WHEREAS, Carrier is a motor contract carrier of property, duly registered with the Federal Motor Carrier Safety Administration ("FMCSA") in Docket No. MC- ________, and is engaged in the business of transporting property by motor vehicle in interstate, intrastate, and foreign commerce;
WHEREAS, Broker is duly registered as a property broker with the FMCSA in Docket No. MC # 905987 and arranges transportation of property by motor carriers for its customers; and
WHEREAS, Broker desires to engage the services of Carrier to transport property for or on behalf of Broker's customers and Carrier desires to provide such services to Broker.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual promises contained herein, the Parties agree as follows:
1. Contract Term and Termination.
This Contract shall be effective as of the date written above and shall remain in effect until terminated in the manner provided herein. Either Party shall have the right to terminate this Contract at any time upon thirty (30) days' prior written notice to the other Party.
2. Shipments to be Tendered by Broker.
Broker hereby agrees to tender shipments to Carrier as Broker's needs require for transportation in interstate, intrastate or foreign commerce, and Carrier hereby agrees to transport such shipments in accordance with the terms and conditions stated in this Contract. The Parties acknowledge and agree that this is not an exclusive arrangement, meaning that Broker shall not be required to submit any or all of its transportation requirements to Carrier, and Carrier may provide transportation services to other customers, provided that Carrier complies with Paragraph 22 of this Contract. Each shipment tendered by Broker and accepted for transportation by Carrier shall be confirmed via a "Master Load Tender Confirmation" ("Load Confirmation"). Each Load Confirmation shall be governed by the terms and conditions of this Contract.
3. Determination of Carrier's Compensation.
Carrier shall seek payment for services rendered hereunder solely and exclusively from Broker, and shall not, under any circumstances, present an invoice, bill, demand, or other claim for payment to Broker's customers or any consignor or consignee of a shipment tendered hereunder. Broker shall compensate Carrier as set forth below:
a. Broker shall pay Carrier in accordance with rates and charges set forth in the Load Confirmation, which rates and charges are mutually agreed upon and apply to all shipments tendered under this Contract. Carrier agrees that none of its tariffs, circulars, pricing authorities, and/or similar documents shall apply to the transportation services rendered hereunder, unless such tariff, circular, pricing authority, or similar document is expressly incorporated into this Contract, or into a Load Confirmation by a signed writing other than a bill of lading, receipt, or similar shipping document.
4. Payment of Compensation.
a. Except as provided in 4.b. and c., below, Broker shall pay compensation to Carrier, as set forth in Paragraph 3, hereof, within the agreed terms of its receipt of Carrier's invoice. Each invoice submitted by Carrier shall be accompanied by the bill of lading and delivery receipt for the shipment covered by the invoice, showing delivery without loss, damage, or delay. Carrier (i) waives and relinquishes any and all rights to claim, demand, or seek payment from any person other than Broker for any shipment tendered hereunder; (ii) agrees not to contact Broker's customers, consignors, consignees or any party other than Broker concerning payment for transportation services; and (iii) agrees to indemnify, defend, and hold Broker, its customers, consignors, and consignees harmless from any losses, harm, injuries, damages, claims, costs, expenses, and liabilities (including reasonable attorneys' fees and other costs of litigation, including expert witness fees) (collectively, "Damage"), arising from any claim or demand made by any of Carrier's subcontractor or other party for payment for transportation services related to a shipment tendered hereunder.
b. Broker may withhold and offset any compensation owed to Carrier (i) on any occasion when a shipment tendered hereunder is lost, damaged, or delayed in transit; (ii) to satisfy any unpaid debt owed by Carrier to Broker; or (iii) to satisfy any un-reimbursed advance made to Carrier, or on its behalf. Withholding and offsetting of compensation shall not allow, permit, or entitle Carrier to seek payment from Broker's customers, consignors, consignees, or any other third party.
c. Any claim for overpayment or underpayment of compensation for transportation services provided hereunder shall be presented within thirty (30) days of its discovery, provided that neither Party may assert such a claim more than six (6) months after the delivery date of the shipment giving rise to the claim. A Party shall support its claim with documentation identifying the amount of the overcharge or the undercharge, the delivery date, the goods, the consignor, and the consignee. A Party shall pay, deny, or make a firm compromise offer within forty-five (45) days of receiving a claim from the other Party. Any civil action to recover overcharges or undercharges shall be instituted within eighteen (18) months of the date of delivery of the shipment giving rise to the claim. This Section 4 shall survive termination of this Contract.
