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Exhibit 10.18
[*]  Indicates that certain information in this exhibit has been excluded because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
ROMEO SYSTEMS, INC.
PRODUCT SUPPLY MASTER AGREEMENT
This ROMEO PRODUCT SUPPLY MASTER AGREEMENT (this “Agreement”) is entered into as of September 8, 2020 by and between Romeo Systems, Inc., a Delaware corporation (“Romeo”) and Phoenix Cars LLC dba Phoenix Motorcars, a Delaware limited liability company (“Purchaser”), with reference to the following facts:
A.    Romeo has developed and manufactures the [*]  line of battery products described in Exhibit B.
B.    Purchaser desires to purchase such products from Romeo, and Romeo desires to supply such products to Purchaser, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, the Parties hereby agree as follows:
1.     Definitions.   The following terms shall have the meanings indicated.
(a)     “Affiliate” of any individual or entity means a Person that controls, is controlled by or is under common control with such individual or entity.
(b)     “Failure Rate” means the percentage of Severity Level 1 and Severity Level 2 occurrences, as defined in the Service Level Agreement, as determined at the end of each calendar year, to be calculated by dividing the number of Products Units and Safety Tested Battery Units (if applicable) where a Severity Level 1 and/or Severity Level 2 event occurred, shipped by Romeo to Purchaser overall Product Units and Safety Tested Battery Units (if applicable) shipped to date that are still under warranty.
(c)     “Initial Term” has the meaning provided in Section 7.
(d)     “Lead Time” means [*] weeks from PO submission date.
(e)     “Minimum Volume Commitment” means, for each calendar year during the Initial Term, the number of Product Units ordered, shipped and accepted as specified as such in Exhibit B for such year, and for any Renewal Term, the number of Product Units ordered, shipped and accepted as determined pursuant to Section 7.
(f)      “Party” means a party to this Agreement.
(g)     “Person” means any individual, sole proprietorship, partnership, joint venture, trust, unincorporated association, corporation, limited liability company, entity or governmental authority.
(h)     “PO” means a purchase order submitted by Purchaser to Romeo hereunder.
(i)      “Product” means, with respect to any PO accepted by Romeo pursuant to Section 2, any Product Unit, Prototype Unit or Safety Tested Battery Unit ordered pursuant to such PO.
(j)      “Product Unit” means one [*]  unit as defined in Exhibit B that had its design and performance validated through the successful conclusion of the Test Campaign.
(k)     “Prototype Unit” means one [*]  unit as defined in Exhibit B that has not had its design and performance validate through the Test Campaign. Prototype Units do not have any Warranty.
(l)      “Purchaser Authorized Product” means the vehicle, machine, device or other product that will be powered by the Product and into which the Product will be incorporated as specified in the applicable PO.  All of Purchaser’s products that may be Purchaser Authorized Products are described in Exhibit C.
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(m)    “Quality Standard” means a Failure Rate equal to or less than [*]  in the applicable calendar year in the Initial Term.
(n)     “Renewal Term” has the meaning provided in Section 7.
(o)     “Safety Tested Battery Unit” means one [*]  unit as defined in Exhibit B that had its design and performance validated through the successful conclusion of the Functional and Safety Testing segment of the Test Campaign per Exhibit A ([*]).  A Safety Tested Battery Unit becomes a Product Unit upon completion of the Performance & Reliability segment of the Test Campaign.
(p)     “Service Level Agreement” means the signed Service Level Agreement between Romeo and Purchaser for the Product Units.
(q)     “Test Campaign” means the testing and validation plan to validate Product performance described in Exhibit A [*].
(r)      “Term” means the Initial Term and any Renewal Term.
(s)      “Warranty” means the meaning provided in Exhibit D (Product Warranty) and Section 8(a).
2.     Purchase Orders.
(a)     POs.  From time to time Purchaser shall order Products by issuing POs to Romeo in written form via email to Account Receivables (ar@romeopower.com) and Program Management (pm@romeopower.com) or other means of which Romeo notifies Purchaser in writing, all in accordance with the terms and conditions of this Agreement.  The terms and conditions of every PO may be reviewed by Romeo for conformance to this Agreement (e.g. Product specifications, pricing, due dates within lead time, etc.). Within three (3) business days after Purchaser submits any PO, Romeo shall accept or reject such PO by written notice to Purchaser via email (to the contact email address stated on the PO) or other means of communication of which Romeo notifies Purchaser in writing.  For the avoidance of doubt, any PO that is rejected by Romeo due to non-conforming PO terms shall be corrected by Purchaser and resubmitted with accurate terms.  Any PO that is not expressly accepted or rejected by written notice during such three (3) business day period shall be deemed to have been rejected.  Neither Party shall have any obligation under or with respect to any PO that is not accepted by Romeo, and Romeo may accept or reject POs in the exercise of its sole discretion. The quantities specified on POs rejected by Romeo without an opportunity for Purchaser to rectify the PO will count towards the Minimum Volume Commitment.  Accepted POs shall be binding on the Parties (and may not be cancelled or changed by either Party without the written consent of the other Party).  Romeo shall not be deemed to violate any obligation hereunder (including, without limitation, under any PO) if it delivers any Products after the delivery date specified in the applicable PO, provided that Romeo provides Purchaser with prompt written notice of such delayed delivery date and uses commercially reasonable efforts to ship such Products as close to such scheduled delivery date as is reasonably practicable.  A PO Project Plan for the Prototype Units is attached as Exhibit F.
(b)     POs for Safety Tested Battery Units.  Purchaser has agreed to the Test Campaign.  Purchaser may order Safety Tested Battery Units for delivery while the Performance & Reliability segment of the Test Campaign is in progress.
(c)     Form of PO.  Each PO submitted by Purchaser shall (i) identify the Product  (by product number or other means specified by Romeo), (ii) the quantity ordered, (iii) the requested shipment date (which shall be at [*] from PO submission date), (iv) the ship to address, (v) the price of each unit of Product and total amount due for the applicable order, and (vi) for each Product, the applicable Purchaser Authorized Product.  No PO shall include any terms other than those referenced in this Section 2 and, if any PO does include any other terms, such terms shall be of no force or effect whatsoever.
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(d)     Manufacture and Supply.  During the Term, Romeo shall manufacture and supply to Purchaser the Products that are ordered by Purchaser pursuant to POs accepted by Romeo, and Purchaser shall purchase such Products, in each case subject to the terms and conditions of this Agreement.
(e)     Incoterms and Delivery.    All deliveries shall be Ex Works Romeo’s facility, except to the extent otherwise specified in the applicable PO.  The ship-to address for any Product purchased hereunder shall be in North America.
3.     Review and Acceptance.  Purchaser shall promptly review any shipment received from Romeo and shall notify Romeo promptly (and in any event within ten (10) business days of receipt of the shipment) of any failure of such shipment materially to conform to the applicable PO or to Product Units, Prototype Units or Safety Tested Battery Units in accordance with Exhibit B (the “Specifications”).  Unless Purchaser timely provides notice of such a failure with respect to any delivery, such delivery shall be conclusively presumed to be accepted.  If any shipment does fail to conform to the applicable PO or Specifications and Purchaser timely so notifies Romeo, Romeo shall make commercially reasonable efforts to cure such failure within ten (10) business days (which cure may include a correction of any error in the Specifications).  For avoidance of doubt, Purchaser shall accept any order delivered hereunder that materially conforms to the applicable PO and Specifications.
4.     Prices and Payment.
(a)     Price.  The price at which Purchaser may purchase each Product hereunder shall be the amount specified in Exhibit B attached hereto.
(b)     Periodic Cost Review. In April and September of each year during the Term, Romeo and Purchaser shall jointly review the Romeo bill of materials for the Product Units (the “BOM”) to determine if the BOM has decreased since the prior review.  The BOM costs to be reviewed will include, without limitation, battery cells, pack enclosure, electrical components, plastic components, cold plate, and printed circuit board assemblies.  The BOM costs to be reviewed will be supported by invoices and other relevant documentation from Romeo’s BOM vendors, though vendor names and other confidential information may be redacted.  [*] .
(c)     Shortfall Payment.  If Purchaser orders fewer Product Units than [*] of the applicable Minimum Volume Commitment during any calendar year of this Agreement, Romeo may invoice Purchaser in an amount equal [*].  Purchaser will pay any invoice submitted pursuant to this Section 4(c) within thirty (30) days of the date thereof.  For avoidance of doubt, a Product Unit will be deemed to be ordered by Purchaser for purposes of this Section 4(c) if (i) it is accepted by Romeo pursuant to Sections 2 (Purchase Orders) and 3 (Review and Acceptance) above; (ii) it was ordered by Purchaser but  rejected by Romeo without an opportunity for Purchaser to rectify the PO; or (iii) it conforms in all respects to the lead time, pricing, specification, warranty and other terms of this Agreement. Any Shortfall Payment is contingent upon Satisfactory Completion of the Test Campaign and Romeo supplying Product Units materially in compliance with the Lead Time, Specifications and meeting the Quality Standard in the prior calendar year.  For avoidance of doubt, Purchaser will not be liable for any Shortfall Payment until (1) Satisfactory Completion of the Test Campaign and (2) Romeo’s compliance with this Subsection 4(c).
(d)     Invoices.  Purchaser will pay invoices submitted by Romeo for Products within [*] days after the invoice date unless certain items require prepayment, which terms shall be agreed upon in advance in writing and on a case-by-case basis.
(e)     Late Fees and Discounts.  Purchaser shall pay Romeo late fees accruing at the rate of one percent (1.0%) per month or the highest rate permitted under applicable law, whichever is lower, on any amounts that are not paid when due hereunder.  Romeo will provide a discount to Purchaser for early payment of invoices at a rate of two percent (2%) per invoice paid within ten (10) days of invoice receipt.
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(f)      Taxes.  Purchaser shall pay any sales, use, excise or other tax, duty or assessment incurred in connection with the manufacture and delivery of Purchaser Authorized Products or the performance under this Agreement which are customary for product supply transactions, other than taxes based solely on Romeo’s net income.
5.     Compliance.
(a)     Purchaser Authorized Products.  Subject to Satisfactory Completion, Romeo hereby grants Purchaser the nonexclusive right and license under the patents and other intellectual property rights held or controlled by Romeo to incorporate the Product into, and use the Product to power, only Purchaser Authorized Products.  No right or license is granted to incorporate the Product into any other vehicle, machine, device or other product.  Purchaser shall not incorporate any Product into, or use any Product to power, any vehicle, machine, device or other product other than the applicable Purchaser Authorized Product.  Purchaser shall use reasonable efforts to ensure that no reseller or other Person that purchases or otherwise obtains any Product from Purchaser incorporates any Product into, or uses any Product to power, any vehicle, machine, device or other product other than the applicable Purchaser Authorized Product. For purposes of this Agreement reasonable efforts means delivering the installed Product to Purchaser’s customers and/or end users.
(b)     Compliance with Law.  Purchaser shall ensure that its use, sale or other commercialization of Product shall comply in all respects with applicable law and regulation, including, without limitation, laws or regulations relating to the export of Products.
6.     Intellectual Property.  As between Romeo and Purchaser, Romeo does and shall own all patents and other intellectual property rights in or relating to the Products.  Purchaser does and shall own all patents and other intellectual property rights in any of its own vehicles, machines, devices or other products in which the Products are used.
7.     Term & Termination.  The initial term of this Agreement shall commence upon the date hereof and shall continue through December 31, 2022 (the “Initial Term”).  This Agreement shall automatically renew for successive terms of one (1) year each (each, a “Renewal Term”) unless either party notifies the other in writing that this Agreement shall not renew at least one hundred eighty (180) days before the end of the Initial Term or the then current Renewal Term, as the case may be.  The Minimum Volume Commitment and Price for any Renewal Term shall be reviewed in good faith by both Parties starting two hundred and seventy (270) days before the end of the Initial Term or the then current Renewal Term, as the case may be and agreed in writing prior to one hundred eighty (180) days before the end of the Initial Term or the then current Renewal Term, as the case may be. The rights, obligations and duties of the Parties shall survive any termination of this Agreement with respect to any PO submitted by Purchaser and accepted by Romeo during the Term.  Further, Sections 4(c), 4(d), 4(e), 4(f), 5, 6, 8, 9, 10, 11, 12, 13, 14, 15 and 16 shall survive any termination of this Agreement and remain fully effective and enforceable thereafter. The Purchaser may terminate this Agreement for cause, in writing with a ninety (90) days written notice, if: (a) Romeo has failed to meet the Quality Standard to the provision of such termination notice; or (b) Romeo consistently fails to satisfy deliveries within the Lead Time; provided, however, (i) the written termination notice must describe in sufficient detail the reasons and events leading to the termination and steps proposed by Purchaser for avoiding termination; (ii) upon receiving such notice, Romeo will be given thirty (30) days to execute on commercially reasonable proposed steps to remedy any default leading to Purchaser’s termination notice; and (iii) Purchaser shall not terminate this Agreement if Romeo achieves the proposed steps within the thirty (30) days (or longer timeframe, if agreed by the Parties in writing) Purchaser may terminate this Agreement in the event of a Purchaser change of control with no less than one hundred twenty (120) days written notice to Romeo..
8.     Warranties.
(a)     By Romeo.  Romeo shall provide Purchaser the warranty with respect to the Products set forth on Exhibit D, subject to all of the terms, conditions and restrictions set forth therein.
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(b)     By Purchaser.  Purchaser warrants that its use of all Products shall comply with all applicable laws and regulations and shall satisfy all of the conditions to the warranty provided in Exhibit D.
(c)     Disclaimer.  Except as expressly provided in this Section 8 and Exhibit D, Romeo neither makes nor provides any additional warranty hereunder, and Purchaser’s use or other commercialization of any Product shall be at Purchaser’s sole risk.  Without limiting the foregoing, Romeo expressly disclaims any implied warranties, including, without limitation, the implied warranties of merchantability, fitness for a particular purpose and non-infringement
9.     Powered By Credit.  Purchaser may, at Purchaser’s full discretion, credit Romeo as the manufacturer of the battery products used in Purchaser Authorized Products in accordance with Exhibit E.  If Exhibit E is blank as of the date hereof, Romeo may at any time during the Term add a new Exhibit E with Purchaser’s consent.
10.   Indemnification.
(a)     General.  Each Party (the “Indemnifying Party”) shall (i) defend the other Party, its Affiliates and their respective employees, officers, directors, representatives and agents (the “Indemnified Parties”) against any claim asserted or threatened by any third party that is based on any allegation of a fact, thing, circumstance or condition that would, if confirmed, constitute a breach by the Indemnifying Party of this Agreement or the gross negligence, willfulness or intentional misconduct of the Indemnifying Party or any Affiliate thereof (a “Claim”) and (ii) pay any settlement of or final judgment awarded for any Claim; provided in each case that the applicable Indemnified Parties promptly notify the Indemnifying Party in writing of the Claim, tender sole control of the defense and settlement thereof to the Indemnifying Party, and reasonably cooperate in such defense.  Notwithstanding the foregoing, the Indemnifying Party shall not settle any Claim without the Indemnified Party’s prior written consent, not to be unreasonably withheld, delayed or conditioned.
(b)     Intellectual Property Infringement. Romeo shall (i) defend Purchaser, its Affiliates and their respective employees, officers, directors, representatives and agents (the “IP Indemnified Parties”) against any claim asserted or threatened by any third party that any Product infringes any United States patent or other Intellectual Property Right arising under the laws of the United States (an “IP Claim”) and (ii) pay any settlement of or final judgment awarded for any IP Claim; provided in each case that the applicable IP Indemnified Parties promptly notify Romeo in writing of the IP Claim, tender sole control of the defense and settlement thereof to Romeo, and reasonably cooperate in such defense.  Notwithstanding any other provision hereof, Romeo may cancel any PO for any Products that are subject to any IP Claim.  Further, Purchaser shall reasonably cooperate with Romeo’s efforts to address, settle or mitigate the damages, potential damages or other actual or potential liability associated with any IP Claim, including, without limitation, by making or allowing Romeo to make, at Romeo’s expense, any changes to any Products subject to such Claim or to the use thereof, or by accepting any restrictions regarding the use or other commercialization of any such Products, as reasonably requested by Romeo. Notwithstanding the provisions of Section 10(b), Romeo assumes no liability for any IP Claim arising out of or resulting from: (1) Purchasers combination or use of the Products with hardware, software, systems, technology, products, services, intellectual property, data, or materials not provided or approved by Romeo, if such IP Claim could have been avoided by the non-combined or independent use of the Product; (2) modification of the Product by anyone other than Romeo, if such IP Claim would have been avoided by use of the unmodified Product; (3) Romeo’s modification of the Product at Purchaser’s sole direction, if such IP Claim would have been avoided by use of the unmodified Product; or (4) Purchaser’s use of the Product in a manner unauthorized by Romeo or inconsistent with this Agreement.
