Document:

Distribution Agreement, dated as of October 7, 2019, between NeoVolta, Inc. and PMP Energy, LLC

Certain identified information has been excluded from this exhibit because it is both not material and is the type that the registrant treats as private or confidential. Information that was omitted has been noted in this document with a placeholder identified by the mark “[***]”.

 

 

Distribution Agreement

This Distribution Agreement (this “Agreement”) (Reference Number NVI001), dated as of October 7, 2019, is entered into between NeoVolta Inc., a Nevada corporation (“Seller”) located at 13370 Kirkham Way, Poway, CA 92064 and PMP Energy, LLC, a Nevada limited liability company located at 6 Sunset Way, Suite 108, Henderson, NV 89014 (“Distributor,” and together with Seller, the “Parties,” and each, a “Party”).

WHEREAS, Seller is in the business of designing /manufacturing and selling the Goods (as defined below); and

WHEREAS, Distributor is in the business of marketing and reselling Goods;

WHEREAS, Seller desires to sell the Goods to Distributor and appoint Distributor as a non­ exclusive distributor under the terms and conditions of this Agreement; and

WHEREAS, Distributor desires to purchase the Goods from Seller and resell the Goods to customers, subject to the terms and conditions of this Agreement,

NOW, THEREFORE, in consideration of the mutual covenants, terms and conditions set out herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:

1.  Definitions.

“Agreement” has the meaning set out in the preamble and includes all schedules and exhibits hereto.

“Confidential Information” has the meaning set out under Section 11.

“Customer” means a purchaser that is an individual or entity located in the Territory that has been approved by Seller, that agrees to terms required for Customers herein, and has acquired a Good from Distributor.

“Distributor” has the meaning set out in the preamble.

“Force Majeure Event” has the meaning set out in Section 36.

“Good” means any good that is identified in Schedule 1, as it may be revised pursuant to Section 4.4 from time to time.

“Indemnified Party” has the meaning set out under Section 17.1.

”Party” has the meaning set out in the preamble. 

“Seller” has the meaning set out in the preamble. 

“Term” has the meaning set out under Section 10. 

“Territory” means the territories listed in Schedule l.

2. Appointment.

2.1 Non-Exclusive Appointment. Seller hereby appoints Distributor, and Distributor hereby accepts the appointment, to act as a non-exclusive distributor of Goods to Customers during the Term in accordance with the terms and condition s of this Agreement. Distributor shall not sell or offer to sell Goods outside the Territory without prior written approval from the Seller, email will suffice with mutual acceptance. Seller may in its sole discretion sell the Goods to any other person, including distributors, retailers, and customers in or outside the Territory, except as specifically provided herein. By accepting this appointment, Distributor agrees to conform to all quality standards established from time to time by Seller for its distributors. These quality standards are subject to change by Seller on 30 days’ prior notice to Distributor.

3.  Facilities, Inventory, and Marketing Obligations.

3.1  Distributor Obligations. Distributor shall:

(a)  market, advertise, promote, and sell the Goods to Customer s in a manner that reflects favorably at all times on Goods and the good name, goodwill and reputation of Seller and consistent with good business practice , in each case using its best efforts to maximize the sales volume of the Goods;

(b)  maintain a place or places of business in the Territory, including adequate office, storage, and warehouse facilities and all other facilities as required for Distributor to perform its duties under this Agreement in a location or lo cations approved by Seller;

(c)  provide Seller a purchase order and communicate the delivery timelines to the Customer once those timelines are provided to the Distributor by the Seller;

(d)  have sufficient knowledge of the industry and products competitive with each Good (including specifications, features, and benefits) so as to be able to explain in detail to Customers:

(i)  the differences between the Good and competing products;  and

(ii)  information on standard protocols and features of each  Good;

(e)  unless otherwise defined to the contrary in this Agreement, observe all directions and instructions given to it by Seller in relation to the marketing, advertisement, and promotion of the Goods, including Seller’s sales, marketing, and merchandising policies as they currently exist or as they may hereafter be changed by Seller;

(f)  not use any promotional and marketing materials, whether prepared by Distributor or others, without the prior written consent of Seller.

(g)  establish and maintain a sales and marketing organization sufficient to develop the market potential for the sale of the Goods, and independent sales representatives, facilities, and a distribution organization sufficient to make the Goods available for shipment through Distributor to each Customer within the agreed upon timeframe from receipt of order;

(h)  develop and execute a marketing plan sufficient to fulfill its obligations under this Agreement;

2

(i)  not make any materially misleading or untrue statements concerning Seller or the Goods, including any product disparagement or “bait-and-switch” practices;

(j)  unless otherwise prohibited by law promptly notify Seller of any complaint or adverse claim about any Good or its use of which Distributor becomes aware;

(k)  submit to Seller complete and accurate monthly reports regarding inventory, marketing, and sales of the Goods in a computer-readable format and containing the scope of information acceptable to Seller, maintain books, records, and accounts of all transactions and permit full examination thereof by Seller in accordance with Section 9;

(l)  not resell Goods to any federal, state, local, or foreign government or political subdivision or agency thereof, without express written approval from Seller; and

(m)  on request, provide Seller with a written forecast of the current and three- month forecast of demand for the Goods in the Territory, especially in relation to similar or competing products; and

(n)  only resell any software or accessories offered by the Seller bundled, or packaged with any Good on those terms and conditions as Seller may, from time to time, require.

(o)  Distributor in its sole discretion may incorporate the sale of Seller’s Products and Services into a larger proposal incorporating Products and Services not of the Seller including but not limited to the following; bundles, financing and payment options, additional services, support, and warranties. In no event will Distributor white label or otherwise change the manufacturing labels of the Goods without prior written permission from Seller or as part of an approved Purchase Order.

3.2  Seller Obligations. Seller shall:

(a)  provide any information and support that may be reasonably requested by Distributor regarding the marketing, advertising, promotion, and sale of Goods;

(b)  allow Distributor to participate, at its own expense, in any marketing, advertising, promotion and sales programs or events that Seller may make generally available to its authorized distributors of Goods in the Territory, provided that Seller may alter or eliminate any program at any time outside of the program dates or by providing 60 days written notice ;

(c)  approve or reject within ten (10) business days, in its discretion, any promotional information or material submitted by Distributor for Seller’s approval, any material not responded to within the ten (10) business days will be deemed accepted; 

(d)  and Seller may provide promotional information and material. Distributor and Seller will agree on what materials Distributor shall obtain and use. Such materials will be at Distributor’s sole cost and expense for use by Distributor in accordance with this Agreement.

4.  Agreement to Purchase and Sell Goods.

4.1  Terms of Sale; Orders. Seller shall make available and sell Goods to Distributor at the prices under Section 4.2 and on the terms and conditions set out in this Agreement.

4.2  Price. The prices for Goods sold under this Agreement shall be as per Schedule 1 or Seller’s then-current wholesale price list. Subject to Section 6:

3

(a)  all prices are exclusive of all sales, use and excise taxes, and any other similar taxes, duties, and charges of any kind imposed by any governmental authority on any amounts payable by Distributor  under this Agreement;

(b)  Distributor is responsible for all charges, costs, and taxes, provided that Distributor is not responsible for any taxes imposed on, or regarding, Seller’s income, revenues, gross receipts, personnel, or real or personal  property or other assets; and

(c)  Distributor shall pay interest on all late payments, calculated daily and compounded monthly, at the lesser of the rate of [***]% per month or the highest rate permissible under applicable Law.

