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AMENDMENT NO. 3 TO LONG-TERM SUPPLY AGREEMENT

Reference No. LTSA-MPT-2020-0315

Effective Date: November 1, 2022

This Amendment No. 3 to Long-Term Supply Agreement (this "Amendment No. 3") is entered into as of November 1, 2022 (the "Effective Date"), by and between:

VANTAGE MOBILITY SYSTEMS CORP., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 4280 Mound Road, Sterling Heights, Michigan 48310 (hereinafter referred to as "Supplier" or "Vantage"),

and

MERIDIAN POWERTRAIN HOLDINGS, INC., a corporation organized and existing under the laws of the State of Illinois, with its principal place of business at 2200 North Meacham Road, Suite 400, Schaumburg, Illinois 60173 (hereinafter referred to as "Buyer" or "Meridian").

Supplier and Buyer are each referred to herein individually as a "Party" and collectively as the "Parties."

RECITALS

WHEREAS (A), the Parties entered into that certain Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, dated as of March 15, 2020, pursuant to which Supplier manufactures and supplies to Buyer precision-machined aluminum valve body housings (Part Nos. VMS-4400A, VMS-4400B, VMS-4400C, VMS-4400D, VMS-4400E, and VMS-4400F) for integration into Buyer's 8-speed automatic transmission modules (Meridian Model MPT-8AT), which agreement was subsequently amended by that certain Amendment No. 1, dated as of September 1, 2020, and that certain Amendment No. 2, dated as of June 15, 2021 (as so amended, the "Agreement"), and which Agreement has a five-year term running through March 14, 2025;

WHEREAS (B), certain disputes arose between the Parties regarding warranty chargebacks issued by Buyer under Section 9 of the Agreement, specifically in connection with Warranty Chargeback Notice WCN-2021-1247 (dated December 6, 2021), Warranty Chargeback Notice WCN-2022-0103 (dated January 18, 2022), and Warranty Chargeback Notice WCN-2022-0289 (dated February 7, 2022), which notices collectively covered an aggregate of eleven thousand eight hundred fourteen (11,814) units and aggregate claimed chargebacks of Four Million Eight Hundred Seventy Thousand Five Hundred Fifty Dollars and Twenty Cents ($4,870,550.20) (collectively, the "Disputed Warranty Chargebacks");

WHEREAS (C), the Parties have entered into that certain Settlement Agreement and Mutual Release, dated as of October 28, 2022 (the "Settlement Agreement"), resolving all disputes related to the above-referenced Warranty Chargeback Notices and the Disputed Warranty Chargebacks, and the Settlement Agreement contemplates certain amendments to the Agreement, which the Parties now wish to memorialize in this Amendment No. 3;

WHEREAS (D), the Parties desire to amend certain provisions of the Agreement, specifically Section 9.3 (Recoverable Warranty-Chargeback Costs) and Section 9.4(b) (Part Inspection Procedures Following Warranty Chargeback Notice), to reflect the terms agreed upon in the Settlement Agreement and to improve the contractual framework governing warranty chargebacks on a going-forward basis; and

WHEREAS (E), each Party has duly authorized the execution and delivery of this Amendment No. 3 by all necessary corporate action.

NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the agreements contained in the Settlement Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

ARTICLE 1 — DEFINITIONS AND INTERPRETATION

Section 1.1 — Defined Terms

Unless otherwise defined in this Amendment No. 3, all capitalized terms used herein shall have the respective meanings ascribed to them in the Agreement. In addition to the foregoing, the following terms shall have the meanings set forth below for purposes of this Amendment No. 3:

(a) "Agreement" means the Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, dated as of March 15, 2020, by and between Supplier and Buyer, as amended by Amendment No. 1, dated as of September 1, 2020, Amendment No. 2, dated as of June 15, 2021, and this Amendment No. 3, dated as of the Effective Date.

(b) "Effective Date" means November 1, 2022.

(c) "Settlement Agreement" means the Settlement Agreement and Mutual Release, dated as of October 28, 2022, by and between Supplier and Buyer, resolving all disputes related to the Disputed Warranty Chargebacks.

Section 1.2 — Interpretation

This Amendment No. 3 shall be read in conjunction with, and forms an integral part of, the Agreement. The Agreement, as amended by this Amendment No. 3, shall be treated as a single instrument for all purposes.

In the event of any conflict or inconsistency between the terms of this Amendment No. 3 and the terms of the Agreement (as previously amended by Amendment No. 1 and Amendment No. 2), the terms of this Amendment No. 3 shall prevail and control to the extent of such conflict or inconsistency.

All references in this Amendment No. 3 to "Sections" are to sections of the Agreement as amended hereby, unless the context otherwise requires or unless otherwise expressly specified. All references in the Agreement to "this Agreement" or words of similar import shall, from and after the Effective Date, be deemed to refer to the Agreement as amended by this Amendment No. 3. The rules of interpretation set forth in Article 1 of the Agreement shall apply to this Amendment No. 3 mutatis mutandis.

ARTICLE 2 — AMENDMENTS TO THE AGREEMENT

Section 2.1 — Amendment to Section 9.3 (Recoverable Warranty-Chargeback Costs)

(a) Deletion of Administrative Fee. Section 9.3 of the Agreement is hereby amended as of the Effective Date to delete the administrative fee (previously set at Forty-Eight Dollars ($48.00) per unit) from the definition and calculation of "Recoverable Warranty-Chargeback Costs." From and after the Effective Date, the per-unit chargeback amount recoverable by Buyer under any Warranty Chargeback Notice issued pursuant to Section 9 of the Agreement shall consist only of the following cost components, in each case as actually incurred and reasonably documented:

(i) the replacement part cost (meaning the then-current unit price for the applicable Part Number as set forth in Schedule A to the Agreement, as such Schedule may be updated from time to time in accordance with the Agreement);

(ii) OEM dealer labor costs directly incurred in the removal and replacement of the defective part or parts, as documented by the applicable OEM dealer's work order, service invoice, or equivalent record; and

(iii) Buyer's documented internal failure-analysis and logistics costs, including costs of return freight, incoming inspection, root-cause analysis, and related engineering support, in each case as actually incurred and supported by Buyer's internal cost records or third-party invoices.

For the avoidance of doubt, the administrative fee or any similar overhead allocation, surcharge, processing fee, or general and administrative cost recovery charge previously assessed or assessable under Section 9.3 of the Agreement shall not be included as a component of Recoverable Warranty-Chargeback Costs unless expressly agreed in writing by both Parties on a case-by-case basis. No course of dealing, trade usage, or prior practice between the Parties shall be construed to authorize the inclusion of any such fee or charge absent such express written agreement.

(b) Restated Text of Section 9.3. Effective as of the Effective Date, Section 9.3 of the Agreement is hereby deleted in its entirety and replaced with the amended and restated text of Section 9.3 attached hereto as Exhibit A and incorporated herein by reference. The amended and restated text of Section 9.3 set forth in Exhibit A reflects the deletion of the administrative fee component as described in Section 2.1(a) above and further clarifies that all recoverable costs must be supported by reasonable documentation, including applicable invoices, labor records, and failure-analysis reports, which documentation shall be provided to Supplier contemporaneously with the delivery of any Warranty Chargeback Notice or, if not available at the time of delivery, within fifteen (15) business days thereafter.

Section 2.2 — Amendment to Section 9.4(b) (Part Inspection Procedures Following Warranty Chargeback Notice)

(a) Replacement of 30-Day Unilateral Deadline with 45-Day Mutual Deadline. Section 9.4(b) of the Agreement is hereby amended and restated in its entirety as of the Effective Date. The prior requirement under Section 9.4(b) that Buyer make returned parts available to Supplier for inspection within thirty (30) days of the issuance of a Warranty Chargeback Notice is hereby replaced with the following mutual inspection framework:

(i) Following the issuance of any Warranty Chargeback Notice by Buyer pursuant to Section 9.4(a) of the Agreement, each Party shall cooperate in good faith to make the relevant returned parts available for inspection by both Parties (or their respective designated experts, engineers, or other authorized representatives) within forty-five (45) calendar days of the date of such Warranty Chargeback Notice (the "Inspection Period").

(ii) The obligation to facilitate timely inspection is mutual. Buyer shall tender the returned parts that are the subject of the applicable Warranty Chargeback Notice to Supplier at Supplier's Sterling Heights, Michigan facility or to such other mutually agreed inspection facility as the Parties may designate in writing, in each case within the Inspection Period. Supplier shall complete its initial inspection of the tendered parts and provide its written findings, including any preliminary root-cause analysis and supporting data, to Buyer within the same forty-five (45) calendar day Inspection Period, or within such longer period as the Parties may mutually agree in writing.

(iii) Each Party shall bear its own costs in connection with the inspection of returned parts, except that the cost of freight and logistics for transporting the returned parts to the designated inspection location shall be borne by Buyer.

