ZEV Credits Agreement
Exhibit 10.32
Confidential Treatment Requested by Tesla Motors, Inc.
XXX Credits Agreement
This XXX Credits Agreement (“Agreement”) is made this 12th day of February 2009, between and American Honda Motor Co., Inc., with its principal offices at 0000 Xxxxxxxx Xxxxxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000-0000 (“Honda”) and Tesla Motors, Inc., with its principal offices at 0000 Xxxx Xxxxxx, Xxx Xxxxxx, Xxxxxxxxxx 00000 (“Tesla”) (Honda and Tesla are individually a “Party” and together the “Parties”).
BACKGROUND AND PURPOSE
| 1. | Under California’s Low-Emission Vehicle Regulations (13 California Code of Regulations (CCR) § 1900 et seq.), and similar laws in other states, vehicle manufacturers are required to ensure that a portion of the vehicles delivered for sale in that state during each model year are zero-emission vehicles (or “XXX”s, as defined below). States that have adopted XXX regulations pursuant to section 177 of the Clean Air Act, including XXX Credit regulations, include New York, Massachusetts, Vermont, Maine, Connecticut, Rhode Island, New Jersey, Oregon, New Mexico, Maryland, Arizona and District of Columbia; other states have indicated that they plan to adopt such regulations in the near future. Any state that adopts XXX Credit regulations prior to or during the term of this Agreement is referred to herein as a “XXX State.” XXX Credit regulations provide that a manufacturer may use its own earned credits or acquire credits from another party. If acquired, credits must be transferred via a credit bank set up by the California Air Resources Board (“ARB”) or another prescribed mechanism established by an equivalent regulatory agency in a XXX State. |
| 2. | Honda desires that Tesla, for agreed-upon consideration, transfer to Honda all XXX Credits that Tesla may earn and receive for the delivery for sale and placement into service of at least 650 Tesla ZEVs in California or a XXX State during the period set forth below. Tesla likewise desires to transfer to Honda all such XXX Credits. |
| 3. | For purposes of this Agreement, “XXX” means a zero emission vehicle as defined by 13 CCR Section 1962.1 , Zero Emission Vehicle Standards for 2009 and Subsequent Model Year Passenger Cars, Light-Duty Trucks, and Medium-Duty Vehicles; “XXX Credit” means one regulatory-established credit, multiples of which may be issued for delivering for sale or placing in service a XXX in California1 or a XXX State; and “Xxxxx XXX” means any model year 2009 vehicle produced by Tesla that is capable of earning a Type III XXX Credit. |
| 1 | See, 13 CCR Section 1962.1 (d)(5)(C) indicating that Type III ZEVs earn 4 credits and 13 CCR Section 196.1, (d)(5)(D) indicating that a Multiplier for Certain ZEVs allows for a multiplier of 1.25 - for a total of 5 credits. Although the ARB XXX Credit Transfer Form, Exhibit A to this Agreement, also measures credits by g/mi NMOG, the Parties are not using that measure when describing XXX Credits, or setting the price of a XXX Credit, in this Agreement. |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
AGREEMENT
NOW THEREFORE, in consideration of the mutual promises contained herein, and for other good and valuable consideration, the sufficiency of which is hereby acknowledge, Honda and Tesla agree as follows:
| I. | XXX Credit Generation; Commitment to Sell and Buy XXX Credits. |
| A. | Tesla will use reasonable commercial efforts to manufacture, deliver for sale, and place in service Tesla ZEVs in California and the XXX States. Tesla estimates that it may produce between five hundred (500) and six hundred fifty (650) Tesla ZEVs. |
| B. | Tesla agrees to offer to sell and transfer to Honda all XXX Credits, including all associated rights and benefits, that Tesla earns from delivering for sale and/or placing info service Tesla ZEVs in California or any XXX State during the period from January 1, 2009 through June 30, 2010, and Honda agrees to buy all XXX Credits that Tesla may earn and receive associated with the delivery for sale and placement into service of at least 650 Tesla ZEVs in California or a XXX State during the period set forth below; such credits shall be bought/sold on the terms set forth in this Agreement. (The Parties agree that Honda does not owe any money for, and is not required to purchase, credits granted by one XXX state, other than California, for the delivery for sale and/or placement into service of a Xxxxx XXX in another XXX state.) |
