Document:

Exhibit 10.1 

 

 

 

 

December 15, 2016

 

Via Electronic Delivery 

 

Carol Gilbert

c/o American Public Education, Inc.

111 West Congress Street

Charles Town, West Virginia 25414

 

Dear Carol:

 

Thank you for your long and distinguished service to the Company
and its institutions. This retirement letter agreement (this “Letter Agreement”) sets forth the terms and conditions
of your retirement as the Executive Vice President, Programs and Marketing of American Public Education, Inc., a Delaware corporation
(the “Company”) and of American Public University System, Inc., a West Virginia corporation and wholly owned
subsidiary of the Company (“APUS”). This Letter Agreement amends and supplements the Executive Employment Agreement
by and among you, APUS and the Company, dated as of August 1, 2014 (the “Employment Agreement”). Please acknowledge
your agreement and acceptance of the terms of this Letter Agreement by countersigning and returning a copy of this letter to me.

 

Any capitalized terms that are not otherwise defined herein
shall have the meanings assigned thereto in the Employment Agreement.

 

In consideration of the mutual promises contained in this Letter
Agreement, the Company and you agree, effective as of the date of this letter, as follows:

 

		1.	Retirement from Service.

 

		(a)	As of December 16, 2016, or such other date as you and the Company may mutually agree upon (provided that such date
shall be no later than December 31, 2016) (the “Retirement Date”), you will resign from your positions as the
Executive Vice President, Programs and Marketing of the Company and of APUS and any other positions you may have with the Company,
APUS or their respective affiliates, and will promptly execute such documents and take such actions as may be necessary or reasonably
requested by the Company to effectuate or memorialize your resignation from such positions. The parties agree that your resignation
will be treated as a termination of employment by you for Good Reason pursuant to Section 9(c) of the Employment Agreement, and
that the Retirement Date shall constitute the Date of Termination for purposes of the Employment Agreement.

 

		(b)	Effective as of the Retirement Date, your employment under the Employment Agreement will terminate and you will no longer be
employed by the Company, APUS or any of their affiliates. From and after the Retirement Date, you agree to provide consulting services
to the Company and APUS from time to time as reasonably requested by the Chief Executive Officer of the Company or President of
APUS relating to marketing and enrollment management functions, strategic planning, accreditation, and organizational and realignment
matters. In addition, you will serve as the APUS team lead for HLC Criterion 2 in preparation for the HLC assurance site visit
scheduled for February 2018. You will provide up to thirty (30) hours per month of such consulting services for the term of this
Letter Agreement, which shall begin on the Retirement Date and shall end on April 16, 2018 (the “Term”).

 

     

     

    

 

		2.	Release. On or before the 60th day following the Retirement Date, you shall execute a release of claims substantially
in the form attached to the Employment Agreement as Appendix A (the “Release”). No payments shall be made to
you pursuant to this Letter Agreement and no benefits to which you are entitled pursuant to this Letter Agreement shall accrue
or otherwise take effect unless and until you have executed the Release and all revocation periods applicable thereto have expired
on or before the 60th day following the Retirement Date without the release being revoked.

 

		3.	Termination Benefits.

 

		(a)	You and the Company agree that, because your retirement is being treated as a termination by you for Good Reason pursuant to
Section 9(c) of the Employment Agreement, you shall receive the benefits pursuant to Section 10(d) of the Employment Agreement
in accordance with and subject to the terms of the Employment Agreement. You acknowledge and agree that because the Date of Termination
will occur within 60 days prior to the end of a calendar year, certain of the payments you will receive pursuant to Section 10(d)
of the Employment Agreement will not commence until 2017.

 

		(b)	You and the Company agree that, in recognition of, and as consideration for, the consulting services you will provide to the
Company during the Term and subject to your compliance with the terms of this Letter Agreement, including the continued performance
of consulting services during the Term, and the terms of the Employment Agreement, including those referred to in Section 4 below,
during the Term (i) all of your outstanding restricted stock units and restricted stock awards shall continue to vest and be settled
in accordance with the respective vesting schedules and performance conditions applicable thereto, and (ii) you shall receive a
fee of $5,000.00 per month.

 

		(c)	You acknowledge and agree that you have no further right to receive any compensation, payments or benefits from the Company
or its affiliates, other than as set forth in the Employment Agreement, as amended by this Letter Agreement.

 

		4.	Restrictive Covenants. You acknowledge and agree that any and all restrictive covenants to which you are subject, including,
but not limited to, those described in Section 7 (Confidential Information) and Section 8 (Non-Competition) of the Employment Agreement,
will continue in full force and effect in accordance with the terms and conditions thereof, provided that the term of the restrictions
set forth in Section 8 of the Employment agreement is hereby extended to and including April 16, 2018. You also acknowledge and
agree that any and all terms and conditions of the Employment Agreement which expressly or by reasonable implication survive your
separation from the Company to which you are subject will continue in full force and effect in accordance with the terms and conditions
thereof.