(d)  Distributor shall perform its obligations under this Agreement without setoff, deduction, recoupment or withholding of any kind for amounts owed or payable by Seller, whether relating to Seller’s or Seller’s affiliates’ breach, bankruptcy, or otherwise and whether under this Agreement, any purchase order, any other agreement between (i) Distributor or any of its affiliates and (ii) Seller or any of its affiliates, or otherwise. However, Distributor may withhold payments on disputed amounts for amounts disputed in good faith.

4.3  Payment Terms. Seller shall issue periodic invoices to Distributor for all Goods ordered via purchase order. Distributor shall pay all properly invoiced amounts due to Seller within [***] days after Distributor’s receipt of such invoice, except for any amounts disputed by Distributor in good faith. Orders require a [***] percent ([***]%) deposit upon the order. All credits are subject to the issue of a credit memo.

Distributor shall make all payments in US dollars by check, wire transfer, or automated clearing house, in accordance with Seller’s written instructions.

4.4  Availability/Changes in Goods. Seller is not liable for any late or unfulfilled deliveries. Seller may, in its sole discretion, add or make changes to Goods, or remove Goods from, Schedule I on notice to Distributor, in each case, without obligation to modify or change any Goods previously delivered or to supply new goods meeting earlier specifications excepting Purchase Orders that have been submitted by the Distributor and deemed Accepted by the Seller as stated in this Agreement in Section 5.2.

5.  Orders Procedure.

5.1  Orders. Distributor shall issue all purchase orders to Seller in written form via e- mail, or US mail. By placing an order, Distributor makes an offer to purchase Goods under the following commercial terms listed in the purchase order and the terms and conditions of this Agreement, and on no other terms:

(a)  the listed Goods to be purchased;

(b)  the quantities ordered

(c)  the delivery address; and

(d)  the requested delivery date.

Any variations made to the terms and conditions of this Agreement by Distributor in any order are void and have no effect.

5.2  Seller’s Right to Accept or Reject Orders. Seller may, in its sole discretion, accept or reject any order. Seller may accept any order by confirming the order (whether by written confirmation, in voice, or otherwise) or by delivering the Goods, whichever occurs first. If Seller does not accept the order under 

4

the terms of this Section 5.2 within [***] days of Seller’s receipt of the order, the order will lapse. No order is binding on Seller unless accepted by Seller as provided in this Agreement.

5.3  Order Deposit. Distributor shall provide a [***] percent ([***]%) deposit on all Orders. Seller may terminate the Order for Distributor’s failure to pay the deposit within ten days of the Acceptance of the Order.

5.4  Non-Cancellable Orders. All Orders accepted by Seller are non-cancellable by Distributor except if the Order is under [***] units and the Order is cancelled at least [***] days prior to shipment (estimated shipment date as provided  in the Order).

6.  Shipment and Delivery.

6.1  Shipment and Delivery. Unless expressly agreed to by the Parties in writing, Seller shall:

(a)  Select the method of shipment of and the carrier for the Goods. Seller will ship in batches based on the order quantity. Seller may make partial shipment of Goods as agreed upon in the purchase order or by both Parties in an amended Purchase Order,

(b)  Deliver the Goods to the address on the Order using Seller’s or manufacturers standard methods for packaging and shipping. All prices are FOB, Poway, California.  Any time quoted for delivery is an estimate only.

6.2  Title and Risk of Loss. Title and risk of loss passes to Distributor upon delivery of the Goods to the carrier and Seller’s shipping point. As collateral security for the payment of the Goods (balance due), Distributor hereby grants to Seller a lien on and security interest in and to all of the right, title and interest of Distributor in, to and under the Goods, wherever located, and whether now existing or hereafter arising or acquired from time to time, and in all accessions thereto and replacements or modifications thereof, as well as all proceeds (including insurance proceeds) of the foregoing. The security interest granted under this provision constitutes a purchase money security interest under the California Uniform Commercial Code.

6.3  Inspection and Acceptance of Goods. Distributor shall inspect Goods received under this Agreement. On the 5th day after delivery of the actual Goods delivered in each separate delivery, Distributor shall be deemed to have accepted the Goods unless it earlier notifies Seller in writing and furnishes written evidence or other documentation  that the Goods:

(a)  are damaged, defective, or otherwise do not conform to the Goods listed in the applicable purchase order; or

(b)  were delivered to Distributor as a result of Seller’s error.

If Distributor notifies Seller pursuant to this Section 6.3, then Seller shall determine, in its sole discretion, whether to repair or replace the Goods or refund the price for the Goods.

Distributor shall ship at Seller’s expense, all goods to be returned, repaired, or replaced under this Section 6.3 to Seller’s facility located in Poway, California. If Seller exercises its option to replace the Goods, Seller shall, after receiving Distributor’s shipment of the Goods under this provision, ship to Distributor, at Seller’ s expense and at Distributor ‘ s risk of loss, the replacement Goods to shipping address on the Order. Distributor acknowledges and agrees that the remedies set out in this Section 6.3 are exclusive of all other remedies, subject to Distributor’s rights under Section 12 regarding any Goods for which Distributor has accepted delivery under this Section 6.3.

5

Except as provided under this Agreement, all sales of Goods to Distributor under this Agreement are made on a one-way basis and Distributor has no other right to return Goods purchased under this Agreement.

6.4  Installation. Installation of the Goods shall only be provided by authorized installers or authorized home builders. For each Customer that Distributor intends to sell to, Distributor must obtain Seller’s prior approval. Distributor shall have each Customer agree to Seller’s form dealer agreement or Distributor’s contract that contains similar terms and that has been approved by Seller (“Customer Contract”). Distributor shall be responsible to ensure Customer complies with the terms of the Customer Contract. All installation and use of the Goods shall be in compliance with Seller’s documentation.

7.  Intellectual Property Rights.

7.1  Proprietary Rights. Seller retains all right, title and interest in and to the design of the Goods, all intellectual property rights contained in the Goods and all associated documentation and software, whether now known or existing or hereinafter developed , and further including all intellectual property rights therein or in any developments, additions, enhancements, improvements or derivatives thereof created. Distributor does not acquire any rights, express or implied, in any intellectual property owned by Seller other than those specified in this Agreement.  Except as specifically set forth in this Agreement, Distributor here by waives any claim that it may have had or has to title and ownership of any proprietary rights in and to intellectual property owned by Seller. Distributor will not modify, make derivative works or reverse engineer the Goods or associated software.

7.2  Seller’s Trademark License Grant. Subject to Seller’ s pre-approval and trademark use guidelines, which may be amended from time to time in Seller’s sole discretion, and the terms and conditions of this Agreement, Seller hereby grants to Distributor a non-exclusive, non-transferable, and non-sublicensable license in the Territory during the Term solely on or in connection with the promotion, advertising, and resale of the Goods in accordance with the terms and conditions of this Agreement to use all Seller’s trademark[s] set forth on Schedule 2, whether registered or unregistered, including the listed registrations and applications and any registrations, which may be granted pursuant to such applications. On expiration or earlier termination of this Agreement or upon Seller request, Distributor shall promptly discontinue the display or use of any trademark or change the manner in which it is displayed or used with regard to the Goods. Upon expiration or earlier termination of this Agreement, Distributor’s rights under this Section 7 shall cease immediately. Other than the express licenses granted by this Section 7, Seller grants no right or license to Distributor, by implication, estoppels, or otherwise, to the Goods or any intellectual property rights of Seller or its affiliates.

8.  Resale Prices. Distributor unilaterally establishes its own resale prices and terms regarding products it sells, including Goods.