5. Carrier's Operating Authority.
Carrier represents and warrants that it is a motor contract carrier of property holding current and valid operating authority from the FMCSA and that all transportation performed hereunder shall be contract carriage. At all times, Carrier represents and warrants that it shall have and maintain such FMCSA authority and any other registrations, licenses, or authorities issued by state or local governments that are applicable to, or necessary for, its operations hereunder. To the extent that Carrier performs services within, or to or from Canada or Mexico, under this Contract; it represents and warrants that it shall obtain and hold any necessary operating authorities under applicable laws, regulations, or rules. Carrier shall notify Broker immediately of any suspension, termination, or revocation of any operating authority, in which event Broker shall have the right to terminate this Contract immediately upon written notice to Carrier.
6. Drivers, Equipment, and Safety.
a. Carrier represents and warrants that its drivers are properly trained, licensed, qualified, and competent to operate the motor vehicles used to transport shipments tendered by Broker, and to provide related services under this Contract. Carrier further represents and warrants that its drivers shall comply with all rules, policies, and procedures in effect at customer or consignee facilities to the maximum extent practicable.
b. At its own expense, Carrier shall provide and maintain all equipment required for the services requested by Broker and represents and warrants that its equipment is (i) clean; (ii) in good operating condition and repair; (iii) in compliance with all federal and/or state laws, regulations, and rules; (iv) suitable and properly configured to safely load, transport, and unload each shipment tendered hereunder; and (v) all equipment provided for the transportation of food, food grade products, or cosmetics shall comply with the requirements of The Sanitary Food Transportation Act or any other applicable laws or regulations governing the transport of said products, and equipment so provided shall not have been used to carry waste, garbage, hazardous materials, or any other commodity that might adulterate or contaminate food, food products, or cosmetics.
7. Performance and Delivery Time.
Carrier represents and warrants that it shall transport each shipment tendered hereunder to its specified destination with reasonable dispatch and without delay caused by anything within Carrier's control. If Broker or its customer informs Carrier of a specified delivery date and/or schedule before pick-up of any shipment or series of shipments, then Carrier shall meet such specified date and/or schedule. However, Carrier shall not violate any law, rule, or regulation pertaining to highway or motor vehicle safety in order to make timely delivery of a shipment. Carrier shall have sufficient information technology capabilities and resources to provide real-time shipment tracking to Broker upon request.
8. Compliance with Laws.
Carrier represents and warrants that it shall comply with all foreign, federal, state, and local laws, regulations, and rules applicable to its operations and its performance of services under this Contract, including without limit those pertaining to safety, hazardous materials, and the environment. In particular, but without limitation, Carrier represents and warrants that it shall observe and obey all laws, regulations, and rules pertaining to load securement, weight restrictions, speed limits, routing restrictions, hours of service, controlled substances testing, driver training and qualifications, vehicle inspection, and/or safe operation of motor vehicles. During performance hereunder, Carrier shall maintain a "satisfactory" USDOT safety rating, or, as the case may be, a similar rating for Canadian or Mexican operations. Carrier shall be solely responsible for, and shall bear any fines, penalties, costs, or expenses arising from any failure to comply with the requirements of this Paragraph.
9. Broker's Compensation.
Carrier shall not claim or demand, in whole or in part, any commissions earned by Broker on shipments tendered hereunder. Broker shall not be required to disclose the amount of its commission to Carrier, and Carrier shall not attempt to ascertain the amount of such commission from any person. This Paragraph shall survive termination of this Contract.