 

		5.	Taxes. The Company may withhold from any amounts payable under this Letter Agreement all federal, state, city, foreign
or other taxes as the Company is required to withhold pursuant to any applicable law, regulation or ruling. Notwithstanding any
other provision of this Letter Agreement, the Company shall not be obligated to guarantee any particular tax result for you with
respect to any payment provided hereunder, and you shall be responsible for any taxes imposed on you with respect to any such payment.

 

     

     

    

 

		6.	Section 409A. This Letter Agreement and the payments to be made hereunder are intended to comply with, or be exempt
from, Section 409A of the Internal Revenue Code of 1986, as amended and the regulations promulgated thereunder (“Section
409A”), and this Letter Agreement will be interpreted, and all tax filings with the Internal Revenue Service relating
to the payments will be made, in a manner consistent with that intent. Your retirement as the Executive Vice President, Programs
and Marketing of the Company and of APUS is intended to constitute a “separation from service” for purposes of Section 409A. 
In furtherance of the preceding sentence, you and the Company anticipate and agree that the level of consulting services that you
shall perform during the Term shall not exceed the maximum level that is presumed to result in a “separation from service”
in accordance with Treasury Regulation Section 1.409A-1(h)(1)(ii).

 

		7.	Consultation with Attorney; Voluntary Agreement. You acknowledge that (a) the Company has advised you to consult
with an attorney of your own choosing prior to executing this Letter Agreement, (b) you have carefully read and fully understand
all of the provisions of this Letter Agreement, and (c) you are entering into this Letter Agreement knowingly, freely and
voluntarily in exchange for good and valuable consideration.

 

		8.	Governing Law. Letter Agreement shall be governed by and construed in accordance with the laws of the State of West
Virginia (but not including the choice of law rules thereof).

 

		9.	Entire Agreement. This Letter Agreement, taken together with the Release and Employment Agreement, as modified by this
Letter Agreement, constitute and contain the entire agreement and understanding concerning your employment, termination from employment
and the other subject matters addressed herein between the parties, and supersedes and replaces all prior negotiations and all
agreements proposed or otherwise, whether written or oral, concerning the subject matters hereof. Except as expressly amended by
this Letter Agreement, the terms of the Employment Agreement remain in full force and effect.

 

		10.	Amendments. This Letter Agreement shall not be amended, altered or modified except by an instrument in writing duly
executed by the parties hereto.

 

		11.	Counterparts. This Letter Agreement may be executed in two or more counterparts, each of which shall be an original,
and all of which shall be deemed to constitute one and the same instrument.

 

[Signature page follows]

  

     

     

    

If the foregoing accurately reflects our agreement, please sign
and return to us the enclosed duplicate copy of this letter.

 

	 	 	 	 	 
	 	 	AMERICAN PUBLIC EDUCATION, INC.
	 	 	
         

         
	 	 
	 	 	By: 	 	/s/ Wallace E. Boston, Jr.

	 	 	 	 	 
	 	 	Name: 	 	Wallace E. Boston, Jr.
	 	 	Title: 	 	Chief Executive Officer

 

 

	 	 	 	 	 
	 	 	AMERICAN PUBLIC UNIVERSITY SYSTEM, INC.
	 	 	
         

         
	 	 
	 	 	By: 	 	/s/ Karan Powell
	 	 	 	 	 
	 	 	Name: 	 	Karan Powell
	 	 	Title: 	 	President

  

 

 

	
        Accepted and Agreed to:

         

         
	 
	/s/ Carol Gilbert	 
	Carol Gilbert	 

 

 

[Signature Page to Retirement Letter
Agreement]EXHIBIT
10.1

 

LICENSE
AGREEMENT

 

THIS
LICENSE AGREEMENT (“Agreement”), dated this 5TH day of December, 2016, by and between COATES INTERNATIONAL,
LTD., having its principal place of business at Route 34 and Ridgewood Road, Wall Township, New Jersey 07719 USA (hereinafter
referred to as “Licensor”) and SECURE SUPPLIES SE Asia LLC, having its principal place of business at 65 / 2 moo Soi
Bangtao, 14 Cherng Talay Thalang Phuket Thailand 83110, SECURE SUPPLIES HK LLC, having its principal place of business at 3905
Two Exchange Square, 8 Connaught Place Central Hong Kong, SECURE SUPPLY USA, having its principal place of business at 1000 N
West St. Ste. 1501, City of Wilmington, New Castle County, Delaware, 19801, USA and SECURE SUPPLIES MEXICO LLC, 122- 15TH
Street, #695, Delmar, California 92014, USA and their subsidiaries (hereinafter collectively referred to as “Licensee”).

 

Exclusive
distribution, use, lease and sale License for Hydrogen Powered CSRV Engines and Power Generators for the countries and territories
of the United States of America, Canada and Mexico.

