TRANSPORTATION AGREEMENT - Alliance



TRANSPORTATION AGREEMENT

Transportation Agreement (this “Agreement”), dated as of the date set forth on the signature page to this Agreement, is between ALLIANCE SHIPPERS INC. (“ASI”), a New Jersey corporation, and the undersigned customer whose name, state of incorporation or formation, principal office address and authorized signatory’s signature appear on the signature page to this Agreement (“Customer”).

ASI is an intermodal company, not a motor and/or rail carrier, which arranges for the transportation of cargo by motor and rail carriers. ASI is a freight transportation broker. ASI and Customer mutually desire to enter into a continuing agreement whereby ASI will arrange for intrastate and interstate highway and intermodal transportation services for Customer through rail and motor carriers engaged by ASI:

ACCORDINGLY, in consideration of the foregoing premises and the mutual representations, warranties, covenants and agreements contained in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are here by acknowledged, ASI and Customer hereby agree as follows:

1. Commencement, Duration and Cancellation of Agreement. The terms and conditions of this Agreement will commence on the date of this Agreement. This Agreement will continue until canceled by either party on sixty (60) days written notice to the other party or until any earlier termination under Section 12.1.

2. Scope of Agreement. ASI and Customer agree that this Agreement will govern all shipments for which transportation is arranged by ASI during the term of this Agreement. ASI and Customer understand that this Agreement does not bind the respective parties to mutually exclusive services to each other, and that ASI may enter into similar contracts with other customers, and Customer may enter into similar contract with other intermodal marketing companies, transportation brokers or carriers.

3. ASI Obligations.

3.1. Services. ASI will arrange for intermodal transportation by rail carriers or 3rd party rail transportation providers, (collectively, “Rail Carriers”) and dray carriers and highway transportation by motor carriers (collectively with dray carriers, “Motor Carriers” and collectively with Rail Carriers, “Carriers”). ASI may subcontract with Carriers, including its own affiliates, for the performance of the transportation services to be provided under this Agreement. Customer acknowledges that ASI is acting as an intermodal marketing company in the case of intermodal services and as a transportation broker in the case of highway services and is not a motor or rail carrier and that ASI arranges rail and motor carriage transportation services through Carriers with whom ASI has established agreements.

3.2. Delivery Receipt. ASI will cause the Carriers to obtain an acknowledgement of delivery for all shipments by notation on the bill of lading or a delivery receipt signed and dated by the consignee. At Customer’s request, ASI agrees to provide copies of the proof of delivery to Customer to substantiate billing for the services provided.

3.3. Carrier Selection. ASI will use reasonable efforts to engage only those Carriers which will agree to terms and conditions no less favorable to Customer than the following:

3.3.1. Governmental Registration and Safety Rating: Carrier will have proper operating authority and/or be registered with the federal and state regulatory agencies as required by applicable federal or state law and will hold a satisfactory safety fitness rating from Department of Transportation.

3.3.2. Carrier’s Personnel: Carrier will employ qualified and licensed personnel in the operation of its vehicle and equipment, will procure and maintain such licenses and permits required by local, state, or federal authorities with respect to personnel providing transportation services and will comply with those laws and regulations applicable to its personnel.

3.3.3. Equipment Costs: Carrier will bear the cost and expense of all fuel, oil, tires, parts, service, maintenance and repair in connection with the use and operation of its equipment and which may be required to keep the equipment in good repair and a mechanical condition.

3.3.4. Condition of Carrier Equipment: Carrier equipment offered for loading of the commodities to be transported will be clean, odor-free, dry, leak proof and free of contamination and infestation and that the Carrier will use reasonable efforts to prevent any vehicle that has ever been used to transport refuse, garbage, trash or solid or liquid waste of any kind whatsoever, whether hazardous or non-hazardous, from being used to transport commodities.

3.3.5. Motor Carrier’s Carmack Liability: Motor Carrier will assume the same liability as common carriers for full actual loss, subject to the provisions of 49 U. S. C. Sections 14706 (“Carmack Amendment”) and that the Motor Carrier will process the claim in accordance with regulations in 49 C.F.R. Part 370, for any loss or damage to Customer’s cargo while in its possession, subject to any limitation of liability that will be no less than $200,000.

3.3.6. ASI as Billing Party: Carrier will bill ASI for its transportation services and will look exclusively to ASI for payment.

3.4. Carrier Monitoring. ASI will monitor its Carriers’ performance and if requested provide information to the Customer about the Carrier’s performance during each calendar month. The information subject to monitoring and reporting may include the percentage of on-time pick-up and delivery, compliance with ASI's communications standards, number of loads offered versus number of loads accepted by specific lane, customer or in total for ASI, and analysis of transit times.

