Xos Fleet, Inc. General Terms and Conditions
1. The Agreement
1.1 Offer and Acceptance. Each purchase order that XosFleet, Inc. (“Xos”) issues (“Purchase Order”) is Xos's offer to purchase the goods and services (collectively, “Products”) identified in that Purchase Order from the party to whom such Purchase Order is addressed, including applicable affiliates and subsidiaries(“Supplier”). Supplier will be deemed to have accepted a PurchaseOrder as issued by shipping Products, performing services, commencing work under the Purchase Order, written acknowledgment of the Purchase Order, failing to reject the Purchase Order within ten (10) calendar days, or any other conduct evidencing acceptance. Xos may withdraw the Purchase Order at any time before it is accepted by Supplier. Upon acceptance, the Purchase Order together with these General Terms and Conditions(“General Terms”) and any other documents specifically incorporated in the Purchase Order or separately agreed to in writing (including without limitation, specifications, technical or commercial information relating to the design, development, manufacture, packaging and labeling, delivery, logistics, installation, assembly, testing, and/or use of one or more items, drawings, Xos quality and other requirements, collective“Specifications”), will become a binding contract between Xos and Supplier(collectively, the “Agreement”). In the event of conflict between any Purchase Order, Request for Proposal, and these General Terms, the General Terms shall prevail followed by the Purchase Order.
1.2 Changes.
(a) Xos reserves the right to modify or cancel any Purchase Order.
(b) Supplier will not make any change to the Products except at Xos's written instruction or with Xos's written approval.To the extent that Supplier’s change order request will affect the costs, timing, and/or delivery of Supplier’s Products and services, within seven (7) days, Supplier shall provide documentation and information requested by Xos to Xos to substantiate Supplier’s claim. If Xos in its sole discretion determines that an adjustment is appropriate, the parties (i) in good faith will negotiate an equitable price adjustment and/or a change in shipping, delivery, or other applicable terms and (ii) shall memorialize such changes through a written change order form. If Supplier learns of a possible change to the Products that may reduce costs, improve quality, or otherwise be beneficial to Xos, Supplier will inform Xos of the possible change.
1.3 Variations in Quantity. Xos, at Xos’s sole discretion, may reduce the quantity of purchased Products by up to twenty-five percent (25%) for one or more Purchase Orders without Supplier increasing the fixed Price for the materials and/or Products.
2. Products and Services
2.1 Quantity. If quantities or delivery schedules are not specified in the Agreement, they will be as reasonably determined by Xos and stated in Xos’s firm releases (“Releases”) issued to Supplier from time to time. For unspecified quantities, the quantity is for all or a portion of Xos’s requirements and may be for up to one hundred percent (100%) of Xos’s requirements for the Products. Releases may include forecasts or projections of future volume or quantity requirements for the Products, but only Releases for firm quantities are binding upon Xos and Xos will have no obligation or liability beyond the Releases for firm quantities. Unless otherwise specifically stated in the Agreement, the agreement is not exclusive and Xos may purchase similar products and services from third parties, unless the Agreement expressly states that it is exclusive.
2.2 Inspection. Xos, at Xos’s sole discretion may inspect the materials and/or Products at Supplier’s facilities, Xos’s facilities, or any third-party delivery or storage facilities. Any inconsistency or discrepancy between the delivered materials and/or Products and those on the packing list shall be deemed and considered a shortage, loss, or excess in the delivery. Upon Xos’s approval, Supplier, at Supplier’s sole cost and expense may observe the delivery inspection by Xos. Supplier shall timely notify Xos(but no later than seven (7) days prior to a scheduled delivery inspection)if Supplier desires to observe Xos’s delivery inspection. If Xos identifies any shortage, loss, excess, or damage during the delivery inspection, Supplier shall, at Supplier’s sole cost and expense(such costs including without limitation and in accordance with the other terms of the Agreement, expedited shipping, export packing, handling, and transportation costs to the delivery location)immediately repair and/or replace the materials and/or Products necessary to restore such shortage, loss or damage. The determination by Xos as to shortage, loss, or damage shall be binding upon Supplier. Any excess found at the time of an unpacking inspection shall not be deemed to substitute for the shortage, loss, or damage and may be returned to Supplier atSupplier’s cost. Xos may accept or reject any delivery in whole or in part that does not fully comply with any Purchase Order(including without limitation, any delivery that exceeds the quantity of an order, differs in the type of materials and/or Products scheduled for delivery, or quantities or quality that does not comply with order Specifications).
2.2 Xos and Industry Standards and Policies. Supplier agrees to comply with Xos Supplier Manual(as may be amended from time to time)provided to Supplier by Xos or if not so provided, located at http://xostrucks.com/compactterms. Supplier will conform to all quality control and other standards and inspection systems as may be established or directed by Xos for the Products as well as each requirement under applicable law. Such quality control and other standards include, without limitation, quality control policies, ISO/TS quality systems, OHSAS 18001 health and safety certification and ISO 14001 environmental certification including registration, and GADSL / RoHS. Supplier will also participate in Xos’s supplier quality and development programs and adhere to the guidelines within the Xos Supplier Manual. For Products used in vehicle manufacturing, Supplier agrees to meet the full requirements of industry Production Part Approval Processes(PPAP). For the avoidance of doubt, Xos’s Supplier Manual may be amended from time to time in Xos’s sole discretion.