(c)    Personal Injury or Property Damage:  At any time during the term of this Agreement and thereafter, Romeo shall indemnify and hold Purchaser, its parent, subsidiaries and affiliates, and their respective officers and directors harmless from and against any and all Claims arising out of personal injury (including death) or property damage alleged to have been solely caused by a defect in design, materials or workmanship of a Product.  However, Romeo shall have no liability to Purchaser with respect to damages caused solely by Purchaser’s integration of the Product into Purchaser Authorized Products.
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11.   Safety Risks; Recalls.  In the event that an unacceptable risk to property or human safety from the use of any Product is identified or brought to the attention of either Party (each a “Risk Event”), such Party shall promptly inform the other Party in writing.  Romeo may take necessary or appropriate measures, as determined by Romeo in its sole discretion, to address any Risk Event, including, without limitation, recall of Product that is identified as presenting an unacceptable risk to property or human safety.  Furthermore, Romeo may, in its sole discretion, notify competent authorities, agencies, and other notified bodies (“Agencies”) of Risk Events.  Purchaser shall cooperate with Romeo and any Agency in any response to any Risk Event.  Purchaser shall promptly provide Romeo notice and copies of any communications received by Purchaser or any Affiliate thereof from any Agency.  Except for Risk Events or other issues caused by or attributable to any Purchaser Authorized Product or the use thereof or Purchaser’s breach of this Agreement, negligence or misconduct, Romeo shall be responsible for all costs, expenses, fees, damages, and liability incurred in connection with addressing or resolving any Risk Event. Purchaser shall be responsible for all costs, expenses, fees, damages, and liability incurred by Romeo in connection with addressing or resolving any Risk Event caused by or attributable to any Purchaser Authorized Product or the use thereof or Purchaser’s breach of this Agreement, negligence or misconduct.
12.   Confidentiality.
(a)     Definitions.
(i)            “Confidential Information” means the trade secret or other confidential information of a Party that is or has been disclosed to the other Party, orally or in writing, including, without limitation, any such information of which the Party receiving the disclosure may obtain knowledge through or as a result of the relationship with the disclosing Party, access to the disclosing Party’s premises, or communication with the disclosing Party’s employees or independent contractors, including any such information that is designated as confidential at the time of disclosure or that should, under the circumstances, be understood to be confidential by the Parties.
(ii)           For all purposes of this Agreement, (i) Romeo will be referred to as “Discloser” with respect to its Confidential Information and “Recipient” with respect to Confidential Information of Purchaser, and (ii) Purchaser will be referred to as “Discloser” with respect to its Confidential Information and “Recipient” with respect to Confidential Information of Romeo.
(iii)          Notwithstanding any other provision hereof, Confidential Information shall not include information that Recipient shows (i) is now or later becomes generally known to the trade (other than as a result of a breach of this Agreement), (ii) is independently developed by Recipient without reference to any information supplied by Discloser; or (iii) Recipient lawfully obtains from any third party without restriction on use or disclosure.
(b)     No Unauthorized Use or Disclosure.  Recipient agrees not to use any of the Confidential Information of Discloser for any purpose at any time, other than for the purpose of exercising its rights and performing its obligations under this Agreement (the “Purpose”).  Recipient shall at all times hold in confidence and not disclose or reveal to any Person any such Confidential Information without the clear and express prior written consent of a duly authorized representative of Discloser.  Recipient shall at all times protect the confidentiality of such Confidential Information using at least such care as Recipient uses to protect its own confidential and proprietary information of like importance, but in no event less care than a prudent business person would employ under similar circumstances.  Notwithstanding the foregoing, Recipient may disclose Confidential Information to the extent reasonably required in connection with the Purpose, provided that any such disclosure is made (i) solely with and subject to Discloser’s prior written consent, not to be unreasonably withheld, delayed or conditioned, and (ii) subject to written obligations of confidentiality that are at least as protective of the Confidential Agreement as this Agreement.
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(c)     Subpoena.  If Recipient is served with a subpoena or similar order, interrogatories, requests for information or documents, civil investigative demand or other order or process which seeks to compel the production of Confidential Information, Recipient shall, to the extent permitted under applicable law, promptly notify Discloser in writing thereof.  The Parties shall then cooperate with one another for the purpose of obtaining such relief as will protect the Confidential Information.  Should either Party file any timely motion for a protective order or similar motion with respect to the Confidential Information, Recipient shall not comply with such subpoena or similar order, interrogatories, requests for information or documents, civil investigative demand or other order or process until after such time as the court rules on such motion.  Recipient shall protect the Confidential Information to the maximum extent possible consistent with such ruling.
(d)     For avoidance of doubt, this Section 12 supersedes any confidentiality agreement between the Parties entered into before the date hereof solely with respect to the Parties’ respective obligations regarding Confidential Information that is used to exercise rights or perform obligations under this Agreement.  This Agreement shall not be deemed to supersede any pre-existing obligations with respect to any other information.
13.   Limitation of Liability.
(a)     Except as otherwise provided herein, neither Party nor its Affiliates, licensors, suppliers or service providers nor any of their respective officers, directors, owners, employees, agents, suppliers or representatives will be liable for any special, incidental, consequential or exemplary damages, including, but not limited to, damages for loss of use or lost profits, arising out of or in connection with (i) the Products or their use, (ii) any maintenance, support or other services that relate in any way to the Products or their use, or (iii) this Agreement, even if such Party has been advised of the possibility of such damages.
(b)     Except as otherwise provided herein, in no event will the aggregate liability of either Party for any claims relating to the Product or its use, to any maintenance, support or other services that relate in any way to the Products or their use, or to this Agreement, whether sounding in contract, tort or any other theory of liability, exceed, in the aggregate for all claims, the aggregate payments that Romeo receives from Purchaser under this Agreement.
14.   Insurance.
(a)     Each Party shall, by the end of the Functional and Safety Testing segment of the Test Campaign per Exhibit A (which shall be no later than November 20, 2020), obtain and maintain, throughout the Term, Commercial General Liability insurance satisfactory to each Party using the Insurance Service Office (ISO) policy form CG 00 01 04 13 or such form as provides equivalent coverage.  Such policy shall have minimum limits of $1,000,000 per occurrence, $2,000,000 products/completed operations aggregate and $2,000,000 aggregate including Broad Form Property Damage, Premises and Operations coverage, Products and Completed Operations coverage, advertising injury, Personal Injury coverage, and Blanket Contractual Liability coverage.
(b)     The Commercial General Liability Policy shall be further endorsed to provide, to the fullest extent permitted by law:
o      additional insured coverage to the other Party;
o      that coverage available to the additional insureds shall apply on a primary and non-contributing basis as respects any other insurance, deductibles, or self-insurance available to the additional insureds;
o      a waiver of subrogation in favor of the other Party; and
o      that defense costs shall be in addition to and not erode the limits of liability.
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(c)     Each Party shall obtain and maintain, throughout the Term, Commercial Automobile Liability covering all owned, non-owned, and hired vehicles - $1,000,000 combined single limit of liability for bodily injury or death
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and property damage, including loss of use thereof. Such policy or policies of automobile liability insurance shall be written on an "occurrence" (as opposed to a "claims made") basis.  The Commercial Auto Liability Policy shall be further endorsed to:
o      include the other Party as additional insured on a primary and non-contributing basis; and
o      include a waiver of subrogation in favor of the other Party.
(d)     Each Party shall obtain and maintain, throughout the Term, Workers' Compensation and Employers Liability complying with the applicable statutory requirements and Employers Liability insurance with limits of $1,000,000 bodily injury by accident (each accident); $1,000,000 bodily injury by disease (policy limit); and $1,000,000 bodily injury by disease (each employee).  Policy shall include a waiver of subrogation in favor of the other Party.
(e)     Each Party shall obtain and maintain, throughout the Term, Umbrella/Excess Liability in excess of and follow form to the General Liability, Auto Liability and Employers Liability policies required here within in an amount not less than $5,000,000 each occurrence and in the aggregate.
(f)      All insurance required by this Section 14 shall be in such form and with such companies as shall be reasonably satisfactory to the other Party, provided that such company shall have a minimum A.M. Best rating of A- Class IX.  All insurance required under Section 14 shall name the other Party as an additional insured.  Policies of insurance (to the extent applicable) shall (i) provide that the insurance company will have no right of subrogation against the other Party or any of their respective affiliated or subsidiary companies or the agents or employees thereof and (ii) provide that the proceeds thereof in the event of loss or damage shall, to the extent payable to the other Party, be payable notwithstanding any act of negligence or breach of warranty by the other Party which might otherwise result in the forfeiture or nonpayment of such insurance proceeds. All coverage limits and deductible amounts set forth in this Agreement shall be reviewed by the parties from time to time for the purpose of determining the coverage limits and deductible amounts then appropriate for industries similar in type and for the nature of the business being conducted. The parties shall cooperate reasonably to arrive at an agreement on such matters.
(g)     For the purpose of ensuring compliance with the provisions of this Section 14, Each Party shall furnish to the other Party certificates of all insurance and renewals as required to be maintained pursuant to this Section 14 including all endorsements. All such certificates shall specify that the policies to which they relate cannot be canceled, modified or non-renewed on less than thirty (30) days prior written notice to the other Party or ten (10) days for non-payment and at least ten (10) days prior to their respective expiration dates.
(h)     Neither Party in any way represents, warrants or advises that the insurance or the limits of insurance specified herein are sufficient or adequate to protect the other Party’s interests or cover all of the other Party’s liabilities.
15.   Force Majeure.
(a)     No Party shall be liable hereunder for any failure or delay in the performance of its obligations hereunder to the extent resulting from any acts of God, fire, pandemic, epidemic, explosion, accident, strike, lock-out, civil disorder, terrorist attacks, civil or military authority or any other event or cause beyond such Party’s reasonable control (each an "Event").  To the extent reasonably practicable, each Party shall promptly give notice to the other Party of the occurrence of any Event and shall describe such Event in reasonable detail, including, to the extent possible, the expected duration of the Event and its anticipated impact on such Party’s performance of its obligations under this Agreement.
(b)     Each Party acknowledges that, in entering into this Agreement, it has taken into consideration the current and anticipated future effect of the COVID-19 pandemic (the “Pandemic”) on its business.  In particular, Romeo has taken the Pandemic into account in connection with production planning for purposes of meeting Purchaser’s demand for Products hereunder, and Purchaser has taken the Pandemic into account in its sales forecasts to
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manage its risk associated with the provisions of this Agreement relating to the Minimum Volume Commitment (the “Minimum Commitment Provisions”).  If the direct negative effects of the Pandemic on the business of either Party eventually become greater than such Party reasonably anticipated on the date hereof, such Party may so notify the other Party in writing.  Upon such notice, the Parties shall confer and endeavor in good faith to mutually agree on any amendments to the Minimum Commitment Provisions that are reasonably necessary and equitable in light of such unanticipated negative effects.
16.   Miscellaneous.
(a)     Agreement.  This Agreement constitutes the entire agreement between Romeo and Purchaser with respect to the subject matter hereof and supersedes any and all prior or contemporaneous oral or written communications relating to such subject matter. There being no expectations to the contrary between the Parties, no usage of trade or other regular practice or method of dealing between the Parties shall be used to modify, interpret, supplement or alter in any manner any express terms of this Agreement.  Except as otherwise provided herein, this Agreement shall not be amended except by a writing executed by both Parties. No waiver of any provision of this Agreement or any rights or obligations of either Party hereunder shall be effective, except pursuant to a written instrument signed by the Party or Parties waiving compliance, and any such waiver shall be effective only in the specific instance and for the specific purpose stated in such writing.  A Party shall not assign or otherwise transfer this Agreement or any rights hereunder, and any purported assignment or other transfer without the other Party’s prior written consent (which shall not be unreasonably withheld) shall be null and void ab initio and of no force or effect.
(b)     Governing Law.  This Agreement shall be construed and enforced in accordance with the internal laws of the state of California applicable to contracts entered into and fully performed in California by residents thereof.  Application to this Agreement of the United Nations Convention on Contracts for the International Sale of Goods is expressly disclaimed.  Any action or proceeding brought by either Party against the other arising out of or in connection with this Agreement or the breach or alleged breach hereof, the Product, or the use or commercialization of any Product shall be brought only in a state or federal court located in the state of California, county of Los Angeles, and Purchaser hereby irrevocably submits and consents to the personal jurisdiction of and to venue in such courts for purposes of any such action or proceeding.  Notwithstanding the foregoing, Romeo or any Affiliate thereof may bring any claim or action of any type to enforce, or otherwise address any infringement, misappropriation, misuse or other violation of, any patent, trade secret or other intellectual property right owned or controlled by Romeo or any Affiliate thereof in any court, agency or tribunal, anywhere in the world.
(c)     Severability.  If all or part of any provision of this Agreement shall be deemed invalid or unenforceable under applicable law, such provision, or the invalid or unenforceable part thereof, shall be deemed stricken from this Agreement, and the remainder of this Agreement shall continue in full force and effect.
(d)     No Joint Venture; No Third-Party Beneficiary.  Nothing contained herein shall be deemed to create a joint venture or partnership or agency relationship between Romeo and Purchaser.  Neither Party shall assume or create or have the right or authority to assume or create any obligation or responsibility, express or implied, on behalf of or in the name of the other Party.  Nothing in this Agreement shall be deemed to confer upon any Person other than the Parties and their respective assigns or other successors in interest a right of action either under this Agreement or in any manner whatsoever.
(e)     Press Releases; Confidentiality of Terms.  If either Party wishes to issue a press release or otherwise publicly announce this Agreement, it shall first obtain the other Party’s written consent, which shall not be unreasonably withheld or delayed.   Notwithstanding the foregoing, each Party shall hold in confidence and shall not disclose the terms of this Agreement, except that disclosure by a Party shall be permitted to its employees, lawyers, accountants and other advisors who reasonably require access to such terms and to actual or potential regulators, licensees, licensors, acquirors or other Persons with a reasonable interest in the disclosing Party's business arrangements, provided that any Person acquiring knowledge of such terms shall
​