3.5. Shipment Monitoring. ASI will monitor the progress of Customer’s shipments using its automated systems and data from the Carriers. The data that ASI endeavors to collect from the Carriers includes verification that the shipment has been picked-up, estimated arrival time, bill of lading number, gross weight and piece count of the shipment, information about delays affecting the shipment and automated Rail Carrier car location messages. Using this information, ASI will track the progress of Customer’s shipments through its track and trace systems. Customer may choose the methodology by which it receives track and trace data, whether through e-mail, facsimile or from ASI’s website. Access to ASI’s track and trace website will allow searches by certain data, such as purchase order number, bill of lading number, pick-up number, delivery date, equipment number, origin city and destination city.

3.6. Customer Service: ASI operates operations centers in various states that are open 24 hours a day, seven days a week and have personnel available as necessary to assist Customer with transportation requests. Customer understands that ASI does not have personnel on-site at the rail terminals or other Carrier locations but will use reasonable efforts to promptly resolve issues involving Customer’s shipments at the Carrier’s locations.

3.7. Equipment Pools. If Customer is interested in maintaining pools of chassis, container or trailers at certain facilities and maintains a volume of shipments capable of supporting such pool(s), ASI will discuss the feasibility of operating equipment pools with Customer. If ASI and Customer agree to operate equipment pool(s), ASI and Customer will mutually agree on operating procedures for such pool and will comply with such procedures in using the equipment pool.

3.8. Prompt Service. ASI will use reasonable efforts to cause the Carriers to pick-up, transport and deliver Customer’s cargo with reasonable dispatch. If Customer notifies ASI, that it required pick-up or delivery appointments for a particular shipment, ASI will record the notification in the work instructions and systems, will verify that such appointments have been made, and will record in its systems the date/time of the appointment and the name of Customer’s personnel who made the appointment.

9. Diversion and Reconsignment. ASI will not divert or reconsign any shipment where Customer is the “bill to” party except upon written instructions of Customer. ASI will not accept instructions for diversion or reconsignment from any consignee without notifying Customer and obtaining Customer’s consent, unless the consignee is the Customer.

3.10. Notification of On-Hand Cargo and Accidents. ASI will promptly notify Customer by telephone, facsimile or e-mail of (1) any refused or “on-hand” cargo and request additional instructions regarding delivery or storage of the “on-hand” cargo and (2) of any accidents, spills, theft, hijacking or other events which impair the safe and prompt delivery of the cargo. At Customer’s requests, ASI will develop work instructions with Customer to outline the procedures for handling service disruptions and other delays affecting the delivery date of shipments.

3.11. Record Retention. ASI will comply with the record retention requirements of 49 CFR §379.

4. Customer’s Obligation.

4.1. Loading. Unless Customer has requested Carrier loading services before dispatch, Customer and Customer’s shipper and/or consignee Customers will be responsible for causing cargo contained in shipments to be properly and safely loaded, supported, blocked, braced and secured, including in the case of shipments moving intermodally, in accordance with the publications and standards of the Association of American Railroads (“AAR”). If a load shift occurs during transportation and to the extent that it is determined that improper or insufficient loading, blocking and bracing proximately caused the load shift, Customer will be responsible for all expenses arising therefrom, including without limitation the repair of damaged equipment, fines, penalties, loss or damage to cargo and transfer services.

4.2. Shipping Instructions. Customer will provide necessary shipping instructions in accordance with ASI’s procedures and will properly identify all cargo in the bill of lading or other shipping instructions provided to ASI. Customer will not tender or cause to be tendered any prohibited or restricted commodities, including hazardous materials and waste, high value shipments (+$200,000 in value), oversize or overweight shipments, coiled or rolled products and commodities requiring protection from heat or cold, without properly identifying such shipments and making necessary prior arrangements for transportation thereof.

4.3. Count, Load and Seal. Customer and Customer’s shipper and/or consignee Customer is responsible for causing all contents of shipments moved under this Agreement to be properly counted and recorded and to have a protective seal applied to the loaded equipment; except that the Carrier may load and count the cargo if Customer requests ASI to arrange such services before dispatch and pays ASI the accessorial charges for such services.

4.4. Inspection of Equipment. Customer will cause all equipment tendered for loading to be inspected and to reject any equipment which is not in suitable condition to protect and preserve the cargo during transportation. Customer will promptly notify ASI of any rejected equipment. ASI and the Carriers will not be liable for loss or damage to cargo caused by apparent defects in equipment that could have been discovered by reasonable inspection before loading.