Level 3 PPAP is required for all Products unless:
a) The parts supplied to Xos are in production on another automotive vehicle platform and have a prior Level 3 PPAP (currently 100% production tool / 100% production process).In this case a copy of the PSW is required and Xos reserves the right to request further proof of documentation and data by Xos SQA.
b) The Products are interim. In this case, and in lieu of a Level 3 submission, a 100% inspection of all Products, material certifications for each Product, and a control plan is required withEACH AND EVERY shipment to Xos. Failure to supply this information may result in the rejection of Supplier’s Products as determined by Xos in its sole discretion.
c) This purchase is direct from a distributor in which case a Level 1 PSW (Part Submission Warrant) or equivalent certificate of conformance is required.PPAP Requirements apply to first shipments of new parts. If Supplier has obtained PPAP approval from Xos, no further PPAP submissions are necessary unless:
a)There is a design change (Xosor Supplier driven);
b) Production facility or tooling move; or
c)Change of tier 2 or 3 supplier, design, or manufacturing facility.
Refer to the Xos Supplier Manual for further details on the PPAP submission process.
If there is conflict between any part of the above programs or standards and an express provision of these General Terms, these general Terms will control. To the extent any of the standards, policies or systems cited above are amended, supplemented or replaced, Supplier's obligations under the agreement will be automatically amended to the same extent.
2.3 Service Parts and Safety Stock.
(a)Service Parts. During the period in which Xos uses the Products in production of Xos vehicles(the “ProductionPeriod”) and for 10 years thereafter (the “ServicePeriod”), Supplier will sell Products to Xos or an Xos authorized purchasers to fulfill service requirements. Unless otherwise agreed in writing by Xos, the price(s)for the Products during the initial three years of theService Period will be the price(s) that were in effect at the end of the Production Period and the Parties shall negotiate in good faith the price(s) for Products for the remaining seven years of the Service Period. Xos or Xos authorized purchasers shall have the option to designate a different delivery location for service parts.
(b)During the Production Period and the Service Period, if Xos or an Xos authorized purchaser desires to purchase components or parts of Products, Supplier will sell such components or parts at an equitable price that reflects the cost of the component or part less assembly costs, plus a markup commensurate with that on the related product and any actual cost differential for packaging and assembly or manufacturing.
(c)After the end of the Production Period, Supplier will maintain the tooling and an adequate stock of materials and supplies needed to produce new service parts throughout the Service Period.
(d)Supplier will build and maintain at all times during the Agreement a safety stock of Products at an agreed location at no additional charge to Xos that consists of a quantity sufficient to meet at least two weeks of forecast deliveries under the Agreement, unless otherwise agreed in the agreement or in writing by the Parties (the“Safety Stock”). Supplier will retain title to, and Xos will not have any obligations for, the Safety Stock until delivered in accordance with the agreement. Without Xos’s prior written consent, which Xos may withhold in its sole discretion, Supplier may not sell, transfer, encumber or use the Safety Stock for any purpose other than to meet Supplier’s obligations under the Agreement.
3. Delivery
3.1 Packing and Shipment. Xos may specify the method of transportation and the type and number of packing slips and other documents to be provided with each shipment. Supplier shall mark, pack, and ship Products in accordance with Xos’s Supplier’s Manual, general shipping instructions (including, without limitation, shipping instructions pertaining to labeling, marking and hazardous materials) and any and all additional shipping instructions or requirements that Xos may include with a Purchase Order. If Xos has not provided packing or shipping instructions, Supplier will pack and ship Products in accordance with industry best practices. If Supplier is required by Xos to use Xos's returnable packaging, Supplier will be responsible for cleaning and returning their the returnable packaging. If returnable packaging is not available, Supplier may use expendable packaging and Xos will reimburse Supplier for the reasonable costs of expendable packaging if agreed to in advance in writing by Xos.