(b) Consequences of Non-Compliance. The following reciprocal consequences shall apply in the event of either Party's failure to comply with the inspection procedures set forth in Section 2.2(a):

(i) Buyer's Failure to Tender. If Buyer fails to make the returned parts that are the subject of a Warranty Chargeback Notice available for inspection within the forty-five (45) calendar day Inspection Period (as the same may be extended by mutual written agreement of the Parties), Supplier's obligation to honor the applicable Warranty Chargeback Notice shall be suspended until such time as the returned parts are actually made available and tendered to Supplier or to the mutually agreed inspection facility. Upon such actual tender, Supplier shall have an additional forty-five (45) calendar days from the date of such tender to complete its inspection and to contest the applicable Warranty Chargeback Notice in accordance with the procedures set forth in Section 9.4 of the Agreement, and Supplier's right to raise inspection-based defenses shall be fully preserved notwithstanding the expiration of any other deadline under Section 9.4.

(ii) Supplier's Failure to Inspect. If Supplier fails to inspect the tendered returned parts within the forty-five (45) calendar day Inspection Period (or any extension thereof agreed in writing by the Parties), Supplier's right to contest the applicable Warranty Chargeback Notice on the basis of part inspection findings — including, without limitation, any defense relating to the physical condition, metallurgical properties, dimensional conformity, or functional characteristics of the returned parts — shall be deemed waived with respect to those parts. For the avoidance of doubt, any such waiver shall not affect Supplier's right to contest a Warranty Chargeback Notice on grounds other than part inspection (e.g., documentation deficiencies, calculation errors, or timeliness of the Warranty Chargeback Notice itself).

(c) Restated Text of Section 9.4(b). Effective as of the Effective Date, Section 9.4(b) of the Agreement is hereby deleted in its entirety and replaced with the amended and restated text of Section 9.4(b) attached hereto as Exhibit B and incorporated herein by reference. The amended and restated text of Section 9.4(b) set forth in Exhibit B reflects the mutual forty-five (45) calendar day inspection deadline and the reciprocal consequences of non-compliance as described in Sections 2.2(a) and 2.2(b) above.

Section 2.3 — No Other Amendments

Except as expressly amended by this Amendment No. 3, all terms, conditions, covenants, representations, warranties, and agreements of the Agreement shall remain in full force and effect and are hereby ratified and confirmed in all respects. Without limiting the generality of the foregoing, all provisions of the Agreement not specifically addressed by this Amendment No. 3, including, without limitation, the pricing terms set forth in Schedule A, the volume commitments set forth in Schedule B, and the quality and delivery requirements set forth in Articles 5 through 8, shall continue to apply in accordance with their respective terms.

This Amendment No. 3 does not constitute a waiver of any right, remedy, power, or privilege of either Party under the Agreement, whether arising before or after the Effective Date, except as expressly set forth herein. No failure or delay on the part of either Party in exercising any right under this Amendment No. 3 or the Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right preclude the further exercise of that right or any other right.

ARTICLE 3 — SUPPLEMENTAL QUALITY PROTOCOL

Section 3.1 — CT-Scan Porosity-Screening Protocol

In accordance with the requirements of the Settlement Agreement, and as a further condition of the commercial resolution reflected therein, Supplier agrees to implement a supplemental porosity-screening protocol at its manufacturing facility located at 4280 Mound Road, Sterling Heights, Michigan 48310 (the "Sterling Heights Facility"). The supplemental protocol shall consist of the following:

(a) CT-Scan Sampling. Supplier shall implement computed tomography (CT) scan sampling at a frequency of not less than one (1) in every two hundred (200) units (1-in-200) of valve body housings (Part Nos. VMS-4400A, VMS-4400B, VMS-4400C, VMS-4400D, VMS-4400E, and VMS-4400F) produced at the Sterling Heights Facility. The CT-scan equipment, parameters, and inspection criteria shall be consistent with ASTM E1570 or such other applicable standard as the Parties may mutually agree in writing, and shall be capable of detecting internal porosity at or below the threshold specified in Buyer's engineering specifications.

(b) Implementation Timeline. The supplemental CT-scan porosity-screening protocol described in this Section 3.1 shall be fully implemented and operational no later than thirty (30) days after the Effective Date (i.e., by no later than December 1, 2022). Supplier shall provide written confirmation to Buyer upon successful implementation, including a description of the CT-scan equipment installed or engaged, the sampling methodology, and the personnel responsible for administering the protocol.

(c) Record Retention and Audit Rights. Supplier shall maintain complete and accurate records of all CT-scan results, including scan images, analysis reports, lot and serial number traceability data, and any disposition records for parts identified as non-conforming. Such records shall be maintained for a period of not less than seven (7) years from the date of production of the applicable parts. Supplier shall make such records available to Buyer for audit and review upon Buyer's reasonable request, provided that Buyer shall give Supplier not less than fifteen (15) business days' prior written notice of any such audit. Audits shall be conducted during Supplier's normal business hours and shall not unreasonably interfere with Supplier's manufacturing operations.

(d) Cost Allocation. The estimated annual cost of the supplemental CT-scan porosity-screening protocol is approximately One Hundred Eighty-Five Thousand Dollars ($185,000). Such cost, and all actual costs of implementing, operating, and maintaining the supplemental CT-scan protocol, shall be borne solely by Supplier and shall not be passed through to Buyer as a price adjustment, surcharge, or otherwise, unless the Parties otherwise agree in writing. Supplier acknowledges that this cost allocation is a material component of the commercial resolution reflected in the Settlement Agreement.

Section 3.2 — Engineering Specification Compliance

The Parties confirm and agree that all valve body housings supplied under the Agreement (Part Nos. VMS-4400A through VMS-4400F) shall continue to conform in all respects to Buyer's engineering specifications as set forth in Meridian Drawing Set MER-DWG-4400, Revision C, as the same may be updated from time to time in accordance with Article 6 of the Agreement. Without limiting the generality of the foregoing, all valve body housings shall meet or exceed the maximum porosity threshold of ASTM E505 Level 2, as specified in the applicable Meridian engineering drawings and associated material specifications.

The supplemental CT-scan porosity-screening protocol implemented pursuant to Section 3.1 of this Amendment No. 3 is in addition to, and does not replace, limit, or reduce, Supplier's existing quality-control obligations under the Agreement, including, without limitation, Supplier's obligations with respect to Production Part Approval Process (PPAP) documentation, statistical process control (SPC) monitoring, dimensional inspection, and all other quality and inspection requirements set forth in Articles 5, 6, and 7 of the Agreement. Supplier's compliance with the supplemental CT-scan protocol shall not relieve Supplier of any liability for non-conforming parts that are not detected by the CT-scan sampling methodology.

ARTICLE 4 — REFERENCE TO SETTLEMENT AGREEMENT

Section 4.1 — Relationship to Settlement Agreement

This Amendment No. 3 is entered into in connection with, and pursuant to the terms of, the Settlement Agreement dated October 28, 2022. The Parties acknowledge that certain of the amendments set forth in this Amendment No. 3, including the deletion of the administrative fee under Section 2.1, the revised inspection procedures under Section 2.2, and the supplemental CT-scan protocol under Article 3, were agreed upon as part of the broader commercial resolution memorialized in the Settlement Agreement.

Nothing in this Amendment No. 3 shall be construed to modify, amend, supersede, or otherwise affect any provision of the Settlement Agreement, including, without limitation, the mutual releases, payment obligations, and confidentiality provisions set forth therein. The Settlement Agreement remains a separate and independent agreement between the Parties and shall be interpreted and enforced in accordance with its own terms.

In the event of any conflict or inconsistency between the provisions of this Amendment No. 3 and the provisions of the Settlement Agreement: (a) the Settlement Agreement shall control with respect to the resolution of the Disputed Warranty Chargebacks and the specific obligations of the Parties arising thereunder (including payment obligations and releases); and (b) this Amendment No. 3 shall control with respect to the ongoing terms of the Agreement governing the Parties' rights and obligations on a going-forward basis.

Section 4.2 — No Admission of Liability

Consistent with and subject to the provisions of the Settlement Agreement, this Amendment No. 3 and the amendments and supplemental quality obligations set forth herein are made as part of a one-time quality accommodation and commercial resolution and shall not be construed as an admission of liability, fault, defect, or wrongdoing by either Party. Neither Party, by entering into this Amendment No. 3 or performing its obligations hereunder, concedes or admits that any valve body housing supplied under the Agreement was defective or non-conforming, or that any Warranty Chargeback Notice was improperly issued or calculated, as the case may be.

Neither the execution or delivery of this Amendment No. 3, nor any term, provision, or condition hereof, nor any action taken in compliance herewith, shall be admissible in any judicial, arbitral, administrative, or other proceeding as evidence of liability, fault, defect, or wrongdoing by either Party. This Section 4.2 shall survive the expiration or termination of this Amendment No. 3, the Agreement, and the Settlement Agreement.

