Exhibit 99.2
CONTRACT FOR MOTOR TRANSPORTATION
This Agreement, made as of January 1, 1998, by and between MPG Transport, a
corporation with its principal location at 00000 Xxxxx Xxxxxx Xxxx Xxxxx, Xxxxx
000, Xxxxxxx, Xxxxxxxx 00000 (hereinafter referred to as "Carrier") and General
Motors Corporation, a Delaware corporation, with its principal location at 0000
Xxxx Xxxxx Xxxxxxxxx, Xxxxxxx, Xxxxxxxx 00000 (hereinafter referred to as "GM").
WITNESSETH:
GM is a corporation engaged in the business of manufacturing and assembling
motor vehicles at numerous points throughout North America and is desirous of
using the motor transportation services of Carrier for the transportation of
said property from and to points within the scope of Carrier's appropriately
authorized operations.
In this context, GM has a need for Carrier's service to effect the efficient and
prompt delivery of said property to, from or between its various dealers,
distributors, agents, warehouses, and other origins and destinations that GM may
designate, such service being an essential factor in the operation of GM's
business.
Carrier is ready, willing and able to provide the transportation service for GM,
has compiled with all applicable laws and regulations, and is fully qualified as
of the date of execution hereof to engage in the service as herein contemplated
from, to, and between points identified herein.
Now, therefore, for good and valuable consideration and upon the covenants and
promises that follow, the parties do agree:
1. Transportation Service. Carrier will, when requested by GM, furnish to GM a
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complete delivery and Transportation Service (hereinafter "Transportation
Service"), which service, without limiting the generality thereof, will include
transporting motor vehicles and related components from, to and between points
identified in one or more Appendix hereto. GM will employ Carrier to perform
such services on an as required nonexclusive basis during the period of this
Agreement in accord with its terms.
2. Vehicles, Drivers, Etc. As part of said Transportation Service, Carrier
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shall provide all facilities (with the exception of GM Assembly Center
locations), properly licensed drivers and other personnel and equipment
necessary to perform the required Transportation Services in a safe and
efficient manner. Carrier shall also provide, operate and maintain in good
working condition the motor vehicles, trailers and related equipment necessary
for the performance of this service.
3. Control of Transportation Service. Carrier shall have sole and exclusive
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control over the manner in which Carrier and its employees perform the
Transportation Service provided for hereunder, and Carrier shall engage and
employ such individuals as it may deem necessary in connection therewith. Such
individuals shall be considered employees of Carrier only and shall
be subject to employment, discharge, discipline and control solely and
exclusively by Carrier. While on GM property, such Carrier employees will be
directed to follow applicable GM rules communicated to Carrier or its employees
by GM, including by appropriate GM plant security and dock personnel. GM
reserves the right to instruct Carrier to remove any employee from GM related
Transportation Service.
4. Quality Service Requirements. GM requires quality transportation services.
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Carrier will provide such services in accord with the best standards of the
transportation industry and in compliance with applicable GM procedures. Such
services include the following:
(a) Establish and maintain a Quality Improvement team focused on damage
elimination, service, and cost reduction items. They shall communicate and
participate with GM Quality Improvement Teams.
(b) Complete self audits as required by GM NAO Vehicle Logistics.
(c) Maintain a Damage Frequency Rate of 0.40% or less. If this target is not
met, Carrier will pay a 0.50% rebate of the total annual invoiced amount
for each location not in compliance. Damage Frequency will be monitored by
location of operation and reported monthly to GM NAO Vehicle Logistics.
The Damage Frequency will be based on paid claims. The assessment will be
completed annually in August. Any payment due will be made within 30 days
after this assessment.
(d) ISO 9001/2 Full Certification by July 31, 1998. The ISO 9000 standards can
be obtained from ANSI at (000)000-0000. Quality system assessment
documents can be obtained from the AIAG at (000)000-0000. Failure to
achieve certification to ISO 9001 and ISO 9002 may result in
disqualification as a GM carrier. In addition to ISO 9001/2, the following
GM quality procedures must be adhered to: It is GM's expectations that a
Carrier is knowledgeable of our quality procedures and has the appropriate
systems, processes and documentation in place to ensure compliance.