4.5. Use of Equipment. Customer will cause its suppliers, vendors, consignors or consignees not to lose, damage or misuse trailers, containers, chassis or other equipment arranged for use by ASI hereunder. Customer will pay for loss, damage, detention and other charges and expenses for use of trailers, containers, chassis or other equipment assessed by the equipment provider or otherwise incurred by ASI.

4.6. Forecasts. At ASI’s request from time to time, Customer will provide ASI with annual, monthly and/or weekly forecasts of expected volumes of shipments to facilitate ASI’s efforts to provide adequate equipment and personnel to meet Customer’s demand for transportation services.

5. Bills of Lading and Period of Responsibility.

5.1. Function and Status of Bills of Lading. Regardless of whether the Customer’s Customer is the shipper or consignee, Customer will be responsible for causing a bill of lading or other shipping instructions to accompany each shipment accurately describing the cargo, its origin and destination and containing other information reasonably requested by ASI. The Carrier will sign the bill of lading or shipping instructions upon receipt. The parties agree that the bill of lading or other form of receipt will be used solely to acknowledge receipt of the shipment and to identify the kind and quantity of goods, place of pickup and delivery, Customer and consignee and similar information. If ASI is erroneously identified as the “carrier” on any bill of lading or other documents at the origin point or in the course of transit, such designation does not in any way modify or amend the relationship between ASI and Customer under this Agreement or the role of ASI as an intermodal marketing company or broker. If there is a conflict between the terms contained on any bill of lading or shipping instructions, the terms of this Agreement will prevail. Notwithstanding, ASI shall have the rights of a “carrier” to pursue collection of any unpaid freight or accessorial charges from the Customer, shipper, consignee or their agents.

5.2. Period of Responsibility. The period of the Motor Carrier’s liability will be as follows: (1) in case of drayage moves from origin to the rail terminal, from the time of the actual receipt of the shipment by the dray Carrier at origin (as evidenced by the Carrier’s signed bill of lading or other signed written receipt) until interchange of the equipment containing the shipment to the Rail Carrier; (2) in the case of drayage moves from rail terminal to destination, from the time of actual receipt of the shipment by the dray Carrier at the destination rail terminal until delivery has been made (as evidenced by written proof of delivery or other written receipt signed by the consignee or its agent or subcontractors); or (3) in the case of highway moves, from the time of the actual receipt of the shipment by the Carrier at origin (as evidenced by the Carrier’s signed bill of lading or other written receipt) until delivery has been made ( as evidenced by written proof of delivery or other written receipt signed by consignee or its agent or subcontractor). The period of liability for a Rail Carrier will be from the time the Rail Carrier takes actual possession of the trailer or container containing the cargo (“equipment”) until the equipment is interchanged or tendered to another rail carrier, motor carrier, consignee or other party authorized by Customer.

6. Rates: Changes to Rates: Invoices and Payments Procedure.

6.1. Rates and Charges. Customer will pay ASI the rates and charges set forth in Appendix A and any fuel surcharge due under Appendix B for intermodal transportation and related services. The rates may not be used for restricted or prohibited commodities.

6.2. Amendments to Rate and Charges Schedules. ASI and Customer may mutually agree to change or add rates to Appendix A or B from time to time for origins and destinations included or not then included in such Appendix.

6.3. Invoicing and Payment. Customer will pay ASI within thirty (30) days from receipt of any invoice. If Customer disputes the validity of any portion of the invoice, Customers will timely pay ASI the undisputed portion and will notify ASI of the invoice dispute. ASI and the Customer will work diligently and in good faith to resolve any invoice dispute. Upon mutual agreement, ASI and Customer may establish procedures for the invoicing and payment of charges of Customer and/or ASI via electronic means. ASI will not assess any interest or late payment charges unless the invoice is not paid more than sixty (60) days after its due date, in which case Customer will pay interest at the rate of 1% per month from the due date until the invoice is paid in full together with reasonable attorney fees and expenses incurred in litigation and thereafter in collecting the judgment.

6.4. Overcharges and Undercharges. The time limit for Customer to file an overcharge or duplicate payment claim with ASI on shipments moved under this Agreement will be one hundred and eighty (180) days from the date of receipt of ASI’s original invoice by Customer, except that clerical errors, mathematical errors, extension errors and duplicate payments may be corrected at any time. ASI will process overcharges and duplicate payments in accordance with 49 CFR part 378 (Procedures Governing the Processing, Investigation and Disposition of Overcharge, Duplicate Payment or Overcollection Claims). The time limit for Customer to initiate a legal proceeding against ASI to recover overcharges or duplicate payments will be eighteen (18) months from the date of receipt of written declination by ASI. The time limit for ASI to invoice Customer for any additional charges to those originally invoiced will be one hundred eighty (180) days from the date of the original invoice to Customer. The time limit for ASI to initiate a legal proceeding against Customer to recover undercharge payments will be eighteen (18) months from the date of the original invoice to Customer.