ARTICLE 5 — GENERAL PROVISIONS

Section 5.1 — Governing Law

This Amendment No. 3 shall be governed by and construed in accordance with the laws of the State of Illinois, without regard to its conflict of laws principles or any choice of law rule that would cause the application of the laws of any other jurisdiction. The foregoing choice of law is consistent with Section 22.4 of the Agreement, and the provisions of Section 22.4 of the Agreement (including, without limitation, any provisions relating to dispute resolution, jurisdiction, and venue) shall apply to this Amendment No. 3 with the same force and effect as if set forth herein in their entirety.

Section 5.2 — Entire Agreement

The Agreement (as amended by Amendment No. 1, Amendment No. 2, and this Amendment No. 3), together with the Settlement Agreement and all schedules, exhibits, and annexes thereto, constitutes the entire agreement between the Parties with respect to the subject matter hereof and thereof and supersedes all prior and contemporaneous negotiations, representations, discussions, correspondence, proposals, and agreements, whether written or oral, relating to such subject matter. No amendment, modification, or supplement to this Amendment No. 3 shall be effective unless set forth in a written instrument duly executed by authorized representatives of both Parties.

Section 5.3 — Counterparts

This Amendment No. 3 may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Amendment No. 3 by facsimile transmission or by electronic transmission in portable document format (PDF) shall be as effective as delivery of an originally executed counterpart. Each Party agrees that it will not raise the transmission or use of a PDF or facsimile delivery to deliver a signature or the fact that any signature or agreement was transmitted or communicated through the use of a PDF or facsimile delivery as a defense to the formation of a contract, and each Party forever waives any such defense.

Section 5.4 — Severability

If any provision of this Amendment No. 3 is held by a court of competent jurisdiction or arbitral tribunal to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Amendment No. 3 or the Agreement, and this Amendment No. 3 and the Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein or therein. The Parties shall endeavor in good faith to replace any such invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that, to the maximum extent practicable, achieves the economic, business, and other purposes of the provision so held to be invalid, illegal, or unenforceable.

Section 5.5 — Notices

All notices, requests, demands, consents, and other communications required or permitted to be given under this Amendment No. 3 shall be given in accordance with Section 22.1 of the Agreement. For purposes of clarity and convenience, the current notice addresses of the Parties are as follows:

If to Supplier:

Vantage Mobility Systems Corp. 4280 Mound Road Sterling Heights, Michigan 48310

Attention: Priya Nandakumar, General Counsel

If to Buyer:

Meridian Powertrain Holdings, Inc. 2200 North Meacham Road, Suite 400 Schaumburg, Illinois 60173

Attention: Karen Whitford, Vice President, Supply Chain

With a copy (which shall not constitute notice) to:

Pratt, Givens & Lowell LLP 155 North Michigan Avenue, Suite 2700 Chicago, Illinois 60601

Attention: Rachel Drummond

Either Party may change its notice address by providing written notice to the other Party in accordance with Section 22.1 of the Agreement.

Section 5.6 — Authority

Each Party hereby represents and warrants to the other Party that: (a) the person executing this Amendment No. 3 on its behalf has been duly authorized to do so by all necessary corporate action; (b) this Amendment No. 3 has been duly executed and delivered by such Party; and (c) this Amendment No. 3 constitutes a legal, valid, and binding obligation of such Party, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Parties have caused this Amendment No. 3 to Long-Term Supply Agreement to be executed by their duly authorized representatives as of the date first set forth above.

VANTAGE MOBILITY SYSTEMS CORP.

By: ________

Name: Derek Calloway

Title: Chief Executive Officer

Date: ________

MERIDIAN POWERTRAIN HOLDINGS, INC.

By: ________

Name: Karen Whitford

Title: Vice President, Supply Chain

Date: ________

EXHIBIT A

AMENDED AND RESTATED SECTION 9.3 (RECOVERABLE WARRANTY-CHARGEBACK COSTS)

The following constitutes the full amended and restated text of Section 9.3 of the Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, as amended by Amendment No. 3, effective as of November 1, 2022:

Section 9.3 — Recoverable Warranty-Chargeback Costs.

(a) Definition. As used in this Agreement, "Recoverable Warranty-Chargeback Costs" means, with respect to any valve body housing (Part Nos. VMS-4400A through VMS-4400F) that is determined to be a Warranted Defective Part in accordance with Section 9.2, the sum of the following cost components, in each case as actually incurred by or on behalf of Buyer and reasonably documented in accordance with Section 9.3(b) below:

(i) Replacement Part Cost. The then-current unit price for the applicable Part Number as set forth in Schedule A to this Agreement, as such Schedule may be updated from time to time in accordance with Section 4.2 of this Agreement. If the applicable Part Number has been superseded by a replacement Part Number, the replacement part cost shall be the then-current unit price for such replacement Part Number.

(ii) OEM Dealer Labor Costs. The reasonable labor costs directly incurred by the applicable original equipment manufacturer ("OEM") dealer or authorized service provider in the removal, replacement, and installation of the defective valve body housing, as documented by the OEM dealer's work order, service invoice, flat-rate labor schedule, or equivalent record. OEM dealer labor costs shall be calculated at the OEM's standard warranty labor rate in effect at the time of the repair and shall not include any premium, overtime, or expedited service charges unless such charges are documented and were required due to the nature of the defect.

(iii) Buyer's Internal Failure-Analysis and Logistics Costs. Buyer's documented internal costs reasonably and directly incurred in connection with the return, inspection, analysis, and disposition of the defective valve body housing, including, without limitation: (A) return freight and transportation costs; (B) incoming inspection and receiving costs; (C) metallurgical, dimensional, and functional failure-analysis costs, including third-party laboratory costs; (D) root-cause investigation and engineering support costs; and (E) related logistics, handling, and warehousing costs. All such costs shall be supported by Buyer's internal cost records, time sheets, purchase orders, or third-party invoices, as applicable.

(b) Documentation and Substantiation Requirements. Each component of Recoverable Warranty-Chargeback Costs claimed by Buyer in any Warranty Chargeback Notice issued pursuant to Section 9.4(a) shall be supported by reasonable documentation demonstrating that such costs were actually incurred and are directly attributable to the Warranted Defective Part(s) that are the subject of the applicable Warranty Chargeback Notice. Required documentation shall include, as applicable:

(i) invoices or purchase orders evidencing the replacement part cost;

(ii) OEM dealer work orders, service invoices, or flat-rate labor records evidencing the OEM dealer labor costs;

(iii) Buyer's internal cost reports, laboratory reports, failure-analysis summaries, freight invoices, and time records evidencing Buyer's internal failure-analysis and logistics costs; and

(iv) such other documentation as Supplier may reasonably request to verify the accuracy and completeness of the claimed costs.

All supporting documentation shall be provided to Supplier contemporaneously with the delivery of the applicable Warranty Chargeback Notice. If any item of supporting documentation is not available at the time of delivery of the Warranty Chargeback Notice, Buyer shall provide such documentation to Supplier within fifteen (15) business days after delivery of the Warranty Chargeback Notice and shall include with the Warranty Chargeback Notice a written explanation identifying the missing documentation and the anticipated date of its availability.

(c) Exclusion of Administrative Fees and Overhead Allocations. Notwithstanding anything to the contrary in this Agreement, Recoverable Warranty-Chargeback Costs shall not include, and Buyer shall not be entitled to recover from Supplier, any of the following:

(i) administrative fees, general and administrative overhead allocations, or processing surcharges of any kind, whether previously assessed under this Agreement or otherwise;

(ii) indirect costs, corporate overhead allocations, or allocated profit margins not directly attributable to the specific Warranted Defective Part(s) that are the subject of the applicable Warranty Chargeback Notice; or

(iii) any other cost category not expressly enumerated in Section 9.3(a)(i), (ii), or (iii) above,

unless such cost is expressly agreed to by both Parties in a written instrument signed by authorized representatives of both Parties specifically referencing this Section 9.3(c). No course of dealing, trade usage, or prior practice between the Parties shall be construed to authorize the inclusion of any excluded cost component absent such express written agreement.

(d) Dispute of Claimed Costs. In the event Supplier disputes any component of Recoverable Warranty-Chargeback Costs claimed by Buyer in a Warranty Chargeback Notice, Supplier shall identify in its written response to such Warranty Chargeback Notice (delivered in accordance with Section 9.4) the specific cost component(s) in dispute and the basis for such dispute. The Parties shall endeavor in good faith to resolve any such dispute within thirty (30) calendar days of Supplier's written notice of dispute. If the Parties are unable to resolve the dispute within such period, the dispute shall be resolved in accordance with the dispute resolution procedures set forth in Article 22 of this Agreement. Supplier shall not withhold payment of undisputed amounts pending the resolution of any dispute over a particular cost component.

End of Exhibit A

EXHIBIT B

AMENDED AND RESTATED SECTION 9.4(b) (PART INSPECTION PROCEDURES FOLLOWING WARRANTY CHARGEBACK NOTICE)

The following constitutes the full amended and restated text of Section 9.4(b) of the Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, as amended by Amendment No. 3, effective as of November 1, 2022:

Section 9.4(b) — Part Inspection Procedures Following Warranty Chargeback Notice.