9.  Audit and Inspection Rights. During the term of this Agreement, on request and during regular business hours, and no more than two (2) times annually or upon dispute, Seller or its representatives may at its own expense reasonably inspect Distributor’s facility and during the term and for one year thereafter, audit Distributor’s books, records, and other documents related to the sale and distribution of Goods, as necessary to verify compliance with the terms and conditions of this Agreement.

10.  Term; Termination.

10.1  Term. The term of this Agreement commences on the date set out in the preamble of this Agreement and terminates after three years, and shall thereafter renew for additional successive one year terms unless and until either Party provides notice of nonrenewal at least 60 days before the end of the then-current term, or unless and until earlier terminated as provided under this Agreement or applicable law (the “Term”). If either Party provides timely notice of its intent not to renew this Agreement, then unless earlier terminated in accordance with its terms, this Agreement terminates on the expiration of the then-current Term.

6

10.2  Termination Rights. Notwithstanding anything to the contrary in this Agreement, either Party may terminate this Agreement and the appointment of Distributor under Section 2, for any or no reason, at any time upon written notice to the other Party, and said termination shall become effective ninety (90) days following the delivery of such notice, except where a shorter period is provided for in this Agreement. In addition to any remedies that may be provided in this Agreement, Seller may immediately terminate this Agreement (including all related purchase orders pursuant to Section I 0.3(a)) , upon notice to Distributor if Distributor:

(a)  fails to pay any amount when due under this Agreement and failure to pay the amount due is not cured within twenty (20) days;

(b)  is in breach of this Agreement and either the breach cannot be cured or, if the breach can be cured, it is not cured within thirty (30) days following Seller’s receipt of notice of such breach;

(c)  if Distributor:

(i)  becomes insolvent, or is generally unable to pay, or fails to pay, its debts as they become due;

(ii)  files or has filed against it, a petition for voluntary or involuntary bankruptcy or otherwise becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency  law;

(iii)  seeks reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or other relief with respect to it or its debts;

(iv)  makes or seeks to make a general assignment for the benefit of its creditors; or

(v)  applies for or has a receiver, trustee, custodian, or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.

10.3  Effect of Expiration or Termination. Upon the expiration or earlier termination of this Agreement:

(a)  In the event the Agreement is terminated other than for Distributors breach or insolvency, Seller may not sell or execute any Purchase Orders, Agreements, or other transactions with any exclusive Customer of the Distributor who has previously executed Purchase Order with the Distributor or been provided a proposal by the Distributor for purchase of Goods within the past one hundred and eighty (180) days (Seller may fulfill  all existing orders directly to Customer if Distributor  breaches or is insolvent);

(b)  If terminated for Distributor’s breach, all Purchase Orders are automatically terminated, unless Seller fulfills such Purchase Orders to Distributor at its discretion;

(c)  Distributor shall cease to represent itself as Seller’s authorized distributor regarding the Goods, and shall otherwise desist from all conduct or representations that might lead the public to believe that Distributor is authorized by Seller to sell the Goods

(d)  Distributor shall promptly return or destroy (pursuant to Seller’s instructions) all:

(i)  documents and tangible materials (and any copies) containing , reflecting, incorporating or based on Confidential Information; and

7

(e)  Distributor shall promptly return (pursuant to Seller’s instructions) all:

(i)  products that Seller provided to Distributor that are not intended for resale.

10.4  Option to Repurchase. Within 45 days after the effective date of expiration or earlier termination, Distributor shall submit to Seller a written schedule reflecting all Goods then owned by Distributor or in the Distributor’s possession. Upon notice within 15 days following its receipt of such schedule from Distributor, Seller shall have the right, but not the obligation, to buy back all or a portion of such Goods, free of all liens, claims or encumbrances, at a price equal to the lower of Distributor’s cost therefor and the then-prevailing price, minus a 15% restocking fee (restocking fee only applicable if Distributor is in breach), pursuant to the following procedures. Distributor shall promptly deliver, at Seller’s reasonable expense, the repurchased Goods in their original packaging (unopened and undamaged) to Seller’s designated carrier for delivery to Seller. Seller has the right to set off or recoup any liability it owes to Distributor under this Section 10.4 against any liability for which Distributor is liable to Seller, whether either liability is matured or unmatured, is liquidated or unliquidated or arises under this Agreement.

11.  Confidential Information. All non-public, confidential or proprietary information of both Parties, including, but not limited to, specifications, samples, patterns, designs, plans, drawings, documents, data, business operations, customer lists, pricing, discounts or rebates, disclosed by either Party, whether disclosed orally or disclosed or accessed in written, electronic or other form or media, and whether or not marked, designated or otherwise identified as “confidential,” in connection with this Agreement is confidential, solely for the use of performing this Agreement and may not be disclosed or copied unless authorized by the other Party in writing. Upon either Party’s request, requested Party shall promptly return all documents and other materials received from requesting Party. Either Party shall be entitled to injunctive relief for any violation of this Section. This Section shall not apply to information that is:

(a)  in the public domain;

(b)  known to either Party at the time of disclosure; or

(c)  rightfully obtained by the receiving Party on a non -confidential basis from a third party.

12.  Limited Product Warranty; Disclaimer. Seller warrants that the Goods are free from material defects in material and workmanship under normal use and service with proper maintenance as provided in Schedule 1. The term for such warranties shall begin upon Customer’s receipt of the Good. Distributor or Customer shall promptly notify Seller of any known warranty claims and shall cooperate in the investigation of such claims. If any Good is proven to not conform with this warranty during the applicable warranty period, Seller shall, at its exclusive option, either repair or replace the Good or refund the purchase price paid by Distributor for each non-conforming Good.

12.1  Warranty Service. Distributor or through its Customers shall provide warranty services to the end user as provided in Schedule 1 or as agreed in writing signed by both parties.

13.  Seller shall have no obligation under the warranty set forth above if Distributor or Customer:

(a)  fails to notify Seller in writing during the warranty period of a non- conformity; or

(b)  uses, misuses, or neglects the Good in a manner inconsistent with the Good’s specifications or use or maintenance directions, modifies the Good or improperly installs, handles or maintains the Good.

14.  Except as explicitly authorized in this Agreement or in a separate written agreement with Seller, Distributor shall not service, repair, modify, alter, replace, reverse engineer, or otherwise change the Goods it sells to Customers. Distributor shall not provide its own warranty regarding any good unless such warranty program is 

8

approved by the Seller.

15.  EXCEPT FOR THE WARRANTIES SET OUT UNDER SECTION 12, NEITHER SELLER NOR ANY PERSON ON SELLER’S BEHALF HAS MADE OR MAKES FOR DISTRIBUTOR’S BENEFIT ANY EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY WHATSOEVER, INCLUDING ANY WARRANTIES OF: (i) MERCHANTABILITY; (ii) FITNESS FOR A PARTICULAR PURPOSE; (iii) TITLE; OR (iv) NON-INFRINGEMENT; WHETHER ARISING BY LAW, COURSE OF DEALING, COURSE OF PERFORMANCE, USAGE OF TRADE OR OTHERWISE, ALL OF WHICH ARE EXPRESSLY DISCLAIMED. DISTRIBUTOR ACKNOWLEDGES THAT IT HAS NOT RELIED ON ANY REPRESENTATION OR WARRANTY MADE BY SELLER, OR ANY OTHER PERSON ON SELLER’S BEHALF.

