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EXHIBIT 10.3
FLEET SERVICE AGREEMENT
THIS FLEET SERVICE AGREEMENT (this "Agreement") is entered into as of
March 1, 1998, by and between Park 'N View, Inc., a Delaware corporation
("PNV"), with its headquarters at 00000 XX 00xx Xxxxxx, Xxxxx Xxxxxxx, Xxxxxxx
00000 and Contract Freighters, Inc., a Missouri corporation ("CFI"), with its
headquarters at 0000 Xxxx 00xx Xxxxxx, X.X. Xxx 0000, Xxxxxx, Xxxxxxxx 00000.
WHEREAS, CFI currently employs or has contracted for the services of
professional truck drivers to operate its fleet of trucks; and
WHEREAS, CFI operates truck terminals including, without limitation,
those located in (i) Laredo, Texas, (ii) Joplin, Missouri, and (iii) Lancaster,
Texas (which three (3) terminals are hereinafter collectively referred to as
the "Fleet Terminals"); and
WHEREAS, PNV has designed and developed the concept and equipment (the
"System") to: (a) enable truck drivers to receive and/or have access to cable
television services and telecommunications services; and (b) provide such truck
drivers programming consisting of video and audio services, and telephone,
voice mail, fax or other data services while remaining in their vehicles parked
at truckstops and the Fleet Terminals; (collectively, the "Services"); and
WHEREAS, PNV provides the Services to truck drivers through a
membership program pursuant to which each member is entitled to use the
Services at each truckstop and Fleet Terminal at which they are provided in
return for a monthly membership fee; and
WHEREAS, CFI desires to have PNV install the System and provide the
Services at the Fleet Terminals; and
WHEREAS, CFI desires to purchase and PNV desires to provide
memberships to CFI's drivers.
NOW THEREFORE, in consideration of the mutual promises and covenants
contained herein, CFI and PNV (hereinafter collectively being referred to as
the "Parties"), intending to be legally bound, hereby mutually agree as
follows:
1. Purpose. The Parties hereby agree that pursuant to the terms of
this Agreement: (i) PNV shall provide and CFI shall purchase memberships to be
used by certain of CFI's drivers; and (ii) PNV shall install the System and
provide the Services at the Fleet Terminals.
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2. Purchase of Memberships. Commencing on the date that the System
has been installed and is in full operation at each Fleet Terminal (the
"Effective Date"), CFI will purchase from PNV each month during the Term (as
defined in Section 5) the greater of: (i) 1,500 monthly memberships; or (ii)
monthly memberships for each CFI truck being used by a professional truck
driver or driving team employed or retained by CFI during that month. Prior to
the Effective Date, CFI shall provide PNV with a date file of the necessary
driver names and CDL numbers of to enable PNV to activate each driver's/team's
membership. On or before the twenty-fifth (25th) day of each month. PNV shall
acquire from CFI an updated data file of driver names and CDL numbers, and PNV
shall determine the drivers/teams to be added to or deleted from the list for
the following month. Notwithstanding anything contained herein to the contrary,
the minimum number of memberships to be purchased by CFI each month during the
Term shall be 1,500.
3. Installation of the System at the Fleet Terminals
(a) PNV shall, at its sole cost and expense, and in the
manner herein provided, install (and increase) at each Fleet Terminal all
equipment necessary for the provision of the Services and outlet ports to
sufficient parking spaces to provide users full adequate access to the
Services. The location and initial number of the truck parking spaces at which
the Services shall be provided ("Serviced Spaces") shall be mutually determined
by the Parties, and PNV shall complete installation of the System at each of
the Fleet Terminals on or before May 31, 1998. Thereafter, PNV shall increase
the number of Serviced Spaces at each Fleet Terminal as mutually agreed by the
Parties to adequately accommodate use access and demand. The Parties shall
mutually determine the precise number and location of the truck parking spaces
at which the Services shall be provided, taking into account such factors as
the cost of construction and implementation, the layout of the parking
facilities, the usage of particular parking rows to drop trailers and such
other factors as the Parties may deem relevant. All of the equipment as
currently used by PNV is described on Schedule 1 hereto and is hereinafter,
together with any additions or deletions to said equipment, collectively
referred to as the "PNV Equipment." PNV may make additions to and deletions
from the PNV Equipment at each Fleet Terminal with CFI's prior consent, which
consent shall not be unreasonably withheld.