(i) Mutual 45-Day Inspection Period. Following the issuance of any Warranty Chargeback Notice by Buyer pursuant to Section 9.4(a), the Parties shall cooperate in good faith to make the returned parts that are the subject of such Warranty Chargeback Notice (the "Subject Parts") available for inspection by both Parties (or their respective designated experts, engineers, metallurgists, or other authorized representatives) within forty-five (45) calendar days of the date of such Warranty Chargeback Notice (the "Inspection Period"). The obligation to facilitate timely inspection is mutual, and each Party shall take commercially reasonable steps to ensure that the inspection is completed within the Inspection Period.

(ii) Tender of Returned Parts. Buyer shall tender the Subject Parts to Supplier at Supplier's manufacturing facility located at 4280 Mound Road, Sterling Heights, Michigan 48310, or to such other mutually agreed inspection facility as the Parties may designate in writing (the "Inspection Location"), in each case within the Inspection Period. Buyer's tender of Subject Parts shall be accompanied by the following:

(A) a written transmittal identifying the applicable Warranty Chargeback Notice number, the Part Number(s) and serial number(s) (if available) of the Subject Parts, and the total quantity of parts being tendered;

(B) a chain-of-custody log documenting the handling, storage, and transportation of the Subject Parts from the point of return through delivery to the Inspection Location, including the identity of all persons or entities having custody of the Subject Parts during such period;

(D) such other information as Supplier may reasonably request to facilitate its inspection.

Buyer shall use commercially reasonable efforts to preserve the condition of the Subject Parts during transit and storage and to ensure that the Subject Parts are not altered, modified, disassembled, or subjected to destructive testing prior to tender, except as may be reasonably necessary for Buyer's own failure-analysis activities conducted in accordance with Section 9.3(a)(iii). If Buyer has conducted any destructive or semi-destructive testing on any Subject Part prior to tender, Buyer shall provide Supplier with a written description of the testing performed and the results obtained.

The cost of freight, packaging, and logistics for transporting the Subject Parts to the Inspection Location shall be borne by Buyer. Upon completion of the inspection, the cost of returning the Subject Parts (if applicable) shall be borne by the Party requesting the return, unless otherwise agreed in writing.

(iii) Supplier's Inspection and Findings. Supplier shall complete its initial inspection of the tendered Subject Parts and provide its written findings to Buyer within the Inspection Period (or within such longer period as the Parties may mutually agree in writing). Supplier's written findings shall include, at a minimum:

(A) a summary of the inspection methodology employed (including any dimensional, metallurgical, visual, or functional testing performed);

(B) the results of the inspection for each Subject Part inspected, including identification of any defects, non-conformances, or anomalies detected;

(C) Supplier's preliminary determination as to the root cause of the failure or defect (if identifiable at the time of the initial inspection); and

(D) Supplier's position as to whether the Subject Parts constitute Warranted Defective Parts under Section 9.2 of the Agreement.

If Supplier requires access to additional testing equipment, third-party laboratory services, or other resources not available at the Inspection Location in order to complete its inspection, Supplier shall promptly notify Buyer in writing and the Parties shall cooperate in good faith to arrange for such additional testing within a mutually agreed timeframe. Any such extension shall not exceed thirty (30) calendar days beyond the expiration of the initial Inspection Period unless both Parties agree otherwise in writing.

(iv) Buyer's Right to Participate. Buyer (or its designated representatives) shall have the right to be present during Supplier's inspection of the Subject Parts. Supplier shall provide Buyer with not less than five (5) business days' prior written notice of the date, time, and location of any scheduled inspection session. Buyer's representatives shall comply with Supplier's reasonable facility access, safety, and confidentiality requirements while on site at the Inspection Location.

(v) Consequences of Buyer's Non-Compliance. If Buyer fails to make the Subject Parts available for inspection by tendering them to the Inspection Location within the forty-five (45) calendar day Inspection Period (as the same may be extended by mutual written agreement of the Parties), the following consequences shall apply:

(A) Supplier's obligation to honor the applicable Warranty Chargeback Notice shall be suspended, and no amounts shall be due or payable by Supplier with respect to such Warranty Chargeback Notice, until such time as the Subject Parts are actually tendered to the Inspection Location in accordance with Section 9.4(b)(ii) above.

(B) Upon actual tender of the Subject Parts following the expiration of the Inspection Period, Supplier shall have an additional forty-five (45) calendar days from the date of actual tender to complete its inspection and to contest the applicable Warranty Chargeback Notice in accordance with the procedures set forth in Section 9.4 of the Agreement.

(C) Supplier's right to raise any inspection-based defense or contest to the applicable Warranty Chargeback Notice shall be fully preserved notwithstanding the expiration of the original Inspection Period, the sixty (60) calendar day contest period under Section 9.4(c), or any other deadline under Section 9.4, to the extent that Buyer's failure to timely tender the Subject Parts caused Supplier's inspection not to occur within the originally applicable time period. For the avoidance of doubt, the sixty (60) calendar day contest period under Section 9.4(c) shall, in the case of Buyer's delay in tendering Subject Parts, be measured from the date on which Supplier completes its inspection (or the date on which the additional forty-five (45) calendar day period described in clause (B) above expires, whichever is earlier), rather than from the date of receipt of the Warranty Chargeback Notice.

(D) Buyer shall not be entitled to deduct, set off, or otherwise recover from Supplier any amount in respect of a Warranty Chargeback Notice for which Supplier's obligation has been suspended under this Section 9.4(b)(v) until the suspension is lifted in accordance with the foregoing provisions.

(vi) Consequences of Supplier's Non-Compliance. If Supplier fails to inspect the tendered Subject Parts and provide written findings to Buyer within the forty-five (45) calendar day Inspection Period (or any extension thereof agreed in writing by the Parties), the following consequences shall apply:

(A) Supplier's right to contest the applicable Warranty Chargeback Notice on the basis of part inspection findings — including, without limitation, any defense relating to the physical condition, metallurgical properties, internal porosity levels, dimensional conformity, surface finish, or functional characteristics of the Subject Parts — shall be deemed waived with respect to those Subject Parts that were tendered in accordance with Section 9.4(b)(ii) and not inspected within the applicable period.

(B) For the avoidance of doubt, any such waiver shall be limited to inspection-based defenses and shall not affect Supplier's right to contest the applicable Warranty Chargeback Notice on grounds other than part inspection, including, without limitation: (1) deficiencies in the documentation provided by Buyer under Section 9.3(b); (2) errors in the calculation of Recoverable Warranty-Chargeback Costs; (3) timeliness deficiencies in the issuance of the Warranty Chargeback Notice under Section 9.4(a); (4) arguments that the claimed defect or failure was caused by Buyer's or its customer's misuse, improper installation, improper storage, or failure to comply with applicable handling instructions; or (5) arguments that the claimed defect or failure was caused by a design deficiency in Buyer's transmission module rather than a manufacturing defect in Supplier's valve body housing.

(C) Any such waiver shall not be construed as an admission by Supplier that the Subject Parts constitute Warranted Defective Parts or that Supplier is liable for the amounts claimed in the applicable Warranty Chargeback Notice.

(vii) Coordination with Contest Period. The sixty (60) calendar day period within which Supplier may contest a Warranty Chargeback Notice under Section 9.4(c) of the Agreement (the "Contest Period") shall run from Supplier's receipt of the Warranty Chargeback Notice, subject to the following:

(A) If Buyer tenders the Subject Parts within the Inspection Period and Supplier completes its inspection within the Inspection Period, the Contest Period shall run from the date of Supplier's receipt of the Warranty Chargeback Notice, without modification.

(B) If Buyer fails to tender the Subject Parts within the Inspection Period, the Contest Period for inspection-based defenses shall be tolled and shall not begin to run until the earlier of (1) the date on which Supplier completes its inspection following actual tender of the Subject Parts, or (2) the date on which the additional forty-five (45) calendar day period described in Section 9.4(b)(v)(B) expires. The Contest Period for non-inspection-based defenses shall not be tolled and shall continue to run from the date of receipt of the Warranty Chargeback Notice.

(C) Nothing in this Section 9.4(b)(vii) shall extend the Contest Period beyond one hundred eighty (180) calendar days from the date of the applicable Warranty Chargeback Notice, regardless of the reason for any delay, unless the Parties otherwise agree in writing.

(viii) Preservation of Parts. Following completion of the inspection, the Subject Parts shall be retained by the Party in possession thereof for a period of not less than one hundred eighty (180) calendar days following the final resolution (whether by agreement, payment, or adjudication) of the applicable Warranty Chargeback Notice, or such longer period as may be required by applicable law or by the terms of any pending or threatened dispute between the Parties. Neither Party shall destroy, discard, or dispose of any Subject Parts during such retention period without the prior written consent of the other Party.

