EXHIBIT 10.1
TRANSPORTATION AGREEMENT
THIS AGREEMENT is entered into this 19th Day of July, 2007, (the "Effective
Date") by and between NEDAK Ethanol LLC. ("Shipper") and Western Oil Trans Inc.
("Carrier"), in consideration of the mutual covenants and agreements herein
contained, hereby mutually covenant and agree as follows:
1. Contract Carrier Authority.
Carrier is engaged in the business of transporting property and is a duly
qualified contract carrier by motor vehicle, holding operating authority from
the Federal Motor Carrier Safety Administration (or one of its predecessor
agencies) in Docket Number MC-563623 (the "Docket").
2. General Obligations.
a. Shipper shall tender to Carrier, and Carrier shall transport and deliver
in its motor vehicle equipment, certain of Shipper's commodities on a continuing
and recurring basis, pursuant to the provisions of this Agreement and under the
terms, conditions, rates and charges set forth in the attached Exhibits which
are incorporated herein by this reference.
b. Carrier shall furnish, operate and maintain in good working condition
and suitable appearance, at its own expense, all motor vehicles and all
equipment necessary to perform the services required under this Agreement and
shall assume all incidental costs and expenses including, but not limited to,
all costs and expenses incident to or arising out of the maintenance, repair, or
operation of such equipment, fuel, and supplies. Carrier agrees to save and hold
Shipper harmless from any and all such costs, expenses and liabilities. Carrier
shall also provide, supervise, and control all necessary drivers and
dispatchers, and procure all necessary licenses for the proper operation of the
equipment so furnished.
c. Carrier assumes and shall pay any and all contributions, taxes and
assessments which may be required to be paid under any so-called Unemployment
Compensation, Disability, Old Age Pension, Social Security, or any similar laws,
by reason of the employment by Carrier of Carrier's employees, and Carrier shall
in all other respects comply with such laws. If, under the applicable State
Unemployment Compensation Law, Carrier has the right to elect whether or not to
come under and be bound by the terms of such Law, Carrier shall either
self-insure or promptly register under said Law.
d. Carrier shall keep Shipper's cargo free and clear from, and shall
indemnify, defend and hold Shipper harmless from and against, all liens related
to payment for which Carrier is responsible arising out of the transportation
services, including, but not limited to, materialmen's, laborers' and mechanics'
liens. Carrier shall deliver to Shipper prompt written notice of actual or
prospective claims of any such liens known to Carrier. Carrier shall not have a
lien on any cargo for which Carrier provides transportation services under this
Agreement.
3. Term.
This Agreement, including the Exhibits that are made a part hereof, shall
commence on the date of first ethanol to be transported and shall be for a term
of three (3) years from the Effective Date, and thereafter will automatically
renew and continue for additional renewal terms of one (1) year each unless
otherwise terminated by provisions contained herein. Unless otherwise terminated
by provisions contained herein, this Agreement shall terminate:
a. by either party giving written notice to the other party no less than
one hundred eighty (180) calendar days prior to the ending date of the initial
three-year term or of any renewal term;
b. on the expiration or suspension of all or any part or aspect of the
authority granted in the Docket;
c. on any change in the authority granted in the Docket, such change of
which adversely affects Carrier's ability to perform the services in the
capacity represented herein;
d. by mutual agreement of Shipper and Carrier;
e. upon the discontinuance of business operations by either party which
discontinuance of business materially affects such party's ability to perform
the obligations agreed to pursuant to the terms of this Agreement; or
f. upon notification to Shipper that Carrier has been issued a U.S.
Department of Transportation Safety Rating of less than "Satisfactory"
4. Effect of Termination.
Termination of this Agreement for any reason shall not release either party
from any obligation that may have accrued before such termination, nor shall it
preclude either party from exercising any remedies it might have in law or
equity to enforce such obligations.