10. Independent Contractor.
Carrier is an independent contractor and shall exercise exclusive control, supervision, and direction over (i) the manner in which transportation services are provided; (ii) the persons engaged in providing transportation services, including its drivers; (iii) the manner in which the Carrier pays its driver; and (iv) the equipment and route selected and used to provide transportation services. Any persons employed by Carrier under this Contract are subject to the direct control and supervision of the Carrier, and not of Broker. None of Carrier's employees, subcontractors, agents or other persons providing transportation services shall be, or shall deemed to be, the employee, subcontractor or agent of Broker for any purpose whatsoever, and Broker shall have no duty, liability or responsibility, of any kind, to or for the acts or omissions of Carrier or its employees, subcontractors, agents or other persons providing transportation services, or any of them. Carrier agrees to defend, indemnify and hold Broker harmless from any Damages with respect to any and all claims of any kind based on any act or omission of Carrier or its employees, drivers, subcontractors, agents or other persons providing transportation services. Carrier shall have full responsibility for the payment of federal, state, and local payroll taxes, workers compensation, social security, and similar withholdings for its employees, drivers, agents, subcontractors and all other persons performing transportation services. This Contract does not create, nor shall it be deemed to create a partnership, joint venture, or agency relationship between Broker and Carrier. This Paragraph shall survive termination of this Contract.
11. Carrier's Cargo Liability and Claims.
a. Carrier shall have sole and exclusive care, custody and control of each shipment tendered by Broker from the time of pick-up until completion of delivery of the shipment to the consignee. Carrier shall be liable to Broker's customer, or to Broker, as assignee of the claim, for loss or theft of, and damage to shipments, and for delayed deliveries. However, Carrier shall not be liable for loss, damage, or delay caused solely by an inherent defect in the product/goods being shipped, or the negligence of Broker or its customer, in which case Carrier shall have burden of proving applicability of the exception. Carrier agrees that broker has 180 days from date of delivery to file a claim.
b. Carrier shall be liable for the full, actual value of each shipment transported hereunder, which shall be the invoice price of the goods comprising the shipment at destination. No released value or other limitation of liability shall be valid or enforceable against Broker or its customer unless expressly agreed to by Broker in a signed writing separate from any bill of lading or other delivery receipt issued by Carrier. The limit set by Carrier's cargo insurance policy shall not limit, or be deemed to limit Carrier's liability on any shipment accepted hereunder.
c. Broker or its customer shall file a written claim (i) for loss, theft or damage to shipments, and (ii) for delay (or non-delivery). Broker or its customer shall support any claim with pertinent documents, provided that failure to supply such documents shall not affect the validity of the claim. Within thirty (30) days of receiving a claim from Broker or its customer for loss, theft, damage, or delay, Carrier shall pay or deny the claim (in which case the reasons for denial shall be fully explained), or make a firm compromise offer.
d. In the event branded or labeled goods are damaged, Broker's customer may decide in its sole discretion, whether the goods may be salvaged, and if salvageable, the value of such salvage. Any salvage receipts shall be deducted from the amount of the claim against Carrier. If Carrier pays the full, actual value of the damaged goods and requests possession of the goods for salvage, then customer shall have the right to remove all identifying marks or labels. Alternatively, the goods shall be permanently marked as "damaged" or similarly noted, in which case neither Broker nor its customer shall bear any cost or expense of such notation. This Section 12 shall survive termination of this Contract.
12. Carrier's Insurance.
Before the first shipment under this Contract, Carrier shall obtain, and thereafter maintain, at its own expense, the following minimum insurance during the term of this Contract, naming Broker as an additional insured and certificate holder: (a) Cargo loss: Minimum $100,000 per shipment; (b) Public and general liability: Minimum $1,000,000 per occurrence; (c) Automobile liability: Minimum $100,000 per occurrence; (d) if refrigerated products require a refrigerated unit Reefer breakdown: Minimum $100,000 per shipment; and (e) Worker's compensation: as required by law. Carrier shall provide current certificates of the foregoing insurance to Broker before the first shipment under this Contract, and, if requested, copies of the underlying policy(ies). At any time during the term hereof, Broker may request, and Carrier shall provide suitable proof of insurance coverage policy(ies). Such policy(ies) shall not be canceled or changed in form without at least thirty (30) days written notice to Broker. Broker may terminate this Contract immediately in the event the aforementioned policy(ies) are canceled or materially changed. Carrier further agrees to procure and maintain any and all insurance required by federal, state, local, or to the extent applicable, foreign laws. Carrier's insurance coverage shall not exclude any claim, loss, injury, damage, or liability related to transportation of hazardous materials, loading or unloading operations, vehicle or trailer theft, or specific classes or kinds of goods, and Carrier shall not invoke any such exclusion in order to avoid liability, responsibility, or obligation, arising hereunder.