End of Exhibit B

AMENDMENT NO. 3 TO LONG-TERM SUPPLY AGREEMENT
Reference No. LTSA-MPT-2020-0315
Effective Date: November 1, 2022
This Amendment No. 3 to Long-Term Supply Agreement (this "Amendment No. 3") is entered into as of November 1, 2022 (the "Effective Date"), by and between:
VANTAGE MOBILITY SYSTEMS CORP., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 4280 Mound Road, Sterling Heights, Michigan 48310 (hereinafter referred to as "Supplier" or "Vantage"),
and
MERIDIAN POWERTRAIN HOLDINGS, INC., a corporation organized and existing under the laws of the State of Illinois, with its principal place of business at 2200 North Meacham Road, Suite 400, Schaumburg, Illinois 60173 (hereinafter referred to as "Buyer" or "Meridian").
Supplier and Buyer are each referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS (A), the Parties entered into that certain Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, dated as of March 15, 2020, pursuant to which Supplier manufactures and supplies to Buyer precision-machined aluminum valve body housings (Part Nos. VMS-4400A, VMS-4400B, VMS-4400C, VMS-4400D, VMS-4400E, and VMS-4400F) for integration into Buyer's 8-speed automatic transmission modules (Meridian Model MPT-8AT), which agreement was subsequently amended by that certain Amendment No. 1, dated as of September 1, 2020, and that certain Amendment No. 2, dated as of June 15, 2021 (as so amended, the "Agreement"), and which Agreement has a five-year term running through March 14, 2025;
WHEREAS (B), certain disputes arose between the Parties regarding warranty chargebacks issued by Buyer under Section 9 of the Agreement, specifically in connection with Warranty Chargeback Notice WCN-2021-1247 (dated December 6, 2021), Warranty Chargeback Notice WCN-2022-0103 (dated January 18, 2022), and Warranty Chargeback Notice WCN-2022-0289 (dated February 7, 2022), which notices collectively covered an aggregate of eleven thousand eight hundred fourteen (11,814) units and aggregate claimed chargebacks of Four Million Eight Hundred Seventy Thousand Five Hundred Fifty Dollars and Twenty Cents ($4,870,550.20) (collectively, the "Disputed Warranty Chargebacks");
WHEREAS (C), the Parties have entered into that certain Settlement Agreement and Mutual Release, dated as of October 28, 2022 (the "Settlement Agreement"), resolving all disputes related to the above-referenced Warranty Chargeback Notices and the Disputed Warranty Chargebacks, and the Settlement Agreement contemplates certain amendments to the Agreement, which the Parties now wish to memorialize in this Amendment No. 3;
WHEREAS (D), the Parties desire to amend certain provisions of the Agreement, specifically Section 9.3 (Recoverable Warranty-Chargeback Costs) and Section 9.4(b) (Part Inspection Procedures Following Warranty Chargeback Notice), to reflect the terms agreed upon in the Settlement Agreement and to improve the contractual framework governing warranty chargebacks on a going-forward basis; and
WHEREAS (E), each Party has duly authorized the execution and delivery of this Amendment No. 3 by all necessary corporate action.
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the agreements contained in the Settlement Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE 1 — DEFINITIONS AND INTERPRETATION
Section 1.1 — Defined Terms
Unless otherwise defined in this Amendment No. 3, all capitalized terms used herein shall have the respective meanings ascribed to them in the Agreement. In addition to the foregoing, the following terms shall have the meanings set forth below for purposes of this Amendment No. 3:
(a) "Agreement" means the Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, dated as of March 15, 2020, by and between Supplier and Buyer, as amended by Amendment No. 1, dated as of September 1, 2020, Amendment No. 2, dated as of June 15, 2021, and this Amendment No. 3, dated as of the Effective Date.
(b) "Effective Date" means November 1, 2022.
(c) "Settlement Agreement" means the Settlement Agreement and Mutual Release, dated as of October 28, 2022, by and between Supplier and Buyer, resolving all disputes related to the Disputed Warranty Chargebacks.
Section 1.2 — Interpretation
This Amendment No. 3 shall be read in conjunction with, and forms an integral part of, the Agreement. The Agreement, as amended by this Amendment No. 3, shall be treated as a single instrument for all purposes.
In the event of any conflict or inconsistency between the terms of this Amendment No. 3 and the terms of the Agreement (as previously amended by Amendment No. 1 and Amendment No. 2), the terms of this Amendment No. 3 shall prevail and control to the extent of such conflict or inconsistency.
All references in this Amendment No. 3 to "Sections" are to sections of the Agreement as amended hereby, unless the context otherwise requires or unless otherwise expressly specified. All references in the Agreement to "this Agreement" or words of similar import shall, from and after the Effective Date, be deemed to refer to the Agreement as amended by this Amendment No. 3. The rules of interpretation set forth in Article 1 of the Agreement shall apply to this Amendment No. 3 mutatis mutandis.
ARTICLE 2 — AMENDMENTS TO THE AGREEMENT
Section 2.1 — Amendment to Section 9.3 (Recoverable Warranty-Chargeback Costs)
(a) Deletion of Administrative Fee. Section 9.3 of the Agreement is hereby amended as of the Effective Date to delete the administrative fee (previously set at Forty-Eight Dollars ($48.00) per unit) from the definition and calculation of "Recoverable Warranty-Chargeback Costs." From and after the Effective Date, the per-unit chargeback amount recoverable by Buyer under any Warranty Chargeback Notice issued pursuant to Section 9 of the Agreement shall consist only of the following cost components, in each case as actually incurred and reasonably documented:
(i) the replacement part cost (meaning the then-current unit price for the applicable Part Number as set forth in Schedule A to the Agreement, as such Schedule may be updated from time to time in accordance with the Agreement);
(ii) OEM dealer labor costs directly incurred in the removal and replacement of the defective part or parts, as documented by the applicable OEM dealer's work order, service invoice, or equivalent record; and
(iii) Buyer's documented internal failure-analysis and logistics costs, including costs of return freight, incoming inspection, root-cause analysis, and related engineering support, in each case as actually incurred and supported by Buyer's internal cost records or third-party invoices.
For the avoidance of doubt, the administrative fee or any similar overhead allocation, surcharge, processing fee, or general and administrative cost recovery charge previously assessed or assessable under Section 9.3 of the Agreement shall not be included as a component of Recoverable Warranty-Chargeback Costs unless expressly agreed in writing by both Parties on a case-by-case basis. No course of dealing, trade usage, or prior practice between the Parties shall be construed to authorize the inclusion of any such fee or charge absent such express written agreement.
(b) Restated Text of Section 9.3. Effective as of the Effective Date, Section 9.3 of the Agreement is hereby deleted in its entirety and replaced with the amended and restated text of Section 9.3 attached hereto as Exhibit A and incorporated herein by reference. The amended and restated text of Section 9.3 set forth in Exhibit A reflects the deletion of the administrative fee component as described in Section 2.1(a) above and further clarifies that all recoverable costs must be supported by reasonable documentation, including applicable invoices, labor records, and failure-analysis reports, which documentation shall be provided to Supplier contemporaneously with the delivery of any Warranty Chargeback Notice or, if not available at the time of delivery, within fifteen (15) business days thereafter.
Section 2.2 — Amendment to Section 9.4(b) (Part Inspection Procedures Following Warranty Chargeback Notice)
(a) Replacement of 30-Day Unilateral Deadline with 45-Day Mutual Deadline. Section 9.4(b) of the Agreement is hereby amended and restated in its entirety as of the Effective Date. The prior requirement under Section 9.4(b) that Buyer make returned parts available to Supplier for inspection within thirty (30) days of the issuance of a Warranty Chargeback Notice is hereby replaced with the following mutual inspection framework:
(i) Following the issuance of any Warranty Chargeback Notice by Buyer pursuant to Section 9.4(a) of the Agreement, each Party shall cooperate in good faith to make the relevant returned parts available for inspection by both Parties (or their respective designated experts, engineers, or other authorized representatives) within forty-five (45) calendar days of the date of such Warranty Chargeback Notice (the "Inspection Period").
(ii) The obligation to facilitate timely inspection is mutual. Buyer shall tender the returned parts that are the subject of the applicable Warranty Chargeback Notice to Supplier at Supplier's Sterling Heights, Michigan facility or to such other mutually agreed inspection facility as the Parties may designate in writing, in each case within the Inspection Period. Supplier shall complete its initial inspection of the tendered parts and provide its written findings, including any preliminary root-cause analysis and supporting data, to Buyer within the same forty-five (45) calendar day Inspection Period, or within such longer period as the Parties may mutually agree in writing.
(iii) Each Party shall bear its own costs in connection with the inspection of returned parts, except that the cost of freight and logistics for transporting the returned parts to the designated inspection location shall be borne by Buyer.
(b) Consequences of Non-Compliance. The following reciprocal consequences shall apply in the event of either Party's failure to comply with the inspection procedures set forth in Section 2.2(a):
(i) Buyer's Failure to Tender. If Buyer fails to make the returned parts that are the subject of a Warranty Chargeback Notice available for inspection within the forty-five (45) calendar day Inspection Period (as the same may be extended by mutual written agreement of the Parties), Supplier's obligation to honor the applicable Warranty Chargeback Notice shall be suspended until such time as the returned parts are actually made available and tendered to Supplier or to the mutually agreed inspection facility. Upon such actual tender, Supplier shall have an additional forty-five (45) calendar days from the date of such tender to complete its inspection and to contest the applicable Warranty Chargeback Notice in accordance with the procedures set forth in Section 9.4 of the Agreement, and Supplier's right to raise inspection-based defenses shall be fully preserved notwithstanding the expiration of any other deadline under Section 9.4.