5. Carrier's Service Designed to Meet Shipper's Distinct Needs.
The parties agree and acknowledge that the transportation services provided
for under this Agreement are designed to meet the distinct needs of Shipper, and
it is specifically because Carrier acknowledges its ability and willingness to
meet such distinct needs that Shipper has entered into this Agreement. Carrier
shall provide all services in a prompt, efficient and safe manner and shall
warrant the safe and prompt delivery of the goods without loss, damage, delay or
contamination. Carrier and Shipper acknowledge that this is a private contract
to provide specified services under specified rates and conditions, and, to the
extent permitted by 49 U.S.C. ss.14101, hereby waive all rights, obligations and
remedies they may have under 49 U.S.C. ss.13101 through ss.14901 for the
transportation covered by this Agreement, (except on matters relating to
registration, insurance and safety fitness) only to the extent such rights,
obligations and remedies are in conflict with this Agreement.
6. Independent Contractor.
Carrier is and shall remain an independent contractor in all respects
and in the performance of all transportation services and related activities
hereunder. The detailed methods of transporting commodities in motor vehicles
shall be under the exclusive control and direction of Carrier, Shipper being
interested only in the results thereof. All persons engaged in performing the
transportation services and related activities hereunder shall be employees or
agents of Carrier or its subcontractors or their employees, and shall not be
deemed to be subcontractors of agents of Shipper. Carrier, however, agrees to
comply with all requests made to Carrier by Shipper concerning the time,
coordination, and place of performance hereunder.
7. Determination of Freight Charges.
a. Freight charges and fuel surcharges shall be those set forth in the
attached Exhibit A. Unless expressly stated and agreed to otherwise herein, all
such charges shall be inclusive of the following:
i. all origin and destination services (including, but not limited to
loading and unloading services) required by Shipper;
ii. all accessorial charges;
iii. all fuel surcharges;
iv. all hazardous material fees; and
v. all detention charges.
b. In determining the freight and other charges applicable under this
Agreement, the parties shall use those rates set forth in the attached
Exhibit(s).
8. Invoicing and Payments.
a. All commodities transported by Carrier for Shipper, whether received
from Shipper or from a third party, shall be transported under the terms and
conditions of this Agreement. Each shipment shall be evidenced by a document
substantially in the form attached hereto as Exhibit B showing the product and
quantity thereof received and delivered by Carrier at the loading and unloading
points, respectively.
b. Invoicing shall be accomplished either by Carrier mailing to Shipper the
original and one copy of each applicable freight xxxx, or by sending Shipper the
invoice information via Electronic Data Interchange (EDI) with the data
transmitted serving as the freight invoice.
c. Freight invoices sent to Shipper which reflect freight or other charges
that exceed the charges previously agreed to by the parties and incorporated
into the contract rates pursuant to this Agreement, shall, at Shipper's
discretion, either be returned to Carrier for correction to reflect the
previously agreed-to rates and charges or shall be manually revised by Shipper
to reflect the correct amount due as previously agreed to by the parties
pursuant to the terms of this
Agreement. In such cases, Shipper shall pay that portion of the invoice which
Shipper reasonably believes is due and owing to Carrier under the terms of the
Agreement.
d. If Shipper desires to ship on a "freight collect" basis, Carrier agrees
to collect from the consignee the charges listed in Exhibit A , except in the
case where Carrier and consignee have a separate agreement.
e. Shipper's payment of invoices shall not constitute acceptance of
shipments and shall be subject to adjustment for errors, shortages or defect.
9. Scope and Governing Rules.
This Agreement shall apply to and govern all shipments tendered to Carrier
for shipment to and/or from Shipper's facilities, including shipments to and/or
from any locations other than Shipper's facilities as designated by Shipper, and
shipments from suppliers shipping to Shipper. To the extent any term or
provision in this Agreement differs or is contrary to a term or provision of any
tariff, xxxx of lading, freight xxxx, or other shipping or delivery document,
the terms and provisions of this Agreement shall supersede and govern.