16.  Compliance With Laws. Distributor shall at all times comply with all federal, state and local laws, ordinances,  regulations and orders that are applicable to the operation of its business, and this Agreement and its performance hereunder. Without limiting the generality of the foregoing, Distributor shall at all times, at its own expense, obtain and maintain all certifications, credentials, authorizations, licenses, and permits necessary to conduct its business relating to the exercise of its rights and the performance of its obligations under this  Agreement.

17.  Indemnification.

17.1  Indemnification. Subject to the terms and conditions of this Agreement, Distributor shall indemnify, hold harmless, and defend Seller and its parent, officers, directors, partners, members, shareholders, employees, agents, affiliates, successors, and permitted assigns (collectively, “Indemnified  Party”) against any and all losses, damages, liabilities , deficiencies, claims, actions, judgments, settlements, interest, awards, penalties, fines, costs, or expenses of whatever kind, including attorneys’ fees, fees, and the costs of enforcing any right   to indemnification under this Agreement and the cost of pursuing any insurance providers, relating to any claim of a third party or Seller arising out of or occurring in connection   with:

(a)  Distributor’s acts or omissions as Distributor of the Goods, including breach of this Agreement;

(b)  Distributor’s advertising or representations that warrant performance of Goods beyond that provided by Seller’s written warranty or based upon Distributor’s business or trade practices;

(c)  Customer’s breach of the Customer Contract;

(d)  any failure by Distributor or its personnel (including Customer) to comply with any applicable Laws; or

(e)  allegations that Distributor breached its agreement with a third party as a result of or in connection with entering into, performing under or terminating this Agreement.

17.2  Indemnification. Subject to the terms and conditions of this Agreement, Seller shall indemnify, hold harmless, and defend Distributor and its parent, officers, directors, partners, members , shareholders, employees, agents, affiliates, successors, and permitted assigns (collectively, “Indemnified Party”) against any and all losses, damages, liabilities , deficiencies, claims, actions, judgments, settlement s, interest, awards, penalties, fines, costs, or expenses of whatever kind, including attorneys’ fees, fees, and the costs relating to any claim of a third party for personal injury, death or property damage caused by the proper use of the Goods. This indemnification provision shall not apply in the event of misuse, improper maintenance or improper installation.

18.  Limitation of Liability. EXCEPT FOR OBLIGATIONS TO MAKE PAYMENT UNDER THIS AGREEMENT, LIABILITY FOR INDEMNIFICATION, LIABILITY FOR BREACH OF CONFIDENTIALITY, 

9

OR LIABILITY FOR INFRINGEMENT OR MISAPPROPRIATION OF INTELLECTUAL  PROPERTY RIGHTS, IN NO EVENT:

(a)  IS SELLER OR ANY SELLER REPRESENTATIVE LIABLE FOR CONSEQUENTIAL, INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE, OR ENHANCED DAMAGES, LOST PROFITS OR REVENUES, OR DIMINUTION IN VALUE, ARISING OUT OF OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF:

(i)  WHETHER THE DAMAGES WERE FORESEEABLE;

(ii)  WHETHER OR NOT SELLER WAS ADVISED OF THE POSSIBILITY OF THE DAMAGES; AND

(iii)  THE LEGAL OR EQUITABLE THEORY (CONTRACT, TORT, OR OTHERWISE) ON WHICH THE CLAIM IS BASED.

(b)  SHALL SELLER’S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT, WHETHER ARISING OUT OF OR RELATED TO BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE), OR OTHERWISE, EXCEED THE TOTAL OF THE AMOUNTS PAID TO SELLER UNDER THIS AGREEMENT IN THE 12 MONTH PERIOD PRECEDING THE EVENT GIVING RISE TO THE CLAIM OR SELLER’ S LIABILITY RELATED TO A CLAIM SHALL NOT EXCEED THE AMOUNT OF THE PURCHASE ORDER GIVING RISE TO THE CLAIM, WHICHEVER IS  LESS.

19.  THE FOREGOING LIMITATIONS APPLY EVEN IF THE DISTRIBUTOR’S REMEDIES UNDER THIS AGREEMENT FAIL OF THEIR ESSENTIAL PURPOSE.

20.  Insurance. During the Term and for a period of one year after the Term, Distributor shall, at its own expense, maintain and carry insurance in full force and effect that includes, but is not limited to, commercial genera l liability (including product liability) with limits no less than $[***] for each occurrence and $[***] in the aggregate and worker’s compensation insurance (legal minimums) with financially sound and reputable insurers. Upon Seller’s request, Distributor shall provide Seller with a certificate of insurance and policy endorsements for all insurance coverage required by this Section 20, and shall not do anything to invalidate such insurance. The certificate of insurance shall name Seller as an additional insured. Distributor shall provide Seller with 30 days’ advance written notice in the event of a cancellation or material change in Distributor’s insurance policy. Except where prohibited by law, Distributor shall require its insurer to waive all rights of subrogation against Seller’s insurers, Seller and the other Indemnified Parties.

21.  Entire Agreement. This Agreement, including and together with any related exhibits, schedules, attachments and appendices, constitutes the sole and entire agreement of the Parties with respect to the subject matter contained herein, and supersedes  all prior and contemporaneous understandings, agreements, representations, and warranties, both written and oral, regarding such subject matter. The terms of this Agreement prevail over any terms or conditions contained in any other documentation related to the subject matter of this Agreement and expressly exclude any of Distributor’s general terms and conditions contained in any purchase order or other document issued by Distributor (excluding the information set out in Section 5. l (a) - Section 5. l(c)).

22.  Survival. Subject to the limitations and other provision s of this Agreement: (a) the representations and warranties of the Parties contained herein shall survive the expiration or earlier termination of this Agreement; and (b) of this Agreement, as well as any other provision that, in order to give proper effect to its intent, should survive such expiration or termination, shall survive the expiration or earlier termination of this Agreement.

23.  Notices. All notices , requests, consents, claims, demands, waivers and other communications under this Agreement must be in writing and addressed to the other Party at its address set forth below (or to such other address that the receiving Party may designate from time to time in accordance with this Section). Unless otherwise 

10

agreed herein, all notices must be delivered by personal delivery, nationally recognized overnight courier, or certified or registered mail (in each case, return receipt requested and postage prepaid). Except as otherwise provided in this Agreement, a notice is effective only (a) on receipt by the receiving Party, and (b) if the Party giving the notice has complied with the requirements of this Section.

	Notice to Seller:

	13370 Kirkham Way, Poway, CA 92064

Attention:  Brent Willson

	 

	 

	Notice to Distributor:

	6 Sunset Way, Suite 108, Henderson, NV 89104

Attention  Dan Briggs

24.  Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon a determination that any term or provision is invalid, illegal, or unenforceable, the Parties shall negotiate in good faith to or the court may modify this Agreement to give effect to the original intent of the Parties as closely as possible in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

25.  Amendments. No amendment to this Agreement is effective unless it is in writing and signed by an authorized representative of each Party.

26.  Waiver. No waiver by any party of any of the provisions of this Agreement shall be effective unless explicitly set forth in writing and signed by the party so waiving. Except as otherwise set forth in this Agreement, no failure to exercise, or delay in exercising, any rights, remedy, power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.

27.  Cumulative Remedies. All rights and remedies provided in this Agreement are cumulative and not exclusive, and the exercise by either Party of any right or remedy does not preclude the exercise of any other rights or remedies that may now or subsequently be available at law, in equity, by statute, in any other agreement between the Parties, or otherwise. Notwithstanding the previous sentence, the Parties intend that Distributor’s rights under this Agreement are Distributor’s exclusive remedies for the events specified therein.