 

BACKGROUND

 

WHEREAS,
Licensor owns and/or has the right to license certain Patent Rights and Technical Information (as hereinafter defined) relating
to Licensed Products used (as hereinafter defined) in the design and construction of internal combustion engines and power generators
incorporating spherical rotary valves (the “Coates Spherical Rotary Valve System”) (“CSRV”);

 

WHEREAS,
Licensor desires to grant to Licensee certain rights under such Patent Rights and Technical Information to distribute, use, sell
and lease the Licensed Products in the Countries and Territories (as hereinafter defined); and

 

WHEREAS,
Licensee desires the rights to distribute, use, sell and lease the Licensed Products in the Countries and Territories in accordance
with the terms and conditions hereinafter set forth.

 

NOW,
THEREFORE, in consideration of the premises of the performance of the undertakings herein, it is agreed by and between the
parties hereto as follows:

 

ARTICLE
I – DEFINITIONS

 

In
this Agreement, including recitals:

 

1.1 “CSRV
Valve System” shall mean a cylinder head or heads attached to an internal combustion engine manufactured in
accordance with the Patent Rights and/or Technical Information of the CSRV System.

 

1.2 “CSRV
Valve Seal” shall mean a valve seal for use with the CSRV Rotary Valve Sphere in the CSRV System.

 

     

     

    

 

1.3 “CSRV
Rotary Valve Sphere” shall mean a spherical rotary valve used in the CSRV Valve System in accordance with the
Technical Specifications.

 

1.4 “CSRV
Components” shall mean the parts that when assembled comprise the Licensed Product.

 

1.5 “Coates
Co-Generation System” shall mean a device consisting of an Engine linked to a Coates Generator.

 

1.6 “Dollars”
and “$” shall mean the official currency of the Government of the United States of America.

 

1.7 “Engine”
or “Engines” shall mean all Coates internal combustion engine(s) employing the CSRV System utilizing
hydrogen as the fuel to operate.

 

1.8 “Field
of Use” shall mean use of the Coates Co-Generation System as the power source for the generation of electrical
energy and/or for the power source for compression, pumping, pressurization and distribution of any gas or fluids for all
applications, and/or for the power source and storage operations of hydrogen.

 

1.9 “Generator” shall
mean a Coates patented device, which produces electricity having an engine as its power source.

 

1.10 “Improvement” shall
mean any improvement, change or modification to the Engines, Generators, Coates Co-Generation System, the CSRV System, the
CSRV Valve Seal and/or CSRV Rotary Valve System, which may be developed, created or acquired by either party to this
Agreement, but only to the extent that the same comes within the scope of one or more claims in the Patent Rights.

 

1.11 “Licensed
Product” shall mean the Coates Co-Generation System incorporating the Engines, the Coates Generators, and any
other CSRV Products, Patent Rights and/or Technical Information in its design and manufacture incorporating the components in
Sections 1.1, 1.2, 1.3 and 1.4.

 

1.12 “Licensee” shall
mean the Licensee and “Licensor” shall mean Licensor as specified on the title page of this Agreement.

 

1.13 “Patent
Rights” shall mean the patents and patent applications, as listed in Appendix 1.13, and all patents which may be
issued pursuant to such patent applications, together with any continuations or continuations-in-part thereof, and all
patents issuing thereon or therefrom including reissues, patents of addition and any registration or configuration patents
corresponding thereto.

 

1.14 “Regulatory
Approval” shall mean, with respect to the countries and territories of the United States of America, Canada and
Mexico and all government approvals necessary for Licensee to use the Licensed Product.

 

    	 	 	2

     

    

 

1.15 “Regulatory
Authority” shall mean, with respect to the countries and territories of the United States of America, Canada and
Mexico and the governmental authority responsible for granting Regulatory Approval.

 

1.16 “Technical
Information” shall mean all information imparted by Licensor to Licensee, together with all proprietary
information, trade secrets, skills and experience, recorded and unrecorded, accumulated from time to time during the term of
this Agreement, relating to a Licensed Product and all designs, drawings, specifications, know-how and the like, owned by
Licensor, insofar as the same related to a Licensed Product.

 

1.17 “Technical
Specifications” shall mean the specifications and performance parameters developed by Licensor for the Licensed
Product.

 

1.18 “Territory” shall
mean the countries and territories of the United State of America, Canada and Mexico.

 

ARTICLE
II – LICENSE GRANTED

 

2.1
LICENSE GRANTED TO LICENSEE

 

Subject
to the terms and conditions set forth herein, the Licensor grants an Exclusive Distribution, Use, Sale and Leasing License for
the countries and territories of the United States of America, Canada and Mexico to distribute, use, sell and lease the Licensed
Product, manufactured by Licensor and sold and supplied exclusively to Licensee for use of Hydrogen as its fuel. Falling within
the scope of the patent rights and/or technical specifications with the territories and with respect to the Field of Use. This
License will continue to sustain its exclusivity provided the Licensee purchases a minimum of 10 MW of products per year.