6.5. Charge-backs and Set-offs. Neither Customer nor ASI will have the right to set off claims for loss, damage, or delay, and claims for undercharge, overcharge or duplicate payment, against transportation or other charges owed to the other party.

7. Cargo Loss and/or Damage

7.1. General. ASI is committed to resolving cargo claims fairly and efficiently. ASI acts as an intermediary between the Carrier and Customer. ASI will endeavor to assist Customer in thoroughly investigating and efficiently resolving all cargo loss and damage claims. ASI will also work closely with both Customer and the Carrier to help Customer understand the reasons for any disallowance of a claim. If Customer wishes for a person or entity other than Customer to file and resolve a cargo claim, Customer is required to assign its rights in connection with that claim in a form of assignment reasonably acceptable to ASI.

7.2. Liability of the Carriers. ASI will cause the Motor Carriers, in the transportation of all cargo hereunder, to assume the liability of a common carrier for full actual loss of cargo, subject to the provisions of the Carmack Amendment and 49 CFR Part 370 (claim regulations), subject to applicable limitations of liability which will be no less than $200,000 per container or trailer. The Rail Carriers will process and pay cargo claims in accordance with and subject to 49 C.F.R. 1005 and their respective circulars, tariffs, directories and policies as in effect at the time of the cargo loss or damage (each a “Rail Circular”). Generally, the Rail Carriers have established a maximum limit on their liability of $250,000 per container or trailer, and some Rail Carriers have also established per package limits of liability. More information about the Rail Circulars may be obtained from ASI’s Director of Freight Claims in Orland Park.

7.3. ASI Liability. ASI will be liable for loss or damage to cargo to the extent (on a comparative basis) that ASI’s negligence or willful misconduct in arranging for transportation of the cargo was the sole cause of the cargo loss or damage, subject to a maximum limitation of liability of $200,000 per shipment.

7.4. Defenses. Neither ASI nor the Carriers will be liable for the following: (1) damage to cargo or equipment to the extent due to packaging, loading, unloading, blocking, bracing or securing of the cargo; (2) inherent vice or defect in the cargo transported, including rusting of metals, swelling of wood caused by humidity, moisture or condensation, deterioration of perishable products, or damages caused by heat or cold; (3) force majeure events; (4) an act or default of any Customer, consignor, consignee or beneficial owner, or (5) shipments stopped and held in transit at Customer’s request. Unless otherwise agreed to by ASI in writing before the time of shipment, neither ASI nor the Carriers guarantee adherence to any particular transit or train schedule and will not be liable for failure to transport any shipment by any particular train or in time for any particular market or appointment.

7.5. Liability in Mexico. ASI will not be liable and U. S. or Canadian Carriers generally provide that they are not liable for cargo loss or damage that occurs while the cargo is in the possession of an international or domestic Carrier in Mexico. Furthermore, ASI does not assume any liability for, and its insurance overage does not extend to cover, shipments outside the United States or Canada.

7.6. Mitigation of Damages. Customer will cause itself or the consignee to use reasonable efforts to mitigate its damages in connection with cargo loss or damage. Such obligation to mitigate damages will include replacing damaged cartons and packaging, relabeling cargo and undertaking other repairs of cargo and replacement of packaging. Customer will cause itself or the consignee to accept each shipment or that portion of each shipment that is not totally worthless and without salvage value. If the consignee refuses to accept the cargo or Customer refuses to provide direction regarding disposal of cargo rejected by the consignee or Customer prevents or refuses to sell or allow the sale of damaged cargo, then ASI or the Carriers may, without further notice or demand, place the cargo in storage at Customer’s risk and expense, may deduct ASI or the Carrier’s reasonable estimate of the salvage value of the damaged cargo from the claim and may recover from Customer and/or from the proceeds of a sale of the cargo (or deduct from the claim) all costs incurred as a result of the consignee’s rejection and Customer’s failure to provide prompt direction or to sell or permit the sale of the cargo, including storage fees and costs of disposal. If the cargo is offered to ASI or the Carriers for salvage, ASI or the Carriers may, but are not obliged to, undertake salvage efforts, and such determination not to undertake salvage efforts will not waive ASI or the Carrier’s rights to assert a claim regarding Customer’s failure to mitigate damages.

7.7. Refused Shipments. The liability of the Carrier will be that of a warehouseman for cargo loss or damage occurring after twenty-four (24) hours from notice of the arrival of the shipment at destination or the port of export (if intended for export) has been duly sent or given, and after the shipment has been placed for delivery at destination, or tender of delivery of the shipment has been made to the party entitled to receive it. If the consignee refuses to accept delivery of a shipment and Customer fails to provide prompt direction regarding such cargo, then ASI or the Carrier may, without further notice or demand, place the cargo in storage at Customer’s risk and expense and may recover from Customer all costs incurred as a result of Customer’s failure to provide prompt direction regarding the cargo.