13. Carrier's Indemnification.
Carrier shall indemnify, defend, and hold Broker, its customers, consignors, and consignees, and their respective officers, directors, employees and agents harmless from and against any and all Damages arising from, or in connection with (a) Carrier's breach of this Contract, and (b) the services provided by Carrier, its employees, agents, and contractors, unless resulting exclusively from the negligence of Broker or its customer. This Paragraph shall survive termination of this Contract. In the event Broker initiates litigation against Carrier arising from Carrier's breach of this contract, Broker shall be entitled to recover its reasonable attorneys' fees if Broker prevails in such litigation.
14. Bills of Lading/Receipts.
Carrier shall issue and sign a standard bill of lading or similar receipt ("Receipt") acceptable to Broker and Broker's customer upon acceptance of a shipment for transportation. The terms and conditions of such Receipt shall not modify, supplement, or supersede the terms and conditions of this Contract, unless specifically agreed to by Broker in a separate signed writing, apart from the Receipt. Carrier's issuance and execution of the Receipt shall constitute prima facie evidence that Carrier received the shipment in good order and condition, unless exceptions are specifically noted. Carrier shall submit an original copy of the Receipt to Broker evidencing delivery of the shipment, unless otherwise instructed by Broker, in which case Carrier shall retain custody of the Receipt and provide it to Broker upon request. Carrier assumes all risks and liability arising from its loss of any Receipt issued hereunder. This Paragraph shall survive termination of this Contract.
15. Subcontractors.
Carrier shall not co-broker or subcontract any shipment tendered hereunder without first obtaining prior written authorization from Broker. Carrier shall remain fully liable to Broker under the terms of this Contract for any work or service performed by any of its agents or subcontractors in connection with a shipment tendered hereunder, whether the agent or subcontractor is known or unknown to Broker. Carrier shall indemnify, defend, and hold Broker and its customer harmless from and against any Damages of any kind made by or against any such agent or subcontractor. On any occasion when Carrier seeks to co-broker or subcontract a shipment by seeking prior written authorization from Broker, it shall provide proof of the subcontracting carrier's operating authority, its "satisfactory" safety rating, and its insurance in the forms and amounts required of Carrier in Paragraph 13 hereof. This Paragraph shall survive termination of this Contract.
16. Communications.
Carrier and Broker shall seek to communicate by the most efficient means to exchange information, including instructions, equipment, shipment location, and other information useful or necessary to achieve performance of this Contract. Such means shall include without limit telephone, fax machines, e-mail, Internet, electronic funds transfer, EDI, and satellite.
17. Assignment.
This Contract may be assigned only upon the express written consent of both Parties, which consent may be withheld for any reason. If assigned pursuant to the terms of this Paragraph, then this Contract shall inure to the benefit and be binding upon the assignee. Any assignment that is not in full conformity with this Paragraph shall be null and void.
18. Notices.
Except for routine communications made in the course of performance of this Contract, all notices shall be in writing and delivered by facsimile, certified mail, or express mail. Notices transmitted by facsimile shall be deemed received as of the date and time of sender's fax transmission report indicating successful transmission. Notices transmitted by certified mail or express mail shall be deemed received as of the date and time signed for by recipient. Notices shall be addressed as follows: FORTUS GROUP INC, 7485 TERRASSE BOURDEAU, SUITE 402, MONTREAL, QC H8N 2K9.
19. Force Majeure.
Each Party shall be relieved of its respective obligations under this Contract for the duration of any force majeure, which shall include acts of God, flood, earthquake, hurricane, tornado, acts of a public enemy, acts of terror, war, insurrection, sabotage, labor disturbance, governmental order or decree, or similar unusual events beyond the reasonable control of the Party. The Party experiencing a force majeure shall provide written notice to the other Party within three (3) days of the onset of the event and again within five (5) days of termination of the event. The initial notice shall fully describe the force majeure, including its cause and likely duration.