3.2 Delivery Schedules. Supplier will deliver Products in strict accordance with the Agreement terms, including in the quantities and at the times specified in the Purchase Order and Releases issued by Xos(the "Delivery Date")in accordance with Xos’s instructions (“Shipping Instructions”) located at http://xostrucks.com/compactterms Time and quantity of delivery are of the essence.In the event of a delay or anticipated delay from any cause, including, but not limited to, Force Majeure (defined below), Supplier shall immediately notify Xos of the delay or anticipated delivery delay, and shall undertake to shorten or makeup the delay by all possible means. If Supplier fails to meet the Delivery Date or progress requirements established in the Agreement without Xos’s prior approval, Xos may cancel all or any part of the Agreement without charge to Xos, without prejudice to any rights Xos may have under the Agreement. Unless otherwise stated in the Agreement, Products will be delivered DDP Xos’s designated facility (Incoterms) and title will transfer upon receipt of the Products by Xos. If Products are not made ready by Supplier for delivery in time to meet Xos’s Delivery Date, Supplier will be responsible for additional costs, fees, damages and expenses incurred by Xos, including but not limited to any resulting expedited freight or other special transportation costs. If Supplier fails to deliver the Products in full on the Delivery Date, Xos may terminate the Purchase Order immediately by providing written notice to Supplier and Supplier will indemnify Xos against any losses, claims, damages, and reasonable costs and expenses directly attributable toSupplier's failure to deliver the Products on the delivery Date. Xos will not be required to remit payment for products delivered to Xos that are in excess of the firm quantities and delivery schedules specified in Releases. Xos has the right to return any Products delivered prior to the Delivery Date atSupplier's expense and supplier will redeliver such Products on the delivery Date. Supplier will give written notice of shipment to Xos when the Products are delivered to a carrier for transportation. Supplier will provide Xos all shipping documents, including the commercial invoice, packing list, air waybill/bill of lading and any other documents necessary to release the Products to Xos within three (3)business days after Supplier delivers the Products. The Purchase Order number must appear on all shipping documents, shipping labels, bills of lading, air waybills, invoices, correspondence and any other documents pertaining to the Purchase Order.
3.3 Location. All Products will be delivered to the address specified in Purchase Order (the "Delivery Location") during Xos’s normal business hours or as otherwise instructed by Xos.
4. Taxes
Unless otherwise stated in the Agreement, the Agreement price includes all applicable federal, state, provincial, and local taxes, transportation taxes, or other tax, including but not limited to customs, duties and tariffs, other than sales, value added, or similar turnover taxes or charges. Supplier will separately invoice Xos for any sales, value added, or similar turnover taxes or charges related to the Products purchased by Xos that Supplier is required by law to pay or collect from Xos.
5. Payment
5.1 Price. The purchase price of the Products shall be stated on the Purchase Order. Unless otherwise stated in the Agreement, the purchase price: (a) is a firm fixed price for the duration of the Agreement and not subject to increase for any reason, including increased raw material costs, increased labor or other manufacturing costs, increased development costs, or changes in volumes or program length from those estimated or expected even if there is a requirements Agreement; (b) is inclusive of all taxes as provided in Section 4and any customs, tariffs and duties applicable to provision of the Products; and (c) is inclusive of all storage, handling, packaging and all other expenses and charges of Supplier.
5.2 Invoices. Unless otherwise stated in the agreement, Supplier will issue invoices on or after delivery of the Products to Xos and Xos’s payment will be deemed to occur upon mailing of a check to Supplier or, alternatively, upon successful initiation of an ACHTransfer, a Wire Transfer, or an EFT Payment to Supplier from Xos to the account designated by Supplier for which payment is to be made. All payment will be made in the currency of the country of origin unless otherwise agreed. Supplier will, at its expense, comply with Xos's instructions and policies with respect to the form, content and method for submission of invoices.
5.3 Payment Terms. Unless otherwise stated in the Agreement, Xos will pay invoices for Products which are properly presented and not subject to dispute, no later than sixty calendar (60) days from the receipt of the Products with required support. If the date that is sixty calendar (60) days from the date the Products and requirement support are received falls on a holiday or weekend, Xos may transfer payment on the next business day.5.4Best Price. The Supplier warrants that the prices for the Products sold to Xos are no less favorable than those that Supplier currently extends to any other customer for the same or similar Products in similar quantities. If Supplier reduces its prices to third parties on the same or similar products during the term of the Purchase Order for the Products, Supplier will correspondingly reduce the prices charged to Xos.
5.5 Set Off. In addition to any right of setoff or recoupment provided by law, all amounts due Supplier, or any of its affiliates or subsidiaries, will be considered net of indebtedness or payment obligations of Xos, or any of its affiliates or subsidiaries. Xos will been titled at any time to set off or recoup against sums payable by Xos or any of its affiliates or subsidiaries to Supplier or any of its affiliates or subsidiaries any amounts for which Xos determines in good faith. Supplier or any of its affiliates is liable to it or any of its affiliates. Xos will consult with Supplier prior to any such set-off or recoupment.
5.6 Payment Not Acceptance. Payment for Products will not constitute acceptance of non-conforming Products, nor will it limit or affect any rights or remedies of Xos.
5.7 Credits. Credits or benefits resulting from the Agreement, including trade credits, export credits or the refund of duties, taxes, or fees, belong to Xos. Supplier will provide all information and certificates (including, without limitation, USMCA Certificates of Origin) necessary to permit Xos to receive these benefits or credits.
6.Product Warranties
6.1 Supplier’s Warranties.
(a) All Products. Supplier warrants to Xos and its respective successors and assigns that the Product will:
strictly conform to all Specifications, drawings, PPAP submissions, samples and other descriptions furnished to or by Xos;
conform with all industry standards, laws and regulations in force in countries where such Products or vehicles equipped with such Products are to be sold;
be free from defects in design, material and workmanship, merchantable and will be new and of the highest quality;
be free of all malware, viruses and all other malicious code, disabling code, or code that causes either theProduct or any product into which the Product is incorporated to perform in an unintended manner; and
be free and clear of all liens, claims or other encumbrances, and that supplier is conveying good title to Xos.