 

The
Licensee shall be prohibited from manufacturing Coates Co-Generation Systems, the Coates generators or engines, components thereof
and any other CSRV products.

 

As
a condition of this License, the Licensee must purchase all CSRV products, parts and components from Licensor and/or its assigns
and from no other entity.

 

2.2
LIMITATION OF LICENSES GRANTED

 

Licensee
shall have no right to manufacture or sublicense the Licensed Product or components of the Licensed Product, the Patent Rights
and/or Technical Information.

 

2.3
IMPROVEMENTS

 

If
Licensee has heretofore brought about or shall hereafter during the term of this Agreement or within two (2) years after the expiration
of this Agreement bring about any Improvement on the Licensed Product, Licensee shall promptly disclose such Improvement to Licensor.
If such Improvement is approved for patent, Licensor shall have the first option within the time prescribed by law to file a patent
application thereon in Licensor’s name. The expense of filing, securing and maintaining patent protection on such Improvements
shall be borne by Licensor and the Licensee will have a royalty-free license to use them. If Licensor shall elect not to file
any such patent application, then Licensee shall have the option to do so in its own name and at its own expense.

 

Licensee
agrees to grant and hereby grants to Licensor an exclusive, royalty-free license together with the right to grant sublicenses
to other licensees under each of said patent applications and any patents issuing as set forth in this Section.

 

2.4
PATENT MARKINGS

 

Licensee
shall not alter, remove, obscure or cover patent markings or any other writing or printed words identifying Licensor as owner
of the pertinent patents and/or patent applications.

 

    	 	 	3

     

    

 

ARTICLE
III – TECHNICAL COOPERATION AND APPROVALS

 

3.1
TECHNICAL COOPERATION

 

Other
than for existing Coates CSRV products, should Licensee request that Licensor design and develop any new Coates CSRV applications,
such technical assistance will be performed pursuant to the terms of a separate engineering contract between the parties.

 

3.2
REGULATORY APPROVALS

 

For
the full term of this Agreement, Licensee assumes complete responsibility, at Licensee’s sole cost and expense, for obtaining
Regulatory Approval, where required, from appropriate governing Regulatory Authorities, for the use of Licensed Products.

 

Licensor
agrees to provide Licensee with all reasonable assistance and cooperation in the preparation and submission of any application
for Regulatory Approval.

 

ARTICLE
IV – CONFIDENTIAL INFORMATION

 

4.1
Licensee shall use Technical information and Technical Specifications obtained heretofore or hereafter from Licensor for the
sole purpose of using Licensed Product under this Agreement.

 

4.2
Licensee agrees to hold in confidence any and all Technical Information and Technical Specifications disclosed, directly or
indirectly, to Licensee by Licensor under this Agreement except that such obligation does not extend to: (a) Technical
Information and Technical Specifications which at the time of disclosure are in the public domain; (b) Technical Information
and Technical Specifications which after disclosure is published or otherwise becomes part of the public domain through no
fault of the Licensee (but only after, and only to the extent that, it is published or otherwise becomes part of the public
domain); (c) Technical Information which Licensee can prove was in its possession (as evidenced by Licensee’s written
records) at the time of disclosure and was not acquired, directly or indirectly from Licensor or from a third party under an
obligation of confidence; and (d) Technical Information and Technical Specification which Licensee can prove was received by
it (as evidenced by Licensee’s written records) after the time of disclosure hereunder from a third party who did not
require Licensee to hold it in confidence and who did not acquire it, directly or indirectly, from Licensor under an
obligation of confidence.

 

4.3
Licensee agrees, upon request by Licensor, to obtain from its officers, employees, agents and other persons having access to
Confidential Information, a duly binding agreement to maintain such information in confidence, each such agreement must be in
a form reasonably acceptable to Licensor.

 

    	 	 	4

     

    

 

ARTICLE
V – PAYMENTS

EXCLUSIVE
LICENSE FEE

 

This
Distribution, Use, Sale and Lease Exclusive License fee is $75,000,000 USD (Seventy Five Million US Dollars).

 

Based
on the size of this project and order presented to the Company and the vast potential expansion of hydrogen applications, Company
management has agree to forgive the exclusive license fee of $75,000,000 USD and work with Secure Supplies HK LLC to move this
project forward in an expedited fashion.

 

5.1
PAYMENTS AND ROYALTIES

 

Upon
execution of this agreement, the Licensee shall pay a one-time fee of $1,000,000 USD to Licensor.

 

A
royalty of $50 USD will be paid per engine or gen set sold to Licensee, to the Coates Trust regardless of the size or type of
CSRV engine.

 

Licensor
shall proceed with the process of modifying of a 100 to 150 KW CSRV gen set to demonstrate the successful operation of Secure
Supply HK LLC HH2 Gas POD and Injection Ignition system for commercial use.