7.8. Immediate Notification. If a shipment arrives with visible or obvious damage or loss of cargo, Customer itself will or cause consignee to notify ASI claims department promptly (in no event later than 48 hours after delivery) in writing advising ASI of the nature and extent of the loss or damage. Prompt notifications are required to enable ASI to comply with its underlying agreements with the Carriers, to allow the removal of damaged equipment from further use until repairs can be made, and to permit ASI and the Carriers to inspect the shipment. The Carriers may consider Customer to have waived and released the claim if there is a failure to provide this immediate notification. Customer itself will or cause its consignee to preserve and make available to ASI or the Carrier’s inspectors all damaged cargo, all cargo received in good condition and all packaging, blocking, bracing and security devices to assist the inspectors in determining the cause of the damage or loss. Failure to inspect damaged cargo for whatever reason will not relieve Customer of its burden to establish that cargo was delivered in damaged condition and was properly loaded, blocked and braced nor will it be considered an admission of liability by ASI or the Carrier.

7.9. Cargo Claim Procedures. Customer shall not file with ASI a claim for cargo loss or damage of less than $250. In the absence of other evidence, a seal breach in and of itself will not create a presumption of loss or contamination. Cargo claims should include the following information: (1) a demand for payment of a specified dollar amount accompanied by documentation to verify the amount of the demand such as certified copies of repair invoices or actual product costs. If the cargo has not been invoiced to the consignee or the invoice does not show the price or value, or the cargo has not been sold but transferred at bookkeeping values only or has been shipped on consignment or approval or is otherwise involved in an inventory or stock to stock transfer, the demand should include documentation and certification of the actual value of the cargo; (2) information to identify the shipment such as unit number, date of shipment, origin and destination of the shipment, Customer’s consignee’s and notify party’s name, and bill of lading number; (3) legible copies of shipping instructions, the delivery receipt and other shipping documents; (4) the applicable salvage amount; (5) legible copies of the loading and unloading tally denoting contents and quantities of each of the packages involved in the shipment and seal record (particularly for shortage claims); (6) supporting documentation detailing the nature of the damage or loss (such as photographs supporting the method of bracing or actual damage to or defect in equipment); and (7) any import declaration (if applicable).

7.10. Computation of Damages. ASI and the Carrier’s liability for loss, damage or shortage of cargo will not exceed the actual loss or damage to the cargo minus the salvage value of the cargo, subject to applicable limitations of liability. Amounts for which ASI and the Carrier’s are not liable include loss of or damage to any goods not identified in the transportation documents, loss of or damage to any dunnage, transportation charges and brokerage fees, fines, import duties or other charges on shipments intended for export.

11. Time Limits.

7.11.1. Time Limits for Filing Cargo Claim. If Customer wishes for ASI to seek recovery for cargo loss or damage from the Carrier or believes that ASI is directly liable for a cargo claim, as a strict condition precedent to recovery, Customer is required to submit the claim to ASI cargo claims department within nine (9) months of date of delivery or in the case of a lost shipment, within nine (9) months of the expected delivery date. If the cargo claim Is not timely filed, Customer’s failure to timely file the claim will release ASI and the Carriers from responsibility for that cargo claim and Customer’s claim will be declined. After expiration of these time periods, Customer may proceed by filing the written claim directly with the applicable Carrier but ASI will have no responsibility for timeliness of the filing or the payment or processing of that claim.

7.11.2. Time Limit for Filing Lawsuit for Cargo Claim. As a condition precedent to recovery, Customer is required to institute suit against ASI and/or the Carrier to recover on a claim for damage or loss of cargo transported (1) using intermodal rail service within five (5) months from the date of the written disallowance of the claim or any portion of it from ASI or the Carrier or (2) using highway services within twenty (20) months from date of disallowance of all or any portion of the claim. If the suit on a cargo claim is not timely filed, Customer’s failure to timely initiate the lawsuit will release ASI and the Carrier from responsibility for that cargo claim, and neither ASI nor the Carrier will be liable for that claim.

7.12. Applicability of Cargo Claims Policy. ASI’s cargo claim policy in effect at the time will apply to Customer’s cargo loss or damage claims as secondary insurance. The Carrier’s insurance shall always remain primary. Customer may obtain a copy of ASI’s cargo claims policy by contacting ASI’s claims department in Orland Park, IL.