After Honda purchases all XXX Credits that Tesla earns and received associated with the delivery for sale and placement into service of 650 Tesla ZEVs in California or a XXX State, Tesla must continue to offer Honda the opportunity to purchase any further XXX Credit earned by Tesla from delivering for sale and/or placing into service a Xxxxx XXX in California or any XXX State during the period set forth above (the “Right of First Refusal”), and should Honda accept such offer, Tesla must sell and transfer such credits to Honda. In order to facilitate the Right of First Refusal, within one month of the complete execution of this Agreement, Tesla shall begin providing Honda with a non-binding informal estimate updated monthly, of the number of Tesla ZEVs it believes it will deliver for sale and/or place into service in California or a XXX State during the ensuing three calendar months. Once Honda has been invoiced for all XXX Credits associated with the delivery for sale and placement into service of 550 Tesla ZEVs and, for the first time, a subsequent rolling three month forecast indicates that Tesla is likely to deliver for sale and place into service a cumulative total of 650 Tesla ZEVs in California or a XXX State, the Parties shall undertake the following process:
| (i) | First Quarterly Forecast. Tesla will give to Honda a forecast of the number of Tesla ZEVs that it expects to deliver for sale or place into service in the calendar quarter immediately following the date in which it first forecast it will have sold and placed into service a cumulative total of 650 Tesla ZEVs in California or a XXX State. |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
| (ii) | Honda Decision. Within two weeks following receipt of the forecast referenced in subparagraph (i), Honda will indicate in writing whether it plans to (a) purchase the XXX Credits that Tesla may earn and receive associated with the delivery for sale and placement into service of Tesla ZEVs in California or a XXX State during the forecast period; or (b) decline to purchase the XXX Credits that Tesla may earn and receive in the forecast period. |
| (iii) | Purchase Obligation Or Termination. In the event that Honda confirms its desire to purchase the XXX Credits that Tesla may earn and receive during the forecast period, then Honda will have an obligation to purchase such XXX Credits. In the event that Honda declines to purchase the XXX Credits, then this Agreement shall terminate, subject to the survival provisions in Section IV.A, below. |
| (iv) | Second Quarterly Forecast and Process. The foregoing process will be repeated for the XXX Credits that Tesla may earn and receive associated with the delivery for sale and placement into service of Tesla ZEVs in California or a XXX State during the calendar quarter following the period covered in the First Quarterly Forecast (subparagraph (i), above). Specifically, one month prior to the start of the period to be covered by the Second Quarterly Forecast, Tesla will provide the Second Quarterly Forecast to Honda, and Honda will indicate in writing within two weeks of receipt of the Second Quarterly Forecast whether it plans to (a) purchase the XXX Credits that Tesla may earn and receive associated with the delivery for sale and placement into service of Tesla ZEVs in California or a XXX State during the forecast period; or (b) decline to purchase the XXX Credits that Tesla may earn and receive in the forecast period. In the event that Honda confirms its desire to purchase the XXX Credits that Tesla may earn and receive during the forecast period, then Honda will have an obligation to purchase such XXX credits. In the event that Honda declines to purchase the XXX Credits, then this Agreement shall terminate (assuming it has not already expired), subject to the survival provisions in Section IV.A, below. |
In return for the transfer to Honda of all XXX Credits Tesla earns and receives associated with the delivery and placement into service of a Xxxxx XXX in California or a XXX State, Honda will pay Tesla $[***] for each Xxxxx XXX sold or placed into service in California or a XXX State.2 Honda, however, is not obligated to purchase more than the XXX Credits that Tesla earns and receives associated with the delivery for sale and placement into service of 650 Tesla ZEVs in California or a XXX State.