10. Loading and Handling Obligations.
a. Carrier shall be responsible for loading Shipper's freight onto
Carrier's equipment at the origin point and for unloading Shipper's freight at
the delivery point. When on Shipper's premises, Carrier, its subcontractors and
agents shall comply with the safety practices and procedures established for
those premises.
b. Carrier is responsible to maintain an accurate count of all of Shipper's
freight at all times such freight is in Carrier's possession, custody, or
control. Subject only to their taking appropriate safety measures. Carrier,
Carrier's employees, agents and/or authorized representatives may visually
inspect and count Shipper's freight during the loading process and during all
times in which such freight is in Carrier's possession, custody, and control.
11. Loss of or Damage to Property, Third-Party Claims.
a. Loss of or Damage to Property of Shipper or Third Parties.
i. Regardless of the points of origin, destination or location of the
transportation services provided, Carrier shall be liable to Shipper in the
same manner and to the same extent as a common carrier under 49 U.S.C.
ss.14706 (or its successor statute) for loss of, damage to, contamination
of, or delay in delivery of Shipper's products when tendered and accepted
for transportation hereunder, except where such loss or damage results from
(1) acts of God, or public authority, (2) inherent vice or nature of the
commodities, or (3) acts of Shipper. Irrespective of any provisions in
Carrier's tariffs, service guides or similar publications, Carrier's
liability for loss, damage, contamination, or delay shall be determined
solely by the terms of this Contract. Any attempts to limit Carrier's
liability by tariff or other provisions incorporated by reference in a xxxx
of lading or other shipping document shall be deemed null and void.
Products which have been tendered to Carrier in good order and condition,
and subsequently
delivered by Carrier in damaged or contaminated condition, or lost or
destroyed, or unreasonably delayed in delivery, shall be conclusively
deemed to have been damaged, contaminated, lost, destroyed, or delayed by
Carrier's negligence unless Carrier can otherwise establish by clear and
convincing evidence.
ii. Carrier's acceptance of Shipper's products for transportation shall be
deemed to occur at the time such products (or any part thereof) pass the flange
of the loading valve on Carrier's trailer.
iii. Claims against Carrier for loss of, damage to, contamination of, or
delay in delivery of the Shipper's products and the processing of any salvage
shall be governed by 49 C.F.R. Part 370, or any applicable successor
regulations, except as otherwise set out in this Agreement. Carrier shall not
dispose of any damaged or contaminated cargo, without the prior written consent
of Shipper. Shipper may determine, within its sole discretion, and not subject
to a reasonableness standard, whether and how the cargo, may be salvaged, and if
salvageable, the value of such salvage. Any salvage receipts shall be credited
against Shipper's claim against Carrier. Shipper shall have the right to remove
all identifying marks or labels when Carrier pays Shipper for the full value of
the damaged or contaminated cargo and requests possession of the salvage.
Alternatively, the cargo shall be permanently marked as "damaged" or a similar
notation, without debiting Shipper for such notations. If any portion of 49
C.F.R. Part 370 conflicts with any portion of this Agreement, the provisions of
this Agreement shall govern.
iv. The parties agree and Shipper declares that, in case of loss,
contamination, or damage to Shipper's products, the value of such products and
the liability of Carrier for any cause for which Carrier may be liable, shall be
the full invoice value of the products up to $50,000 per shipment, subject to
reasonable mitigation of the lost, contaminated, or damaged products, plus all
reasonable additional transportation costs. Such full invoice value shall be
determined by the invoice between Shipper and the consignee, or if Shipper is
the consignee, the invoice between the consignor and Shipper.
v. Carrier shall be liable to Shipper and to third parties for any loss or
contamination of, or damage to any products or property, other than commodities
tendered for transportation hereunder, where and to the extent such loss,
contamination, or damage is the result of Carrier's negligence or willful
misconduct.