(b) Additional Warranty of Fitness Where Xos Relies on Supplier. In addition to the warranties in Section 6.1(a), where Xos is relying on Supplier’s skill or judgment in selecting which Products to buy for a particular purpose and Supplier is aware of that purpose, Supplier further warrants to Xos and its respective successors and assigns that the Product will be selected, designed, manufactured and assembled by Supplier based upon Xos's stated use and be fit and sufficient for the purposes intended by Xos.
(c) Services. For all services, Supplier further warrants that its work will be performed in a professional and workmanlike manner, consistent with all standards and specifications agreed on with Xos and otherwise consistent with industry standards. Time is of the essence for all services.
(d) Future Performance. All warranties of Supplier extend to future performance of the Product and are not modified, waived or discharged by delivery, inspection, tests, acceptance, and payment. Xos's approval of any design, drawing, material, process or specifications will not relieve Supplier of these warranties. Supplier waives any right to notice of breach.
(e) Warranty Period. The warranty period for Products is the longest of: four (4) years from the date Xos accepts the Product, the warranty period provided by applicable law, or the warranty period offered by Xos or its customer to end-users for the Product or the goods or services into which the Product is incorporated. For Products used to fulfill its current product service requirements and past product service and replacement requirements, the duration of Supplier’s warranty period will be the greater of: eighteen (18) months from the date of delivery to Xos's customer, or the remainder of the warranty period offered by Xos to end-users for the products into which the Products are incorporated.
(f) Application of Warranties. Supplier agrees that the warranties set forth herein, and otherwise made, express or implied, by law or equity, extend to all Products, notwithstanding the fact that such Products may be produced by any of Supplier’s own suppliers, including, without limitation, Directed Suppliers, as that term is defined herein, and, therefore, such warranties will not be disclaimed or otherwise limited in any way due to the fact that any Products have been produced by one of Supplier’s own suppliers, including, without limitation, Directed Suppliers.
6.2 Rejection. Xos, at its sole option, may inspect all or a sample of the Products, and may reject all or any portion of the Products if it determines the Products are nonconforming or defective. If Xos rejects any portion of the Products, Xos has the right, effective upon written notice to Supplier, to: (a) rescind the Purchase Order in its entirety; (b) accept the Products at a reasonably reduced price; or (c) reject the Products and require replacement of the rejected Products. If Xos requires replacement of the Products, Supplier will, at its expense, promptly replace the nonconformingProducts and pay for all related expenses, including, but not limited to, expedited transportation charges for the return of the defective goods and the delivery of replacement Products. If Supplier fails to timely deliver replacement Products, Xos may replace them with goods from a third party and charge Supplier the cost thereof and terminate the Purchase Order for breach pursuant to the terms hereof. Any inspection or other action by Xos under this Section will not reduce or otherwise affect Supplier's obligations under the Purchase Order, and Xos will have the right to conduct further inspections after Supplier has carried out its remedial actions.
6.3 Xos Losses. Supplier is liable for all direct, incidental and consequential damages, losses, costs, and expenses incurred by Xos resulting from Supplier’s failure to deliver conforming and non-defective Products or to comply with the shipping and delivery or other requirements of Xos, even if Supplier has cured the failure. This includes but is not limited to compensating Xos for:
any amounts charged by customer(s) to Xos;
all costs of inspection, containment, sorting, repair, replacement, cure, cover, or any other costs incurred by Xos, determined in such manner and in such amount as reasonably determined by Xos; and
all costs of any recall campaign, corrective service action, or other voluntary or involuntary action in which Xos or any Customer participates in connection with inclusion of Products in goods sold by Xos.
6.4 Corrective Action. Promptly upon learning of defective or non-conforming Products, Supplier will develop, document and implement corrective actions in accordance with all applicable quality control policies and standards of Xos. Supplier will immediately notify Xos in writing when it becomes aware of any ingredient, component, design or defect in the Products that is or may become harmful to persons or property. Supplier is obligated to provide all reasonable support requested by Xos to immediately investigate, address and correct concerns regarding quality, defects or non-conforming of Products supplied.
7. Product Liability
7.1 Indemnification. Supplier agrees to indemnify, defend and hold harmless, reimburse and compensate Xos, its agents, affiliates, customers and users of the products sold by Xos (or the products in which they are incorporated) and all of their respective agents, successors and assigns, and each of their shareholders, directors, officers, employers and agents, on demand, (collectively“Indemnified Parties”) from and against any and all costs, fees, penalties, expenses, damages (consequential and otherwise), attorneys' fees and all other liabilities and obligations whatsoever("Losses"), arising out of any third-party claim or any other demand, requirement, or source of exposure to liability or potential liability, which, in whole or in part, arises from or relates to any actual or alleged:
defect or non-conformity in the Products;
noncompliance by Supplier with any of its representations, warranties or obligations under the Agreement;
negligence or fault of Supplier in connection with the Products;
recall campaign, corrective service action, or other voluntary or involuntary action in which Xos participates with respect to the Products or products into which the Products are incorporated;
any spill, discharge or emission of hazardous wastes or substances which relates, in whole or in part, to the Products;
infringement (including claims of direct or contributory infringement or inducement to infringe) of any Intellectual Property Right relating to Products provided by Supplier, even if they are made to Xos's specifications;
damages to the property of or personal injuries to Xos, its customers, their respective agents, or any other person or entity to the extent arising from or in connection with Supplier’s work on Xos's premises or Supplier's use of Xos's property.