(b) CFI shall make available to PNV a sufficient area in
which to install the PNV Equipment including: (i) such area as is required for
the installation of satellite dish(es); (ii) a secured air-conditioned (normal
air-conditioned room temperature) interior area of approximately 50 square feet
for the installation of the headend equipment and the telephone and related
monitoring equipment; and (iii) an area at the dispatcher desk or other
interior location for installation of the equipment required for activation of
the Services (hereinafter collectively referred to as the "Equipment Area").
Upon reasonable prior notice to CFI, PNV shall be entitled to have continued
access to the Equipment Area and all parking areas for purposes of installing
and monitoring the PNV Equipment, the System and the Services.
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(c) Prior to commencement of construction at any Fleet
Terminal, PNV shall obtain CFI's written approval of the methods and materials
to be used by PNV with respect to the installation of the System. PNV will
repair any damage to the Fleet Terminal that is caused by PNV. However, PNV
shall not be responsible for any existing defects or deficiencies or the normal
wear and tear to the parking lot or the Fleet Terminal.
(d) PNV shall on a timely basis secure, and continuously
maintain in full force and effect, all licenses, permits and approvals required
by governmental authorities with respect to the installation, operation and
maintenance of the System and providing the Services. CFI shall assist PNV (at
PNV's expense) in obtaining any such licenses, permits, or approvals upon PNV's
reasonable request. PNV shall at all times comply with all applicable laws,
rules, regulations, etc. in connection with the installation, operation and
maintenance of the System, or otherwise related to the performance of PNV's
obligations hereunder.
4. Fees.
(a) Commencing on the Effective Date, CFI shall pay to PNV
a fee of Thirty Dollars ($30.00) per month for each membership purchased by CFI
(collectively the "Monthly Fee"). PNV shall invoice CFI for the Monthly Fee on
the first day of each month for the purchase of memberships for its
drivers/teams for that month, and CFI shall pay the Monthly Fee to PNV by the
15th day of that month. Uncontested Monthly Fees that are not timely paid shall
accrue interest at the rate of nine (9%) per annum until paid in full and PNV
may terminate the membership of CFI's drivers if any uncontested delinquent
Monthly Fee is not paid by CFI within five (5) business days after CFI receives
written notice of said delinquency. If CFI desires to transfer the membership
of any driver, PNV shall reissue such membership to a substitute driver upon
receipt of (i) the terminated drivers name and CDL member and (ii) the
substitute drivers name and CDL number. If CFI desires to purchase memberships
for additional drivers (i.e. memberships in excess of 1,500) effective during
the month (as opposed to the first day of the month), PNV shall, upon receipt
of the additional drivers name and CDL number, activate such membership at no
cost to CFI for the remainder of that month but shall not provide the driver
with any free long distance service for that month. On the first day of the
following month, PNV shall commence charging CFI the Monthly Fee and provide
the driver with full membership privileges, including any applicable free long
distance phone service.
(b) PNV agrees that: (i) PNV shall provide CFI with its
most favorable pricing; and (ii) the Monthly Fee shall be adjusted to match the
more favorable pricing provided to any other fleet or group; and (iii) PNV will
promptly notify CFI in writing if a more favorable pricing is given to any
other fleet or group. The foregoing shall not apply to any trial of the
Services by a fleet or group provided that the trial does not exceed 180 days
and that it applies to less than 10% of the fleet's or group's drivers.