9

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first agree in writing to maintain the confidentiality of such terms and to use his or her knowledge of such terms only for the purposes for which such terms are disclosed hereunder.  In any event, Purchaser shall be entitled to publicly disclose that Romeo is its supplier of the Products.
(f)      Failure of Essential Purpose.  The Parties acknowledge and agree that the provisions hereof that limit liability, disclaim warranties, or exclude consequential damages or other damages or remedies are essential terms of this Agreement that are fundamental to the parties’ understanding regarding allocation of risk.  Accordingly, such provisions shall be severable and independent of any other provisions and shall be enforced as such, regardless of any breach or other occurrence hereunder.  Without limiting the generality of the foregoing, Purchaser agrees that all limitations of liability, disclaimers of warranties, and exclusions of consequential damages or other damages or remedies shall remain fully valid, effective and enforceable in accordance with their respective terms, even under circumstances that cause any exclusive remedy under this Agreement to fail of its essential purpose.
(g)     Notices.  Any notice or communication required or permitted to be given pursuant to any provision of this Agreement shall be in writing and shall be (i) delivered personally, (ii) sent by certified mail, return receipt requested, or (iii) delivered by nationally recognized overnight courier, addressed as follows:
​
a.             If to Phoenix, to:
[*]
Attn: [*]
​
b.             If to Romeo, to:
4380 Ayers Ave, Vernon, CA 90058
Attn: Lauren Webb, Chief Financial Officer (lauren@romeopower.com) and Lionel Selwood Jr., President (lionel@romeopower.com)
Any such communication shall be deemed to be delivered, given and received for all purposes hereof (i) on the date of receipt if delivered personally by courier, (ii) five (5) days after posting if transmitted by certified mail, return receipt requested, or (iii) the day following deposit with a nationally recognized express overnight delivery service such as FedEx.
​
[Signatures Follow]
​