| 2 | It is the Parties’ understanding that for each Xxxxx XXX delivered for sale and placed into service in California or a XXX State, Tesla will earn [***] XXX Credits. Based on that understanding, the price for each XXX Credit that Tesla could earn and receive for the delivery for sale and placement into service of a Xxxxx XXX in California or a XXX State is $[***]. |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
| C. | Tesla represents and warrants to Honda that (1) Tesla has full rights to the XXX Credits to be sold and transferred to Honda hereunder, except to the extent that such Credits are subject to any general liens on Tesla assets granted by Tesla to creditors in the normal course of business, (2) Tesla will not transfer, assign or sell any XXX Credit generated by the delivery and/or placement of a Xxxxx XXX in California or any XXX state during the period from January 1, 2009 through June 30, 2010 to any other party unless, once Honda has purchased all XXX Credits that Tesla earns and receives associated with the delivery and placement to service of 650 Tesla ZEVs in California or a XXX State, Honda does not exercise its Right of First Refusal for any further credit, and (3) upon transfer of any XXX Credit to Honda, Honda will own such XXX Credit free and clear of all liens or encumbrances of any kind or any other interests of any third party. Tesla further represents and warrants to Honda that Tesla has the full power, authority and rights to enter into this Agreement and to sell and transfer all XXX credits contemplated to be sold to Honda pursuant to this Agreement. |
| D. | Each party represents and warrants to the other Party that the execution and delivery of this Agreement by such Party and the performance by such Party of its obligations hereunder have been duly and validly authorized and approved by all necessary corporate action. |
| II. | Transfer of XXX Credits. |
The transfer of XXX Credits from Tesla to Honda and Honda’s payment for such XXX Credits shall be performed in accordance with the process described in Exhibit B, attached hereto.
| III. | Confidentiality; Publicity. |
| A. | The Parties agree that the terms of this Agreement, as well as all information submitted under a grant of confidentiality (whether express, implied, or pursuant to statute or regulation) to ARB or any XXX Agency pursuant to the terms of this Agreement, will remain confidential and will not be disclosed by either Party except only (1) to their respective employees, contractors, professional advisors and consultants on a need-to-know basis; (2) to their prospective investors under appropriate non-disclosure agreements; (3) to the extent necessary to resolve disputes between the Parties, but only under a protective order protecting confidentiality; (4) if required by law, regulation, or legal order if the disclosing Party uses reasonable efforts to have the recipient treat it as confidential and takes reasonable steps to give the other Party prior notice sufficient to allow the other Party to contest disclosure; (5) to the SEC, if requested pursuant to regulations adopted under the Securities Act of 1933; and (6) as otherwise may be agreed in writing by the Parties; |
| B. | Tesla will use reasonable efforts to keep any information related to this Agreement that is submitted to ARB or any XXX Agency confidential, and will designate its submittals as confidential trade secrets of Tesla. The Parties acknowledge that, although XXX Credit information meets the definition of “trade secret” in California Government Code section 6254.7(d), there can be no guarantee that ARB or any XXX Agency will keep the XXX Credit information confidential. |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
| C. | The Parties will jointly coordinate any press conference, press release, public statement or any other publicity, if any, about this Agreement or its subject matter, including without limitation, the existence or contents of this Agreement, and any such communication must be mutually agreed upon in writing by the Parties. |
| IV. | Other Terms |
| A. | Expiration and Termination; Survival. This Agreement will expire at 11:59 p.m. on December 31, 2009. In addition, this Agreement can be terminated by either Party by providing written notice to the other Party of (1) a material breach of this Agreement by the other Party, or (2) the other Party’s default in the performance of or compliance with any material term or condition of this Agreement, if such breach or default is not cured within 10 days of receipt of written notice. In addition, if at any time during the term of this Agreement there is any change in any law or regulation in California or any XXX State so that Tesla no longer can transfer XXX Credits to Honda, this Agreement will automatically be terminated as to XXX Credits generated in any such state; to the extent that such law or regulation has a retroactive effect to nullify any prior transfer of XXX Credits from Tesla to Honda, Tesla shall reimburse Honda all monies paid for such XXX Credits and shall do so within 10 days of Honda’s written request for reimbursement. |
The provisions of Sections I.B, I.C, III, and IV.B will survive expiration or termination of this Agreement. In addition, the provisions of Exhibit B to this Agreement will continue to apply to any XXX Credits earned by Tesla as a result of its delivery for sale, or placing in service, a Xxxxx XXX in California or a XXX State between January 1, 2009 and June 30, 2010 up to and until the time that the transfer and payment process specified in Exhibit B has been completed by the Parties for such XXX Credits.