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5. Term. The term of this Agreement (the "Term") shall be for an
initial period of three (3) years commencing on the Effective Date, and shall
automatically renew from year to year thereafter, unless CFI gives PNV written
notice of nonrenewal at least ninety (90) days before the end of the initial or
any renewal period. For value received, PNV guarantees that CFI's Monthly Fee
for PNV's "Basic Package" (as defined in Section 7) shall not exceed Thirty
Dollars ($30.00) during the initial three year period, nor exceed Thirty-Three
Dollars ($33.00) per month for the first five (5) annual renewal periods
thereafter.
6. Rights and Duties of The Parties With Respect To The PNV
Equipment. Notwithstanding the fact that certain parts of the PNV Equipment may
be affixed to each Fleet Terminal, the PNV Equipment shall not become a fixture
thereto and shall remain the property of PNV. Upon the termination of this
Agreement for any reason, PNV shall have the right to: (i) remove, at its sole
cost and expense, any or all of the PNV Equipment from each Fleet Terminal; or
(ii) if agreeable to CFI, sell or lease it to the CFI or its successors,
nominees or assignees. If PNV removes the PNV Equipment, PNV shall restore the
Fleet Terminal as near as reasonably possible to the condition of such premises
prior to the installation of the System, existing defects and normal wear and
tear excepted, but shall not be obligated or permitted without the prior
consent of CFI to remove any underground cables.
7. Programming and Telecommunications Services to Be Provided.
(a) PNV shall make the Services available on the System as
follows:
(i) PNV shall source and deliver its "Basic
"Package" which at all times (i) shall
consist of at least eighteen (18) channels
of entertainment programming, and (ii) be
at least the substantial equivalent in
quality of PNV's current programming
schedule shown on Schedule 2; and (iii)
include at least the other programming and
telecommunications services hereinafter
listed in this Section 7. PNV shall pay the
cost of all such programming. PNV may add
to or make changes to its programming
schedule from time to time, and any
additional channels or other services which
PNV makes generally available in the future
to PNV's other subscribers without
additional charge or as part of their basic
services also be included in CFI's Basic
Package without additional charge.
(ii) In addition to at least eighteen (18)
channel entertainment channels, there shall
be other channels, which shall be used to
provide a programming schedule and
advertising.
(iii) PNV may provide pay-per-view or other
non-traditional cable channels or services
as part of the Services, and shall provide
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CFI a dedicated VCR driven channel at each
Fleet Terminal to be available for CFI
specific programming that CFI will develop
and deliver on 1/2 inch video tape.
(iv) As part of CFI's Basic Package, PNV shall
also provide telephone service at each
parking slot at which the Services are
provided. The current telephone services
offered by PNV are set forth on Schedule 3.
PNV shall have the right to determine and
make changes to the specific types of
telecommunication services provided from
time to time, but CFI always shall receive
without further charge such
telecommunications upgrades and additions
as PNV generally makes available to its
other subscribers without additional charge
or as part of their basic services.
8. Promotion, Use, Operation and Maintenance of the PNV Equipment,
the System and the Services.
(a) Prior to the Effective Date, PNV shall, at its cost,
provide CFI and its drivers with all equipment (including a free phone kit and
cable wires) and materials necessary for CFI and its drivers to commence use of
the System and the Services on the Effective Date. PNV shall program its
automated log-on system to provide CFI's drivers with a personal message from
CFI upon their initial log-on to the System.
(b) Upon installation of the System at a Fleet Terminal,
PNV shall train CFI and its designated employees at no additional expense to
CFI with respect to the maintenance and operation of the System. This initial
training will be designed so that CFI will be able to maintain the System and
train new personnel with respect to operation of the System and maintenance of
the PNV Equipment as needed. PNV shall provide follow up training for CFI's
personnel at no additional expense to CFI during normal business hours with
respect to the operation of the System and the maintenance of the PNV Equipment
as may be reasonably requested by CFI from time to time.