(ii) Supplier's Failure to Inspect. If Supplier fails to inspect the tendered returned parts within the forty-five (45) calendar day Inspection Period (or any extension thereof agreed in writing by the Parties), Supplier's right to contest the applicable Warranty Chargeback Notice on the basis of part inspection findings — including, without limitation, any defense relating to the physical condition, metallurgical properties, dimensional conformity, or functional characteristics of the returned parts — shall be deemed waived with respect to those parts. For the avoidance of doubt, any such waiver shall not affect Supplier's right to contest a Warranty Chargeback Notice on grounds other than part inspection (e.g., documentation deficiencies, calculation errors, or timeliness of the Warranty Chargeback Notice itself).
(c) Restated Text of Section 9.4(b). Effective as of the Effective Date, Section 9.4(b) of the Agreement is hereby deleted in its entirety and replaced with the amended and restated text of Section 9.4(b) attached hereto as Exhibit B and incorporated herein by reference. The amended and restated text of Section 9.4(b) set forth in Exhibit B reflects the mutual forty-five (45) calendar day inspection deadline and the reciprocal consequences of non-compliance as described in Sections 2.2(a) and 2.2(b) above.
Section 2.3 — No Other Amendments
Except as expressly amended by this Amendment No. 3, all terms, conditions, covenants, representations, warranties, and agreements of the Agreement shall remain in full force and effect and are hereby ratified and confirmed in all respects. Without limiting the generality of the foregoing, all provisions of the Agreement not specifically addressed by this Amendment No. 3, including, without limitation, the pricing terms set forth in Schedule A, the volume commitments set forth in Schedule B, and the quality and delivery requirements set forth in Articles 5 through 8, shall continue to apply in accordance with their respective terms.
This Amendment No. 3 does not constitute a waiver of any right, remedy, power, or privilege of either Party under the Agreement, whether arising before or after the Effective Date, except as expressly set forth herein. No failure or delay on the part of either Party in exercising any right under this Amendment No. 3 or the Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right preclude the further exercise of that right or any other right.
ARTICLE 3 — SUPPLEMENTAL QUALITY PROTOCOL
Section 3.1 — CT-Scan Porosity-Screening Protocol
In accordance with the requirements of the Settlement Agreement, and as a further condition of the commercial resolution reflected therein, Supplier agrees to implement a supplemental porosity-screening protocol at its manufacturing facility located at 4280 Mound Road, Sterling Heights, Michigan 48310 (the "Sterling Heights Facility"). The supplemental protocol shall consist of the following:
(a) CT-Scan Sampling. Supplier shall implement computed tomography (CT) scan sampling at a frequency of not less than one (1) in every two hundred (200) units (1-in-200) of valve body housings (Part Nos. VMS-4400A, VMS-4400B, VMS-4400C, VMS-4400D, VMS-4400E, and VMS-4400F) produced at the Sterling Heights Facility. The CT-scan equipment, parameters, and inspection criteria shall be consistent with ASTM E1570 or such other applicable standard as the Parties may mutually agree in writing, and shall be capable of detecting internal porosity at or below the threshold specified in Buyer's engineering specifications.
(b) Implementation Timeline. The supplemental CT-scan porosity-screening protocol described in this Section 3.1 shall be fully implemented and operational no later than thirty (30) days after the Effective Date (i.e., by no later than December 1, 2022). Supplier shall provide written confirmation to Buyer upon successful implementation, including a description of the CT-scan equipment installed or engaged, the sampling methodology, and the personnel responsible for administering the protocol.
(c) Record Retention and Audit Rights. Supplier shall maintain complete and accurate records of all CT-scan results, including scan images, analysis reports, lot and serial number traceability data, and any disposition records for parts identified as non-conforming. Such records shall be maintained for a period of not less than seven (7) years from the date of production of the applicable parts. Supplier shall make such records available to Buyer for audit and review upon Buyer's reasonable request, provided that Buyer shall give Supplier not less than fifteen (15) business days' prior written notice of any such audit. Audits shall be conducted during Supplier's normal business hours and shall not unreasonably interfere with Supplier's manufacturing operations.
(d) Cost Allocation. The estimated annual cost of the supplemental CT-scan porosity-screening protocol is approximately One Hundred Eighty-Five Thousand Dollars ($185,000). Such cost, and all actual costs of implementing, operating, and maintaining the supplemental CT-scan protocol, shall be borne solely by Supplier and shall not be passed through to Buyer as a price adjustment, surcharge, or otherwise, unless the Parties otherwise agree in writing. Supplier acknowledges that this cost allocation is a material component of the commercial resolution reflected in the Settlement Agreement.
Section 3.2 — Engineering Specification Compliance
The Parties confirm and agree that all valve body housings supplied under the Agreement (Part Nos. VMS-4400A through VMS-4400F) shall continue to conform in all respects to Buyer's engineering specifications as set forth in Meridian Drawing Set MER-DWG-4400, Revision C, as the same may be updated from time to time in accordance with Article 6 of the Agreement. Without limiting the generality of the foregoing, all valve body housings shall meet or exceed the maximum porosity threshold of ASTM E505 Level 2, as specified in the applicable Meridian engineering drawings and associated material specifications.
The supplemental CT-scan porosity-screening protocol implemented pursuant to Section 3.1 of this Amendment No. 3 is in addition to, and does not replace, limit, or reduce, Supplier's existing quality-control obligations under the Agreement, including, without limitation, Supplier's obligations with respect to Production Part Approval Process (PPAP) documentation, statistical process control (SPC) monitoring, dimensional inspection, and all other quality and inspection requirements set forth in Articles 5, 6, and 7 of the Agreement. Supplier's compliance with the supplemental CT-scan protocol shall not relieve Supplier of any liability for non-conforming parts that are not detected by the CT-scan sampling methodology.
ARTICLE 4 — REFERENCE TO SETTLEMENT AGREEMENT
Section 4.1 — Relationship to Settlement Agreement
This Amendment No. 3 is entered into in connection with, and pursuant to the terms of, the Settlement Agreement dated October 28, 2022. The Parties acknowledge that certain of the amendments set forth in this Amendment No. 3, including the deletion of the administrative fee under Section 2.1, the revised inspection procedures under Section 2.2, and the supplemental CT-scan protocol under Article 3, were agreed upon as part of the broader commercial resolution memorialized in the Settlement Agreement.
Nothing in this Amendment No. 3 shall be construed to modify, amend, supersede, or otherwise affect any provision of the Settlement Agreement, including, without limitation, the mutual releases, payment obligations, and confidentiality provisions set forth therein. The Settlement Agreement remains a separate and independent agreement between the Parties and shall be interpreted and enforced in accordance with its own terms.
In the event of any conflict or inconsistency between the provisions of this Amendment No. 3 and the provisions of the Settlement Agreement: (a) the Settlement Agreement shall control with respect to the resolution of the Disputed Warranty Chargebacks and the specific obligations of the Parties arising thereunder (including payment obligations and releases); and (b) this Amendment No. 3 shall control with respect to the ongoing terms of the Agreement governing the Parties' rights and obligations on a going-forward basis.
Section 4.2 — No Admission of Liability
Consistent with and subject to the provisions of the Settlement Agreement, this Amendment No. 3 and the amendments and supplemental quality obligations set forth herein are made as part of a one-time quality accommodation and commercial resolution and shall not be construed as an admission of liability, fault, defect, or wrongdoing by either Party. Neither Party, by entering into this Amendment No. 3 or performing its obligations hereunder, concedes or admits that any valve body housing supplied under the Agreement was defective or non-conforming, or that any Warranty Chargeback Notice was improperly issued or calculated, as the case may be.
Neither the execution or delivery of this Amendment No. 3, nor any term, provision, or condition hereof, nor any action taken in compliance herewith, shall be admissible in any judicial, arbitral, administrative, or other proceeding as evidence of liability, fault, defect, or wrongdoing by either Party. This Section 4.2 shall survive the expiration or termination of this Amendment No. 3, the Agreement, and the Settlement Agreement.
ARTICLE 5 — GENERAL PROVISIONS
Section 5.1 — Governing Law
This Amendment No. 3 shall be governed by and construed in accordance with the laws of the State of Illinois, without regard to its conflict of laws principles or any choice of law rule that would cause the application of the laws of any other jurisdiction. The foregoing choice of law is consistent with Section 22.4 of the Agreement, and the provisions of Section 22.4 of the Agreement (including, without limitation, any provisions relating to dispute resolution, jurisdiction, and venue) shall apply to this Amendment No. 3 with the same force and effect as if set forth herein in their entirety.
Section 5.2 — Entire Agreement