1. APQP - Advance Product Quality Planning
2. GP-5T Problem Reporting and Resolutions
3. GP-8T Continuous Improvement Procedures
4. GP-9T Run at Rate
(e) Control Plans will be submitted for all locations.
(f) Driver certification and training programs are to be established. A
periodical rectification program for continuous improvement of driver
skills will be established.
(g) All trucks and trailers will be equipped with a "Decks Up" warning system
to alert the operator.
(h) Vehicles must be shipped in accordance with the latest revision of the GM
Vehicle Shipping Manual.
(i) A second tier supplier used for trip leasing must be pre-approved by GM NAO
Vehicle Logistics Vehicle Quality Assurance.
(j) Carrier will provide a loading inspector to cover all hours of loading
operations.
(k) A third-party inspection will be required at all operations. The third
party will be selected by GM. The cost of this third party will be shared
by each Carrier at the same location.
(1) Security shall be provided by Xxxxxxxxx at all Assembly Centers and paid
for by the Carrier. Such security is required for plant yard areas falling
under Carrier responsibility.
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(m) All facility layout changes must be pre-approved by GM NAO Vehicle
Logistics Quality Assurance Manager.
5. Operational Requirements. Carrier will provide operational services in
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accord with the best standards of the transportation industry and in compliance
with the latest GM guidelines. Such operational requirements include the
following:
(a) All vehicles must be dispatched within three working days of receipt
(Saturdays, Sundays, and holidays are not included). Each vehicle not
meeting this requirement will be assessed a $5.00 per day penalty for
aging. If natural disaster prevents delivery "force majeure" must be
invoked. All accrued assessments resulting from noncompliance will be
billed on a month-by-month basis (VIN detail will be supplied at billing).
Other exceptions for noncompliance may be granted if submitted in writing
to the GM NAO Vehicle Logistics Truckaway Operations supervisor.
(b) Operations must be appropriately fleet sized for both equipment and drivers
based on an annual forecast and capacity review between the Carrier and the
GM NAO Vehicle Logistics Operations Manager.
6. Property Damage and Loss. Carrier will have exclusive care, custody and
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control of all goods hereunder including motor vehicles and related components
from the time delivered to it until delivery to a consignee named by GM.
Carrier assumes full responsibility for any and all loss or damage to said
property while in its care, custody or control. The value of said property will
be based on the normal GM invoice price thereof plus freight charges, with the
exception of certain major vehicle damage claims described below.
(a) Major vehicle damage claim settlements will be handled as follows:
1. Vehicles which sustain damage while in the hands of the Carrier, to
the extent that such damage affects the merchantability, safety,
durability or reliability of the vehicle, will be handled as major
transportation damage claims. GM will have the sole responsibility
for determining vehicle repairability.
2. As the vehicle manufacturer, GM alone will determine whether repair of
a damaged vehicle is capable of fully restoring that vehicle to a
marketable condition, complying with all applicable government motor
vehicle standards.
3. If it is determined by GM that a vehicle will not be repaired, it will
immediately be returned by the Carrier as directed to the possession
of GM.
4. When it is determined that a vehicle will not be repaired, a claim
will be processed utilizing the vehicle's dealer net price, minus 35%
as the salvage value, plus DFC (Destination Freight Charge).
5. All major damage claims will be reviewed and either paid or rejected
by the Carrier within thirty (30) days of transmittal to Carrier.
(b) Claims for loss or damage will be accepted by Carrier in writing or via
electronic transmission for a period of nine (9) months following delivery
by Carrier as follows:
1. Claims received at the GM Corporate Claim Center within nine (9)
months after delivery of lost or damaged motor vehicles or related
components by Carrier will
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be deemed accepted by Carrier, provided any such claim is transmitted
to Carrier within (12) months after delivery by Carrier.