28.  Assignment. Distributor shall not assign, transfer, delegate, or subcontract any of its rights or obligations under this Agreement without the prior written consent of Seller. Any purported assignment or delegation in violation of this Section shall be null and void. No assignment or delegation shall relieve Distributor of any of its obligations hereunder. Seller may at any time assign, transfer, or subcontract any or all of its rights or obligations under this Agreement without Distributor’s prior written consent.

29.  Successors and Assigns. This Agreement is binding on and inures to the benefit of the Parties to this Agreement and their respective permitted successors and permitted assigns.

30.  No Third-Party Beneficiaries. Subject to the next paragraph, this Agreement benefits solely the Parties to this Agreement and their respective permitted successors and assigns and nothing in this Agreement, express or implied, confers on any other Person (including any Customer) any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

31.  The Parties hereby designate Indemnified Parties as third-party beneficiaries of Section 17 with the right to enforce this provision.

32.  Choice of Law. This Agreement, including all exhibits, schedule s, attachments and appendices attached to this Agreement and thereto, and all matters arising out of or relating to this Agreement, are governed by, and construed in accordance with, the laws of the State of California, United States of America, without regard to 

11

the conflict of laws provision s thereof to the extent such principles or rules would require or permit the application of the laws of any jurisdiction other than those of the State of California.

33.  Arbitration. Any controversy or claim arising out of or relating to this Agreement or any breach thereof shall be settled by arbitration in San Diego County, California, conducted by JAMS using one arbitrator in accordance with JAMS commercial rule s of arbitration. Judgment upon the award of the arbitrator may be entered in any court of competent jurisdiction.  In any action between the Parties to enforce any of the terms of this Agreement, the prevailing Party shall be entitled to recover expenses, including arbitration costs and reasonable attorneys’ fees.

34.  Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be one and the same agreement.  Notwithstanding anything to the contrary in Section 23, a signed copy of this Agreement delivered by facsimile, email, or other means of electronic transmission is deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

35.  Force Majeure. No Party shall be liable or responsible to the other Party, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement (except for any obligations to make payments to the other Party under this Agreement), when and to the extent the failure or delay is caused by or results from acts beyond the impacted Party’s (“Impacted Party”) reasonable control (which events may include natural disasters, embargoes, explosions , riots, wars or acts of invasion or terrorism, requirements of law, national or regional emergency , strikes, labor stoppages or slowdowns or shortage of adequate power or transportation) (each, a “Force Majeure Event”). A Party shall give the other Party prompt written notice of any event or circumstance that is reasonably likely to result in a Force Majeure Event, and the anticipated duration of such Force Majeure Event. An affected Party shall use all diligent efforts to end the Force Majeure Event, ensure that the effects of any Force Majeure Event are minimized, and resume full performance under this Agreement.

36.  No Franchise or Business Opportunity Agreement. The Parties to this Agreement are independent contractors and nothing in this Agreement shall be deemed or construed as creating a joint venture, partnership, agency relationship, franchise, or business opportunity between Seller and Distributor. Neither Party, by virtue of this Agreement, will have any right, power, or authority to act or create an obligation, express or implied, on behalf of the other Party. Each Party assumes responsibility for the actions of their personnel under this Agreement and will be solely responsible for their supervision, daily direction and control, wage rates, withholding income taxes, disability benefits, or the manner and means through which the work under this Agreement will be accomplished. Except as provided otherwise  in this Agreement, Distributor  has the sole discretion to determine Distributor’s methods of operation, Distributor’s accounting practices, the types and amounts  of  insurance  Distributor   carries,   Distributor’s   personnel   practices,  Distributor’s   advertising and promotion, its Customers , and Distributor’s service areas and methods. The relationship created hereby between the parties is solely that of seller and distributor. If any provision of this Agreement is deemed to create a franchise relationship between the parties, then Seller may immediately terminate this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

NEOVOLTA INC.

 

By:  /s/ Brent Willson

Name:  Brent Willson

Title:  Chief Executive Officer

 

 

PMP ENERGY, LLC

 

By:  /s/ Dan Briggs

Name:  Dan Briggs

Title:  Chief Executive Officer

12

SCHEDULE 1

 

Goods and Price List

 

[***]

 

 

 

Warranty and Warranty Service

[***]

 

 

Volume Compensation

 

As of the end of each calendar quarter (i.e. March 31, June 30, September 30 and December 31), to the extent Distributor meets the requirements set forth herein, Seller agrees to issue Distributor shares of Seller’s common stock as follows (the “Distributor Compensation Shares”):

 

[***]

 

 

 

 

 

 

 

 

 

 

 

 

 

  

 

The Distributor hereby acknowledges that is an “accredited investor” within the meaning of Rule 501 of Regulation D of the Securities and Exchange Commission (the “SEC”). The Distributor hereby re-affirms this representation each calendar quarter, unless it provides Seller with notice stating that it is no longer an “accredited investor”.

The Distributor understands that the Distributor Compensation Shares are “restricted  securities” under the federal securities laws inasmuch as they are being acquired from Seller in a transaction not involving a public offering and that under such laws and applicable regulations such securities may  be resold without registration under the Securities Act of 1933 only in certain limited circumstances. The Distributor understands that the Distributor Compensation Shares will bear a restrictive legend stating the foregoing.

By accepting the Distributor Compensation Shares, the Distributor hereby agrees that it shall not sell more than 5% of the Distributor Compensation Shares earned in any quarter during any calendar month.

 

 

 

  

Schedule 1 - Page 2

Limited Exclusivity

Distributor shall have limited exclusive distribution in those territories or to those Customers provided in the chart below. Exclusivity requires the minimum purchases provided in the chart below, per year.

[***]

 

 

 

 

 

 

  

Schedule 1 - Page 3

[SCHEDULE 2]

 

NeoVolta Inc.’s Trademarks

Trademarks:Exclusive Supply Agreement, effective as of August 30, 2021, by and between NeoVolta, Inc. and NingBo Deye Inverter Technology Co, Ltd.

  Certain identified information has been excluded from this exhibit because it is both not material and is the type that the registrant treats as private or confidential. Information that was omitted has been noted in this document with a placeholder identified by the mark “[***]”.
  
 EXCLUSIVE SUPPLY AGREEMENT
  
 THIS EXCLUSIVE SUPPLY AGREEMENT (the “Agreement”) is effective as of August 30, 2021 (“Commencement Date”), by and  between  NeoVolta,  Inc., a Nevada  corporation having  a principal  place of business at 13651 Danielson Street, Suite A, Poway CA 92064 USA, on behalf of itself (“NeoVolta”) and NingBo Deye Inverter Technology Co, Ltd, a Chinese Limited Company having its principal place of business at No 26-30, Southern Yongjiang Road, Beilun, NingBo, China, on behalf of itself (“Manufacturer” or “Deye”).  For purposes of this agreement, either NeoVolta or Manufacturer may be referred to as a “Party” and may collectively be referred to as the “Parties.”
  
 WHEREAS, the Parties entered into a Supply Agreement dated September 25, 2018 where Deye developed the NV7600 for NeoVolta and NeoVolta received the exclusive rights of and ownership of the NV7600;
  
 WHEREAS, the Parties desire to continue the improvement and supply of inverters by Deye to NeoVolta, subject to the terms herein.
  