The Agreement (as amended by Amendment No. 1, Amendment No. 2, and this Amendment No. 3), together with the Settlement Agreement and all schedules, exhibits, and annexes thereto, constitutes the entire agreement between the Parties with respect to the subject matter hereof and thereof and supersedes all prior and contemporaneous negotiations, representations, discussions, correspondence, proposals, and agreements, whether written or oral, relating to such subject matter. No amendment, modification, or supplement to this Amendment No. 3 shall be effective unless set forth in a written instrument duly executed by authorized representatives of both Parties.
Section 5.3 — Counterparts
This Amendment No. 3 may be executed in one or more counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of this Amendment No. 3 by facsimile transmission or by electronic transmission in portable document format (PDF) shall be as effective as delivery of an originally executed counterpart. Each Party agrees that it will not raise the transmission or use of a PDF or facsimile delivery to deliver a signature or the fact that any signature or agreement was transmitted or communicated through the use of a PDF or facsimile delivery as a defense to the formation of a contract, and each Party forever waives any such defense.
Section 5.4 — Severability
If any provision of this Amendment No. 3 is held by a court of competent jurisdiction or arbitral tribunal to be invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Amendment No. 3 or the Agreement, and this Amendment No. 3 and the Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein or therein. The Parties shall endeavor in good faith to replace any such invalid, illegal, or unenforceable provision with a valid, legal, and enforceable provision that, to the maximum extent practicable, achieves the economic, business, and other purposes of the provision so held to be invalid, illegal, or unenforceable.
Section 5.5 — Notices
All notices, requests, demands, consents, and other communications required or permitted to be given under this Amendment No. 3 shall be given in accordance with Section 22.1 of the Agreement. For purposes of clarity and convenience, the current notice addresses of the Parties are as follows:
If to Supplier:
Vantage Mobility Systems Corp. 4280 Mound Road Sterling Heights, Michigan 48310
Attention: Priya Nandakumar, General Counsel
If to Buyer:
Meridian Powertrain Holdings, Inc. 2200 North Meacham Road, Suite 400 Schaumburg, Illinois 60173
Attention: Karen Whitford, Vice President, Supply Chain
With a copy (which shall not constitute notice) to:
Pratt, Givens & Lowell LLP 155 North Michigan Avenue, Suite 2700 Chicago, Illinois 60601
Attention: Rachel Drummond
Either Party may change its notice address by providing written notice to the other Party in accordance with Section 22.1 of the Agreement.
Section 5.6 — Authority
Each Party hereby represents and warrants to the other Party that: (a) the person executing this Amendment No. 3 on its behalf has been duly authorized to do so by all necessary corporate action; (b) this Amendment No. 3 has been duly executed and delivered by such Party; and (c) this Amendment No. 3 constitutes a legal, valid, and binding obligation of such Party, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Parties have caused this Amendment No. 3 to Long-Term Supply Agreement to be executed by their duly authorized representatives as of the date first set forth above.
VANTAGE MOBILITY SYSTEMS CORP.
By: ________
Name: Derek Calloway
Title: Chief Executive Officer
Date: ________
MERIDIAN POWERTRAIN HOLDINGS, INC.
By: ________
Name: Karen Whitford
Title: Vice President, Supply Chain
Date: ________
EXHIBIT A
AMENDED AND RESTATED SECTION 9.3 (RECOVERABLE WARRANTY-CHARGEBACK COSTS)
The following constitutes the full amended and restated text of Section 9.3 of the Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, as amended by Amendment No. 3, effective as of November 1, 2022:
Section 9.3 — Recoverable Warranty-Chargeback Costs.
(a) Definition. As used in this Agreement, "Recoverable Warranty-Chargeback Costs" means, with respect to any valve body housing (Part Nos. VMS-4400A through VMS-4400F) that is determined to be a Warranted Defective Part in accordance with Section 9.2, the sum of the following cost components, in each case as actually incurred by or on behalf of Buyer and reasonably documented in accordance with Section 9.3(b) below:
(i) Replacement Part Cost. The then-current unit price for the applicable Part Number as set forth in Schedule A to this Agreement, as such Schedule may be updated from time to time in accordance with Section 4.2 of this Agreement. If the applicable Part Number has been superseded by a replacement Part Number, the replacement part cost shall be the then-current unit price for such replacement Part Number.
(ii) OEM Dealer Labor Costs. The reasonable labor costs directly incurred by the applicable original equipment manufacturer ("OEM") dealer or authorized service provider in the removal, replacement, and installation of the defective valve body housing, as documented by the OEM dealer's work order, service invoice, flat-rate labor schedule, or equivalent record. OEM dealer labor costs shall be calculated at the OEM's standard warranty labor rate in effect at the time of the repair and shall not include any premium, overtime, or expedited service charges unless such charges are documented and were required due to the nature of the defect.
(iii) Buyer's Internal Failure-Analysis and Logistics Costs. Buyer's documented internal costs reasonably and directly incurred in connection with the return, inspection, analysis, and disposition of the defective valve body housing, including, without limitation: (A) return freight and transportation costs; (B) incoming inspection and receiving costs; (C) metallurgical, dimensional, and functional failure-analysis costs, including third-party laboratory costs; (D) root-cause investigation and engineering support costs; and (E) related logistics, handling, and warehousing costs. All such costs shall be supported by Buyer's internal cost records, time sheets, purchase orders, or third-party invoices, as applicable.
(b) Documentation and Substantiation Requirements. Each component of Recoverable Warranty-Chargeback Costs claimed by Buyer in any Warranty Chargeback Notice issued pursuant to Section 9.4(a) shall be supported by reasonable documentation demonstrating that such costs were actually incurred and are directly attributable to the Warranted Defective Part(s) that are the subject of the applicable Warranty Chargeback Notice. Required documentation shall include, as applicable:
(i) invoices or purchase orders evidencing the replacement part cost;
(ii) OEM dealer work orders, service invoices, or flat-rate labor records evidencing the OEM dealer labor costs;
(iii) Buyer's internal cost reports, laboratory reports, failure-analysis summaries, freight invoices, and time records evidencing Buyer's internal failure-analysis and logistics costs; and
(iv) such other documentation as Supplier may reasonably request to verify the accuracy and completeness of the claimed costs.
All supporting documentation shall be provided to Supplier contemporaneously with the delivery of the applicable Warranty Chargeback Notice. If any item of supporting documentation is not available at the time of delivery of the Warranty Chargeback Notice, Buyer shall provide such documentation to Supplier within fifteen (15) business days after delivery of the Warranty Chargeback Notice and shall include with the Warranty Chargeback Notice a written explanation identifying the missing documentation and the anticipated date of its availability.
(c) Exclusion of Administrative Fees and Overhead Allocations. Notwithstanding anything to the contrary in this Agreement, Recoverable Warranty-Chargeback Costs shall not include, and Buyer shall not be entitled to recover from Supplier, any of the following:
(i) administrative fees, general and administrative overhead allocations, or processing surcharges of any kind, whether previously assessed under this Agreement or otherwise;
(ii) indirect costs, corporate overhead allocations, or allocated profit margins not directly attributable to the specific Warranted Defective Part(s) that are the subject of the applicable Warranty Chargeback Notice; or
(iii) any other cost category not expressly enumerated in Section 9.3(a)(i), (ii), or (iii) above,
unless such cost is expressly agreed to by both Parties in a written instrument signed by authorized representatives of both Parties specifically referencing this Section 9.3(c). No course of dealing, trade usage, or prior practice between the Parties shall be construed to authorize the inclusion of any excluded cost component absent such express written agreement.
(d) Dispute of Claimed Costs. In the event Supplier disputes any component of Recoverable Warranty-Chargeback Costs claimed by Buyer in a Warranty Chargeback Notice, Supplier shall identify in its written response to such Warranty Chargeback Notice (delivered in accordance with Section 9.4) the specific cost component(s) in dispute and the basis for such dispute. The Parties shall endeavor in good faith to resolve any such dispute within thirty (30) calendar days of Supplier's written notice of dispute. If the Parties are unable to resolve the dispute within such period, the dispute shall be resolved in accordance with the dispute resolution procedures set forth in Article 22 of this Agreement. Supplier shall not withhold payment of undisputed amounts pending the resolution of any dispute over a particular cost component.
End of Exhibit A
EXHIBIT B
AMENDED AND RESTATED SECTION 9.4(b) (PART INSPECTION PROCEDURES FOLLOWING WARRANTY CHARGEBACK NOTICE)
The following constitutes the full amended and restated text of Section 9.4(b) of the Long-Term Supply Agreement, Reference No. LTSA-MPT-2020-0315, as amended by Amendment No. 3, effective as of November 1, 2022:
Section 9.4(b) — Part Inspection Procedures Following Warranty Chargeback Notice.
(i) Mutual 45-Day Inspection Period. Following the issuance of any Warranty Chargeback Notice by Buyer pursuant to Section 9.4(a), the Parties shall cooperate in good faith to make the returned parts that are the subject of such Warranty Chargeback Notice (the "Subject Parts") available for inspection by both Parties (or their respective designated experts, engineers, metallurgists, or other authorized representatives) within forty-five (45) calendar days of the date of such Warranty Chargeback Notice (the "Inspection Period"). The obligation to facilitate timely inspection is mutual, and each Party shall take commercially reasonable steps to ensure that the inspection is completed within the Inspection Period.