| B. | Expenses. Each Party will bear its own expenses incurred in connection with this Agreement. |
| C. | Governing Law. This Agreement is governed by and is to be construed in accordance with the laws of the State of California and as if entirely performed therein. The United Nations Convention on the International Sales of Goods does not apply to this Agreement or any of the transactions contemplated by it. |
| D. | Entire Agreement; Modifications. This Agreement constitutes the entire understanding between the Parties and supersedes and cancels all prior agreements, express or implied, written or oral, with respect to its subject matter. This Agreement may be modified or extended, but only by a written agreement executed by the Parties. |
| E. | Notices. Except for notices provided pursuant to Exhibit B, any notices required or permitted hereunder must be given in writing and forwarded, charges prepaid, |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
| (1) by certified mail, return receipt requested, (2) by postage prepaid overnight air express mail, or (3) by facsimile, with a confirmation copy dispatched promptly by certified mail, return receipt requested, or postage prepaid overnight air express mail: |
If to Honda:
American Honda Motor Co., Inc.
Product Regulatory Office
0000 Xxxxxxxx Xxxx., M.S. 500-2C-10A
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Managing Counsel
Fax: 000-000-0000
If to Tesla:
Tesla Motors, Inc.
0000 Xxxx Xxxxxx
Xxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx
Legal Department
Fax: 000 000 0000
| F. | Relationship of the Parties. Nothing contained in this Agreement will be construed to make any Party a partner, joint venturer, fiduciary or agent of the other Party, nor will either Party have the authority to bind the other Party in any respect. Neither Party will hold itself out as a partner, joint venturer or fiduciary of the other Party in relation to this Agreement. |
| G. | Counterparts. This Agreement may be executed by each Party in separate counterparts, each of which, when so executed and delivered, will be deemed to be an original and all counterparts of this Agreement, taken together, will constitute one and the same instrument. |
| H. | Assignment. Neither Party may assign this Agreement or delegate any duties hereunder without the prior written consent of the other Party; provided, however, that a Party may assign this Agreement, without such consent, to any person or entity that acquires all or substantially all of such Party’s business or assets related to the performance of this Agreement, or assumes managerial contro1 of such Party, or succeeds to such Party’s interest in this Agreement by sale, merger, consolidation, reorganization or similar transaction, provided that the assignee agrees to assume the assignor’s obligations hereunder with respect to the business or assets transferred. |
| I. | Dispute Resolution. In the event any disputes, differences or controversies arise between the Parties in connection with this Agreement, the Parties will explore all possibilities for an amicable settlement. In case an amicable settlement is not reached within 90 days from the date a Party is first notified of the existence of a dispute in accordance with this Agreement, such disputes, differences or controversies shall be referred to arbitration in San Francisco, California |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
| conducted by the Judicial Arbitration and Mediation Services/Endispute, Inc. (“JAMS”), or its successors, provided that the arbitrator shall: (1) have the authority to compel adequate discovery for the resolution of the dispute and to award such relief as would otherwise be permitted by law (but not in excess of, or contrary to, the law); and (2) issue a written arbitration decision including the arbitrator’s essential findings and conclusions and a statement of the award. |
The award of such arbitration shall be final and binding upon the Parties. Each Party waives any right to adjudicate the dispute in any other court or forum, except that a Party may seek to enforce any decision in the arbitration in a court having jurisdiction. The Parties shall share the cost of such arbitration equally, but the prevailing Party may be entitled to recover reasonable legal expenses from the non-prevailing Party, and such determination shall be in the discretion of the arbitrator.