 

Licensee
shall deliver one 6-cylinder fuel injection system and one gas POD for testing and demonstration for scale up to CSRVv12 and CSRVv16
1 mw to 5 mw Models.

 

5.2 Sublicensing.

 

No
Sublicense will be sold without the written permission from Licensor and must be executed by Licensor. 50% of Sublicense Fee shall
be paid to Licensor. Any Sublicense must be executed by Licensor and Licensee.

 

5.3
CSRV PRODUCT PAYMENTS

 

A
50% down payment on all CSRV products shall be paid to the Licensor with each order presented. The balance due on each order shall
be paid at the time the order has been staged for delivery from Licensor’s manufacturing plant.

 

    	 	 	5

     

    

 

ARTICLE
VI – PATENT ENFORCEMENT

 

6.1
Licensee shall immediately inform Licensor of any actual or potential infringement of the Patent Rights by Licensee or any
third party, which may come to Licensee’s attention. It shall be the responsibility of the Licensor at its own expense
and solely at Licensor’s discretion (which shall not be obligated to exercise) to terminate any such potential actual
infringement of any of the Patent Rights. If Licensor shall elect not to pursue, Licensee may at its sole cost and expense,
and with Licensor’s approval, take such action to terminate such infringement and Licensor agrees to reasonably
cooperate with Licensee in pursuing such action.

 

ARTICLE
VII – REPRESENTATIONS

 

7.1
Licensor represents and warrants as follows:

 

(a)
Licensor is a duly organized, validly existing Delaware corporation and the corporate charter of the Licensee has never been revoked
or suspended.

 

(b)
All Technical Information delivered prior to the date of execution hereon has been, and all Technical Information delivered
hereafter will be, to the best of Licensor’s knowledge, substantially accurate and complete with respect to material
matters.

 

(c)
Licensor is the rightful owner of the Patent Rights and has the exclusive right to license all of the Patent
Rights.

 

(d)
Licensor has the power and authority to execute, deliver and perform its obligations under this Agreement, and neither the
execution nor delivery of this Agreement or the performance of its obligations hereunder will constitute a breach of the
terms or provisions of any contract or agreement to which it is a party.

 

7.2
Licensee represents and warrants as follows:

 

(a)
Licensee is a duly organized, validly existing corporation in USA and the corporate charter of the Licensee has never been revoked
or suspended.

 

(b)
Licensee has the power and authority to execute, deliver and perform its obligations under this Agreement and neither the execution
nor the delivery of this Agreement nor the performance of its obligations hereunder will constitute a breach of the terms or provisions
of any contract or agreement to which it is a party.

 

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(c)
Licensee has the financial capability to pay the consideration that is required by Article V, noting Coates company management
has agreed to forgive the exclusive license fee of $75,000,000 USD replaced by a royalty fee of $50 USD, that will be paid per
engine or gen set sold to Licensee, to the Coates Trust regardless of the size or type of CSRV engine.

 

7.3
OBLIGATIONS OF LICENSEE – Licensee will use its best efforts to:

 

(a)
Execute all such tasks as may be necessary to bring about the speedy use of Licensed Products consistent with good business practice;
and

 

(b)
Ensure that all steps within its power are undertaken with all reasonable speed to ensure that the Licensed Products comply with
relevant governmental regulations in the Field of Use in the Territory.

 

7.4
LIMITATION OF LICENSOR’S WARRANTIES:

 

(a)
Nothing contained in this Agreement shall be construed as a warranty or representation by Licensor as to the validity or scope
of any patent including the Patent Rights. Furthermore, no warranty or representation is made by Licensor that the use by Licensee
of Licensed Products will be free of infringement of any patent or other rights of persons not a party hereto. Licensor shall
not be obliged to defend, indemnify or hold Licensee harmless against suit, claim, demand or action based on actual or alleged
infringement of any patent or other rights belonging to a person or entity not a party to this Agreement. Any such suit, claim,
demand or action based on actual or alleged infringement by Licensee shall not relieve Licensee from its performance of its obligations
hereunder.

 

(b)
Licensor makes no representations, extends no warranties of any kind, express or implied, and assumes no responsibility whatsoever
with respect to the use by Licensee or its vendors of products incorporating, or made by use of, Licensed Products, Patent rights
and/or Technical Information furnished under this Agreement.

 

7.5
INDEMNIFICATION BY LICENSEE AND INSURANCE

 

Licensee
shall indemnify and hold Licensor harmless from and against any and all expenses including attorney’s fees, claims, demands,
liabilities or money judgments for death or bodily injury arising from the use of the Licensed Product by Licensee. Licensee shall
give Licensor notice as soon as practicable of any claim or action to which the foregoing provision applies. Licensor shall have
the right, but not the obligation, to participate in any compromise, settlement or defense of any such claim or action.