vi. The parties agree that, in case of loss or contamination of, or damage
to any products or property of third parties or Shipper, other than commodities
tendered for transportation hereunder, the value of such products or property
and the liability of Carrier for any cause for which Carrier may be liable,
shall be the fair market value of such products or property or the reasonable
cost of repair, whichever is less.
b. Loss of or Damage to Property of Carrier.
i. Shipper shall be liable to Carrier for loss of or damage to any property
of Carrier where and to the extent such loss or damage is the result of
Shipper's negligence or willful misconduct.
ii. The parties agree that in case of loss or damage to any property of
Carrier, the value of such property and the liability of Shipper for any cause
for which Shipper may be liable, shall be the fair market value of such property
or the reasonable cost of repair, whichever is less.
12. Indemnification.
a. Except as expressly provided below Carrier agrees to hold harmless and
unconditionally indemnify Shipper against and from all liability, cost,
expenses, claims, and damages which Shipper may at any time suffer or sustain or
become liable for by reason of:
i. Any and all penalties, fines, costs or expenses of any character
which may be enforced or sought to be enforced against Shipper or Carrier
by reason of the violation or alleged violation by Carrier of any federal,
state or local law or regulation;
ii. Any and all claims, actions and causes of action which may at any
time arise by reason of accident or damage to the property of either party
or third parties or the injury to or death of any party including employees
of either party or any third parties caused by any negligent act or
omission of Carrier, its officers, agents, or employees arising from or in
connection with:
(a) The maintenance, use, or operation (including loading and
unloading) by Carrier or its agents, or employees of any motor
vehicles or equipment used by Carrier in performance of this
Agreement;
(b) Carrier's performance of the transportation services to be
provided under this Agreement;
iii. Any and all claims, actions and causes of action which may at any
time arise by reason of any state or local sales tax that may be assessed
on payments made by Carrier to Shipper for loss or damage to Shipper's
commodities or any other property of Shipper.
b. The indemnity herein provided shall include, but shall not be limited
to, all costs, expenses, and attorneys' fees incurred or payable by Shipper in
settling such claims or penalties or fines or in investigating or defending
against the same.
c. Notwithstanding any other provision in this Agreement, such indemnity of
Carrier shall not hold Shipper harmless from or against any such penalty, fine,
claim, action or cause of action shown to arise from the negligence of Shipper.
Where personal injury, death or loss of or damage to property (excluding
property of Shipper or Carrier) is the result of the joint negligence or willful
misconduct of Carrier and Shipper, Carrier's duty of indemnification shall be in
proportion to its allocable share of such joint negligence or willful
misconduct.
d. This Section 12 shall not apply to claims for lost, contaminated,
damaged or delayed cargo that are covered by Section 11.a. i-iv above.
13. Insurance.
a. Carrier shall obtain and maintain at all times during the term of this
Agreement the following insurance coverage:
i. Comprehensive general liability (including automobile and
contractual liability), bodily injury and property damage insurance, with
an appropriately licensed company, in an amount not less than Five Million
Dollars ($5,000,000.00) or the amount required by applicable state and/or
federal law, whichever is greater, insuring Carrier's ability to pay for
any loss, damage, or injury arising out of Carrier's performance or failure
to perform under this Agreement.
ii. Cargo insurance with an appropriately licensed company
satisfactory to Shipper in an amount not less than Fifty Thousand Dollars
($50,000.00) for loss of or damage to property carried on motor vehicles
used in connection with the transportation services agreed to under the
terms of this Agreement, or for any and all amounts as per statutory
requirements, whichever is greater;
iii. Worker's compensation insurance, with an appropriate licensed
company, in an amount not less than the statutory requirements, for injury
to any of Carrier's employees arising out of Carrier's performance of this
Agreement;
iv. Environmental damage liability insurance, as evidenced by an
MCS90, with limits of liability of not less than Five Million Dollars
($5,000,000.00) per occurrence; and
v. Any other insurance required by any federal or state regulatory
agency.