7.2 Xos Participation. If Supplier is obligated to indemnify under this Section, then Xos may at its option participate in the defense of any claim with its own counsel, at Supplier's expense.
7.3 Limitations. To the maximum extent permitted by applicable law, Supplier's obligation under this Section will apply even as to Losses caused in whole or in part by an Indemnified Party’s negligence, but Supplier's indemnification will not apply to the extent that Losses resulted solely and directly from the negligence or willful misconduct of such Indemnified Party. Supplier's obligation to defend and indemnify under this Section will also apply regardless of whether the claim arises in tort, negligence, Agreement, 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 Supplier under Workers' Compensation Acts, occupational disease acts, disability benefits acts or other employee benefits acts.
8. Compliance with Laws
Supplier will comply with applicable laws, rules and regulations of the jurisdictions where the Products are manufactured, or the Services are performed. Supplier will provide Xos with material safety data sheets regarding the Products and, upon Xos's request, will provide Xos with other information reasonably required in order to comply with applicable laws.
9. Intellectual Property Rights
9.1 Warranty. Supplier warrants that, the Products and the sale and/or use thereof (before or after incorporation into products during manufacture) do not and will not infringe any Intellectual Property Rights. “Intellectual Property Rights” means any right arising under U.S. or foreign law relating to patent, trademark, copyright, moral, industrial design right or misuse or misappropriation of trade secrets.
9.2 Ownership. If Supplier, or any person employed by or working under the direction of Supplier, in the performance of the 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 Products or any alternative or improved method of accomplishing the objectives of this agreement (collectively, “Inventions”), such Inventions will be owned by Xos and be deemed confidential and proprietary property of Xos, whether such inventions or any portions thereof can be copyrighted or patented or not. Supplier will immediately disclose all Inventions to Xos and will cooperate (and cause its employees and agents to cooperate)in executing any documents and taking any other actions necessary or convenient to patent, copyright, assign to Xos or otherwise perfect or protect such Inventions for the benefit of Xos. For the avoidance of doubt, Xos owns any and all“Xos Intellectual Property”, which includes without limitation, patents, copyright, trademarks, service marks, and trademarks, and trade secrets that Xos contrived, created, owned, developed, or reduced to writing prior to, during, or following the termination of this Agreement. Xos in no event grants any ownership, right, title, or interest to any Xos Intellectual Property to Supplier under this Agreement.
9.3 Products for Third Parties. Supplier will not manufacture or provide, or offer to manufacture or provide, any goods or services that are based in whole or in part upon Inventions, confidential or proprietary information of Xos or Xos Intellectual Property, whether for its own purposes (other than to satisfy its obligations under this Agreement, or any other third parties, without Xos's prior written consent, which consent may be withheld for any or no reason.
9.4 License to Xos. Supplier hereby grants to Xos, its subsidiaries and affiliates, and their respective successors and assigns, and Xos hereby accepts, a perpetual, non-exclusive, irrevocable, royalty-free, fully paid up worldwide license, including the right to sublicense to others in connection with providing the Products to Xos, under: (i) any Intellectual Property Rights owned or controlled by Supplier or its affiliates, and relating to the Products, to make, have made, repair, reconstruct, rebuild, relocate, use, sell and import the Products, and (ii) any works of authorship fixed in any tangible medium of expression (including drawings, prints, manuals and specifications) furnished by Supplier in the course ofSupplier’s activity under thisAgreement, to reproduce, distribute and display such works and to prepare derivative works based thereon, subject to the other provisions of theAgreement(all items in clauses (i) and (ii) above, collectively, “Supplier’s IntellectualProperty,” and such license in respect thereof, the“License”). Supplier acknowledges and understands that the License will be effective from the first date of delivery of the Products under this Agreement and extend for so long as Xos produces the Product or has the Product incorporated into its goods and services. The License is intended to be subject to 11 USC Section 365(n), as an executory agreement under which Xos has license rights toSupplier’s Intellectual Property, and is supplementary to any other rights of Xos under this Agreement and any other agreement withSupplier.9.5Supplier Employees. Supplier will ensure that the terms of its contracts with its subcontractors and employees are consistent with the terms of this Section.
10. Duration and Termination of the Agreement
10.1 Duration. The Agreement (a) will commence on the date specified in the Purchase Order, or if no date is specified when issued by Xos and (b) shall continue for the greater of twelve (12)months or until all of the Products for a particular PO are delivered to and accepted by Xos.