 

7.6
MUTUAL INDEMNITIES

 

Each
of the parties hereto shall indemnify and save harmless the other of, from and against any losses, damages and costs (including
legal fees and expenses) which the other may suffer or incur by reason of a breach of this Agreement.

 

    	 	 	7

     

    

 

7.7
INSURANCE

 

Insurance
shall be purchased by Licensee or Sublicensee immediately when CSRV products are sold to any customers anywhere in the world.
The insurance shall cover the origin of where the CSRV products are sold and placed; the insurance amount shall be determined
by the amount of CSRV products sold and placed. Licensor bears no responsibility and is held harmless in the use and sale of CSRV
products manufactured and sold anywhere in the world.

 

ARTICLE
VIII – DURATION AND TERMINATION

 

8.1
Subject to the provisions of Section 8.4 hereof, all rights and obligations under this Agreement shall expire upon the
expiration of the last to expire patent of the patent Rights and any Improvement Patents added thereto.

 

8.2
If either Licensee or the Licensor commits a material breach of any provision of this Agreement, and such breach is not cured
within thirty (30) days after the date on which notice of breach is sent to the breaching party, the non-breaching party
shall have the right to request to terminate this Agreement. If the breaching party disagrees with the request of
termination, such request of termination shall be taken to a mutually agreeable juristic for binding arbitration (Refer to
ARTICLE XIV) except that if the breach is related to the failure of the Licensee to pay any sum that is due to Licensor and
such breach is not cured within thirty (30) days of the date on which payment was due, then Licensor shall have the right,
without notice to Licensee, to pursue its claims in the state or federal courts in the State of New Jersey having
jurisdiction, or alternatively, to terminate this Agreement.

 

8.3
This Agreement shall terminate effective immediately upon:

 

(a)
The filing by Licensee of an involuntary petition in bankruptcy, the entry of a decree or order by a court agency or supervisory
authority having jurisdiction in the premises for the appointment of a conservatory, receiver, trustee in bankruptcy or liquidation
for Licensee in any insolvency, readjustment of debt, marshaling of assets and liabilities, bankruptcy or similar proceedings,
or the winding up or liquidation of its affairs, and the continuance of any such petition, decree or order undismissed or unstated
and in effect for a period of sixty (60) consecutive days; or

 

(b)
The consent by Licensee to the appointment of a conservator, receiver, trustee in bankruptcy or liquidation in any solvency, readjustment
of debt, marshaling of assets and liabilities, bankruptcy or similar proceedings of or relating to Licensees, or relating to substantially
all of its property, or if Licensee shall admit in writing its inability to pay its debts generally as they become due, file a
petition to take advantage of any applicable insolvency, reorganization, or bankruptcy statute, make an assignment for the benefit
of its creditors or voluntarily suspend payment of its obligations; or

 

    	 	 	8

     

    

 

8.4
Termination shall not release either Licensee or Licensor from any obligation arising prior to such termination or any
requirement pursuant to ARTICLE IV, V and Sections 7.3, 7.5, 7.6, 7.7 and 17.2 of this Agreement.

 

8.5
In the event of any termination of this Agreement, other than because of Licensee’s default, Licensee shall be entitled
to use Licensed Products for which commitments to customers have been made at the time of such termination.

 

8.6
Any termination of this Agreement shall be without prejudice as to any obligation of either party to the other accruing prior
to or at such termination. Applicable royalties shall be payable under Section 5.2 of ARTICLE V with respect to income from
the use of all Licensed Products which were manufactured or were in the course of manufacture prior to such
termination.

 

ARTICLE
IX – WAIVER

 

9.1
No provision of this Agreement shall be deemed to have been modified by any act of either party, its agents or employees, or
by the failure to object to any act of the other party which may be inconsistent herewith, or otherwise, except by a
subsequent agreement in writing signed by both parties. No waiver of a breach committed by either party in one instance shall
constitute a waiver or a license to commit or continue breaches in other or like instances.

 

ARTICLE
X – LIMITATIONS OF RIGHTS AND AUTHORITY

 

10.1
No right or title whatsoever in the Patent Rights or Technical Information is granted by Licensor to Licensee, or shall be
taken or assumed by Licensee, except as is specifically set forth or granted in this Agreement.

 

10.2
Neither party shall in any respect whatsoever be taken to be the agent or representative of the other party and neither party
shall have any authority to assume any obligation for the other party or to commit or bind the other party in any
way.

 

10.3
Neither party shall at any time heretofore or hereafter publicly state or imply that the terms and conditions specified
herein, or that the relationships between Licensor and Licensee, are in any way different from those specifically set forth
in this Agreement. If requested by one party, the other party shall promptly supply copies of all public statements and of
all promotional material relating to this Agreement and to Licensed Products.