(ii) Tender of Returned Parts. Buyer shall tender the Subject Parts to Supplier at Supplier's manufacturing facility located at 4280 Mound Road, Sterling Heights, Michigan 48310, or to such other mutually agreed inspection facility as the Parties may designate in writing (the "Inspection Location"), in each case within the Inspection Period. Buyer's tender of Subject Parts shall be accompanied by the following:
(A) a written transmittal identifying the applicable Warranty Chargeback Notice number, the Part Number(s) and serial number(s) (if available) of the Subject Parts, and the total quantity of parts being tendered;
(B) a chain-of-custody log documenting the handling, storage, and transportation of the Subject Parts from the point of return through delivery to the Inspection Location, including the identity of all persons or entities having custody of the Subject Parts during such period;
(C) any available preliminary failure data, photographs, or field service reports relating to the Subject Parts; and
(D) such other information as Supplier may reasonably request to facilitate its inspection.
Buyer shall use commercially reasonable efforts to preserve the condition of the Subject Parts during transit and storage and to ensure that the Subject Parts are not altered, modified, disassembled, or subjected to destructive testing prior to tender, except as may be reasonably necessary for Buyer's own failure-analysis activities conducted in accordance with Section 9.3(a)(iii). If Buyer has conducted any destructive or semi-destructive testing on any Subject Part prior to tender, Buyer shall provide Supplier with a written description of the testing performed and the results obtained.
The cost of freight, packaging, and logistics for transporting the Subject Parts to the Inspection Location shall be borne by Buyer. Upon completion of the inspection, the cost of returning the Subject Parts (if applicable) shall be borne by the Party requesting the return, unless otherwise agreed in writing.
(iii) Supplier's Inspection and Findings. Supplier shall complete its initial inspection of the tendered Subject Parts and provide its written findings to Buyer within the Inspection Period (or within such longer period as the Parties may mutually agree in writing). Supplier's written findings shall include, at a minimum:
(A) a summary of the inspection methodology employed (including any dimensional, metallurgical, visual, or functional testing performed);
(B) the results of the inspection for each Subject Part inspected, including identification of any defects, non-conformances, or anomalies detected;
(C) Supplier's preliminary determination as to the root cause of the failure or defect (if identifiable at the time of the initial inspection); and
(D) Supplier's position as to whether the Subject Parts constitute Warranted Defective Parts under Section 9.2 of the Agreement.
If Supplier requires access to additional testing equipment, third-party laboratory services, or other resources not available at the Inspection Location in order to complete its inspection, Supplier shall promptly notify Buyer in writing and the Parties shall cooperate in good faith to arrange for such additional testing within a mutually agreed timeframe. Any such extension shall not exceed thirty (30) calendar days beyond the expiration of the initial Inspection Period unless both Parties agree otherwise in writing.
(iv) Buyer's Right to Participate. Buyer (or its designated representatives) shall have the right to be present during Supplier's inspection of the Subject Parts. Supplier shall provide Buyer with not less than five (5) business days' prior written notice of the date, time, and location of any scheduled inspection session. Buyer's representatives shall comply with Supplier's reasonable facility access, safety, and confidentiality requirements while on site at the Inspection Location.
(v) Consequences of Buyer's Non-Compliance. If Buyer fails to make the Subject Parts available for inspection by tendering them to the Inspection Location within the forty-five (45) calendar day Inspection Period (as the same may be extended by mutual written agreement of the Parties), the following consequences shall apply:
(A) Supplier's obligation to honor the applicable Warranty Chargeback Notice shall be suspended, and no amounts shall be due or payable by Supplier with respect to such Warranty Chargeback Notice, until such time as the Subject Parts are actually tendered to the Inspection Location in accordance with Section 9.4(b)(ii) above.
(B) Upon actual tender of the Subject Parts following the expiration of the Inspection Period, Supplier shall have an additional forty-five (45) calendar days from the date of actual tender to complete its inspection and to contest the applicable Warranty Chargeback Notice in accordance with the procedures set forth in Section 9.4 of the Agreement.
(C) Supplier's right to raise any inspection-based defense or contest to the applicable Warranty Chargeback Notice shall be fully preserved notwithstanding the expiration of the original Inspection Period, the sixty (60) calendar day contest period under Section 9.4(c), or any other deadline under Section 9.4, to the extent that Buyer's failure to timely tender the Subject Parts caused Supplier's inspection not to occur within the originally applicable time period. For the avoidance of doubt, the sixty (60) calendar day contest period under Section 9.4(c) shall, in the case of Buyer's delay in tendering Subject Parts, be measured from the date on which Supplier completes its inspection (or the date on which the additional forty-five (45) calendar day period described in clause (B) above expires, whichever is earlier), rather than from the date of receipt of the Warranty Chargeback Notice.
(D) Buyer shall not be entitled to deduct, set off, or otherwise recover from Supplier any amount in respect of a Warranty Chargeback Notice for which Supplier's obligation has been suspended under this Section 9.4(b)(v) until the suspension is lifted in accordance with the foregoing provisions.
(vi) Consequences of Supplier's Non-Compliance. If Supplier fails to inspect the tendered Subject Parts and provide written findings to Buyer within the forty-five (45) calendar day Inspection Period (or any extension thereof agreed in writing by the Parties), the following consequences shall apply:
(A) Supplier's right to contest the applicable Warranty Chargeback Notice on the basis of part inspection findings — including, without limitation, any defense relating to the physical condition, metallurgical properties, internal porosity levels, dimensional conformity, surface finish, or functional characteristics of the Subject Parts — shall be deemed waived with respect to those Subject Parts that were tendered in accordance with Section 9.4(b)(ii) and not inspected within the applicable period.
(B) For the avoidance of doubt, any such waiver shall be limited to inspection-based defenses and shall not affect Supplier's right to contest the applicable Warranty Chargeback Notice on grounds other than part inspection, including, without limitation: (1) deficiencies in the documentation provided by Buyer under Section 9.3(b); (2) errors in the calculation of Recoverable Warranty-Chargeback Costs; (3) timeliness deficiencies in the issuance of the Warranty Chargeback Notice under Section 9.4(a); (4) arguments that the claimed defect or failure was caused by Buyer's or its customer's misuse, improper installation, improper storage, or failure to comply with applicable handling instructions; or (5) arguments that the claimed defect or failure was caused by a design deficiency in Buyer's transmission module rather than a manufacturing defect in Supplier's valve body housing.
(C) Any such waiver shall not be construed as an admission by Supplier that the Subject Parts constitute Warranted Defective Parts or that Supplier is liable for the amounts claimed in the applicable Warranty Chargeback Notice.
(vii) Coordination with Contest Period. The sixty (60) calendar day period within which Supplier may contest a Warranty Chargeback Notice under Section 9.4(c) of the Agreement (the "Contest Period") shall run from Supplier's receipt of the Warranty Chargeback Notice, subject to the following:
(A) If Buyer tenders the Subject Parts within the Inspection Period and Supplier completes its inspection within the Inspection Period, the Contest Period shall run from the date of Supplier's receipt of the Warranty Chargeback Notice, without modification.
(B) If Buyer fails to tender the Subject Parts within the Inspection Period, the Contest Period for inspection-based defenses shall be tolled and shall not begin to run until the earlier of (1) the date on which Supplier completes its inspection following actual tender of the Subject Parts, or (2) the date on which the additional forty-five (45) calendar day period described in Section 9.4(b)(v)(B) expires. The Contest Period for non-inspection-based defenses shall not be tolled and shall continue to run from the date of receipt of the Warranty Chargeback Notice.
(C) Nothing in this Section 9.4(b)(vii) shall extend the Contest Period beyond one hundred eighty (180) calendar days from the date of the applicable Warranty Chargeback Notice, regardless of the reason for any delay, unless the Parties otherwise agree in writing.
(viii) Preservation of Parts. Following completion of the inspection, the Subject Parts shall be retained by the Party in possession thereof for a period of not less than one hundred eighty (180) calendar days following the final resolution (whether by agreement, payment, or adjudication) of the applicable Warranty Chargeback Notice, or such longer period as may be required by applicable law or by the terms of any pending or threatened dispute between the Parties. Neither Party shall destroy, discard, or dispose of any Subject Parts during such retention period without the prior written consent of the other Party.
End of Exhibit B

AMENDMENT NO. 3 TO LONG-TERM SUPPLY AGREEMENT

RECITALS

VANTAGE MOBILITY SYSTEMS CORP.

MERIDIAN POWERTRAIN HOLDINGS, INC.

EXHIBIT A

AMENDED AND RESTATED SECTION 9.3 (RECOVERABLE WARRANTY-CHARGEBACK COSTS)

EXHIBIT B

Record

Parties

Dates

Amounts