EXHIBIT 10.5
Fleet Owner Agreement
This fleet owner agreement, being on this ______ day of May, 2003 by
and between XRG, Inc. a Florida corporation with its main headquarters located
at 0000 Xxxxxxx Xxxxxx, Xxxxx, XX 00000, a common and contract Carrier of
general commodities operating by the authority of the Federal Highway
Administration (FHA) and applicable Public Utility Commission(s) hereinafter
referred to as "Carrier" and X. Xxxxxx Companies, Inc., hereafter referred to as
"Fleet owner". In the event of any default of subject of terms of the agreement,
Fleet owner shall be liable, responsible and accountable to Carrier as a result
of said default.
I. Premises
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Whereas Carrier agrees to hire Fleet owner as their representative at
his principal office located at Sweetwater, TN to be identified as FLEET OWNER
NUMBER 100, or whatever fleet owner designation at a later date and to solicit
commodities Carrier is authorized to haul on interstate by the authority of the
FHA and on intrastate by the authority of the applicable Public Utility
Commission and to direct the transportation of shipments on a commission basis
on behalf of Carrier to points and places Carrier is authorized to serve by the
FHA or applicable Public Utility Commission.
Whereas, Fleet owner agrees to represent Carrier as Fleet owner Manager
and to solicit commodities Carrier is authorized to haul by authority of the FHA
or applicable Public Utility Commission on shipments on behalf of Carrier as set
forth above for the consideration here-in-after stated.
Now, it is therefore mutually agreed between the parties hereto as
follows:
This agreement is one of the representations of transportation services
only. Fleet owner has no authority to speak on behalf of the Carrier to any
outside media or to any regulatory agency of a State, Federal Government, to
legal councils, or any other professional or consulting service. Fleet owner has
no authority to represent Carrier or enter into any contractual agreements or
legal proceedings without prior consent from the president of the carrier.
Any cost incurred to Carrier as a result of deviation from this policy
will be charged back to the Fleet owner. Carrier will not be responsible for any
expenses incurred for the operation of the fleet owner's premises, i.e.
telephones, rents, utilities, taxes, employee expenses, or any other expenses
incidental to the operation of the fleet owner's premises.
II. Terms and Conditions
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A. Responsibility of Carrier
(1) Carrier agrees to assign a series of freight bills/Delivery receipt
forms to be used on all outbound shipments billed by this commodities
division. Carrier also agrees to assign all necessary legal
documentation and paperwork required to properly represent Carrier on
interstate and intrastate shipments, including but not limited to:
certificates of insurance, copies of all operating authorities,
equipment leases, door signs, driver and vehicle applications,
maintenance and inspection reports, and a copy of carrier's applicable
rate schedules or published tariff of rates and charges on file with
the FHA or the applicable Public Utilities Commission.
(2) Carrier agrees to pay on direct and interline haul, excluding
accessorial charges on commodities shipments hauled Fleet owner
equipment
(3) Carrier agrees to allow a maximum of 67% of the gross freight revenue
as compensation to vehicles under permanent lease agreement with
Carrier and a maximum of 67% of the gross freight revenue as
compensation to vehicles under a trip lease with Carrier which are
under the direction of Fleet owner or assigned to this commodities
division. The maximum allowable percentage will include all related
charges and costs that pertain to each shipment. Insurance handling
charges are not to be considered a part of the transportation charges
or freight revenues.
(4) Carrier agrees to a minimum lease payment to the fleet owner equal to
the real costs incurred in the operation of the equipment. These costs
shall include the following:
i) Driver pay, payroll taxes, worker compensation, and other benefit
costs already in place
ii) Fuel costs net of fuel surcharges
iii) Equipment lease payments or finance payments to third party
financers
iv) Repairs and maintenance costs related the equipment under lease
to the Carrier
v) Plates and permits on equipment leased to Carrier
vi) Physical damage insurance on equipment leased to Carrier
(5) Carrier agrees to present to Fleet owner a weekly summary of account
standings and a weekly report itemizing all shipments received for
that process week in addition to an account of compensation due.
NOTE: Revenue collected by Carrier for driver assistance in loading or
unloading; fuel surcharges; truck ordered not used, detention of drivers and/or
vehicle storage, and special hauling permits will paid entirely to the Fleet
owner.
B. Responsibility of Fleet owner
(1) Fleet owner agrees to submit to corporate office all legal
documentation and properly prepared paperwork pertaining to each shipment as
required by all regulatory commissions including but not limited to the Federal
Highway Administration, U.S. Department of Transportation and will assure
Carrier that all drivers whose services are enlisted by Fleet owner are in
compliance with all Federal Motor Carrier Safety Regulations as set forth in
title 49 code of Federal Regulations, Parts 40, 325, 382, 383, 385, 386, 387,
390-397, and 399. (Carrier has provided Copy of which to Fleet owner) Fleet
owner also agrees to submit all documentation necessary for Carrier to secure
payment from shippers on a timely basis. Fleet owner agrees to report daily
activity concerning dispatch and checks issued for payments authorized by Fleet
owner. Fleet owners found to be in violation of any part of this provision will
be responsible for all costs and fines incurred upon Carrier by any regulatory
commission. Non-compliance with this provision shall result in an assessment of
$200.00 per occurrence toward Fleet owner.
(2) Fleet owner agrees and understands that carrier funds may be issued
only in payment of transportation services for operation advances to drivers and
final settlements to the Fleet owner.
(3) Fleet owner agrees to be responsible for all monies on company
checks that are stolen or lost and cashed before notifying Carrier of loss of
checks. Fleet owner also agrees and understands that he/she is responsible for
all checks cashed by fraudulent, deceptive misrepresentation of company
business.
(4) Fleet owner agrees to be responsible for insurance deductible on
cargo losses that cannot be re-cooperated from their negligent operators.
(5) Fleet owner agrees to be responsible for the protection of freight
bills, Company checks, permits, stickers, fuel decals and any other company
documents in their possession.
(6) Fleet owner agrees to allow Carrier complete control over the
dispatch and utilization of the equipment under lease to the Carrier.
III. Indemnification
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(1) Fleet owner shall indemnify and save harmless Carrier from any and
all claims, loss or damage of any kind whatsoever, including direct, indirect,
incidental or consequential damages, along with costs including reasonable
attorney's fees connected therewith, brought by any person or persons arising
out of, directly or indirectly, fleet owner's negligent or unlawful
transportation of property or for any other negligent or unlawful performance in
connection with this agreement.
IV. Term of Contract
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The term of this agreement shall be for two (2) years, commencing as of
the date first written above, and shall be automatically renewed from year to
year thereafter until such time as the agreement is terminated wholly or in part
by either Fleet owner or Carrier upon thirty (30) days prior written notice at
any time to the other party.
V. Default
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In the event that either party shall fail to perform any covenant or
condition required under this agreement to be preformed by that party, and such
default in performance shall have continued for a period of (7) consecutive days
after notice thereof given by the non-defaulting party, then the non-defaulting
party may declare the other party in default. Upon declaration of default, the
non-defaulting party may elect to treat this agreement as immediately
terminated.
VI. Modifications and Effectiveness
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It is agreed that there are no oral representations, agreements or
understandings affecting this agreement and that any future representations,
agreements, understandings or waivers to be binding upon the parties hereto,
must be reduced to writing by way of either addendum to or revisions thereof to
the original agreement.
Either party's failure strictly to enforce any provision of this
agreement shall not be construed as a waiver thereof excusing the other party
from performance.
IN WITNESS WHEREOF, Carrier and Fleet owner do hereby sign this
agreement on the above date first written which shall be the effective date.
Fleet owner: Carrier:
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