 

ARTICLE
XI – FORCE MAJEURE

 

11.1
Neither party shall be liable for failure to perform or delay in performing obligations set forth in this Agreement and
Licensor and Licensee shall not be deemed in breach of their obligations, if, to the extent and for so long as such failure
or delay in breach is due to natural disaster or cause reasonably beyond the control of that party. If a party desires to
invoke this Article it shall notify the other promptly of such desire and shall use reasonable efforts to resume performance
of its obligations as soon as reasonably possible. However, if performance by a party becomes impossible for more than twelve
(12) consecutive months by reason thereof, this Agreement may be terminated by either party giving thirty (30) days written
notice upon consensus.

 

    	 	 	9

     

    

 

ARTICLE
XII – INJUNCTIVE RELIEF FOR BREACH: SEVERABILITY AND ENFORCEABILITY

 

12.1
The parties agree that a party may not be adequately compensated by damaged at law for a breach or threatened breach by the
other party of any of the provisions of this Agreement, and that the other party shall be entitled to injunctive relief and
specific performance in connection therewith, in addition to all other remedies.

 

12.2
Each of the covenants contained in this Agreement shall be construed as separate covenants, and if any court shall finally
determine that any such covenants are too broad as the area, activity or time set forth therein, said area, activity or time
shall be deemed reduced to whatever extent the court deems reasonable and such covenants shall be enforced as to such reduced
area, activity or time, without limiting the scope or enforceability of the remaining provisions of those
sections.

 

12.3
If any provision of this Agreement is declared invalid by a court of last resort or by any court from the decision of which
an appeal is not taken within the time provided by law, then and in such an event, this Agreement will be deemed to have been
terminated only as to the portion thereof which related to the provision invalidated by that judicial decision, but this
Agreement, in all other respects, will remain in force.

 

12.4
It is specifically agreed that no provision that is in any manner violates the antitrust laws of The United States of America
as now or hereafter enacted or construed, is intended or will be considered to be incorporated into this Agreement or will be
binding upon the parties.

 

ARTICLE
XIII – LIMITATIONS OF ASSIGNMENT OF LICENSEE

 

13.1
The rights, duties and privileges of the parties hereunder shall not be transferred or assigned, either in whole or in
part.

 

ARTICLE
XIV – GOVERNING LAW / JURISDICTION

 

14.1
This Agreement shall be governed by and construed and enforced in accordance with the laws of The United States of America as
to patents only and in all other respects with the laws of the State of New Jersey. Each party hereby submits to the
jurisdiction of the state or federal courts in the State of New Jersey in the event of any claims arising under this
Agreement.

 

    	 	 	10

     

    

 

ARTICLE
XV – ENTIRE AGREEMENT

 

15.1
This Agreement sets forth the entire agreement and understanding by and between Licensor and Licensee as to the subject
matter hereof and it supersedes all documents, verbal consents and understandings made before the execution of this Agreement
and none of the terms of this Agreement shall be amended or modified except in written document signed by Licensor and
Licensee.

 

15.2
In the event of an inconsistency between any terms of this Agreement and any translation thereof into another language, the
English language version shall control.

 

15.3
Should any portion of this Agreement be declared null and void, the remainder of this Agreement shall remain in full force
and effect.

 

ARTICLE
XVI – NOTICES

 

16.1
Any notice, consent or approval required under this Agreement shall be in English in writing, and shall be delivered to the
following addresses (a) personally by hand, (b) by Certified Mail, postage prepaid, with return receipt requested, or (c) by
telefax, confirmed by Certified Mail.

 

If
to the Licensor:

 

Coates
International, Ltd.

2100
Highway 34 and Ridgewood Road

Wall
Township, NJ 07719

 

If
to the Licensee:

 

Secure
Supplies SE Asia LLC

65
/ 2 moo Soi Bangtao

14
Cherng Talay Thalang

Phuket
Thailand 83110 danieldonatelli1@gmail.com

Mb+
66 83 647 3443 www.securesupplies.biz

 

All
notices shall be deemed effective upon the date delivered. If either party desires to change the address to which notice is sent
to such party, it shall so notify the other party in writing in accordance with the foregoing.

 

ARTICLE
XVII – MISCELLANEOUS

 

17.1
HEADINGS AND REFERENCES

 

Headings
in this Agreement are included herein for ease of reference only and have no legal effect. References herein to Sections or Attachments
are to Sections and Attachments to this Agreement, unless expressly stated otherwise.

 

17.2
RESTRICTION ON DISCLOSURE OF TERMS AND PROVISIONS

 

(a)
This Agreement shall be distributed solely to: (I) Those personnel of Licensor and Licensee who shall have a need to know its
contents; (II) those persons whose knowledge of its contents will facilitate performance of the obligations of the parties under
this Agreement; (III) those persons, if any, whose knowledge of its contents is essential in order to permit Licensee or Licensor
to place or maintain or secure benefits under policies of insurance; and (IV) as may be required by law, regulation or judicial
order.

