARF may within thirty (30) days of its request review all the books and records at a single U.S. location to allow WARF to verify the accuracy of Licensee’s royalty reports and Development Reports. Such review may be performed by any employee of WARF as well as by any attorney or registered CPA designated by WARF, upon reasonable notice and during regular business hours. The contents of all such books and records shall constitute “Confidential Information” for purposes of Section 18 of this Agreement.

C.     If a royalty payment deficiency is determined, Licensee shall pay the royalty deficiency outstanding within thirty (30) days of receiving written notice thereof plus interest on outstanding amounts as described in Section 4E(i).

D.     If a royalty payment deficiency for a calendar year [****], then Licensee shall be responsible for paying WARF’s out-of-pocket expenses incurred with respect to such review.

Section 7.     Term and Termination.

A.     The term of this license shall begin on the effective date of this Agreement and continue until this Agreement is terminated as provided herein or until the earlier of the date that no Licensed Patent remains an enforceable patent or the payment of earned royalties under Section 4B, once begun, ceases for more than eight (8) consecutive calendar quarters.

B.     Licensee may terminate this Agreement at any time by giving at least ninety (90) days written and unambiguous notice of such termination to WARF. Such a notice shall be accompanied by a statement of the reasons for termination.

C.     WARF may terminate this Agreement by giving Licensee at least ninety (90) days written notice if the Date of First Commercial Sale does not occur on or before December 31, 2007.

D.     If Licensee at any time defaults in the timely payment of any monies due to WARF or the timely submission to WARF of any Development Report, fails to actively pursue the development plan, or commits any material breach of any other covenant herein contained, and Licensee fails to remedy any such breach or default within ninety (90) days after written notice thereof by WARF, or if Licensee commits any act of bankruptcy, becomes insolvent, is unable to pay its debts as they become due, files a petition under any bankruptcy or insolvency act, or has any such petition filed against it which is not dismissed within sixty (60) days, or offers any component of the Licensed Patents to its creditors, WARF may, at its option, terminate this Agreement by giving notice of termination to Licensee.

E.     Upon the termination of this Agreement, Licensee shall remain obligated to provide an accounting for and to pay royalties earned up to the date of the termination and any minimum royalties shall be prorated as of the date of termination by the number of days elapsed in the applicable calendar year.

F.     Waiver by either party of a single breach or default, or a succession of breaches or defaults, shall not deprive such party of any right to terminate this Agreement in the event of any subsequent breach or default.

Section 8.     Enforcement of Licensed Patents.

5 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

WARF intends to protect the Licensed Patents against infringers or otherwise act to eliminate infringement, when, in WARF‘s sole judgment, such action may be reasonably necessary, proper, and justified. In the event that Licensee believes there is infringement of any Licensed Patent under this Agreement which is to Licensee's substantial detriment, Licensee shall provide WARE with notification and reasonable evidence of such infringement. WARE shall have the sole and exclusive right to determine whether or not any action should be taken regarding any infringement of the Licensed Patents (at WARE‘s cost and for WARE‘s benefit), and such proceedings shall be under the exclusive control of WARF. Upon request by WARF, Licensee shall take action, join in an action, and otherwise provide WARF with such assistance and information as may be useful to WARE in connection with WARF‘s taking such action (if the cause of action arose during the term of this Agreement and WARF reimburses Licensee for Licensees reasonable out-of-pocket expenses). However, if any infringement of the Licensed Patents which is to the substantial detriment of Licensee has not been discontinued within six (6) months after written request by Licensee to WARF and WARF has not by the end of such period taken action intended to abate or terminate the infringing action and Licensee's rights are still exclusive hereunder, Licensee shall have the right, with WARE 's written consent, which shall not be unreasonably withheld, to file a lawsuit to seek to stop such activity at its own expense. During such litigation Licensee shall act in good faith to preserve WARE 's right, title and interest in and to the Licensed Patent, shall keep WARF advised as to the status of the litigation and shall not enter into a settlement of such litigation without first allowing WARF the option of either approving the settlement or of continuing the litigation at WARE‘s expense for WARE‘s benefit (upon payment to Licensee of its out-of-pocket costs and expenses of the litigation). Nothing herein shall permit or allow Licensee to commence any action for infringement of the Licensed Patent for any activity allowed under a settlement arrangement entered into by WARF in good faith with a third party infringer.

Section 9.     Assignability.

This Agreement may not be transferred or assigned by Licensee except with the prior written consent of WARF.