8. Insurance

8.1. Insurance. ASI will procure and maintain, at its expense, with reputable and financially responsible insurance underwriters, the following insurance coverage: (1) contingent cargo liability insurance in an amount not less than $200,000 per shipment; (2) commercial automobile liability insurance in an amount not less than $500,000 combined single limit per occurrence; and (3) commercial general liability insurance in an amount not less than $500,000 combined single limit per occurrence. ASI will furnish to Customer written certificates showing that the above insurance has been procured and is being maintained upon Customer’s request. ASI’s liability for any type of claim under this Agreement shall be limited to the foregoing insurance coverage.

8.2. Carrier’s Insurance. ASI will cause the Carriers to procure and maintain, at the expense of Carrier, with reputable and financially responsible insurance underwriters, the following insurance coverage: (1) cargo liability insurance in an amount not less than $200,000 per shipment, (2) commercial automobile liability insurance in an amount not less than $500,000 combined single limit per occurrence, and (3) commercial general liability insurance in an amount of not less than $500,000 per occurrence. ASI will furnish to Customer written certificates showing that the Carrier’s insurance has been procured and is being maintained upon Customer’s request.

9. Indemnification

9.1. ASI’s Indemnification. ASI will indemnify Customer and its directors, officers, employees, agents, subsidiaries and other affiliates for, and hold each of them harmless from and against, any and all Losses to the extent arising from or in connection with (1) the breach of any covenant or agreement of ASI contained in this Agreement, or (2) any wrongful or negligent act or omission of ASI’s related to the performance of its obligations under this Agreement. The indemnification shall be limited to the extent of available insurance coverage, required by Section 8.1 of this Agreement.

9.2. Customer’s Indemnification. Customer will indemnify ASI and its directors, officers, employees, agents, subsidiaries and other affiliates for, and hold each of them harmless from and against, any and all Losses to the extent arising from or in connection with (1) the breach of any covenant or agreement of Customer contained in the Agreement or this Addendum, or (2) any wrongful or negligent act or omission of Customer related to the performance of its obligations under the Agreement or this Addendum.

9.3. Definition of Losses. For purposes herein “Losses” will mean all fees, costs, damages, judgments, penalties and expenses incurred by either party, including attorneys’ fees and expenses and remediation and other clean up costs, in connection with the investigation, prosecution or defense of any claim, arising from or related to an act or omission for which indemnity is granted herein, or in connection with the enforcement of the obligation to indemnify contained in this Agreement.

9.4. Indemnification Procedures. A person or entity claiming the right to indemnification hereunder (an “indemnitee”) will give notice to the indemnifying party promptly after indemnitee has actual knowledge of any claim as to which indemnity may be sought. The indemnifying party will have the right to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel, who will conduct the defense of such claim or any litigation resulting therefrom, will be approved by indemnitee (which approval will not be unreasonably withheld). If the indemnifying party assumes the defense, then indemnitee may participate in the defense at indemnitee’s expense. Failure of indemnitee to give notice of a claim as provided in this section will not relieve indemnifying party of its obligations under this section except to the extent such failure to give notice materially adversely affects the indemnifying party in the defense of any claim or litigation. The indemnifying party will not enter into any settlement of the claim or litigation that does not unconditionally release the indemnitee from all liability relating to the claim or litigation without the indemnitee’s prior written consent.

9.5. No Consequential Damages. Except where a party to this Agreement is required to pay such damages to a third person or entity and to the extent that party is entitled to full or partial indemnity from the other party under this Agreement, neither party hereto will be liable to the other party or to any other person or entity for consequential, special, indirect or exemplary damages, lost profits, lost savings, losses due to fluctuations in the cargo’s market value, or to damage to cargo in transit or delays, regardless of whether or not the other party was aware of or reasonably or otherwise could have foreseen any such damages. This limitation of liability for such consequential and other damages will apply with equal force to protect third party service providers.

10. Rights to Lien or Delay Release of Cargo or Equipment. ASI will not assert any lien or make any claim on any cargo or equipment or prevent or delay the release of any cargo or equipment except in the limited circumstance in which Customer has failed to pay undisputed transportation charges for more than sixty (60) days after their due date and ASI has provided Customer with at least ten (10) days written notice of its intent to assert a lien against Customer or its cargo or equipment or prevent or delay the release of cargo and equipment. If any Carrier asserts a lien against Customer or its cargo or equipment or prevents or delays the release of any cargo or equipment and provided that no undisputed transportation charges due to ASI remain unpaid more than sixty (60) days after their due date, ASI will use all reasonable efforts to cause the Carrier to release the lien and to permit the immediate release of the cargo and equipment.