10

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​
IN WITNESS WHEREOF, the Parties hereby enter into this Agreement as of the date hereof:
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	​

	​

	​

	PURCHASER
	ROMEO

	​
	​

	By:
	/s/ Gillray Cadet
	​
	By:
	/s/ Lauren Webb

	Title:
	CFO & Interim CEO
	​
	Title: Chief Financial Officer

	Print Name:
	Gillray Cadet
	​
	Print Name: Lauren Webb

​
​

11

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Exhibit A
Test Campaign
Romeo will conduct a Test Campaign, for the tests as described below, to validate road-readiness of Product Units.
The tests, which will be conducted in parallel (see Exhibit F), will include but may not be limited to:
	[*]  
	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

		
	[*]  
	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

	[*]  

​
​

12

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Exhibit B
Prices, Minimum Commitments, Lead Time
Product Unit
Romeo Power [*] Pack containing [*].
​
Lead Time
Lead Time, as specified in Section 1(d) of this agreement, is [*] weeks from PO submission. However, a Lead Time exception has been made for the two (2) Prototype Units which will be delivered on September 28, 2020 and the first PO for the Minimum Volume Commitment for 2020 (see below table)  which will have a Lead Time according to Exhibit F.  For the avoidance of doubt, Romeo has accepted the PO for the two (2) Prototype Units and the first PO for the Minimum Volume Commitment for 2020.
​
Prototype Unit Price
Romeo Power Prototype Pack ([*])
​
Product Unit Price and Minimum Volume Commitment
​
	​

	​

	​

	​

	​

	Year
	    
	Price
	    
	Minimum Volume Commitment

	2020
	​
	[*]  
	​
	[*]  

	2021
	​
	[*]  
	​
	[*]  

	2022
	​
	[*]  
	​
	[*]  

​
Price Ceiling Clause
[*]
​
Tiered Pricing Table
[*]
​
​

13

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Exhibit C
Purchaser Authorized Products
1.     [*]
2.     [*]
a.     [*]
3.     [*]
a.     [*]
​
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14

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Exhibit D
Product Warranty
1.     WARRANTY
Subject to Section 2 of this Limited Product Warranty (this “Warranty”), Romeo warrants to Purchaser that each Product Unit and each Safety Tested Battery Unit that has completed the Functional and Safety Testing segment of the Test Campaign per Exhibit A (which shall be no later than November 20, 2020) shall be free of defects in design, materials and workmanship during the period (the “Warranty Period”) commencing upon Purchaser’s receipt of the Product Unit and/or Safety Tested Battery Unit and ending upon the earliest to occur of the following: [*]. For the avoidance of doubt, Romeo defines a cycle as a full charge event followed by a drive event that consumes at least 50% of the Product Unit’s and/or Safety Tested Battery Unit’s usable energy capacity.  Additionally, notwithstanding the foregoing, no warranties are provided for Safety Tested Battery Units that have not completed the Functional and Safety Testing segment of the Test Campaign per Exhibit A  (which shall be no later than November 20, 2020).
​
2.     CONDITIONS
Notwithstanding any other provision hereof, this Warranty shall be void and of no force or effect if:
·      the Product is altered or repaired by any person other than Romeo or Romeo’s authorized service representative;
·      neither Purchaser nor any person that subsequently obtains the Product shall fail in any respect to (i) install, operate, maintain, store and transport the Product in accordance with any guidelines or instructions provided by Romeo or (ii) comply with Section 4 of this Warranty;
·      the Product is at any time exposed to operating temperatures above 60°C or below -20°C.
·      the Product is at any time exposed to charging temperatures above 50°C or below 0°C.
Further, Romeo shall have no liability or obligation under this Warranty, and no Product shall be deemed to violate this Warranty, as a result of any failure, condition or problem attributable to:
·      accident;
·      fire;
·      immersion in liquid;
·      natural disasters, war, riot, terrorism, or other events or occurrences that are beyond Romeo’s reasonable control; or
·      electrical overloading or external electrical shorts, power failure surges, inrush current or lightning.
Notwithstanding any other provision hereof, Romeo provides no warranty whatsoever with respect to (i) any prototypes provided hereunder or (ii) any Products that are not satisfactory as determined by the Test Campaign (i.e., any Products that may not be sold by Purchaser as provided in Section 2(b)).
3.     SERVICE LEVEL AGREEMENT
A Service Level Agreement has been released under Document Reference Number 20004.199.00. The Service Level Agreement shall be reviewed jointly by both Parties, at minimum once per calendar Year.
4.     POTENTIAL WARRANTY EXTENSION
[*]:
[*]
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15

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5.     CLAIM PROCESS AND EXCLUSIVE REMEDY
Purchaser shall promptly notify Romeo of any violation of this Warranty by telephone or email or physical letter as follows:
	​

	​

	​

	Email:
	warrantyclaims@romeopower.com
	​

	Phone:
	323-675-2180
	​

	Address:
	Romeo Power Technology
	​

	​
	4380 Ayers Ave
	​

	​
	Vernon, CA 90058
	​

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Such notice shall (i) describe the warranty violation in detail and (ii) specify the date that the Product was first shipped by Romeo, the date that the Product was first used and the serial number of the Product.  If Romeo requests, Purchaser shall confer (or shall cause the then-current owner of the Product to confer) with a Romeo engineer or technician for the purpose of providing any requested information and endeavoring to resolve the warranty claim expeditiously.  If requested by Romeo, Purchaser shall allow (or shall cause the then-current owner of the Product to allow) an authorized Romeo engineer or technician to inspect the Product at Purchaser’s (or such then-current owner’s) facility or will ship (or cause the then-current owner to ship) the Product to Romeo, FOB destination, to the address provided above or other address specified by Romeo.
If Romeo accepts the warranty claim, it will promptly make commercially reasonable efforts to repair or replace the Product and, if the Product is at Romeo’s facility, will ship the repaired or replaced Product to Purchaser FOB Purchaser’s address (or, if Purchaser requests, to the then-current owner of the Product FOB such current owner’s address).  The repaired Product or replacement Product (as the case may be) will continue to be covered by this Warranty for the remainder of the original Warranty Period.  (Accordingly, for purposes of determining the Warranty Period for a repaired or replacement Product, the ship date and first use date, respectively, of the repaired or replacement Product shall be deemed to be the same as the ship date and first use date of the original Product, and the Ah-throughput of the repaired or replacement Product as of the time that it is shipped or otherwise provided by Romeo shall be deemed to be the same as the Ah-throughput of the Product at the time of the applicable warranty claim.)  Any Product or any components thereof that are replaced shall become the property of Romeo.  The decision whether to repair a defective Product or replace it shall be made by Romeo in the exercise of its sole discretion.  If the defective Product is replaced and the original Product is at Purchaser’s (or the then-current owner’s) facility, Purchaser will either ship the original Product back to Romeo or dispose of the original Product, in each case as Romeo instructs and at Romeo’s sole expense.
If Romeo rejects the warranty claim, it shall promptly so notify Purchaser in writing, which notice explains why Romeo rejected such claim.  If the Product is at Romeo’s facility, Romeo will either ship the Product back to Purchaser (or, if Purchaser requests, to the then-current owner) or dispose of the Product, in each case as the Purchaser instructs and at Purchaser’s sole expense.
This Section 5 of this Warranty sets forth Romeo’s only obligation and liability and Purchaser’s sole and exclusive remedy for any breach of this Warranty.
​
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16

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Exhibit E
Powered By Credit
​
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17

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Exhibit F
Phoenix Motorcars – Project Plan
[*]

18Exhibit 10.19
​
[*] Indicates that certain information in this exhibit has been excluded because it is both (i) not
material and (ii) would be competitively harmful if publicly disclosed.
​
SUPPLY AGREEMENT
​
This Supply Agreement (the “Agreement”) is entered into by and among Nikola Corporation (“Nikola”), a Delaware corporation and Romeo Systems, Inc. (“Romeo”), a Delaware corporation, effective as of August 28, 2020 (the “Effective Date”). Nikola or Romeo may be collectively referred to as the “Parties” or individually as a “Party.”
​
RECITALS
​
WHEREAS, Nikola is a manufacturer of battery electric vehicles.
​
WHEREAS, Romeo is willing to productionize and supply Batteries (as defined herein) for Nikola vehicles in accordance with this Agreement.
​
WHEREAS, Romeo is willing to engage the support of BorgWarner Romeo Power LLC (the “JV”) to industrialize and productionize the Batteries.
​
WHEREAS, Nikola is willing to purchase Batteries for Nikola vehicles from Romeo in accordance with this Agreement.
​
NOW, THEREFORE, in consideration of the premises and the promises made herein, as well as other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Nikola and Romeo agree to be legally bound as follows:
​
AGREEMENT
​
1.         Scope. This Agreement sets forth the terms and conditions between Nikola or Romeo and its Affiliates (as defined herein) regarding the purchase and supply of automotive-grade Romeo [*] as described in Annex 4 (“Packs”) and the necessary battery management software (“BMS”), (the necessary cells, Modules, Packs, & BMS together as “Battery” or “Batteries,” as the case may be). [*]
​
2.         Term. This Agreement shall commence on the Effective Date and, unless terminated as set forth herein, shall remain in effect until [*] after the start of serial production of the Batteries following Level 5 PPAP on production tooling.  The effective period of this Agreement is referred to as the “Term.” The provisions of Sections 12 through and including 25 and the Annexes hereto will survive the termination of this Agreement.
​
3.         Quantity. During the Term, Nikola shall purchase, and Romeo shall deliver, at least [*] (“Quantity Satisfaction”), subject to the other terms hereof.
​
4.         Forecast. Nikola or its designee(s) shall provide quarterly written rolling [*] forecasts indicating Nikola’s projected demand for Batteries (each such forecast, a “Forecast”).  Romeo will accept each such Forecast unless it notifies Nikola in writing to the contrary within five (5) business days after receiving such Forecast.  Romeo’s only basis for rejecting a Forecast shall be that it is inconsistent with the Quantity Satisfaction in that (i) the required deliveries are
​