2. Claims filed against one Carrier on a joint line, or joint line cross-
border movement, will be deemed a filing against all connecting
Carriers within the time limits in (1) above.
(c) Carrier will render payment, or provide written reasons for nonpayment, of
any claim within thirty (30) days of receipt of such claims.
7. Standard Insurance Requirements. Carrier shall obtain and maintain pursuant
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to the terms of this agreement, at its sole expense, the following types of
insurance coverage, with minimum limits as set forth below, unless increased
types and amounts are required due to the equipment of service requirements in
specific Appendices:
(a) Commercial General Liability covering liability arising from premises,
operations, independent contractors, products-completed operations,
personal and advertising injury, and liability assumed under an insured
contract - $5,000,000 each occurrence.
(b) Commercial Automobile Liability covering all owned, hired, and non-owned
vehicles - $5,000,000 each occurrence, including all statutory coverages
for all states of operation.
(c) Workers Compensation - statutory limits ($20,000,000 specific excess if
self-insured) for all states of operation.
(d) Employers Liability - $ 1,000,000 each employee for bodily injury by
accident and $1,000,000 each employee for bodily injury by disease.
(e) Cargo Insurance, including loading and unloading, with a limit equal at
least to the value of the property shipped and in any event not less than
$250,000 per occurrence.
(f) Any insurance coverage required by any government body for the types of
Transportation Services specified in the Appendices.
(g) Any deductible or self-insured retention in excess of $250,000 must be
declared to and approved by GM.
Carrier shall provide GM with a certificate of insurance evidencing compliance
with the insurance requirements set forth above. Certificate will provide that
GM shall be named an additional insured for liability arising from the
operations of the carrier on all liability policies (except Cargo Insurance,
Workers' Compensation and Employers Liability) and state that the above required
coverages shall apply as primary insurance with respect to any other insurance
or self-insurance programs afforded to GM. In addition, the certificate shall
provide that GM will receive thirty (30) days' prior written notice from the
insurer of any termination or reduction in the amount or scope of coverage.
Such certificates shall be in a form acceptable to, and underwritten by,
insurance company(ies) reasonably satisfactory to GM. The purchase of
appropriate insurance coverage by Carrier or the furnishing of certificate(s) of
insurance shall not release Carrier from its respective obligations or
liabilities under this Agreement.
8. Rates and Charges. Carrier will charge GM, and GM will pay Carrier, for the
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Transportation Services herein contemplated the simplified rates and charges set
forth in one or
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more Appendices attached. Such Appendix may be revised from time to time by
mutual written agreement of the parties. GM will not reimburse the carrier for
overtime due to weekend activity. Weekend operations are scheduled at GM
Assembly Center's discretion.
9. Electronic Funds Transfer - (EFT). Carrier will execute a separate EFT
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agreement. Carrier agrees to hold GM harmless for uncollected funds not
properly or timely transferred from bank or depository in accordance with EFT or
Appendices.
10. Payment - Electronic Data Interchange - (EDI). After GM receives a valid
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and acceptable electronic service record, GM will transmit to the Carrier an EDI
820 Transaction Set (Advance Payment Notification). Upon receipt of an EDI 820,
Carrier will transmit to GM an EDI 997 Transaction Set (Acknowledgment of the
EDI 820) confirmation. GM shall transfer funds electronically (pay) to the bank
designated by the Carrier in the applicable wire transfer agreement or
appendices on the 10th and 25th of the following month from the date that
service was performed. Balance Due payments will fall under the same rules as
do line haul payments.
The agreement to transfer funds for all applicable services on the 10th and 25th
of the following month shall end on December 1, 1998. Effective December 1,
1998, GM shall transfer funds for all applicable services on the 25th of the
following month.