 

(b)
In the event disclosure is required by law, regulation or judicial order, the disclosing party shall request that any disclosure
be kept secret and shall attempt to minimize disclosure of the financial terms of this Agreement. Any party may publicly announce
the existence of this Agreement the manner in which the parties shall operate, and the areas of responsibility of each party.
Except as legally required, no party may disclose the amount of payments or royalty rates without the consent of the other party.
The parties will consult with each other prior to any press release to this Agreement. Notwithstanding the foregoing, Licensee
hereby, acknowledges its understanding that Licensor is required to file a copy of this License Agreement with the U.S. Securities
and Exchange Commission within four days after it is executed.

 

    	 	 	11

     

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this agreement to be executed as of the date first above written in duplicate
by their duly-authorized representatives.Form

 

Distribution,
use, lease and sale License for Coates CSRV Products in the countries and territories of the United States of America, Canada
and Mexico or as approved by Coates International in writing.

 

	ATTEST:	 	COATES
    INTERNATIONAL, LTD.
	 	 	 
	/s/
    Kathy Restivo	 	/s/
    George J. Coates
	Kathy
    Restivo	 	George
    J. Coates, President and CEO
	 	 	 
	ATTEST:	 	SECURE
    SUPPLIES HK LLC (Parent)
	 	 	 	 
	/s/
    Supannee Saentaveesuk	 	By:	/s/
    Daniel Donatelli
	 	 	 	Daniel
    Donatelli, President and CEO
	 	 	 	 
	ATTEST:	 	 	SECURE
    SUPPLIES SE ASIA LLC
	 	 	 	 
	/s/
    Supannee Saentaveesuk	 	By:	/s/
    Daniel Donatelli
	 	 	 	Daniel
    Donatelli, CEO
	 	 	 	 
	ATTEST:	 	 	SECURE
    SUPPLY USA LLX
	 	 	 	 
	/s/
    Supannee Saentaveesuk	 	By:	/s/
    Daniel Donatelli
	 	 	 	Daniel
    Donatelli, CEO
	 	 	 	 
	ATTEST:	 	 	SECURE
    SUPPLIES MEXICO LLC
	 	 	 	 
	/s/
    Supannee Saentaveesuk	 	By:	/s/
    Daniel Donatelli
	 	 	 	Daniel
    Donatelli

 

    	 	 	12

     

    

 

Appendix 1.13

Patents

 

	U.S. Patent 4,944,261, issued July 31, 1990, 
	"Spherical Rotary Valve Assembly for an Internal Combustion Engine"
	 
	U.S. Patent 4,953,527, issued September 4, 1990, 
	"Spherical Rotary Valve Assembly for an Internal Combustion Engine"
	 
	U.S. Patent 4,976,232, issued December 11, 1990, 
	"Valve Seal for Rotary Valve Engine"
	 
	U.S. Patent 4,989,558, issued February 5, 1991, 
	"Spherical Rotary Valve Assembly for an Internal Combustion Engine
	 
	U.S. Patent 4,989,576, issued February 5, 1991, 
	"Internal Combustion Engine"
	 
	U.S. Patent 5,048,979, issued September 17, 1991, 
	"Self Adjusting Wheel Bearing Assembly"
	 
	U.S. Patent 5,109,814, issued May 5, 1992, 
	"Spherical Valve"
	 
	U.S. Patent 5,361,739, issued November 8, 1994, 
	"Spherical Rotary Valve Assembly for use in Rotary Valve Internal Combustion Engine"
	 
	U.S. Patent 5,601,405, issued February 11, 1997, 
	"Valve Apparatus for Steam Turbines"
	 
	U.S. Patent 6,293,098B1, issued September, 25, 2001, 
	"Methods and Apparatus for Joining Pressurized Exhaust Manifold Sections"
	 
	U.S. Patent 6,308,676B1, issued October 30, 2001
	"Cooling System for Rotary Valve Engine"
	 
	U.S. Patent 6,666,458B2, issued December 23, 2003,
	"Valve Seal for Rotary Engine"
	 
	U.S. Patent 6,668,785B1, issued December 30, 2003, 
	"Piston Head for Internal Combustion Engine"
	 
	U.S. Patent 6,718,933B1, issued April 13, 2004, 
	"Valve Seal for Rotary Valve Engine"
	 
	U.S. Patent 6,779,504B2, issued August 24, 2004, 
	"Spherical Rotary Intake Valve for Engine Assembly"
	 
	U.S. Patent 6, 779,925B2, issued August 24, 2004, 
	"Bearing Assembly"
	 
	U.S. Patent 6,789,516, issued September 14, 2004. 
	"Rotary Valve & Valve Seal Assembly for Rotary Valve Engine having Hemispherical Combustion Chambers"
	 
	U.S. Patent 6,880,511B1, issued April 19, 2005, 
	"Seal Pressure Regulator" 

 

*****
Please note this will include all Worldwide Patents for Secure Supplies LLC and Secure Supplies Subsidiaries to Use, which some
are Not Listed.

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