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unreasonably clustered (rather than spread over the period of the Forecast) to an extent that imposes an unreasonable burden on Romeo or (ii) the number of Batteries in the Forecast is less than required to meet the Quantity Satisfaction.  If Romeo rejects a Forecast, the parties hereto will promptly confer and mutually agree upon a revised Forecast.  Romeo will timely commence the manufacture of Batteries in order to deliver the Batteries by the dates indicated in each accepted Forecast.  Subject to the Quantity Satisfaction obligations, Nikola may reduce the Battery quantities in a given Forecast without penalty for such reduction, except that Batteries scheduled for delivery within [*] from the date of any such notice of reduction by Nikola will be non-cancellable.
​
5.         Battery Pricing. Romeo shall provide Batteries, including the BMS, consisting of and limited to the following costs per kilowatt hour:
​
(a)        [*]
(b)        [*]
(c)        [*].
​
[*].
​
6.         [*].
​
7.         Purchase Orders.
​
(a)        Romeo will accept and timely fulfill all Purchase Orders (as defined herein) that Nikola or its designee(s) issues by the delivery date requested in such Purchase Order so long as the number of Batteries indicated does not exceed the quantity specified in the applicable accepted Forecast with respect to the relevant delivery period and Nikola is current on payment of past invoices.  Romeo’s failure to reject any Purchase Order within five (5) business days shall be deemed to constitute acceptance thereof.  “Purchase Order” means Nikola’s or its designee(s)’s written or electronically transmitted instruction to Romeo that Romeo accepts for deliver Batteries pursuant to applicable delivery or performance dates and locations.
​
(b)        Subject to Sections 3 and 4, Nikola or its designee(s) may: (i) cancel any Purchase Order, or any portion thereof or (ii) reschedule the shipment date of undelivered Batteries and/or redirect shipments of Batteries to alternate locations at any time in its sole discretion for any reason; except that Purchase Orders will become non-cancellable on the date that is [*] from the original scheduled delivery date or, if later, the cell producer’s order lead time, subject to the provisions and Romeo’s obligations below. Upon receipt of notice from Nikola of the cancellation of any portion of a Purchase Order (“Cancelled Portion”), Romeo shall immediately cease all activities associated with such Cancelled Portion and incur no further costs in connection with such Cancelled Portion. Notwithstanding anything herein to the contrary, Nikola will not be liable for any costs in connection with such Cancelled Portion, except for the: (i) portion of the Batteries delivered and/or Services performed prior to the notice of the cancellation provided that such Batteries and/or Services comply with the duties and obligations of this Agreement; (ii) necessary raw materials and components (if any) that were acquired by Romeo in order to comply with the duties and obligations set forth in this Agreement and
​

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associated Purchase Order, which were ordered for delivery no earlier than necessary in order to meet the delivery dates specified in the subject Purchase Order, and which could not be returned for a refund or credit or used for or sold to any of Romeo’s ’s other customers.  Romeo shall notify Nikola of the cost of any cancellation, reschedule or redirection within ten (10) Business Days of notification.
​
(c)        Unless mutually agreed in writing otherwise, all Purchase Orders will be governed by the terms and conditions of this Agreement.  As between Nikola and Romeo, any different or additional terms in any proposal, acknowledgement form or any other document will be of no force or effect and will not become part of the agreement between the Parties.
​
(d)        Romeo may not invoice for Batteries until title transfer, which will be deemed to occur when Nikola or its designee assumes the risk of loss or damage.  Payment terms are [*] from the date Nikola or its designee(s) receives an undisputed invoice.  All amounts payable will be stated and paid in United States Dollars.
​
(e)        Without limiting Nikola’s obligations under Section 3, Nikola is not obligated to purchase any Batteries except pursuant to a Purchase Order it or its designee(s) issues.  Except for amounts due pursuant to a Purchase Order, Nikola will not be responsible for any costs in connection with the supply or purchase of any Batteries.
​
8.         Manufacture & Delivery.  TIME IS OF THE ESSENCE AS TO THE SUPPLY AND DELIVERY OF BATTERIES UNDER THIS AGREEMENT.  Romeo and its Affiliates shall prioritize the manufacture and supply of the Batteries to Nikola to ensure timely fulfillment of Purchase Orders. If Romeo cannot meet the requirements of an accepted Forecast or a Purchase Order, Romeo must promptly notify Nikola and propose a revised delivery date, and Nikola may, at its option, require Romeo to deliver the Batteries using priority freight delivery (with all incremental freight charges at Romeo’s ’s expense).  If, at any time after PPAP level 5 approval, Romeo fails to deliver Batteries when required under the applicable Purchase Order (other than any failure attributable to Nikola or any vendor or supplier thereto (other than Romeo)) and Nikola’s manufacturing lines that rely on Batteries are idled as a result, then the Quantity Satisfaction shall be reduced by five percent (5%) for each day that such lines remain idled until Romeo resumes deliveries.
​
9.         Supply Constraint. If Romeo’s ’s ability to manufacture and deliver any Batteries in accordance with the then current accepted Forecast is constrained for any reason (other than a Force Majeure Event), Romeo will promptly notify Nikola of the supply constraint and Romeo’s plan to resolve it, and will provide Nikola reasonable periodic updates regarding the steps taken to resolve the supply constraint.
​
10.       Pack Development & Productionization.
​
(a)        Engineering.
​
​