| American Honda Co., Inc. |
||||||||
| By: | /s/ Xxxxxxx Xxxx |
Date: |
02/20/09 | |||||
| Name: |
Xxxxxxx Xxxx |
|||||||
| Title: |
Executive Vice President, Product Regulatory Office | |||||||
| Tesla Motors, Inc. |
||||||||
| By: | /s/Xxxxx X. Xxxxxxx |
Date: | Feb 12, 2009 | |||||
| Name: | Xxxxx X. Xxxxxxx | |||||||
| Title: | General Counsel & Secretary | |||||||
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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Confidential Treatment Requested by Tesla Motors, Inc.
| Attachment A | ||||
|
Zero Emission Vehicle (XXX) Credit Transfer Form Complete and Submit to: Program Manager, XXX Bank California Air Resources Board, MSCD/XXX X.X. Xxx 0000, Xxxxxxxxxx, Xxxxxxxxxx 00000 |
Transfer ID ARB Use Only |
|
Date of Transfer |
This document certifies that pursuant to Section 1962, Title 13, California Code of Regulations, an agreement executed between Company A and Company B on the Date of Transfer contains the following terms of transfer:
| |
|
/ / |
I. TRANSFER OF ZERO-EMISSION VEHICLE CREDITS FROM TRANSFEROR (A) TO TRANSFEREE (B)
| Model Year Earned |
Type of Vehicle (NEV, 0, I, II, IIICA, III177, ATPZEV, PZEV) |
Number of Credits (g/mi NMOG) |
Transportation System Credits (Y/N) | |||
|
1
|
||||||
|
2
|
||||||
|
3
|
||||||
|
4
|
I declare under penalty of perjury that all information provided herein are true and correct, to the best of my knowledge and belief.
II. TRANSFEROR (A)
| Account Holder – Company Name
|
*Account ID
| |
|
Authorized Company Representative Name – First, Middle I., Last (please print)
|
Phone Number
| |
|
Authorized Company Representative Signature (A)
|
Date
|
III. TRANSFEREE
| Account Holder – Company Name
|
*Account ID
| |
|
Authorized Company Representative Name – First, Middle I., Last (please print)
|
Phone Number
| |
|
Authorized Company Representative Signature (B)
|
Date
|
| * | Please refer to Attachment F for XXX Account Holder Identification codes. If the code for your company is not listed, please contact the XXX Bank Program Manager. |
FOR ARB USE ONLY:
| Entered By (Please print name and title)
|
Initials | Date Received | Date Recorded |
| STATE OF CALIFORNIA | AIR RESOURCES BOARD | |
| ENVIRONMENTAL PROTECTION AGENCY |
MSCD/XXX MAC 2006-03 |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
Confidential Treatment Requested by Tesla Motors, Inc.