10.2 Termination by Xos. Xos at its sole discretion may terminate all or any part of a Purchase Order, with or without cause, at any time by giving seven (7) day prior notice to Supplier. Termination by Xos in accordance with this provision shall not constitute a breach of the Purchase Order, entitle Supplier to any damages or claims except as expressly provided in the Purchase Order, or relieve Supplier of any liability under the Agreement.
11. Default
11.1 Events of Default. Time is of the essence and, subject to in conjunction with and notwithstanding any other term of the Agreement regarding Xos’s right to terminate the Agreement in the event of a Default by Supplier as defined therein, either party will be in “Default” under the Agreement if it (a) fails to perform any obligation under the Agreement and, if the non-performance can be cured, fails to cure the non-performance within fifteen (15) business days after notice from the other party specifying the non-performance, (b) admits in writing its inability to pay its debts as they become due, commences a bankruptcy, insolvency, receivership, or similar proceeding, or makes a general assignment for the benefit of creditors, (c) becomes a debtor in a bankruptcy, insolvency, receivership, or similar proceeding commenced by a third party that is not dismissed within thirty (30) calendar days after commencement, or (d) fails to provide adequate assurance of performance under theAgreement within three business days after written demand by the other party.
11.2 Remedies and Damages.
(a)Subject to Sections 6 and 7(which provide the exclusive remedies for breach of warranty, Recalls, and products liability) and the limitations in this section 11.2, either party may exercise the remedies provided in this section 11.2, which are cumulative and are in addition to all other rights and remedies available elsewhere in the Agreement or by law.
(b)Either party may recover from the other party its actual out-of-pocket damages or costs directly caused by the other party’s breach of the Agreement, regardless of whether the breach subsequently becomes a Default with the passage of time or giving of notice or both. All damages under this section 12.2 will be reasonably determined based on the nature, type, price, and profitability of the Products or Services, industry practices, and the overall volume, scope, and profitability of other business relationships between Supplier and Xos.
(c)Upon the occurrence of a Default and while that Default is continuing, the non-defaulting party may terminate the Agreement by notice to the defaulting party. If Supplier is in Default, Xos's damages will include the reasonable costs actually incurred to relocate the work to an alternate source, and Xos may purchase completed Products at the Agreement price and work-in-process and raw materials atSupplier’s actual cost. If Xos is in Default, Supplier’s damages will include (i) the Agreement price for completed Products and Services and the actual cost of work-in-process and raw materials (which will become Xos Property upon payment in full), and (ii) the cost of unreimbursed and unamortized research and development, capital equipment, Xos Property, and supplies that are unique to the Products.
(d)Liquidated Damages. Without prejudice to any other right Xos may have under the Agreement, if Supplier breaches its obligation to deliver goods in accordance with the schedule provided for in this Agreement, Supplier agrees that Xos shall be entitled to recover as liquidated damages (and not to be considered a penalty) one-half percent (0.5%) of the Purchase Order price per week for each week of delay, (for a maximum total of ten percent (10%) of the total Purchase Order price). Supplier’s payment of liquidated damages shall not relieve Supplier from any obligation to diligently fulfill the Purchase Order or deliver the Products, or from any other obligation or liability under the Agreement. Xos’s entitlement to demand payment of liquidated damages shall remain effective after acceptance of the Products.
12. Confidential Information
Supplier agrees that any information disclosed by Xos to Supplier under this Agreement (including without limitation quantity and type of parts, order projections, and the terms of this Agreement is confidential (“Confidential Information”), will be deemed confidential and proprietary to, and remain the sole property of, Xos. Supplier may not disclose Confidential Information or use Confidential Information for any purpose other than as contemplated under the Agreement without in each case the written consent of Xos, which such consent may be withheld for any or no reason. Confidential Information will not include information that is or becomes generally available to the public other than as a result of a violation of this Section 12 by the Supplier or was obtained by the Supplier on a non-confidential basis from a third party who it was not under an obligation of confidentiality. Notwithstanding the foregoing, this Agreement will not be deemed to restrict Supplier from complying with a lawfully issued governmental order or other legal requirement to produce or disclose Confidential Information of Xos; provided, however, that the Supplier will promptly notify the disclosing party upon learning any request for such order or requirement, to enable the disclosing party to oppose the order or obtain a protective order. Xos and Supplier will each use the same degree of care to safeguard Confidential Information that it uses to protect its own confidential information from unauthorized access or disclosure (but not less than a reasonable degree of care). Upon request by Xos, Xos reserves all rights it may be entitled to in law or in equity.
13. Assignment and Subcontracting
Xos’s Purchase Order is issued to Supplier, in reliance upon its personal performance of the duties imposed thereby and by these General Terms. Without prior written consent of Xos, Supplier may not: (a) assign the Agreement or delegate the performance of its duties hereunder; or (b) assign any accounts receivable from Xos to third parties. Supplier will ensure that the terms of its contracts with its sub-suppliers and subcontractors provide Xos with all of the rights specified in the Agreement Any subcontracting, assignment, or delegation does not relieve Supplier of any responsibility under this Agreement.