​
(i)        Romeo shall timely develop and engineer production-ready Batteries (the “Services”) that pass the tests and meet the requirements of the Design Validation Plan & Report (“DVP&R”) as set forth in Annex 5. [*].
​
(ii)       Romeo acknowledges that the conduct of DVP&R and achieving PPAP level 5 approval is a complex process (the “Development Process”) that involves multiple interdependent projects and initiatives that rely on input and performance from each Party hereto and from several vendors, and that Romeo is primarily responsible for managing the Development Process.  Further, each Party acknowledges that processes such as the Development Process are subject to unanticipated delays and that project management best practices, consistent with budgetary constraints, must be consistently applied to mitigate any such delays.  Accordingly, Romeo will manage and conduct the Development Process in accordance with such best practices in a timely manner.
​
(iii)      If Nikola at any time is concerned that, as a result of Romeo’s failure to manage the Development Process as provided in Section 10(a)(ii) in a timely manner,  either the timing or quality of the Development Process is substantially compromised, Nikola may so notify Romeo in writing.  The Parties will then collaborate to address Nikola’s concerns and remediate any Romeo performance deficiencies.  If Romeo fails to promptly collaborate as required herein upon receipt of such notice from Nikola and to address and resolve any performance deficiencies in accordance with Nikola’s recommendations and project management best practices, Nikola may terminate this Agreement with immediate effect upon written notice to Romeo, notwithstanding any cure period set forth herein.
​
(b)        Pack Line Capital Costs. In conjunction with specifications, requirements, and direction provided by Nikola, Romeo and its Affiliates shall design, procure, and install all machinery, equipment, and tooling necessary to timely assemble the Packs (“Pack Line”) in the quantity required herein at Romeo’s facility in Vernon, CA, USA. [*].
​
(c)        Supplier Tooling. Romeo and its Affiliates shall timely procure the necessary supplier equipment and tooling (“Pack Supplier Tooling”) to produce the Pack enclosure and associated components, [*].
​
(d)        BorgWarner Support. Romeo shall engage the JV to industrialize and productionize the Batteries and associated equipment, machinery, and tooling, including but not limited to the Pack Line and Pack Supplier Tooling.
​
11.       Acceptance. Batteries delivered will be subject to Nikola’s inspection, test and rejection. Acceptance testing and inspection of Batteries will be performed at Nikola’s vehicle fabrication facility (or other applicable delivery destination specified in the Purchase Order) by Romeo’s (as necessary) and Nikola’s personnel.  For avoidance of doubt, if acceptance is delayed with respect to any Purchase Order beyond the date that payment thereunder is due, Nikola shall nevertheless make such payment when due, provided that Nikola shall be entitled to return (at Romeo’s expense) any Batteries that are rightfully rejected and promptly receive a refund therefor.  Any Batteries delivered (individual units or entire lots) that do not comply with the requirements of the applicable Specifications (as defined herein), Purchase Order or this Agreement may be
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rejected; provided, however, that any Batteries accepted upon completion of end-of-line testing and inspection, but later discovered to be Defective Batteries, will instead be handled according to Sections 12 and 13.  Payment of invoices in no way limit Nikola’s rights or remedies under Sections 12 or 13. “Specifications” means the specifications and requirements set forth in Annexes 3 & 4 and any relevant drawings consistent with such specifications that Romeo provides and Nikola approves in writing; provided, however, that if this Agreement is executed before Annexes 3 & 4 are complete, then the Parties shall mutually agree on the final version thereof within forty eight (48) hours after such execution.
​
12.       Warranties.
​
(a)        Romeo represents and warrants that: (a) it has the right to enter into this Agreement and its performance of this Agreement will be free and clear of liens and encumbrances; (b) entering into this Agreement will not cause Romeo to breach any other agreements to which it is a party; (c) the Batteries will be new and comprised of new materials when delivered; (d) to Romeo’s knowledge, neither the Batteries nor any portion thereof infringes any patent, copyright, trademark, trade secret, or other proprietary right (“Intellectual Property Right”) of a third party; (e) when delivered to Nikola, the Batteries will conform to all applicable laws in the United States and Canada, including but not limited to, the National Traffic and Motor Vehicle Safety Act and United States Federal Motor Vehicle Safety Standards. Romeo further warrants (the “Product Warranty”) that the Batteries will meet the Specifications and be free from any defects in material and workmanship or due to design for a period commencing upon delivery of the Battery to Nikola and continuing for: [*].
​
(b)        Notwithstanding the foregoing, the Product Warranty shall be void and of no force or effect if (i) the Battery is altered or repaired by any person other than Romeo or Romeo’s authorized service representative, (ii) either Nikola or any person that subsequently obtains the Battery shall fail in any respect to install, operate, maintain, store and transport the Battery in accordance with any guidelines or instructions provided by Romeo, (iii) cell temperature is at any time outside the range set forth in the Specifications, which temperature is not caused by or attributable to Romeo, or (iv) the Battery is at any time exposed to ambient temperatures outside the range set forth in the Specifications. Further, Romeo shall have no liability or obligation under the Product Warranty, and no Battery shall be deemed to violate the Product Warranty, as a result of any failure, condition or problem attributable to (i) accident, (ii) fire, (iii) immersion in liquid, (iv) natural disasters, war, riot, terrorism, or other events or occurrences that are beyond Romeo’s reasonable control, or (v) if not attributable to Romeo, electrical overloading or external electrical shorts, power failure surges, inrush current or lightning.
​
(c)        For all Batteries that Nikola’s designee(s) purchases, if any, Romeo agrees that Nikola may enforce against Romeo any and all applicable warranties set forth in this Section 12 in the same manner as if Nikola was the actual purchaser of the Batteries.  Further, Nikola’s rights and remedies under this Agreement with respect to the Batteries (including all warranties) remain in full force and effect even if Nikola sells, consigns or otherwise transfers the Batteries to any of Nikola’s contract manufacturers or other subcontractors provided that they are properly stored in Romeo’s original packaging and in accordance with Romeo recommendations. Further,
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the warranty shall follow the Batteries as installed on the original vehicle, tracked by VIN and Battery serial number until expiration, as noted above.
​
13.       Remedies for Defective Batteries.
​
(a)        “Defective Battery” or “Defective Batteries” means any Battery that: (i) fails to comply with the applicable Product Warranty at any time during the applicable warranty period, (ii) fails to comply with any applicable law or regulation at time of delivery; or (iii) creates a theretofore unknown substantiality greater relative risk of bodily injury or property damage.
​
(b)        If, after acceptance, Nikola gives notice to Romeo that more than [*] percent of the Batteries delivered over the course of any calendar quarter or [*] percent during a calendar year are Defective Batteries, the Parties will promptly convene a quality control committee (“QCC”) to determine the cause. Nikola and Romeo may each designate three (3) of their respective qualified personnel to participate in the QCC.  Romeo will provide a sufficient number of qualified manufacturing, materials and quality engineers to effectively conduct the necessary analyses and to document the QCC findings. The QCC will conduct weekly meetings until the cause has been determined and documented to Nikola’s reasonable satisfaction.  Based on such determination of the QCC, Romeo will take appropriate remedial steps approved by the QCC to reduce the defect rate to less than [*] percent per calendar quarter or [*] percent per calendar year.
​
(c)        If more than [*] percent of Batteries delivered to Nikola over a three (3) month period after successful completion of the PPAP level 5 approval are Defective Batteries, regardless of fault or QCC determination, the Quantity Satisfaction will be reduced to zero and will be deemed met.
​
14.       Return of Batteries.  At its expense, Romeo will accept the return of any Defective Batteries that Nikola or its designee(s) returns and will thereupon ship replacement Batteries on the same day the Nikola or its designee(s) returns the Batteries to the extent sufficient Safety Stock (as hereinafter defined) is available or as promptly as is reasonably practicable otherwise.  Romeo will produce and store [*] Packs based upon the applicable Forecast in inventory solely for the purpose of replacing Defective Batteries (the “Safety Stock”).  Romeo will promptly replenish the Safety Stock as it is depleted.
​
15.       Modifications.  Either party may, upon written notice to the other party, request changes to the Specifications.  The party receiving any such request will respond thereto within ten (10) business days, which response will either (i) accept such request or (ii) reject such request.  Neither party will unreasonably reject any such request.  A reasonable basis for Nikola’s rejection of any request to change the Specifications from Romeo would be that the proposed change would make the Batteries less useful, of lower quality in any material respect, or substantially delay or otherwise affect Nikola’s ability to manufacture vehicles in a timely manner.  A reasonable basis for Romeo’s rejection of any request to change the Specifications from Nikola would be that the proposed change would make the Batteries more expensive to produce (except to the extent that Nikola agrees to increase the prices hereunder pro rata based upon such increase in production costs) or would increase the time required for Romeo to produce the Batteries or that Romeo lacks the resources required to accommodate the requested change.  Any rejection will be accompanied
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​
by a detailed explanation of the reason therefor.  If a party hereto requests a change to the Specifications and such request is rejected, the parties, upon notice from the party that requested the change, will promptly confer and mutually agree to revise the Specifications and, potentially, other terms of this Agreement in an effort to accomplish as much as possible the goals of the party making the request for the change while reasonably addressing the concerns of the other party.  If any change to the Specifications is required to comply with a change in law or regulation or to address a material safety concern, the parties will mutually agree to such change and to any changes to other terms hereof that are fair and equitable in light of such change to the Specifications.
​
16.       Service Units and Support Services.  Romeo will provide the service units and support services set forth on Annex 1.
​
17.       Logistics. Delivery terms will be FCA (INCOTERMS 2010) from Romeo’s manufacturing facility, distribution center, or hub to the location designated in the applicable Purchase Order. If Nikola or its designee(s) is the “Importer of Record,” Romeo will, at no charge, promptly forward to Nikola any documents Nikola or its designee(s) may reasonably require to allow Nikola or its designee(s) to clear the Batteries through customs and/or obtain possession of the Batteries at the port of entry.  Romeo will use the freight carriers that Nikola or its designee(s) selects or approves.  Romeo will package all Batteries in accordance with applicable Specifications using at least industry-standard commercial practices.
​
18.       Manufacturing Commitment.  Regardless of initial manufacturing yields or any other circumstance, Romeo will always timely start the manufacture of the Batteries in order to fully and timely meet Nikola’s accepted Forecasts.  For example, if Romeo is experiencing undesirable manufacturing yields during the initial ramp of any Batteries, Romeo will nevertheless continue to manufacture the Batteries to meet Nikola’s accepted Forecast.
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19.       Right to Manufacture. If Romeo materially breaches its supply obligations under this Agreement and fails to cure such breach within thirty (30) Days of Romeo’s receipt of Nikola’s written notice of such breach (“Cure Period”), then Romeo, shall grant and hereby grants to Nikola an irrevocable, sublicensable, worldwide, royalty-free license for the duration of the breach to produce that number of Batteries that Romeo was obligated but failed to supply.
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20.       Limits of Liability.  Except for any violation of any obligation with respect to Confidential Information or to pay amounts owing under any Purchase Order, (i) in no event will either party be liable under this Agreement for consequential or exemplary damages, and (ii) in no event will either party’s liability to the other arising out of or in connection with this Agreement exceed, in the aggregate, the amounts paid or payable by Nikola to Romeo during the twelve (12) month period preceding the time that such liability first accrues.
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21.       Indemnification.
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(a)        Romeo’s Obligations. Romeo agrees to indemnify, defend and hold harmless, reimburse and compensate Nikola, Nikola’s Affiliates, and each of their shareholders, directors, officers, employees and agents (collectively “Nikola Indemnities”) from and against
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any and all costs, fees, penalties, expenses, damages (consequential and otherwise) that any Nikola Indemnitee is obligated to pay to the Claimant (as hereinafter defined), and reasonable attorneys’ fees (“Losses”) arising out of any claim brought by any third party (the “Claimant”) against Nikola to the extent that such Losses arise from any actual or alleged:
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(i)        Noncompliance by Romeo with any of its representations, warranties or obligations under this Agreement (other than the Product Warranty);
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(ii)       Defect that causes the Batteries to be unreasonably dangerous, to the extent that such defect causes personal injury, death or property damage;
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(iii)      Negligence, recklessness or willful misconduct of Romeo;
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(iv)      Recall campaign, corrective service action, or other voluntary or involuntary action in which Nikola reasonably participates with respect to the Batteries that is not attributable to the negligence or fault of Nikola or any affiliate thereof;
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(v)        Any spill, discharge or emission of hazardous wastes or substances from the Batteries;
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(vi)      Infringement (including claims of direct or contributory infringement or inducement to infringe) of any Intellectual Property Right (as defined herein) by the Batteries provided by Romeo;
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(vii)     Damages to the property of or personal injuries to Nikola, Nikola’s customers, their respective agents, or any other person or entity to the extent arising from or in connection with Romeo’s negligence associated with its work on Nikola’s controlled premises or its use of Nikola’s property; or
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(viii)    Challenge to Nikola’s sole right, title and interest in the tooling, jigs, dies, gauges, fixtures, molds, patterns, supplies (the “Tooling”), or right to possession of the Tooling, brought by any third party, including toolmakers, subcontractors, and lending institutions, other than any of the foregoing that is based upon any act or omission or Nikola, any Affiliate thereof, or any of their respective agents or representatives.
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(b)        Nikola’s Obligations. Nikola agrees to indemnify, defend and hold harmless, reimburse and compensate Romeo, Romeo’s Affiliates, and each of their shareholders, directors, officers, employees and agents (collectively “Romeo Indemnities”) from and against any and all Losses (“Losses”) arising out of any claim brought by the Claimant against Romeo to the extent that such Losses arise from any actual or alleged:
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(i)        Negligence, recklessness or willful misconduct of Nikola; or
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(ii)       Recall campaign, corrective service action, or other voluntary or involuntary action in which Romeo reasonably participates with respect to the Batteries that is attributable to the negligence or fault of Nikola or any affiliate thereof.
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(c)        Process. The indemnified party shall tender sole control of the defense and settlement of any indemnified claim to the indemnifying party and shall reasonably cooperate with the indemnifying party in such defense; provided that the indemnifying party shall not settle any claim without the indemnified party’s consent, not to be unreasonably withheld, delayed or conditioned.  The indemnified party may at its option participate in the defense of any claim with its own counsel, at its expense.
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(d)         Obligation Scope. The indemnifying party’s obligations under this Section even apply to Losses partially caused by any indemnitee’s negligence, provided that in that event such liability shall be equitably apportioned.  The indemnifying party’s obligation to defend and indemnify under this Section apply regardless of whether the claim arises in tort, negligence, contract, warranty, strict liability or otherwise.  The indemnification obligation under this Section will not be limited in any way by any limitation on the amount or type of damages, compensation or benefits payable by or for the benefit of the indemnifying party under workers’ compensation acts, occupational disease acts, disability benefits acts or other employee benefits acts.
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22.       Duty to Correct.  If a third-party claims that any Batteries infringe such third party’s Intellectual Property Right, Romeo will, in addition to its obligations in this Agreement, promptly notify Nikola in writing and, at its own expense, keep Nikola informed of Romeo’s defenses.  If a third party  obtains a final non-appealable judgment against Romeo arising out of a claim by such party alleging that the Batteries infringe an Intellectual Property Right(s) of such third party, Romeo will exercise the first of the following remedies that is practicable: (a) obtain from such third party the right for Nikola to use, import and sell such Batteries in Nikola products; (b) modify the Batteries so they are non-infringing and in compliance with this Agreement; (c) replace the Batteries with non-infringing versions that comply with the requirements of any Specifications and this Agreement; or (d) at Nikola’s sole request and option, accept the return of infringing Batteries in Nikola’s possession and refund any amounts Nikola paid.
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23.       Termination.
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(a)        Termination by Nikola for Cause. Subject to Section 23(b), Nikola may also terminate for cause, effective upon delivery of a termination notice or upon such other date specified by Nikola in writing.  Subject to Section 23(b), Cause means:
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(i)        Breach of any warranty or other term of this Agreement; or
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(ii)       Assignment for the benefit of creditors, voluntary bankruptcy or involuntary bankruptcy or insolvency proceedings that are not dismissed within ninety (90) days.
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(b)        Cure.  Subject to the provisions of Section 8 and 10, if Romeo breaches any warranty or other term of this Agreement, (i) Romeo may cure such breach within thirty (30) days of Romeo’s receipt of written notice thereof from Nikola if such breach is reasonably capable of
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being cured within thirty (30) days or, (ii) if such breach is not reasonably capable of being cured within such thirty (30) day period, Romeo commences to cure such breach within such thirty (30) day period and pursues such cure to completion with reasonable diligence.
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(c)        Limitations on Nikola's Obligations Following Termination..
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(i)        Within one (1) month after the date of termination, Romeo must provide Nikola with a complete list of Nikola's obligations hereunder which list Nikola may verify via audit of Romeo's records, either before or after payment.
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(ii)       Nikola is not obligated to make any payment for Batteries, Pack Line, Pack Supplier Tooling, equipment, tooling, works in process, parts or raw materials: (i) in excess of those authorized or required under any Purchase Order, (ii) that are damaged or destroyed or that are not merchantable or useable; (iii) that are in Romeo's standard stock or that are readily marketable; or (iv) that can be returned by Romeo for credit.
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(iii)      Nikola is not liable, directly or on account of claims by Romeo's subcontractors, for consequential damages, loss of anticipated profit, failure to realize anticipated production volumes, revenues or savings, unabsorbed overhead, interest on claims, product development and engineering costs, tooling, facilities and equipment rearrangement costs or rental, unamortized capital or depreciation costs, or general administrative burden charges from termination or expiration of this Agreement by Nikola pursuant to Section 23(a).