 THEREFORE, the Parties agree as follows:
  
 1.TERM 
  
 The initial term of this Agreement will commence on the Commencement Date and will continue for FIVE (5) years. NeoVolta will have an option to renew the Agreement for another two (2) years. Thereafter the Agreement will automatically renew on an annual basis after the initial term notwithstanding the foregoing, the term of this Agreement will automatically extend to include the terms of any Orders (defined in 4.1 (a) below) pending at the time of termination (“Term” including the initial term, option term and any renewals).  NeoVolta promises to grow as rapidly as possible.  NeoVolta will keep Deye appraised of any large developments that will increase volume.
  
 2.PRICING 
  
 2.1.  Pricing. During the Term, NeoVolta may purchase from Manufacturer the products specified in Exhibits A hereto, as such Exhibit may be amended from time to time by mutual written agreement (the “Products”) at the prices set forth in the quote and purchase order (the “Price(s)”). Prices (a) are in U.S. Dollars, (b) include Manufacturer standard packaging, and (c) are based on the configuration set forth in the specifications provided in Exhibit A (the “Specifications”).
  
 2.2.  Pricing Review. Manufacturer shall make reasonable efforts to reduce costs of the Products on a yearly basis. NeoVolta pricing will be as good as, if not better than any other buyer of Deye inverters.
  
 3.PAYMENT TERMS 
  
 Payment Terms.  Payment shall be [***]% upon shipping.
  
 4.PURCHASE ORDERS/RESCHEDULE 
  
 4.1.Purchase Orders. 
  
 (a)  NeoVolta will issue to Manufacturer specific purchase orders for Product covered by this Agreement (each an “Order”). Each Order will be based on a quote provided by Manufacturer. Each Order will be in the form of a written or electronic communication and contain the following information: (i) the part number of the Product; (ii) the quantity of the Product; (iii) the delivery date or shipping schedule which will have a lead time agreed to by each party; (iv) the location to which the Product is to be shipped; and (v) transportation instructions. Each Order will contain a number for billing purposes, and may include other instructions and terms (provided that such terms do not conflict with this Agreement) as may be appropriate under the circumstances.
 
 - 1 -
 
  
 
 (b)  Manufacturer will decide whether to accept Orders issued by NeoVolta within five (5) business days of receipt. In the event Manufacturer fails to accept the Order within five (5) business days of receipt, the parties will negotiate in good faith to resolve the disputed matter(s). Manufacturer will supply the Product in quantities to meet all requirements of NeoVolta.  Manufacturer guarantees for the Term to supply the Products to NeoVolta.
  
 (c)  Once the Order is accepted by Manufacturer, NeoVolta will purchase all Product ordered in each order, and Manufacturer will manufacture and sell to NeoVolta all such Product.
  
 (d)  Reschedule. NeoVolta may reschedule all or part of a scheduled delivery at any time, subject to the percentage –allowances in the following table:
  
 	 Days Before Delivery Date
	 Percentage Reschedule Allowance

	 [***]
	 [***]

	 [***]
	 [***]%

	 [***]
	 [***]%

  
 Manufacturer will use its best efforts to accommodate any upside schedule changes beyond the firm order periods.
  
 5.DELIVERY AND ACCEPTANCE 
  
 5.1.  Delivery. Manufacturer will deliver all Products to destination(s) specified in the applicable Order as stipulated in the Order. Shipments (including shipments made in accordance with Section 7 (Warranty)) will be made shipped F.O.B. the destination location identified by NeoVolta in the Purchase Order, either to NeoVolta or to warehouse in Qingdao. Risk of loss or damage to the Product will pass to NeoVolta upon Manufacturer's delivery of the Product of the Order at the NeoVolta designated shipping facility in China and the BL copy has been transmitted to NeoVolta.  Manufacturer will mark, pack, package, crate, transport, ship and store Product to ensure (a) delivery of the Product to its ultimate destination in safe condition, (b) compliance with all requirements of the carrier and destination authorities priorly agreed by both parties, and (c) compliance with any special instructions by both parties. Manufacturer will deliver the Products on the agreed-upon delivery dates and will notify NeoVolta of any anticipated delays.
  
 5.2.  Acceptance.  NeoVolta will accept the Product no later than [***] days after receiving Product. NeoVolta will base its acceptance on whether the Product passes a reasonable acceptance test procedure or inspection designed to demonstrate compliance with the Specifications. If NeoVolta does not reject the Product within [***] day period, the Product will be deemed accepted. Once a Product is rejected by the reason of failure to comply with the Specifications, all defective Product returns will be handled in accordance with Article 7 (Warranty). Prior to returning any rejected Product, NeoVolta will obtain an Return Materials Authorization (“RMA”) number from Manufacturer, which number Manufacturer will promptly provide NeoVolta, and NeoVolta will return such Product in accordance with the Manufacturer's reasonable instructions, at manufacturer's expense. NeoVolta will specify the reason for such rejection in all RMAs and provide relevant supporting documents. In the event a Product is rejected, Manufacturer will promptly repair or replace the Product with Product that complies with the Specifications. NeoVolta's obligation to pay for any rejected Product will be suspended until such time as Manufacturer provides Product to NeoVolta that complies with the Specifications and Acceptance Testing.
  
 5.3.  Quality. Manufacturer acknowledges that the detail, quality, reliability and workmanship of the Products affects the goodwill and reputation of NeoVo1ta. Manufacturer will meet or exceed the good industry standards with respect to detail, quality and reliability of the Products, and will only employ the high caliber of workmanship and use the high quality components with respect to the manufacture of the Products. Without limiting the generality of the foregoing, Manufacturer will develop and .implement appropriate policies and procedures, including testing processes for quality and reliability, to ensure compliance with this Section. If any of the Products fail to conform to the Specifications or otherwise fail to perform in their intended capacity, the Parties will work together in good faith to conduct a failure analysis and identify the cause of the failure(s).
 
 - 2 -
 
  
 
 6.CHANGES 
  
 Both parties may upon sufficient notice make changes within the general scope of this Agreement or any Order.  Such changes may include, but are not limited to changes in (l) drawings, plans, designs, procedures, Specifications, test specifications or bill of material (“BOM”), (2) methods of packaging and shipment, (3) quantities of Product to be furnished, (4) delivery schedule, or (5) NeoVolta-Furnished Items. All material changes other than changes in quantity of Products to be furnished will be requested pursuant to a revised Order.  If any such change causes either a material increase or decrease (+/-[***]%) in Manufacturer's cost or the time required for performance of any part of the work under this Agreement, Manufacturer will adjust the Price in accordance with the procedure described in Section 2.1 to account for such change.
  
 7.WARRANTY 
  
 7.1.  Manufacturer Warranty.  Manufacturer warrants that, for a period of five (5) years, from the date of Acceptance of the Product, (i) the Product will be merchantable, conform to the Specifications, and be free from defects in material and workmanship, and (ii) Manufacturer has good and marketable title to such Products, free from any claims of infringement or misappropriation of intellectual property, and there are no leins, licenses, claims or encumbrances of any kind on such Products. Manufacturer will, at its sole expense use its best efforts to replace all Product found defective with Product that conforms to the Specifications and requirements under this Section (Section 7.1) during the warranty period. If Manufacturer fails to use its best efforts to replace defective Products, then MANUFACTURER will be liable for costs of procurement of substitute products by NeoVolta. Additional warranty coverage is available for a fee, which can be negotiated separately.
  