Section l0.     Contest of Validity.

In the event Licensee contests the validity of any Licensed Patent, Licensee shall continue to pay royalties with respect to that patent as if such contest were not underway until the patent is adjudicated invalid or unenforceable.

Section 11.     Patent Marking.
    
Licensee shall mark all Products or Product packaging with the appropriate patent number reference in compliance with the requirements of U.S. law, 35 U.S.C. § 287.

Section 12.     Product Liability Patent Infringement; Conduct of Business.

A.     Licensee shall, at all times during the term of this Agreement and thereafter, indemnify, defend and hold WARF and the inventors of the Licensed Patents harmless against all claims and expenses, including legal expenses and reasonable attorneys fees, arising out of the death of or injury to any person or persons or out of any damage to property and against any other claim, proceeding, demand, expense and liability of any kind whatsoever resulting from the production, manufacture, sale, use, lease, consumption or advertisement of Products arising from any right or obligation of Licensee hereunder. Licensee shall have the right to control the defense of any such claim or litigation, provided that WARF at all times reserves the right to select and retain counsel of its own, at its own expense, to defend WARF’s interests.

B.     Licensee warrants that it now maintains and will continue to maintain liability insurance coverage appropriate to the risk involved in marketing the products subject to this Agreement and that such insurance coverage is sufficient to cover WARF and the inventors of the Licensed Patents as additional insured. 

6 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Within ninety (90) days after the execution of this Agreement and thereafter annually between January 1 and January 31 of each year, Licensee will present evidence to WARF that such coverage is being maintained. In addition, Licensee shall provide WARF with at least thirty (30) days prior written notice of any change in or cancellation of the insurance coverage.

Section 13.     Use of Names.

Neither party hereto shall use the other party’s name, the name of any inventor of inventions governed by this Agreement, or the name of the University of Wisconsin or Tecogen in any sales promotion, advertising, or any other form of publicity without the prior written approval of the entity or person whose name is being used.

Section 14.     United States Government Interests.

It is understood that if the United States Government (through any of its agencies or otherwise) has funded research, during the course of or under which any of the inventions of the Licensed Patents were conceived or made, the United States Government is entitled, as a right, under the provisions of 35 U.S.C. §§ 200-212 and applicable regulations of Chapter 37 of the Code of Federal Regulations, to a nonexclusive, nontransferable, irrevocable, paid-up license to practice or have practiced the invention of such Licensed Patents for governmental purposes, Any license granted to Licensee in this Agreement shall be subject to such right.

Section 15.     Miscellaneous.

This Agreement shall be governed by and construed in all respects in accordance with the laws of the State of Wisconsin. If any provisions of this Agreement are or shall come into conflict with the laws or regulations of any jurisdiction or any governmental entity having jurisdiction over the parties or this Agreement, those provisions shall be deemed automatically deleted, if such deletion is allowed by relevant law, and the remaining terms and conditions of this Agreement shall remain in full force and effect. If such a deletion is not so allowed or if such a deletion leaves terms thereby made clearly illogical or inappropriate in effect, the parties agree to substitute new terms as similar in effect to the present terms of this Agreement as may be allowed under the applicable laws and regulations. The parties hereto are independent contractors and not joint venturers or partners.

Section l6.     Notices.

Any notice required to be given pursuant to the provisions of this Agreement shall be in writing and shall be deemed to have been given at the earlier of the time when actually received as a consequence of any effective method of delivery, including but not limited to hand delivery, transmission by telecopier, or delivery by a professional courier service or the time when sent by certified or registered mail addressed to the party for whom intended at the address below or at such changed address as the party shall have specified by written notice, provided that any notice of change of address shall be effective only upon actual receipt.
    
(a)     Wisconsin Alumni Research Foundation
Attn: Managing Director
6l4 Walnut Street
Madison, Wisconsin 53726

(b)     Tecogen, Inc.
Attn: President
45 First Avenue
Waltham, MA 02451
    
Section 17.     Integration.

7 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

This Agreement constitutes the full understanding between the parties with reference to the subject matter hereof and no statements or agreements by or between the parties, whether orally or in writing, except as provided for elsewhere in this Section 17, made prior to or at the signing hereof, shall vary or modify the written terms of this Agreement. Neither party shall claim any amendment, modification, or release from any provisions of this Agreement by mutual agreement, acknowledgment, or otherwise, unless such mutual agreement is in writing, signed by the other party, and specifically states that it is an amendment to this Agreement.