(c) PNV shall maintain a good quality signal and reception
through the System comparable to the signal and reception supplied for regular
television programming and telecommunications services to home consumers.
(d) The day to day maintenance of the System shall be
handled as follows:
(i) CFI's trained staff members shall: (i)
maintain the cable and phone boxes in the
outside hookups in proper operating order,
including cleaning and removal of debris
(i.e. oil, dirt, ice, snow, etc.; (ii)
replace failed connecting drop cables and
accessories with replacement equipment to
be furnished by PNV at PNV's
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cost; and (iii) replace failed cable and
phone connection outlets in the outside
hookups with equipment furnished by PNV at
PNV's cost. PNV shall keep CFI provided
with an adequate inventory of such
replacement equipment, materials and parts
at PNV's cost.
(ii) If a mechanical problem arises other than
through a failed connecting cable or
accessory, CFI shall contact PNV by
telephone at PNV's office. Unless
extenuating circumstances exist, PNV shall
make (or have made) the necessary repairs
to the System at PNV's sole cost and
expense within forty-eight (48) hours.
9. Representations and Warranties of PNV.
(a) PNV is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has full power
and authority: (i) to enter into this Agreement; and (ii) to carry out the
other transactions and agreements contemplated by this Agreement.
(b) The execution, delivery and performance of this
Agreement by PNV has been duly authorized by all necessary action of PNV. This
Agreement and each of the other documents to be executed and delivered by PNV
pursuant to this Agreement have been duly executed and delivered by PNV and are
the valid and binding obligations of PNV enforceable in accordance with their
respective terms, subject only as to enforceability affected by bankruptcy,
insolvency or similar laws affecting the rights of creditors generally and by
general equitable principles. The execution, delivery and performance of this
Agreement and the other documents to be executed, delivered and performed by
PNV pursuant to this Agreement will not: (i) conflict with or violate any
provision of PNV's organizational documents, or any law, ordinance or
regulation or any decree or order of any court or administrative or other
governmental body which is either applicable to, binding upon or enforceable
against PNV; or (ii) result in any breach of or default under or cause the
acceleration of performance of any mortgage, contract, agreement, indenture or
other instrument which is either binding upon or enforceable against PNV.
(c) PNV is not required to obtain the approval, consent or
waiver of any other person or entity for the execution, delivery or performance
of this Agreement.
(d) PNV warrants that the Services shall be provided in
accordance with Section 8(c) hereof and the highest industry standards, and
that all equipment, materials and parts furnished by PNV in connection with the
System and the Services shall be of merchantable quality and fit for the
purposes stated herein.
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10. Representations and Warranties of CFI.
(a) CFI is a corporation duly organized, validly existing
and in good standing under the laws of Missouri and has full power and
authority: (i) to enter into this Agreement; and (ii) to carry out the other
transactions and agreements contemplated by this Agreement.
(b) The execution, delivery and performance of this
Agreement by CFI has been duly authorized by all necessary action of CFI. This
Agreement and each of the other documents to be executed and delivered by CFI
pursuant to this Agreement have been duly executed and delivered by CFI and are
the valid and binding obligations of CFI enforceable in accordance with their
respective terms, subject only as to enforceability affected by bankruptcy,
insolvency or similar laws affecting the rights of creditors generally and by
general equitable principles. The execution, delivery and performance of this
Agreement and the other documents to be executed, delivered and performed by
CFI pursuant to this Agreement will not: (i) conflict with or violate any
provision of CFI's organizational documents, or any law, ordinance or
regulation or any decree or order of any court or administrative or other
governmental body which is either applicable to, binding upon or enforceable
against CFI; or (ii) result in any breach of or default under or cause the
acceleration of performance of any mortgage, contract, agreement, indenture or
other instrument which is either binding upon or enforceable against CFI.