 7.2.  RMA Procedure. Manufacturer will concur in advance on all Products found defective to be returned for repair or replacement.  NeoVolta will obtain a RMA number from Manufacturer prior to return shipment, which number Manufacturer wi1l promptly provide to NeoVolta.  All returns will state the specific reason for such return, and will be processed in accordance with Manufacturer's reasonable RMA Procedure. NeoVolta will pay transportation costs of any defective product being returned to Manufacturer (but will be given a credit for such transportation costs if the returned Product is under warranty).  Manufacturer will pay transportation and shipping costs to return repaired or replaced product to NeoVolta or to NeoVolta's affiliates, and will bear all risk of loss or damage to such Products while in transit. Any repaired or replaced Product will be warranted as set forth in this Article for a period equal to (i) if repaired, the balance of the applicable warranty period relating to such Product plus six (6) months or (ii) if replaced the full warranty period of five (5) years.
  
 7.3.  Exclusions From Warranty.  If applicable, this warranty does not include Products that have defects or failures resulting solely from (a) neglect, abuse, misuse, improper handling, or storage; or (b) alterations, modifications by NeoVolta or third parties.
  
 7.4.  Remedy. The sole remedy under this warranty will be the prompt repair, replacement, transportation, and credit for defective parts, and/or costs of procurement of substitute products, as stated above.
  
 8.INDEMNIFICATION 
  
 8.1.  Manufacturer's Indemnification. Manufacturer will indemnify, defend, and hold NeoVolta harmless from all third party demands, claims, actions, causes of action, proceedings, suits, assessments, losses, damages, liabilities, settlements, judgments, fines, penalties, interest, costs and expenses (including fees and disbursements of counsel) of every kind (each a “Claim,” and, collectively “Claims”) (i) based upon personal injury or death or injury to property (other than damage to the Product itself, which is handled in accordance with Article 7/Warranty) to the extent any of the foregoing is proximately caused either by the negligent or willful acts or omissions of Manufacturer or its officers, employees, subcontractors or agents (ii) arising from a breach by Manufacturer of any representation, warranty or covenant under this Agreement. For clarity, Manufacturer is only responsible for Claims related to the NV7600 and liability arising from the NV7600.
  
 8.2.  Procedure. If NeoVolta is entitled to indemnification pursuant to this Article, NeoVolta will promptly notify the Manufacturer in writing of any Claims covered by this indemnity and provide relevant supporting documents. Promptly after receipt of such notice, Manufacturer will assume the defense of such Claim. If Manufacturer fails, within a reasonable time after receipt of such notice, to assume the defense or, if 
 
 - 3 -
 
  
in the reasonable judgment of the Indemnitee, a direct or indirect conflict of interest exists between the Parties with respect to the Claim, NeoVolta will have the right to undertake the defense, compromise and settlement of such Claim for the account and at the expense of the Indemnitor. Manufacturer will not compromise any Claim (or portions thereof) or consent to the entry of any judgment without an release of all liability of NeoVolta as to each claimant or plaintiff.
  
 9.TERMINATION 
  
 9.1.  Termination for Cause.  Subject to Section 9.4, either Party may terminate this Agreement or an Order hereunder for default if the other Party materially breaches this Agreement; provided, however, no termination right will accrue until twenty (20) days after the defaulting Party is notified in writing of the material breach and has failed to cure or give adequate assurances of performance within the twenty (20) day period after notice of material breach.
  
 9.2.  Termination for Convenience. Subject to Section 9.4, NeoVolta may terminate this Agreement hereunder for any reason upon ninety (90) days prior written notice.
  
 9.3.  Termination by Operation of Law. Subject to Section 9.4, this Agreement will immediately and automatically terminate should either Party (a) become insolvent; (b) enter into or file a petition, arraignment or proceeding seeking an order for relief under the bankruptcy laws of its respective jurisdiction; (c) enter into a receivership of any of its assets or (d) enter into a dissolution or liquidation of its assets or an assignment for the benefit of its creditors.
  
 9.4.  Consequences of Termination.
  
 (a)  Termination for Reasons other than Manufacturer’s Breach.  In the event this Agreement or an Order hereunder is terminated for any reason other than a breach by Manufacturer (including but not limited to a force majeure or termination for convenience), NeoVolta will pay Manufacturer the contract price for all finished Product existing at the time of termination, and which are promptly delivered to and accepted by NeoVolta.
  
 (b)  Surviving Terms. The following terms shall survive any termination of this Agreement:  Sections 7, 8, 10, 11 and 13.
  
 10.EXCLUSIVITY 
  
 During the Term and thereafter, Manufacturer agrees to sell the NV7600 product only to NeoVolta. The designs of the NV7600 product are solely owned by NeoVolta.  This exclusivity provision shall survive termination of this Agreement and shall be enforceable by NeoVolta.
  
 11.CONFIDENTIALITY AND INTELLECTUAL PROPERTY 
  
 11.1.Definitions. For the purpose of this Agreement, 
  
 (a)  “Confidential Information” means information (in any form or media) regarding either Party, including any of its affiliates, and its customers, potential customers, methods of operation, design, development, ordering and manufacturing methods and processes, programs and databases, designs, know how, billing rates, billing procedures, vendors and suppliers, orders, purchases, projections, forecasts, sales, business methods or strategy, finances, management, or any other business information relating to either Party, including its affiliates (whether constituting a trade secret or proprietary or otherwise) which has value to such Party and is treated by such Party as being confidential; provided, however, that Confidential Information does not include information that (i) is known to the other party prior to receipt from the disclosing party hereunder, which knowledge will be evidenced by written records, (ii) is independently developed without the use of such Confidential Information as evidenced by written records, (iii) is or becomes in the public domain through no breach of this Agreement, or (iv) is received from a third party without breach of any obligation of confidentiality.  Notwithstanding anything to the contrary in this Agreement, all information provided by either Party hereunder regarding the Products, will be the Confidential Information of such Party.
  
 (b)  “Person” will mean and include any individual, partnership, association, corporation, trust, unincorporated organization, limited liability company or any other business entity or enterprise.
 
 - 4 -
 
  
 
 (c)  “Representative” will mean a Party’s employees, agents, or representatives, including, without limitation, financial advisors, lawyers, accountants, experts, and consultants.
  
 11.2.Nondisclosure Covenants. 
  
 (a)  In connection with this Agreement, each Party (the “Disclosing Party”) may furnish to the other Party (the “Receiving Party”) or its Representatives certain Confidential Information. For a period of five (5) years from the date of the last disclosure under this Agreement, or in perpetuity with respect to any Confidential Information that is held by a party as a trade secret, the Receiving Party (a) will maintain as confidential all Confidential Information disclosed to it by the Disclosing Party, (b) will not, directly or indirectly, disclose any such Confidential Information to any Person other than (i) those Representatives of the Receiving Party whose duties justify the need to know such Confidential Information and then only if such Representative is under written obligations no less restrictive than those contained herein regarding maintaining the confidentiality of such Confidential Information and restricting the use of such Confidential Information or (ii) if Manufacturer is the Receiving Party, a third party Vendor for the purpose of obtaining price quotations provided that such Vendor is under written obligations no less restrictive than those contained herein regarding maintaining the confidentiality of the Confidential Information and restricting the use of such Confidential Information and (c) will treat such Confidential Information with the same degree of care as it treats its own Confidential Information (but in no case with less than a reasonable degree of  care).
  
 (b)  The disclosure of any Confidential Information is solely for the purpose of enabling each Party to perform under this Agreement or exercise rights under this Agreement, and the Receiving Party will not use any Confidential Information disclosed by the Disclosing Party for any other purpose.
  