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(d)        Termination by Romeo for Cause. Romeo may only terminate this Agreement for non-payment of the purchase price for the Batteries or other breach of this Agreement by Nikola, and then only if:
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(i)        Romeo first provides Nikola written notice specifying the amounts past due or other breach hereof and Romeo's intent to terminate this Agreement if the past due amount is not paid or other breach cured; and
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(ii)       Nikola does not either:
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(1)        pay the past due amounts or notify Romeo that the amount claimed to be unpaid are disputed by Nikola in good faith, in either event within ten (10) days of notice of such default, in the event of a payment default
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(2)        or (x) cure such breach within thirty (30) days of Nikola’s receipt of written notice thereof from Romeo if such breach is reasonably capable of being cured within 30 days or, (y) if such breach is not reasonably capable of being cured within such thirty (30) day period, commence to cure such breach within such thirty (30) day period and pursue such cure to completion with reasonable diligence
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(e)        Romeo's Obligations Following Termination For Any Reason. Notwithstanding any claimed or actual breach by Nikola (but provided that Nikola is current in its
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payment obligations and only using the Batteries in Vehicles), Romeo shall cooperate during the transition to a successor supplier (“Transition Support”), which consists of the following:
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(i)        Romeo shall continue production and delivery of all Batteries ordered by Nikola consistent with the accepted Forecast, at the prices and other terms stated in this Agreement, without premium or other condition, during the entire period reasonably needed by Nikola to complete the transition to the alternate supplier(s) (but not exceeding one hundred twenty (120) days);
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(ii)       At no cost to Nikola (except as provided in Section 23(d)(iii)), Romeo shall promptly provide all reasonably requested information and documentation regarding and access to Romeo's manufacturing process relating to Packs, related bill-of-material data, tooling and process detail and samples of Packs and components; and
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(iii)      If the transition occurs for reasons other than Nikola’s termination for cause, Nikola will, at the end of the transition period, pay the reasonable, actual cost of the assistance under Section 23(d)(ii), provided that Romeo has advised Nikola prior to incurring such amounts of its estimate of such costs. If the parties disagree on the cost of Transition Support, Nikola will pay the agreed portion to Romeo without prejudice to Romeo's right to seek to recover any disputed amounts.
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24.       Intellectual Property. If Romeo, or any person employed by or working under the direction of Romeo, in the performance of Section 10 of this Agreement conceives or first reduces to practice: (i) any invention or any experimental, development or research activities, including engineering related thereto, whether or not patentable; (ii) any reduction to practice of any subject matter, application or discovery which could be patented or copyrighted; or (iii) any improvement in the design of the Packs or any alternative or improved method of accomplishing the objectives of this Agreement (collectively, “Inventions”), such Inventions will be owned solely by Nikola and be deemed Nikola's confidential and proprietary property and Romeo shall not disclose or otherwise use such Inventions for the benefit of any third party.  Romeo: (z) shall promptly disclose and assign all Inventions; (y) hereby assigns all Inventions; and (x) shall cooperate (and cause its employees to cooperate) in executing any documents and take any other actions necessary or convenient to patent, copyright, or otherwise perfect or protect all Inventions; each of the foregoing, to or for the sole and exclusive benefit of Nikola. Further, Romeo shall ensure that the terms of its agreements with its subcontractors and employees are consistent with the terms of this Section.
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25.       Miscellaneous.
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(a)        Incorporation by Reference.  The terms and conditions in the Recitals and the Annexes hereto are incorporated herein by this reference.
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(b)        Relationship of Parties.  Nothing in this Agreement creates a joint venture, partnership, franchise, employment or agency relationship or fiduciary duty of any kind. Neither Party will have the power to, nor will it hold itself out as having the power to, act for or in the
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name of or to bind the other Party.  Except as expressly provided, this Agreement is not for the benefit of any third parties.
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(c)        Branding. Except as otherwise required by law, the Batteries or any components thereof may not include any indicia or branding that denotes or otherwise indicates Romeo or its Affiliates as the source of the Batteries. Further, Romeo shall include Nikola branding on the Batteries, to the extent reasonably requested by Nikola.
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(d)        No Waiver; Governing Law.  The failure of either Party to enforce any right resulting from breach of any provision of this Agreement shall not be deemed a waiver of any right relating to a subsequent breach of such provision or of any other right hereunder. This Agreement shall be governed by and construed in accordance with the laws of the State of Arizona, without resort to conflicts of law principles. The Parties further agree that the forum for any legal proceeding arising as a result of this Agreement shall be in the courts of Maricopa County, Arizona.
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(e)        Confidentiality. Except as is necessary to accomplish the purposes of this Agreement, the recipient of any Confidential information (as defined herein) shall hold such Confidential Information in the strictest confidence and shall not use or disclose it without the prior express written consent of the disclosing party, provided that, to the extent permitted under applicable law, any disclosure authorized hereunder shall be made subject to written obligations of confidentiality that are at least as protective of the Confidential Information as this Section 25(d). “Confidential Information” includes the existence of this Agreement (provided that either party may disclose the existence and terms of this Agreement to its financial, legal and other advisors, to any actual or potential creditor, investor or other person similarly having a reasonable interest therein or as required by law or the rules of any securities exchange), all non-public information, including trade secrets, specifications, formulae, compositions, processes, designs, drawings, samples, instructions, models, notes, techniques, diagrams, which are clearly marked with “proprietary,” “confidential” or similar legend or if it would be apparent to a reasonable person that such information is of a confidential or proprietary nature; provided, that, if Romeo is required to disclose any Confidential Information (including the filing of this Agreement) pursuant to law or regulation (each a “Required Disclosure”), Romeo shall provide timely written notice to Nikola to the extent permitted by law and Romeo shall seek confidential treatment with respect to the disclosure of this Agreement to any governmental authority and shall provide Nikola with a reasonable opportunity to review and make suggestions to any proposed disclosure, which reasonable suggestions will be accepted by Romeo  (including any redacted copy of this Agreement to be filed as an exhibit to (i) any public filing by Romeo pursuant to U.S. securities laws or (ii) any other public filing pursuant to any other applicable law or regulation); provided, further, that Romeo shall disclose only that portion of the Confidential Information, which upon the advice of Romeo’s counsel, is legally required to be disclosed. Notwithstanding anything herein to the contrary, following any Required Disclosure, Romeo shall continue to treat any Confidential Information included in such Required Disclosure as confidential and the disclosure of such Confidential Information shall continue to be restricted by the terms hereof as if such Required Disclosure did not occur. For the avoidance of doubt, Confidential Information disclosed in a Required Disclosure is still Confidential Information, including but not limited to Nikola’s identity as a party hereto, regardless of whether publicly disseminated. Any Confidential Information disclosed pursuant hereto shall remain the sole property of the disclosing party.
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Notwithstanding the foregoing, Confidential Information shall not include information that is:   (i) rightfully known to the receiving party prior to receipt of the same from the disclosing party; (ii) independently developed by personnel of the receiving party without any reference or access to the Confidential Information; or (iii) generally made available to third parties by disclosing party without restriction concerning use or disclosure. Notwithstanding anything herein to the contrary, any deliverables, results, or work product created pursuant to Section 10 hereof shall be deemed Nikola's Confidential Information and may only be exploited or used by Romeo for the exclusive benefit of Nikola; provided that, notwithstanding anything herein to the contrary, (i) nothing in this Agreement shall limit or restrict Romeo from using or disclosing any Residuals for any purpose, including without limitation use in development, manufacture, promotion, sale and maintenance of its products and services, provided that this right to Residuals does not represent a license under any Nikola patents, and (ii) receipt of Confidential Information under this Agreement will not create any obligation in any way limiting or restricting the assignment and/or reassignment of Romeo’s personnel.  “Residuals” means any information retained in the unaided memories of Romeo’s personnel who have accessed and used Nikola’s Confidential Information pursuant to the terms of this Agreement, including information subsequently recorded or otherwise expressed in writing or on other media from such unaided memory.  A person’s memory of information is unaided if he or she is not known to have an eidetic, photographic, or other type of atypical memory and he or she does not refer to tangible embodiments of such information (other than notes taken and documents prepared by Romeo’s personnel in the ordinary course of performing their duties for Romeo and not for the purpose of copying tangible embodiments of Confidential Information) for the purpose of using or disclosing such information. THE EXISTENCE OF NIKOLA AS A PARTY HERETO IS NOT A RESIDUAL. NOTHWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, ROMEO MAY NOT PUBLICLY DISCLOSE OR COMMENT ON THE EXISTENCE OF THIS AGREEMENT TO ANY PARTY, EXCEPT FOR IN A REQUIRED DISCLOSURE.
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(f)         Press Releases and Publicity.  Neither Nikola nor Romeo will issue press releases or other publicity regarding this Agreement or its subject matter without the prior written approval of the other.
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(g)        Compliance with Laws.  Romeo agrees that it will fully comply with all applicable laws and regulations in performing its obligations under this Agreement.  Romeo agrees that it will not export, re-export, sell, resell or transfer any customer data or any export-controlled commodity, technical data or software (i) in violation of any law, regulation, order, policy or other limitation imposed by the United States (including the United States Export Administration regulations) or any other government authority with jurisdiction; or (ii) to any country for which an export license or other governmental approval is required at the time of export, without first obtaining all necessary licenses or equivalent.
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(h)        Insurance and Loss Prevention.  Romeo will comply with the requirements specified in Annex 2 hereto.
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(i)         Assignment.  This Agreement is personal to Romeo, and Romeo may not assign, delegate or otherwise transfer this Agreement, any Purchase Order, and/or any right or obligation thereunder without the prior written consent of Nikola, which consent will not be
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unreasonably withheld, delayed or conditioned.  Withholding consent will be deemed to be reasonable so long as the assignment, delegation or other transfer would be reasonably expected to impair Romeo’s ability to perform its obligations under this Agreement (whether because the acquiror lacks industry experience, is financially unsound or for any similar reason).  If Nikola withholds consent, Romeo and Nikola will, to the extent requested by Romeo, confer in an effort to address Nikola’s concerns regarding the proposed assignment, delegation or other transfer so as to obtain Nikola’s consent thereto to the extent reasonably practicable.  A Change of Control, as defined below, will be considered an assignment of this Agreement.  Any assignment, delegation, subcontracting or other transfer, in whole or in part, without such consent will (as Romeo’s sole liability and Nikola’s sole and exclusive remedy therefor) reduce the Quantity Satisfaction to zero, deem it to have been met, and terminate Nikola’s obligations with regard to the Development Process, Pack Line, and Supplier Pack Tooling, resulting in no liability to Nikola in conjunction therewith.  For the avoidance of doubt, Nikola shall have no further liability to Romeo upon assignment of this agreement by Romeo if Romeo shall fail to seek consent therefor as required hereunder or if Nikola reasonably withholds such consent as provided above. Subject to the foregoing, this Agreement will be binding upon, and inure to the benefit of, the successors, assigns, representatives, and administrators of the Parties.  “Change of Control” means (i) any sale or exchange of the capital stock by the shareholders of Romeo in one transaction or a series of related transactions where more than 50% of the outstanding voting power of Romeo is acquired by a person or entity or group of related persons or entities; (ii) any reorganization, consolidation or merger of Romeo where the outstanding voting securities of Romeo immediately before the transaction represent or are converted into less than fifty percent 50% of the outstanding voting power of the surviving entity (or its parent corporation) immediately after the transaction; or (iii) the consummation of any transaction or series of related transactions that results in the sale of all or substantially all of the assets of Romeo, other than where the entity acquiring shares or assets, or the surviving entity with respect to clause (ii) above, is Romeo or a wholly owned subsidiary of Romeo.  For the avoidance of doubt, Romeo’s use of consultants and other service providers in the performance of its obligation hereunder (such as, by way of example and not limitation, its use of the JV in connection with its development and operational obligations hereunder) shall not be deemed to be a delegation in violation of or to otherwise violate this Section 25.
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(j)         Audits & Inspections.  During the Term and for two (2) years thereafter, Nikola or its representatives may inspect Romeo facilities and audit Romeo’s records to verify that Romeo has complied with its obligations under this Agreement.  Romeo will provide Nikola or its representatives any information and documentation that is reasonably requested in connection with such audit or inspection. Romeo will maintain all records related to the Batteries during the Term and for two (2) years thereafter. Romeo will reimburse Nikola within 45 days after the audit is completed for any overpayments made by Nikola or its designee(s). Romeo must track the date Batteries are produced and make such information available to Nikola upon Nikola’s request during the term of this Agreement and for two (2) years after the Batteries are delivered.
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(k)        Romeo Affiliate(s).  Romeo may perform its obligations under this Agreement through one or more of Romeo’s Affiliate(s).  Romeo is not relieved of any of its obligations under this Agreement by virtue of utilizing an Affiliate(s) to perform its obligations under this Agreement. Any breach of this Agreement by an Affiliate(s) is deemed to be a breach of this Agreement by Romeo. If a Romeo Affiliate is providing Batteries or related services under
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this Agreement, then Romeo must notify Nikola in writing of the affiliate’s identity and clearly explain its legal and corporate relationship with Romeo.
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(l)         Remedies.  If Romeo breaches any term of this Agreement in connection with the provision of Batteries to Nikola’s designee(s), then Romeo agrees it owes to Nikola any and all remedies under this Agreement for such breach as if Nikola had been the direct purchaser of the Batteries from Romeo. For example, if Romeo fails to timely deliver Batteries to Nikola’s designee(s), then Romeo will owe Nikola (and Nikola can seek from Romeo under this Agreement) any available remedies for failing to timely deliver such Batteries. If Nikola seeks remedies in such event, then Nikola’s affected designee(s) cannot seek remedies for the same breach.
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(m)       Reports.  Romeo will, at Romeo’s expense, provide reports requested by Nikola, including reports regarding the Batteries, Purchase Orders, and Defective Batteries.
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(n)        Notices.  Any notice required or permitted hereunder will be in writing and will be given to the appropriate Party at the address first set forth above, or at such other address as the Party may hereafter specify in writing.  Any notices to Nikola will be sent to the attention of Nikola’s operations department.  Such notice will be deemed given: upon personal delivery to the appropriate address; or three (3) Business Days after the date of mailing if sent by certified or registered mail; or one (1) Business Day after the date of deposit with a commercial courier service offering next business day service with confirmation of delivery. “Business day” means any day on which banks are open for business in Phoenix, Arizona.
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(o)        Force Majeure.  Neither Party will be liable for any failure to perform caused by circumstances beyond its reasonable control including, but not limited to, acts of God, earthquakes, hurricanes, floods, tornados, fires, acts of war, hostilities, invasions, terrorism, civil disorder, riots, labor actions (other than actions by Romeo’s personnel and contractors), major upheavals, government action, government restrictions, blockade, embargo, utility disruptions, including power and water, or accident (each, a “Force Majeure Event”), provided: (i) it promptly notifies the other Party and uses reasonable efforts to correct its failure to perform; and (ii) it has taken such commercially reasonable efforts to protect against and mitigate the impact of the force majeure event if such event was reasonably foreseeable or was of a kind for which such precautionary measures are customarily taken in the applicable industry. For the avoidance of doubt, the COVID-19 pandemic is not a force majeure event, but any governmental actions taken in response thereto after the date hereof (e.g., orders requiring the closure of manufacturing facilities or suspension of shipping) may be Force Majeure Events.
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(p)        Headings.  The section headings in this Agreement are for convenience only and are not to be considered in construing or interpreting this Agreement.
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(q)        Severability. If a court finds any provision of this Agreement or any right or obligation invalid or unenforceable, this Agreement shall be immediately deemed amended to: (i) include a provision that reflects the intent of the Parties, or, if (i) is not possible, (ii) to exclude such provision and the parties shall negotiate in good faith a substitute provision that reflect the Parties’ intent at the time of entering into this Agreement.
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(r)         Related Documents; Precedence.  The terms and conditions of any Purchase Order and the terms and conditions of any schedules, annexes, attachments and other documents referenced herein or therein are incorporated into the terms and conditions of this Agreement.  In the event of any conflict in the documents which constitute this Agreement, the order of precedence will be (i) this Agreement; (ii) any other schedules, annexes, attachments and other documents referenced and incorporated herein and therein; and (iii) any Purchase Order.
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(s)        Counterparts.  This agreement may be executed in two (2) or more counterparts including signing an electronic or facsimile copy. Each counterpart shall be deemed an original and all counterparts together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the effective date shown above.  Each of the persons signing this Agreement affirms that he or she is duly authorized to do so and thereby to bind the indicated entity.  This Agreement may be executed simultaneously 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.
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      [*]
        [*]
Address:  [*]
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      Lionel Selwood, Jr.
        President
Address:  4380 Ayers Avenue
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	Nikola Corporation
	Romeo Systems, Inc.