(c) CFI is not required to obtain the approval, consent or
waiver of any other person or entity for the execution, delivery or performance
of this Agreement.
11. Ownership and Confidentiality. PNV agrees to maintain and cause
its employees and agents to maintain and keep strictly confidential all
proprietary information received from CFI relating to its drivers, Fleet
Terminals, operations and customers. CFI recognizes and agrees that PNV shall,
during the term of this Agreement and thereafter, retain sole ownership of the
System and the PNV Equipment. CFI recognizes the proprietary nature of the
concept and the design of the System, the PNV Equipment and the Services.
Accordingly, CFI and PNV agree to maintain and cause each of its employees and
agents to maintain and keep strictly confidential all of the confidential
information that it obtains or receives in conjunction with the operation of
the System, the PNV Equipment or the Services. CFI further agrees that the
"Park N' View" name and logo shall be and remain the property of PNV and all
references by CFI to the System or the Services shall incorporate and/or refer
to PNV by its full name (Park N' View), whether in literature, electronic or
print displays, articles, advertising, billboards, banners or otherwise. The
name, Park 'N View, is, or will be, a registered service xxxx of PNV and to the
extent required by PNV, CFI shall execute a no cost limited license agreement
for the use of such service xxxx.
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12. Termination.
(a) This Agreement shall be deemed immediately terminated upon
either party's bankruptcy or insolvency.
(b) In the event that either Party shall fail in any material
respect to perform any obligation under this Agreement, the other Party may in
writing notify the non-performing Party that such failure constitutes a breach.
If the breach is not remedied or cured within ten (10) days following receipt
of such written notice of breach, without limiting any other remedy which may
be available, the non-breaching Party may terminate this Agreement by written
notice to the breaching Party.
(c) CFI also may also terminate the Agreement without cause in CFI's
sole discretion any time after February 28, 1999 upon written notice and
payment to PNV, as liquidated damages, of the following sums:
(i) Two Hundred Thousand Dollars ($200,000) for such
"without cause" termination effective between March 1, 1999 and February 29,
2000;
(ii) One Hundred Thousand Dollars ($100,000) for such
"without cause" termination effective between March 1,
2000 and February 28, 2001;
(iii) One Dollar ($1) for such "without cause" termination
effective after March 1, 2001.
13. Indemnity and Insurance.
(a) PNV shall defend, indemnify and hold harmless CFI and its
employees, agents, successors and assigns from and against all loss, damage,
expense (including legal fees and expenses), actions and claims of every type
and nature whatsoever arising out of or relating to PNV's installation,
maintenance, repair or removal of the System of PNV's performance hereof,
including but not limited to personal injury, death or property damage, unless
such loss, damage, expense actions or claims were directly attributable to
CFI's own sole fault. This obligation shall survive any termination or
expiration of this Agreement.
(b) PNV agrees to furnish and keep in full force and effect the
following minimum insurance and coverage throughout the Term of this Agreement
and so long thereafter as PNV is obligated to indemnify CFI::
(i) Workers Compensation Insurance covering all persons
employed or provided by PNV in the performance of
services required by the Agreement; and
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(ii) Both (1) Comprehensive General Liability and (2)
Comprehensive Automobile Liability Insurance covering
liabilities for property damage and bodily injury,
including death, at the minimum amount of One Million
and No/100 Dollars ($1,000,000.00) per occurrence.
Said insurance policies shall be endorsed so they cannot be terminated without
at least thirty (30) days prior written notice to CFI. PNV will furnish CFI
satisfactory evidence of said insurance before beginning to install the System
or providing any services hereunder.
14. Forum Selection. Any controversy, dispute or question arising
out of, or in connection with, or in relation to this Agreement or the
interpretation, performance or non-performance or any breach thereof shall be
determined at CFI's request exclusively in the Circuit Court of Jasper County,
Missouri, and the Parties irrevocably waive all objections to said court's
jurisdiction and venue (including forum non conveniens) and any removal or
transfer rights therefrom. The prevailing Party shall be entitled in any such
action to recover its reasonable attorney's fees and legal expenses from the
other Party.