 (c)  Except as otherwise set forth in this Agreement, all Confidential Information supplied by the Disclosing Party will remain the property of the Disclosing Party, and will be promptly returned by the Receiving Party upon receipt of written request therefor.
  
 (d)  If the Receiving Party or its Representative is requested or becomes legally compelled to disclose any of the Confidential Information, it will provide the Disclosing Party with prompt written notice. If a protective order or other remedy is not obtained, then only that part of the Confidential Information that is legally required to be furnished will be furnished, and reasonable efforts will be made to obtain reliable assurances of confidentiality.
  
 11.3.  Injunctive Relief Authorized. Any material breach of this Article by a Party or its Representatives may cause irreparable injury and the non-breaching Party may be entitled to equitable relief, including injunctive relief and specific performance, in the event of a breach.  The above will not be construed to limit the remedies available to a Party. In addition, the prevailing Party will be entitled to be reimbursed for all of its reasonable attorneys' fees and expenses at all levels of proceedings and for investigations, from the non-prevailing Party.
  
 11.4.  No Publicity. Each Party agrees not to disclose the terms of this Agreement or any third Party, without the prior consent of the other Party, except as required by law, regulation or court order (in which case, the Party seeking to disclose the information will give reasonable notice to the other Party of its intent to make such a disclosure so as to allow the non-disclosing Party to oppose the disclosure).
  
 11.4  Intellectual Property Rights. Manufacturer will continue to own all right, title, and interest in and to [***] (“Background Manufacturer IP”), and NeoVolta will continue to own all right, title, and interest in and to [***] (“background NeoVolta IP”). 
  
                 (a)  With respect to any Background Manufacturer IP specific to [***]that claims, covers or is otherwise incorporated into the Products, manufacturer hereby grants to NeoVolta a nonexclusive, non transferable, royalty-free, world-wide, fully-paid-up, irrevocable, perpetual license (with the right to grant sublicenses through multiple tiers) to offer for sale, sell or import Products incorporating the Background Manufacturer IP. Except for the foregoing, no license or any other right is granted to NeoVolta in any know-how or process information contained within the Background Manufacturer IP. 
  
                (b)  All developments and improvements of [***] shall be solely owned by NeoVolta.  During the Term of this Agreement, NeoVolta grants to Manufacturer a non-exclusive, royalty-free, internal  
 
 - 5 -
 
  
license to use the Background NeoVolta IP and Neo Volta IP solely for the purpose of performing Manufacturer’s obligations hereunder specific to [***].
  
 (c)  Both parties hereby expressly reserve all rights, title, and interest in any of their respective Intellectual Property not provided for in this Agreement.
  
 12.INSURANCE 
  
 Manufacturer agrees to maintain during the Term of this Agreement any and all insurance as prescribed by the law of the state, or country in which Manufacturer's services are performed.
  
 13.MISCELLANEOUS 
  
 13.1.  Integration Clause. This Agreement (including the Exhibits to this Agreement) constitutes the entire agreement of the parties regarding the subject matter set forth herein, superseding all previous Agreements covering the subject matter. This Agreement will not be changed or modified except by written agreement, specifically amending, modifying and changing this Agreement, signed by Manufacturer and an authorized representative of the NeoVolta. Each Party represents that no third party or other contract will be violated or breached by entering into this Agreement.
  
 13.2.  Limitation of Liability.  EXCEPT AS SPECIFICALLY STATED HEREIN, IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER FOR ANY INDIRECT, CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR SPECIAL DAMAGES WHATSOEVER RESULTING FROM LOSS OF USE, DATA OR PROFITS, EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.  THESE LIM1TATIONS APPLY NOTWITHSTANDING ANY FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY.  Notwithstanding the foregoing, the limitations set forth herein will not apply to limit (i) a Party’s obligation to indemnify the other Party against any third party Claim for personal injury or property damage, (ii) a Party’s obligation to indemnify The other Party against any third party Claim for intellectual property infringement, (iii) a Party’s breach of section 11, (iv) a party’s intentional breach of the Agreement, or (v) actual damages required to be paid to any third party as a result of any infringement claim. THE LIMITATION SET FORTH IN THIS SECTION ONLY APPL1ES WHERE THE DAMAGES ARISE OUT OF OR RELATE TO THIS AGREEMENT.
  
 13.3.  Assignment. Neither this Agreement nor any rights or obligations hereunder will be transferred or assigned by either Party without the written consent of the other Party. Nevertheless, either party may, without such consent, assign this Agreement and its rights and obligations hereunder in connection with the transfer or sale of all or substantially all of its business or assets related to this Agreement, or in the event of its merger, consolidation, change in control or other similar transaction. This Agreement may be assigned in whole or in part by either Party to any Affiliate of such Party provided that such Party remains secondarily liable under this Agreement.
  
 13.4.  Disputes/Choice of Law/Attorneys’ Fees.
  
 This Agreement will be construed in accordance with the State of California laws (excluding its conflicts of laws principles). The provisions of the United Nations Conventions on Contracts for the International Sale of Goods will not apply to this Agreement.
  
 Any dispute, controversy, difference or claim arising out of or relating to this Agreement, including the existing, validity, interpretation, performance, breach or termination thereof or any dispute regarding non-contractual obligations arising out of or relating to it shall be referred to and finally resolved by arbitration administered by Judicate West under the Judicate West Commercial Arbitration Rules in force when the Notice of Arbitration is submitted. The arbitration shall take place in San Diego, California and conducted in English. The number of arbitrators shall be one. The parties agree to split the costs of the arbitration fees of Judicate West.
  
 The prevailing party will be entitled to recover its costs (including arbitration fees) and reasonable attorneys’ fees from the non-prevailing party in any action brought to enforce this Agreement.
  
 13.5.  Severability/Waiver/Counterparts. Any of the provisions of this Agreement which are determined to be invalid or unenforceable in any jurisdiction will be ineffective to the extent of such invalidity 
 
 - 6 -
 
  
or unenforceability in such jurisdiction, without rendering invalid or unenforceable the remaining provision hereof and without affecting the validity or enforceability of any of the terms of this Agreement in any other jurisdiction. The waiver by a party hereto of any right hereunder or the failure to perform or of a breach by another party will not be deemed a waiver of any other right hereunder or of any other breach of failure by said other party whether of a similar nature or otherwise. This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. Each Party represents that the person signing below has the authority to bind the party.
  
 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed effective as of the Commencement Date by their officers, duly authorized.
  
 	 Manufacturer:
 NingBo Deye Inverter Technology Co, Ltd
	  
	  
 NeoVolta Inc.

	  
	  
	  

	  
	  
	  

	 By: /s/ [***]
	  
	 By: /s/ Brent S. Willson

	 Signature
	  
	 Signature

	  
	  
	  

	 Typed Name: [***]
	  
	 Typed Name: Brent S. Willson

	  
	  
	  

	 Title: General Manager
	  
	 Title: President and Chief Executive Officer

	  
	  
	  

	 Date: 30 August 2021
	  
	 Date: 30 August 2021

  
  
  
  
  
  
  
  
  
  
  
  
  
  
 
 - 7 -
 
  
EXHIBIT A
  
 PRODUCTS AND SPECIFICATIONS
  
 NV7600
  
 Capabilities:
  
 [***].
 Regulatory:
 [***].
 Private Label/License:
 [***].
  
 Specifications and Drawings Documents:
  
 [***]
 Software
 [***].
 Development and Upgrades
 [***].
  
  
  
  
  
 
 - 8 -

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00343-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00343-of-00352.parquet"}]]