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	/s/ Mark Russell
	​
	/s/ Lionel Selwood, Jr.

	
	Name:
	Mark Russell
	Name:
	Lionel Selwood, Jr.

	Title:
	Chief Executive Officer
	Title:
	President

	Address:
	[*]
	Address:
	4380 Ayers Avenue

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	​
	Vernon, CA  90058

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Annex 1
Service and Support
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1.         Romeo will accept and fulfill Purchase Orders for replacement Batteries (“Service Units”) [*].  To ensure that it is able to do so, Romeo agrees to (i) maintain an adequate stock of Service Units and/or (ii) maintain the equipment and materials (or the ongoing ability to timely acquire as needed) needed to produce and timely deliver Service Units throughout this five-year period.  [*].
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[*]
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Annex 2
Insurance and Loss Prevention
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1.         Romeo will, at no cost to Nikola or Nikola’s designee(s), maintain the following minimum insurance in full force and effect throughout the term of this Agreement: (i) public liability or commercial general liability insurance, including coverage for products liability and products/completed operations hazard, claims by one insured against another insured, and Romeo’s defense and indemnity obligations under this Agreement, with coverage of not less than $5,000,000 USD combined single limit per occurrence and $5,000,000 USD annual aggregate; (ii) automobile liability insurance in compliance with all statutory requirements and providing coverage for third party bodily injury and property damage, with limits of not less than $500,000 USD each accident, for all owned, non-owned and hired motor vehicles used in the performance of Romeo’s obligations under this Agreement; (iii) workers’ compensation insurance in compliance with all statutory regulations in any country, state, territory or province where any of the Batteries are provided, manufactured or delivered; and (iv) property insurance on an all-risk of physical loss basis, subject to standard exclusions, with sufficient limits to cover Romeo’s liability for risk of loss or damage to Nikola property while in Romeo’s care, custody or control.
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2.         The insurance coverage that Romeo is obligated to carry pursuant to this Annex 2 will include either (i) an indemnity to principals clause and either a blanket interest provision, or separately note the interests of Nikola, its subsidiaries and Affiliates, and any other Party which Nikola may reasonably designate as principals for liabilities and damages for which Romeo is obligated to provide indemnity to such parties pursuant to this Agreement, or (ii) Nikola, its subsidiaries and Affiliates, and any other party which Nikola may reasonably designate as additional insureds for liabilities arising out of the acts or omissions of the Romeo, its employees, and agents in the performance of this Agreement.  The property insurance that Romeo is obligated to carry will include Nikola, its subsidiaries and Affiliates as loss payees, as their interests may appear.  The insurance that Romeo maintains will be primary to and without a right of contribution from any insurance maintained by or otherwise afforded to Nikola, its subsidiaries and Affiliates.
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3.         Romeo will deliver to Nikola’s procurement department ([*]) one or more certificates of insurance showing evidence of the maintenance of the coverage required above.  In the event of cancellation of any required coverage, Romeo will promptly replace such coverage so that no lapse in insurance occurs.  Nikola reserves the right to perform risk evaluations of Romeo’s facilities and Romeo agrees to work with Nikola to upgrade any facility that does not comply with such requirements.
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Annex 3
Module Specifications
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Annex 4
Pack Specifications
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Annex 5
Design Validation Plan & Report

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