20. No Lien.
Carrier shall not have and shall not assert any lien on any shipment tendered hereunder by Broker. This Paragraph shall survive termination of this Contract.
21. Confidentiality.
Carrier agrees that all of Broker's business, proprietary, and/or non-public information (including, but not limited to, Broker's customer information, customer lists, and shipment information), (a) will be kept confidential by Carrier and its employees, directors, officers and agents ("Representatives"); (b) without limiting the foregoing, will not be disclosed by Carrier or its Representatives to any person whomsoever except with the specific prior written consent of Broker or except as expressly otherwise permitted by this Contract; and (c) will not be used by Carrier or its Representatives in any way that is detrimental to Broker. This obligation shall not prevent disclosure of information (a) as required by law; (b) that was or becomes generally available to the public other than as a result of a disclosure by Carrier or its Representatives; or (c) to Carrier's employees, agents or representatives as necessary to assist with the performance of this Contract. Prior to any disclosure pursuant to (a) above, Carrier shall provide Broker with at least ten (10) days advance written notice. This Paragraph shall survive termination of this Contract.
22. Non-Solicitation.
During the term of this Contract and for a period of one (1) year following its termination, Carrier shall not provide transportation services or related services to any of Broker's customers for which Carrier has provided services under this Contract, unless the shipments are tendered by Broker; provided, however, this provision shall not apply if Carrier has conducted business with such customer during the two years before Broker first tendered shipments to Carrier for such customer. If Carrier breaches the foregoing requirement, then it shall be liable for and shall pay liquidated damages to Broker equal to the amount of twenty percent (20%) of its gross revenue for all shipments transported in violation of this Paragraph. The Parties agree that the remedy provided in this Paragraph is reasonable, and shall not limit or exclude any other rights and remedies available to Broker. For purposes of enforcing this Paragraph, Broker shall have the right to inspect Carrier's records and books, during regular business hours, upon ten (10) days prior written notice. This Paragraph shall survive termination of this Contract.
23. Non-Exclusivity.
Nothing in this Contract is intended to require Broker to use only the services of Carrier or to require the Carrier to provide services only to Broker. Carrier, though, is required to comply with Paragraph 22 of this Contract.
24. Severability.
In the event that the operation of any part of this Contract is determined by a court of competent jurisdiction to result in a violation of any foreign, federal, state or local law or regulation, the Parties agree that such part shall be severable as to the jurisdiction in which the operation results in a violation and that the remaining parts of this Contract shall continue in full force and effect. This Paragraph shall survive termination of this Contract.
25. Waiver.
The failure of either Party to enforce any right, privilege, or obligation established by this Contract on any occasion, or number of occasions, shall not constitute, or be deemed to constitute a waiver or relinquishment of such right, privilege, or obligation. To the fullest extent allowed by law, rights, privileges, and obligations created hereunder shall remain effective and enforceable by the Parties. This Paragraph shall survive termination of this Contract.
26. Entire Agreement and Merger.
This Contract, the Appendices attached hereto, and any Load Confirmations constitute the entire agreement between the Parties, and supersede all previous communications, statements, representations, writings, and instruments with respect to the subject matter hereof. This Contract may be modified.
27. Secured Load Policy.
As set forth on Appendix B to this Contract, which is attached hereto, and incorporated herein, this Contract has a secured load policy in place for all loads that are to be secured with seals or padlocks and Carrier must adhere to these strict secured load policies set forth by Broker during the term of the Contract. Secured loads are to be treated with the highest priority in maintaining the integrity of the load as well as protecting the product from adulteration. The Secured Load Policy in Appendix B provides further explanation.
28. Choice of Law.
This Contract shall be governed by and construed in accordance with the laws of the State of Missouri without regard to rules relating to conflict of laws. Any lawsuit concerning the interpretation, performance, enforcement of this Contract shall be brought in the state or federal courts located in Jackson County, Missouri, and the Parties irrevocably consent to the jurisdiction of such courts. The Parties expressly waive any and all rights and remedies existing and allowed to be waived under 49 U.S.C. Subtitle IV. This Paragraph shall survive termination of this Contract.