11. Force Majeure. If either party is precluded from complying with any provision of this Agreement by force majeure event beyond such party’s reasonable control including fire or explosions; lockouts, strikes, slowdowns, labor shortages or disturbances; acts of God, including floods, hurricanes, tornadoes, earthquakes, unusually sever weather, and natural disasters; war, insurrection, terrorism or riots; acts of the public enemy, acts of governmental authority; embargo; epidemics or quarantine restrictions, such compliance will be excused to the extent it is necessitated by such causes provided all other sections of this Agreement remain in full force and effort. The party claiming force majeure will, within five (5) business days from the date of disability, notify the other when it learns of the existence of a force majeure event and will similarly notify the other within a period of two (2) business days when the force majeure event has ended. The party claiming force majeure will take all reasonable efforts to continue to perform its obligations to the extent practicable and to recommence performing all obligations as soon as possible after the force majeure even has ended.

12. Default and Termination.

12.1. Termination for Default. If the other party materially defaults in the performance of any of the terms and conditions of this Agreement, the non-defaulting party may notify such other party of such default. If the other party does not cure such default within fifteen (15) days of the date of the non-defaulting party’s notice, then in addition to any other remedies available to it, the non-defaulting party may terminate this Agreement upon written notice to the other party. All rights and remedies which may have accrued before termination for default will survive termination of this Agreement.

12.2. Obligations During Notice Period. Each party will continue to perform its respective responsibilities hereunder through the effective date of termination.

12.3. Obligations Upon Termination. Upon termination of this Agreement for any reason, each party will complete its performance and fulfill all obligations which accrued before the date of termination, including obligations to pay accrued charges owing from it to the other party and ASI’s obligation to arrange for transportation for all cargo and equipment previously tendered and to return to Customer, at an interchange point or other locations mutually agreed upon, any Customer equipment. In addition, the obligations and rights of the parties under Sections 7, 9, 12.3, 13, 14, 16 and 17 (and any other provision which by its nature should survive termination) will survive any termination of this Agreement.

13. Confidentiality.

13.1. Confidentiality Obligations. Each party acknowledges that in carrying out this Agreement, it will learn information about the other party and its business, including rates, costs, personnel, traffic volumes, computer systems, operational procedures, origins and destinations, types of cargo, shipping schedules, Carriers and subcontractors, and other data that is proprietary to or held in confidence by the disclosing party (collectively, whether written, oral or computerized, the “Information”). Each party will hold in confidence the terms of this Agreement and any Information acquired from the other party during the term of this Agreement, will not disclose the terms of this Agreement or the Information to any third parties, will restrict disclosure to those employees, representatives and subcontractors of the receiving party with a need to know and bind such employees, representatives and subcontractors to these confidentiality restrictions, and will not use the terms of this Agreement or the Information to the disclosing party’s competitive detriment or for any purpose except as contemplated by this Agreement. The receiving party may disclose Information (1) to the extent required by a governmental agency, under a court order or as otherwise required by law, provided that the receiving party has notified the other party of such governmental or court action before disclosing the Information or (2) to an authorized audit agency designated by a party for audit purposes.

13.2. Exclusion of Certain Information. This Section 13 will not prohibit or limit the receiving party’s use of information (1) previously know to it and not subject to any confidentiality restrictions, (2) acquired by it from a third party which is not, to the receiving party knowledge, under an obligation not to disclose such Information, or (3) which is or becomes publicly available through no breach by the receiving party or its employees, representative or subcontractors of these confidentiality obligations.

13.3. Limit on ASI Solicitation of Customer’s Customers. ASI and Customer agree that each party has made substantial investment(s) to develop its accounts. ASI will not during the term of this Agreement, and for a period of one hundred twenty (120) days thereafter, solicit or perform any services for compensation for any account of Customer and from which Customer has previously tendered freight to ASI for arranging transportation of cargo on specific lanes of travel under this Agreement.

It is specifically understood and agreed that the above limit placed upon ASI shall not apply to: mutual accounts of ASI and Customer for which ASI has arranged or will arrange transportation for the accounts on different lanes of travel than for which the mutual account’s freight was tendered by Customer to ASI under this Agreement.

14. Independent Contractor. ASI will perform the services hereunder as an independent contractor and not an agent, joint venturer, partner or employee of Customer. Each party will be liable for the payment of local, state and federal payroll taxes or contributions or taxes for unemployment insurance, workers’ compensation, social security and related protection applicable to its own employees, and agrees to comply with all applicable rules and regulations pertaining thereto. ASI agrees that it is not substantially economically dependent upon Customer and there is no functional integration of Customer’s and the ASI’s respective operations.