14. Force Majeure Non-Performance
Except as otherwise expressly provided herein, any delay or failure of either party to perform its obligations will be excused only if such delay or failure to perform actually prevents performance and is caused by an extraordinary and unforeseeable event beyond the control of the nonperforming party and without the nonperforming party’s negligence, such as acts of God, fires, floods, windstorms, explosions, riots, natural disasters, wars, and sabotage (each a“Force Majeure” event). Increased costs to procure raw materials, to ship Products or to otherwise manufacture and timely deliver Products does not excuse performance. Written notice of such delay, including the anticipated duration of the delay, must be given by the nonperforming party within two (2) business days of the event. In addition, the party so affected shall use diligent efforts to avoid or remove such causes of non-performance and both parties shall promptly (but no later than the cessation of the Force Majeure event) proceed whenever such causes are removed or cease. During the period of any delay or failure to perform by Supplier, Xos at its option, may purchase Supplies from other sources to fulfill its requirements, without liability to Supplier. If a Force Majeure event continues for more than thirty (30) calendar days, then Xos, at its sole option, may terminate any Agreement affected by the Force Majeure event, in whole or in part, without any obligation or liability except that Xos is still responsible for payment for Products that have been delivered to and accepted by Xos prior to receipt of the Force Majeure notice.
15. Labor Disputes
Supplier will notify Xos of any labor contract expiration date at least six (6) months before the expiration of a current labor contract that has not been extended or replaced. Xos may thereafter direct Supplier in writing to ship up to thirty (30)calendar days of additional inventory of Products, specifying the quantities of Products required and any packaging and storage requirements. Supplier will use commercially reasonable efforts to comply with Xos's written directions prior to expiration of the current labor contract and until the current labor contract has been extended or a new contract completed.
16. Customs
As specified inSection 5.7, transferable credits or benefits associated with Products purchased, including trade credits, export credits, or rights to the refund of duties, taxes, or fees, belong to Xos unless otherwise prohibited by applicable law. Supplier will provide Xos with all information and records relating to the Products necessary for Xos to (a) receive these benefits, credits, and rights, (b) fulfill any customs obligations, origin marking or labeling requirements, and certification or local content reporting requirements, (c) claim preferential duty treatment under applicable trade preference regimes, and (d) participate in any duty deferral or free trade zone programs of the country of import. Supplier will obtain all export licenses and authorizations and pay all export taxes, duties, and fees unless otherwise stated in the Agreement, in which case Supplier will provide all information and records necessary to enable Xos to obtain those export licenses or authorizations.
17. Dispute Resolution
17.1 Negotiation and Mediation. Xos and Supplier will first endeavor to resolve through good faith negotiations any dispute arising under the Agreement. If a dispute cannot be resolved through good faith negotiations within a reasonable time, either party may request non-binding mediation by a mediator approved by both parties or, absent that approval, by the National Center for Dispute Resolution, to be conducted in local jurisdiction.
17.2 Arbitration. If mediation fails to resolve the dispute within thirty (30) days after the first mediation session, either party may submit the dispute to binding arbitration by notice to the other party. The arbitration proceedings will be conducted, and a single arbitrator will be selected, in accordance with the rules of the National Center for Dispute Resolution or other rules approved by the parties and will be governed by the United States Arbitration Act, 9 U.S.C. Sections 1-15, and this Section 19. The arbitration will be conducted at an agreed location or at a location selected by the arbitrator if the parties are unable to agree. The arbitrator will issue a written opinion setting forth the basis for the arbitrator’s decision, which may include an award of legal fees and costs. The arbitrator’s award will be final and non-appealable absent fraud or manifest error, and judgment on the arbitrator’s award may be entered in any court having jurisdiction. While arbitration proceedings are pending, the parties will continue to perform their obligations under the Agreement without set off for any matters being contested in the arbitration proceedings.
17.3 Litigation. The parties have selected binding arbitration as the sole means to resolve a dispute between them over monetary claims that cannot be resolved through mediation. Either party may pursue through litigation in any court of competent jurisdiction claims that also involve third parties who have not consented to arbitration, claims in litigation commenced by third parties, and claims for emergency relief, injunctive relief, specific performance or other non-monetary relief.
18. Directed Supplier
Directed Suppliers. The Agreement may include the designation of a third party as a supplier to the Supplier of parts or services to be included in the Products (“Directed Supplier”). Such description does not relieve Supplier of any of its obligations under the Agreement except that if the description in the Agreement includes the price Supplier is to pay the Directed Supplier, Supplier will not be responsible for negotiating or resolving any disputes with the Directed Supplier related to pricing.
19. Limitation of Liability
Xos's sole liability to Supplier under the Agreement(including its termination, expiration, or cancellation) is to pay for the Products in accordance with the Agreement. In no event will Xos be liable to Supplier for any lost profits or for any incidental, consequential, special, exemplary or punitive damages, whether for breach of contract, late payment, property damage, personal injury, illness, or death or otherwise. Nothing in the General Terms will exclude or limit Supplier's liability for Supplier’s material breach of this Agreement or (b)Supplier's liability for fraud, personal injury or death caused by its negligence or willful misconduct.