15. General Provisions.
(a) Notices. All notices required or permitted hereunder
shall be in writing and, may either be delivered by overnight courier,
transmitted by facsimile, or delivered by the United States Mail, postage
prepaid, addressed as follows:
To PNV: Park 'N View, Inc.
00000 XX 00xx Xxxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
Attn: Fleet Sales Department
Fax Number: (000) 000-0000
To CFI: Contract Freighters, Inc.
0000 Xxxx 00xx Xxxxxx
X.X. Xxx 0000
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx Xxxxxxx
Fax: (000) 000-0000
All notices shall be deemed delivered only upon actual receipt. Any party may
change its address for purposes of this Agreement by giving notice of such
change to the other parties pursuant to the terms of this section.
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(b) Assignment. Except in connection with a bona fide
nonbankruptcy sale of substantially all of a Party's assets or business
(including by merger or similar transaction), neither Party may assign this
Agreement or subcontract its obligations hereunder without the other Party's
prior written consent. In the event of a permitted assignment, the Agreement
shall be binding upon and inure to the benefit of CFI's successors and assigns.
(c) Miscellaneous. The section headings in this Agreement
are for convenience of reference only and shall not be deemed to alter or
affect any provision hereof. This Agreement shall not be modified or amended
except by an instrument in writing executed by the parties to this Agreement.
If any part or sub-part of this Agreement is found or held to be invalid that
invalidity shall not affect the enforceability and binding nature of any other
part of this Agreement. This Agreement may be executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, CFI and PNV have caused this Agreement to be
executed pursuant to appropriate legal authority duly given, as of the day and
year first above written.
PARK 'N VIEW, INC.
By: /s/ Xxxxxxx Xxxxxxxx
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Xxxxxxx Xxxxxxxx
Chief Operating Officer
CONTRACT FREIGHTERS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
Senior Vice President-Finance
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SCHEDULE 1
LIST OF CURRENT PNV EQUIPMENT
Current PNV Equipment:
Satellite Dish & Off-air receive antenna
Processing [head-end] equipment
Telephone PBX switch and CFI console
Distribution cables
Parking lot plug-in boxes
Cable TV "billing" computer and software
Membership card dispenser
Telephone & Cable TV accessories for resale
Voice-mail service
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SCHEDULE 2
LIST OF CURRENT PROGRAMMING SCHEDULE
Current Programming Schedule:
===============================================================================
Channel # Program
-------------------------------------------------------------------------------
04 HBO
-------------------------------------------------------------------------------
05 HBO2
-------------------------------------------------------------------------------
06 HBO3
-------------------------------------------------------------------------------
07 DISCOVERY
-------------------------------------------------------------------------------
08 ESPN 2
-------------------------------------------------------------------------------
09 FOX
-------------------------------------------------------------------------------
10 DEN
-------------------------------------------------------------------------------
11 CNN HN
-------------------------------------------------------------------------------
12 WEATHER
-------------------------------------------------------------------------------
13 ESPN
-------------------------------------------------------------------------------
14 NBC
-------------------------------------------------------------------------------
15 ABC
-------------------------------------------------------------------------------
16 A&E
-------------------------------------------------------------------------------
17 CBS
-------------------------------------------------------------------------------
18 TNN
-------------------------------------------------------------------------------
19 TNT
-------------------------------------------------------------------------------
20 WGN
-------------------------------------------------------------------------------
21 PNV
===============================================================================
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SCHEDULE 3
LIST OF CURRENT TELEPHONE SERVICES
Current Telephone Services:
1+ calls
1-800 calls
Local calls
CFI services
Direct call back to stall # (automated)
Message waiting
Wake-up calls (automated)
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