11. Overcharges and Undercharges. Carrier will file any overcharges or
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undercharge claims within 120 days from the time GM receives a valid and
acceptable electronic delivery record. Failure to so file will waive any such
claims by or on behalf of Carrier.
12. Payment Sunset. Carrier will within nine (9) months manually or
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electronically transmit a delivery record from date of delivery or date service
was performed. Failure to so transmit a delivery record will waive any future
claims for payment by or on behalf of Carrier.
13. Financial Statement. Carrier will provide GM (a) true copies of any
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financial statements which have been prepared and filed with any regulatory body
and which are available for public inspection, and (b) as a GM contract carrier
the individual monthly financial statements for all GM Locations to be provided
in electronic format.
14. Revisions. This Agreement may be revised from time to time by execution of
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an amendment signed by both parties. This Agreement cancels and supersedes any
and all prior agreements and discussions between parties prior to the date
hereof dealing with any matter covered hereby and by an Appendix hereto.
15. Notices. All notices required to be given under the terms of this
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Agreement, or which either party hereto may desire to give to the other, shall
be in writing, signed by or on behalf of the party giving such notice, and sent
by certified mail, or via fax and first class mail, to the following addresses
or to such other address as either party may furnish the other in writing:
If to GM: General Motors Corporation
0000 Xxxx Xxxxx Xxxxxxxxx
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Xxxxxxx, XX 00000
Attn: Xxxxxxx X. XxxXxxxxx
Director, Vehicle Logistics
Fax: (000) 000-0000
If to Carrier: MPG Transport
00000 Xxxxx Xxxxxx Xxxx Xx., Xxxxx 000
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx
Fax: (000) 000-0000
16. Terms of Agreement. This contract will continue in full force and effect
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for a period of two (2) years from the date of execution. Should the parties
thereafter continue to operate under this Agreement, it will continue from month
to month until terminated by either party upon not less than thirty (30) days'
prior written notice to the other.
17. Indemnification. Carrier agrees to indemnify, defend and hold GM
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(including its officers, directors, employees, subcontractors and agents)
harmless from and against any and all liabilities, damages, fines, penalties,
costs, claims, demands and expenses (including costs of defense, settlement, and
reasonable attorney's fees) of whatever type or nature, including damage or
destruction of any property, or injury (including death) to any person, arising
out of (a) any act or omission by Carrier, its agents, employees or
subcontractors except negligence of GM, (b) any claims or actions by Carrier's
agents, employees or subcontractors, or (c) the failure of Carrier, its agents,
employees or subcontractors to comply with this Agreement, the Appendices
hereto, or any applicable federal, provincial, and/or local law, statute,
regulation, rule, ordinance, or government directive which may directly or
indirectly regulate or affect the obligations of Carrier hereunder.
18. No Implied Waiver. The failure of either party at any time to require
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performance by the other party of any provision of this Agreement shall in no
way affect the right to require such performance at any time thereafter, nor
shall the waiver of either party of a breach of any provision of this Agreement
constitute a waiver of any succeeding breach of the same or any other provision.
19. Non-Assignment. Carrier may not assign or delegate its obligations under
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this Agreement without GM's prior written consent.
20. Relationship of Parties. Carrier and GM are independent contracting
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parties and nothing in this Agreement shall make either party the agent or legal
representative of the other for any purpose whatsoever, nor does this agreement
grant either party any authority to assume or to create any obligation on behalf
of or in the name of the other.
21. Year 2000 Compliance. Carrier, and any goods and services supplied by the
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Carrier, shall be Year 2000 compliant such that they shall function without
error or fault in the processing (including calculating, managing, manipulating,
comparing, and sequencing) of date and date
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related data, for the years 2000 and beyond. At GM NAO Vehicle Logistics'
request, Carrier shall certify in writing its compliance with the foregoing.
22. Compliance with Laws. Carrier agrees to comply with all applicable
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provisions of federal, provincial, state and/or local law or ordinance and all
lawful orders, rules and regulations issued thereunder, and any provisions,
representations or agreements, or contractual clauses required thereby to be
included or incorporated by reference or by operation of law in this Agreement.