20. Miscellaneous
20.1 Advertising. During and after the term of the Agreement, Supplier will not(a)advertise or otherwise disclose its relationship with Xos, or (b) use or display Xos’s trademarks or logos in such advertising or disclosure without Xos's prior written consent, except as may be required to perform the Agreement or as required by law.
20.2 Audit Rights. Supplier will maintain records as necessary to support amounts charged to Xos under the Agreement in accordance with Supplier’s document retention policies. Xos and its representatives may auditSupplier’s records of transactions completed within one year prior to the audit date, to the extent needed to verify the quantities shipped and that the prices charged match the Agreement prices. Any audit will be conducted at Xos's expense (but will be reimbursed by Supplier if the audit uncovers material errors in the amounts charged), at reasonable times, and at Supplier’s usual place of business.
20.3 Electronic Communication. Supplier will comply with the method of electronic communication specified by Xos in Xos's request for quotation and confirmation in the Agreement, including requirements for electronic funds transfer, purchase order transmission, electronic signature, and communication. Supplier will also make commercially reasonable efforts to comply with any modification to Xos's specified method of electronic communication.
20.4 Relationship of the Parties; Third-Party Beneficiaries. Xos and Supplier are independent contractors, and nothing in the Agreement makes either party the agent or legal representative of the other party for any purpose. Neither party has authority to assume or create any obligation on behalf of the other party. Purchase Orders are for the sole benefit of the parties thereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or will confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of these General Terms.
20.5 Waiver. The failure of either party to enforce any right or remedy provided in the Agreement or by law on a particular occasion will not be deemed a waiver of that right or remedy on a subsequent occasion or a waiver of any other right or remedy.
20.6 Entire Agreement. The Agreement constitutes the entire agreement between the parties with respect to its subject matter and supersedes all prior oral or written representations or agreements by the parties with respect to the subject matter of the Agreement, including Xos's request for quotation and Supplier’s quotation unless specifically incorporated in the Agreement. Except as authorized in Section 1.2, no subsequent terms, conditions, understandings, or agreements purporting to modify the terms of the Agreement will be binding unless in writing and signed by both parties.
20.7 Shrink Wrap Terms. This Agreement shall supersede any “shrink wrap” or “click wrap” terms that may be included with a purchase order issued by Supplier under the accompanying quote or Purchase Order. Xos hereby objects to any additional or different terms contained in any request for proposal, purchase order, acknowledgement or other communication previously or hereafter provided by Supplier to Xos. No such additional or different terms or conditions will be of any force or effect.
20.8 Severability. A finding that any provision of the Agreement is invalid or unenforceable in any jurisdiction will not affect the validity or enforceability of any other provision of the Agreement or the validity or enforceability of that provision in any other jurisdiction. Upon a determination that any term or provision is invalid, illegal, or unenforceable, the parties hereto will negotiate in good faith to or the court may, under applicable circumstances, modify the Agreement to effect the original intent of the parties as closely as possible in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.
20.9 Interpretation. When used in these General Terms, “including” means “including without limitation” and terms defined in the singular include the plural and vice versa.
20.10 Notices. Any notice or other communication required or permitted in the Agreement must be in writing and will be effective on the date of actual receipt if the date of actual receipt is a business day or on the next business day if the date of actual receipt is not a business day.
20.11 Governing Law. All matters arising out of or relating to the General Terms will be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than those of the State of Delaware. The Parties hereby exclude the 1980 United Nations Convention on Contracts for the International Sale of Goods from this Agreement.
20.12 Submission to Jurisdiction. Any legal suit, action or proceeding arising out of or relating to the General Terms will be instituted in the federal courts of the United States of America or the courts of the State of California in each case located in the City of Los Angeles and County of Los Angeles, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.
20.13 Survival. Provisions of these General Terms which by their nature should apply beyond their terms will remain in force after any termination or expiration of the General Terms or the applicable Purchase including, but not limited to, the following provisions: Set Off, Product Liability, Intellectual Property Rights, Insurance, Compliance with Laws, Confidential Information, Governing Law, Submission to Jurisdiction and Survival.
20.14 Insurance. Each Party will keep its business and properties insured at all times against such risks for which insurance is usually maintained by reasonably prudent persons engaged in a similar business (including insurance for hazards and insurance against liability on account of damage to persons or property and insurance under all applicable workers’ compensation laws). The insurance maintained shall be in such monies and with such limits and deductibles usually carried by persons engaged in the same or a similar business. In support of its indemnification obligations, Supplier shall name Xos as an additional insured on its General Liability, Automobile and Worker’s Compensation insurance policies and agrees that such insurance shall respond as primary and noncontributory with any insurance held by Xos. Certificates of Insurance shall be provided within thirty (30) days of the execution of this agreement and annually thereafter on the anniversary date of this agreement.