Section 18.     Confidentiality.

Both parties agree to keep any information identified as confidential by the disclosing party, confidential using methods at least as stringent as each party uses to protect its own confidential information. “Confidential Information” shall include Licensee’s development plan and development reports, the Licensed Patents and all information concerning them and any other information marked confidential or accompanied by correspondence indicating such information is confidential exchanged between the parties hereto. Except as may be authorized in advance in writing by WARF, Licensee shall grant access to the Confidential Information only to its own employees involved in research relating to the Licensed Patents and Licensee shall require such employees to be bound by this Agreement as well. Licensee agrees not to use any Confidential Information to its advantage and WARF’s detriment, including but not limited to claiming priority to any application serial numbers of the Licensed Patents in Licensee’s patent prosecution. The confidentiality and use obligations set forth above apply to all or any part of the Confidential Information disclosed hereunder except to the extent that:

(i)     Licensee or WARF can show by written record that it possessed the information prior to its receipt from the other party;

(ii)     the information was already available to the public or became so through no fault of the Licensee or WARF;

(iii)     the information is subsequently disclosed to Licensee or WARF by a third party that has the right to disclose it free of any obligations of confidentiality; or (iv) five (5) years have elapsed from the termination or other expiration of this Agreement.

Section 20.     Authority.

The persons signing on behalf of WARF and Licensee hereby warrant and represent that they have authority to execute this Agreement on behalf of the party for whom they have signed.

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement on the dates indicated below.

WISCONSIN ALUMNI RESEARCH FOUNDATION

By:    /s/ Craig J, Christianson                       Date: February 5, 2007
Craig J. Christianson, Director of Licensing

TECOGEN INC.

By:    /s/ Robert A. Panora                         Date: February 5, 2007  
Robert A. Panora, President and COO

8 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Reviewed by WARF’s Attorney

________________________________                            Date: ____________
(WARF’s attorney shall not be deemed a signatory to this Agreement.)
WARF Ref: Lasseter — P02205US

9 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Appendix A
A.“Licensed Patents” shall refer to and mean those patents and patent applications listed on Appendix B attached hereto in countries in the Licensed Territory and any subsequent patent application owned by WARF in a country in the Licensed Territory but only to the extent it claims an invention claimed in a patent application listed on Appendix B.
B. “Improvements” shall mean any patented modification of an invention described in the Licensed Patents that (l) would be infringed by the practice of an invention claimed in the Licensed Patents; or (2) if not for the license granted under this Agreement, would infringe one or more claims of the Licensed Patents.

C. “Products” shall refer to and mean any and all products that employ or are in any way produced by the practice of an invention claimed in the Licensed Patents or that would otherwise constitute infringement of any claims of the Licensed Patents.

D. “Date of First Commercial Sale” shall mean the date when cumulative sales to the retail market of Products exceeds $20,000.

E. “Development Report” shall mean a written account of Licensee’s progress under the development plan having at least the information specified on Appendix D to this Agreement, and shall be sent to the address specified on Appendix D.

F. “Licensed Field” shall mean any application or use with spark ignited natural gas reciprocating engines of size equal to or less than 500 kW where the primary use is to produce electricity while simultaneously recovering waste heat from the engines for useful purpose.

G.“Licensed Territory” shall be worldwide.

H.“Non-Commercial Research Purposes” shall mean the use of the inventions of the Licensed Patents and/or Improvements for academic research purposes or other not-for-profit scholarly purposes not involving the use of the inventions of the Licensed Patents or Improvements to perform services for a fee or for the production or manufacture of products for sale to third parties.

10 

Portions of this exhibit were omitted and filed separately with the Secretary of the Securities and Exchange Commission pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.
Such portions are marked by [****].

Appendix B

LICENSED PATENTS 

	
					
	REFERENCE
NUMBER
	COUNTRY
	PATENT
NUMBER
	ISSUE
DATE
	APPLICATION SERIAL NUMBER

CONTROL OF SMALL DISTRIBUTED ENERGY RESOURCES (LASSETER Robert H, PIAGI Paolo)

	
					
	P02205US
	UNITED STATES
	7,116,010
	10/03/2006
	10/245729

	P02205CA
	CANADA
	 
	 
	2497567

	P02205EU
	EUROPE
	 
	 
	3742007.2

	P05242US
	UNITED STATES
	 
	 
	11/084737

11

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