Without limiting the foregoing, Carrier will, at its expense, comply with all
statutes, rules and regulations (including obtaining all permits and licenses)
applicable to the mode of transportation utilized by Carrier which are necessary
for Carrier to provide Transportation Services for GM, and shall be responsible
for complying with all applicable requirements of federal, provincial and/or
local social security, unemployment compensation and tax withholding laws, and
all applicable federal, provincial, state and/or local laws and regulations
pertaining to (1) immigration, (2) occupational health and safety of its
employees, (3) wages and hours of employment and (4) affirmative action, equal
employment opportunity and employment practices, and in this connection, agrees
that it will not discriminate in its employment practices due to age, sex, race,
color, creed or national origin.
23. Force Majeure. Except as otherwise provided, the obligation of Carrier to
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furnish the Transportation Services provided for in this Agreement shall be
temporarily suspended during any period(s) in which either of the parties is
unable to comply with the requirements of this Agreement by reason of the acts
of God or the public enemy, fire, flood, labor disorder, civil commotion,
closing of the public's highway(s), government interference or regulations, or
their contingencies similar or dissimilar to the foregoing beyond reasonable
control of the affected party; provided that written notice of such delay
(including the anticipated duration of the delay) shall be given to the other
party within 10 days.
24. CXD Requirements. The GM CXD (Custom Xpress Delivery) program requires
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that the Carrier deliver each vehicle designated a CXD unit ("C" for Custom &
"P" for Popular Configured) within the time parameters listed in the appropriate
Appendices. Reconsignments received by 6:00 PM Local Time must be delivered as
outlined in the above mentioned Appendices, weekends and holidays included.
Vehicles flowing through a Vehicle Distribution Center (VDC) must be delivered
within 72 hours of receipt, weekends and holidays included. Carrier will be
assessed a $5.00 per unit per day penalty for noncompliance. All accrued
assessments resulting from noncompliance will be billed on a month-by-month
basis (VIN detail will be supplied at billing). CXD service requirements and
rates as well as delivery rates may be found in specific site contract
Appendices. A weekly physical inventory of all vehicles under Carrier's care
and control is required.
GM retains the right to open to competitive bidding any traffic affected by CXD
changes in the GM Vehicle Distribution Network. The Carrier shall be granted
the last option to meet the bid submission considered to be Best in Class and
retain the traffic.
25. System Requirements. All events must be reported into VTIMS (General
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Motors Vehicle Transportation Information Management System). Events include
receipt, dispatch,
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delivery, and start of storage. Payment for each service is based on event
reporting. VTIMS reporting must be completed the day the event occurs. Carrier
systems must be able to electronically:
(a) Receive advance shipping notices (ASN's).
(b) Record receipt of vehicle and bay locations and communicate event (EV4B) to
VTIMS.
(c) Confirm routing based on response from VTIMS to reported EV4B.
(d) Build loads to conform to operational and quality guidelines.
(e) For rail dispatch (EV42) to VTIMS, report immediately since this generates
858 waybill for the railroad.
(f) For truck dispatch (EV42) to VTIMS, reporting must coincide with the truck
leaving the compound.
(g) Other reporting as required:
1. Vehicle on hold (EV4D)
2. Return to plant (EV4P)
3. Downloading and responding to reconsignments in VTIMS.
(h) All events must be reported in "real time".
(i) Reporting will be in either LU6.2 system to system protocol or on line in
VTIMS via dial-up modem.
(j) Limited transactions are to be communicated via batch and EDI.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
In the presence of:
MPG Transport General Motors Corporation
By: /s/ Xxxxxxx X. Xxxxxxx By: /s/ M.E. MacDonald
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Title: President Title: Director, Vehicle Logistics
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Date: Dec 17 1997 Date: Dec 17 1997
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Witness: Witness:
/s/ Xxxxxx X. Janousis
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