15. Notices. All notices or other communications under this Agreement will be in writing and will be deemed to be sufficient if delivered personally, sent by facsimile, e-mail or EDI transmission confirmed by first class mail, sent by nationally-recognized, overnight courier guaranteeing next business day delivery or mailed by registered or certified mail (return receipt requested), postage prepaid, to the parties at the following addresses (or at such other address for a party as will be specified by like notice):

If to ASI to it at: Alliance Shippers Inc.

Attn: Robyn H. Lefcourt ESQ,

General Counsel

516 Sylvan Avenue

Englewood Cliffs, NJ 07632

Tel: (201) 227-0400

Fax: (201) 227-1212

If to Customer, to it at the address set forth on the signature page hereto.

All such notices and other communications will be deemed to have been given and received (1) in the case of personal delivery, on the date of such delivery, (2) in the case of delivery by facsimile, on the date of such delivery (if sent on a business day, or if sent on other than a business day, on the next business day after the date sent), (3) in the case of delivery by nationally-recognized, overnight courier, on the business day following dispatch, (4) in the case of mailing, on the third business day following such mailing, or (5) in the case of notices that a party is authorized to give by e-mail or EDI transmission, on the date of transmission (if sent on a business day, or if sent on other than a business day, on the next business day after the date sent).

16. Miscellaneous.

16.1. Entire Agreement. This Agreement, together with the Appendices attached hereto from time to time, which appendices hereby are incorporated by reference into and made a part hereof, constitutes the entire agreement between ASI and Customer with respect to the subject matter hereof and will supersede all prior oral or written understandings and agreements. In the event of a conflict between provisions of this portion of the Agreement and provisions of any appendix, the terms of this portion of the Agreement will take precedence. No waiver, amendment, alteration or modification of any of the provisions of this Agreement, other than amendments to Appendices by ASI from time to time, will be binding upon either party unless in writing signed by the duly authorized representative of the party intended to be bound thereby.

16.2. No Waiver. Any party’s failure to enforce strictly any provisions of this Agreement will not be construed as a waiver thereof, or as excusing the other party from future performance in accordance with terms of the Agreement.

16.3. Successors and Assigns. Neither party may assign the Agreement without the consent of the other party other than to an affiliate or to any other party succeeding to all or any substantial portion of its business. This Agreement will be binding on and enforceable against the successors and permitted assigns of Customer, including Customer’s trustee in bankruptcy, should Customer become insolvent, and the successors and assigns of ASI.

16.4. Severability. If any provision of this Agreement would be held in any jurisdiction to be invalid, prohibited or unenforceable for any reason, such provision, as to such jurisdiction but not as to any other jurisdiction, will be ineffective, without invalidating the remaining provisions of this Agreement. Notwithstanding the foregoing, if such provision could be more narrowly drawn so as not to be invalid, prohibited or unenforceable in such jurisdiction, it will, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the interpretation of such provision in any other jurisdiction.

16.5. Remedies. All rights and remedies will, to the extent permitted by applicable law, be cumulative and a party’s pursuit of any such right or remedy will not preclude such party from exercising or pursing any other available right or remedy.

16.6. Counterparts and Facsimile Execution. This Agreement may be executed in two or more counterparts, and each such counterpart will be deemed to be an original instrument and will be considered validly delivered and become effective when one or more counterparts have been signed by each of the parties and delivered (by facsimile or otherwise) to the other parties.

16.7. Governing Laws. Except to the extent preempted by federal law, this Agreement will be governed by and construed in accordance with the domestic laws of the State of New Jersey, without giving effect to any choice of law or conflicting provision or rule.

16.8. Interpretation: Construction. The term “Agreement” means this Transportation Agreement together with all appendices attached hereto, as the same may from time to time be amended, supplemented or restated in accordance with the terms hereof. The use in this Agreement of the word “including” means “including, without limitation”. The use in this Agreement of the words “reasonable efforts” means “commercially reasonable efforts.” The words “herein,” “hereof,” “hereunder,” “hereby,” “hereto,” “hereinafter,” and other words of similar import refer to this Agreement as a whole, including the appendices, as the same may from time to time be amended, modified, supplemented or restated, and not to any particular article, section, or subsection contained in this Agreement. The headings in this Agreement are for convenience of reference only and will not govern or affect the interpretation of any of the terms or provisions of this Agreement. Where specific language is used to clarify by example a general statement contained herein, such specific language will not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. The language used in this Agreement has been chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party.

ALLIANCE SHIPPERS INC. Customer:

516 Sylvan Avenue Address: ___________________________

Englewood Cliffs, NJ 07632 City, St. Zip ___________________________

Tel: ___________________________

Fax ___________________________:

By: Signature: ______________________________

JONATHAN LEFCOURT, Print Name: ______________________________

President & CEO Title: ______________________________

Date: Date:

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