Attachment E continued
|
Instructions and Definitions for the XXX Credit Transfer Form | |
| Definitions | ||
| Transferor |
Party giving credits. | |
| Transferee |
Party receiving credits. | |
| Account Holder/ Account ID |
Account Holder/Account ID – Company Name and Account Holder Identification from established list maintained by Air Resources Board. See Attachment F. If your company and Account ID are not listed, please contact the XXX Bank Program Manager. | |
| Model Year |
Year in which credits were earned by manufacturer. | |
| Type of Credit |
XXX Tier – Tier type including: XXX, 0, XX, XXXXX, XXX000 (Type III indicate California or 177 State). Advanced Technology Partial XXX (AT PZEV) Partial XXX (PZEV) | |
| Number of Credits |
Total number of credits transferring in grams/mile Non-Methane Organic Gas (g/mi NMOG). | |
| Transportation System Credits |
Credits earned in a Transportation System Project. These credits are only available for ZEVs (non-NEV), ATPZEVs, and PZEVs. | |
| Example | ||
I. TRANSFER OF ZERO-EMISSION VEHICLE CREDITS FROM TRANSFEROR (A) TO TRANSFEREE (B)
| Model Year Earned |
Type of Vehicle (NEV, I, II, IIICA, III177 ATPZEV, PZEV) |
Number of Credits (g/mi NMOG) |
Transportation System Credits (Y/N) | |||
|
2002
|
XXX
|
15.3
|
Y
| |||
|
2003
|
XXX
|
.39
|
N
| |||
|
2002
|
NEV
|
3.4
|
N
| |||
|
2002
|
PZEV
|
6.8
|
N
|
| STATE OF CALIFORNIA | AIR RESOURCES BOARD | |
| ENVIRONMENTAL PROTECTION AGENCY |
MSCD/XXX MAC 2006-03 |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
Confidential Treatment Requested by Tesla Motors, Inc.
Exhibit B
XXX Credit Transfer Process
| I. | General Credit Transfer Process. |
The Parties acknowledge that the XXX Credits must be transferred via a credit bank set up by ARB. The process is as follows:
| • | To the extent not done so already, the Parties each will first apply for a XXX Credit account and complete an “Application for Zero Emission Vehicle (XXX) Account with the XXX Bank” for the State of California. Each such XXX Credit account is registered in the appropriate XXX accounting bank and shall be hereinafter referred to as a “XXX Bank.” |
| • | The ARB will record Tesla ZEVs and the appropriate number of XXX Credits in the XXX Bank. |
| • | Each transfer of XXX Credits will be filed by Tesla with the XXX Bank using California’s “Zero Emission Vehicle (XXX) Credit Transfer Form,” attached as Exhibit A, (each, a “XXX Credit Transfer Form”). |
| • | Tesla is eligible to receive a certain number of XXX Credits for each Xxxxx XXX produced and delivered for sale pursuant to 13 CCR 1962.1 (d)(5)(C) and the accompanying table as well as the multiplier set forth in 1962.1 (d)(5)(D). |
| II. | Initial Payment; Monthly Reporting and Payment. |
| A. | Initial Payment by Honda. Once Tesla has a minimum of [***] XXX Credits in Xxxxx’x XXX Bank generated by the delivery for sale or placement into service of Tesla ZEVs, Tesla will send to Honda a copy of a statement(s) issued by ARB related to such XXX Credits, along with all documents submitted by Tesla to ARB pursuant to MAC 2006-03 (or subsequent ARB guidance) in connection with such XXX Credits. Within 10 days thereafter, Honda will pay Tesla an amount equal to $[***] per XXX Credit. Upon receipt of such payment, Tesla will immediately prepare, sign and deliver to Honda a partially completed XXX Credit Transfer Form(s) (Tesla will complete Sections I and II in California) to transfer those XXX Credits to Honda. Honda will immediately complete the Transfer Form(s) and deliver them to Tesla, which shall then immediately submit the forms to ARB. The Parties will follow the process set forth in Section II.B for the balance of Xxxxx’x XXX Credits subject to the Agreement. |
| B. | Reporting of ZEVs; Monthly Transfer Reports; Monthly Payments. The XXX Credit transfer process will be as follows: |
| • | By or before the 15th day of each month following a month in which Tesla has earned a XXX Credit subject to the Agreement, Tesla will determine the number of XXX Credits recorded in its XXX Bank(s) and Tesla will prepare, sign and deliver to Honda a partially completed XXX Credit Transfer Form(s) |
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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| (Tesla will complete Sections I and II in California), transferring all such XXX Credits to Honda. Tesla will simultaneously provide to Honda all documents submitted to ARB pursuant to MAC 2006-03 (or subsequent ARB guidance) that pertain to the XXX Credits being transferred to Honda per the XXX Credit Transfer Form(s). |
| • | Upon receipt from Tesla, Honda will verify and complete Section III and sign the XXX Credit Transfer Form(s) and deliver such form to Tesla for submission to ARB. |
| • | Upon confirmation of each trade with ARB, Tesla will present Honda with an invoice (via email/pdf) for an amount equal to the number of XXX Credits transferred by Tesla to Honda multiplied by $[***]. |
| • | Upon receipt of each invoice, Honda will request confirmation from ARB of the most recent transfers and pay Tesla the amount invoiced. Honda shall pay each invoice within 10 business days of the date such invoice was presented to Honda. |
| • | The point of contact for each Party to administer the transfer and payment processes is as follows: |
| For Tesla: |
Xxx Xxxxxx xxxxxxx@xxxxxxxxxxx.xxx |
|||||||
| For Honda: |
Xxxxx Xxxxxxx | |||||||
| Xxxxx_Xxxxxxx@xxx.xxxxx.xxx | ||||||||
| With a copy to: | ||||||||
| Xxxxxx Xxxxxxxxxx | ||||||||
| Xxxxxx_Xxxxxxxxxx@xxx.xxxxx.xxx | ||||||||
| • | Either Party may change its point(s) of contact by written notice to the other Party. All documents and notices required pursuant to this Exhibit B will be sent to these points of contact. The points of contact will be responsible for resolving all issues and discrepancies regarding the transfer of and payment for XXX Credits hereunder. |
| C. | Final Reconciliation Process. |
Within 30 days following the last transfer of XXX Credits from Tesla to Honda pursuant to the Agreement, Tesla wil1 invoice Honda for the final amounts due (if any). Within 30 days following the date of Honda’s receipt of this final invoice, Tesla and Honda will work together to reconcile the final, total number of XXX Credits invoiced and paid for pursuant to the Agreement against the actual number of XXX Credits that Tesla earned and transferred to Honda pursuant to the Agreement to confirm that the amounts paid by Honda were correct. To the extent that Honda either has over- or under-paid for the XXX Credits transferred to it by Tesla pursuant to the Agreement, the Party that owes money will pay such money to the other Party within 5 business days of the date of determination.
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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In addition, if at any time, whether before or after expiration or termination of the Agreement, ARB or any XXX Agency disputes or declines to recognize any XXX Credit reported by Tesla that was paid for by Honda, the Party that becomes aware of such disallowance will immediately notify the other Party. Tesla and Honda will work together to reconcile the matter within 90 days. If the Parties do not persuade ARB or the applicable XXX Agency to validate and recognize the XXX Credit(s) at issue within this 90-day period, Tesla will refund to Honda the amount Honda paid for such XXX Credit(s) within 5 business days after expiration of the 90-day period.
| D. | Cooperation. |
The Parties will cooperate to ensure that all XXX Credits arising or resulting from Tesla ZEVs that are the subject of the Agreement are or will be transferred to Honda, subject to the terms and conditions of the Agreement. The Parties agree to take all actions, including without limitation, executing and delivering upon request any document, and providing all reasonably requested information and documentation to ensure the legal transfer of XXX Credits as provided under the Agreement
| E. | Payment Obligation. |
In the event that, at any time, Honda does not pay the agreed-upon fees to Tesla in accordance with the Agreement for XXX Credits transferred to Honda, Tesla may cease to provide partially completed XXX Credit transfer Form(s) to Honda as otherwise required by the Agreement. Once Honda pays any amounts then owing pursuant to the terms of the Agreement, Tesla shall resume providing partially completed XXX Credit Transfer Form(s) to Honda as required by the Agreement.
| III. | Other XXX States’ Credit Transfer Process. |
The Parties agree that to the extent other XXX States have adopted variations of the procedure set forth above, or new procedures which are not set forth above, then the Parties will comply with the applicable procedures required in such other XXX States.
| [***] | Information has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions. |
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