b. Carrier shall provide certificates of insurance coverage to Shipper to
evidence that the insurance required herein remains in force.
c. Shipper, its subsidiaries and affiliated companies, co-owners and joint
venturers, if any, and their employees, officers and agents shall be named as
additional insureds or as beneficiaries of each of the policies required by this
section, except Workers' Compensation.
d. All policies shall be endorsed to provide that underwriters and
insurance companies of Carrier shall not have any right of subrogation against
Shipper, its subsidiaries, co-owners or joint venturers, if any, and their
agents, employees, officers, invitees, servants, contractors, subcontractors,
underwriters and insurance companies with respect to any loss of or damage to
Shipper's cargo or commodities.
e. Carrier agrees that unless it receives Shipper's prior written consent
otherwise, it will (i) keep such policies in force, (ii) not reduce the amount
or change the nature of the coverage, (iii) not remove Shipper as an additional
insured or beneficiary, and (iv) not change insurers. Shipper shall not
unreasonably withhold any approvals or consents as required herein.
f. Any coverage provided Shipper by Carrier's insurance under this
Agreement is primary insurance, to the extent the loss or damage in question is
caused by Carrier's negligent
act or omission, and shall not be considered contributory insurance with any
insurance policies of Shipper, its employees, subsidiaries, or joint venturers,
if any. To the extent a particular loss or damage is caused by Shipper's
negligent act or omission, any applicable coverage under policies of Shipper
shall be primary insurance, and shall not be considered contributory insurance
with any insurance policies of Carrier.
g. Such insurance policies shall provide (unless prohibited by applicable
statute), that written notice of any such cancellation shall be given to Shipper
at least ten (10) calendar days prior to such cancellation. Carrier's
obligations hereunder shall always be subject to any limitations imposed by
applicable laws, regulations or orders of any governmental authority.
14. Compliance with Laws and Business Practices.
a. Each party hereto agrees to comply with all laws and lawful regulations
applicable to any activities carried out under the provisions of this Agreement
and/or any amendments to it.
b. Carrier agrees to comply with all safety practices and procedures
established for each of Shipper's facilities and premises.
c. Carrier agrees that at all times when its vehicles are transporting
Shipper's freight, such vehicles shall carry a current copy of the Emergency
Response Guide Book.
d. Each party hereto agrees that all financial settlements, xxxxxxxx, and
reports rendered to the other party as provided for in this Agreement and/or any
amendments to it will, to the best of its knowledge and belief, properly reflect
the facts about all activities and transactions related to this Agreement, which
data may be relied upon as being complete and accurate in any further recording
and reporting made by such other party for whatever purpose. Each party hereto
agrees to notify the other party promptly upon discovery of any instance where
the notifying party has reason to believe data covered by this subsection (d)
above are no longer accurate and complete.
e. In addition to and not in limitation of Carrier's general compliance
requirements set forth elsewhere in this Agreement, Carrier warrants that when
providing services for any material that is classified as a Hazardous Material
or Dangerous Good, under applicable international, federal, state, or local law,
Carrier assumes full responsibility that its (and its subcontractors') employees
have been trained, qualified, and screened to safely handle the material for the
purposes of such services and that the material will arrive at the required
destination in a safe manner. Carrier certifies that it has developed and
implemented a security plan in compliance with applicable regulations in the
jurisdictions in which it will provide the services for such material and that
Carrier will furnish a true and correct copy thereof to Shipper, upon Shipper's
request.
15. Transportation of Waste and Hazardous Waste
a. This Section 15 shall apply only in the event a heel remains in the tank
truck after delivery, and, after notification by Carrier, Shipper determines
that the heel must be managed as a hazardous waste.
b. In the event Carrier transports hazardous waste, as defined by the Resource
Conservation and Recovery Act, 42 U.S.C. ss. 6901 et. seq. and applicable state
counterparts, Carrier shall comply with all applicable requirements for
transporters of hazardous waste, including but not limited to the hazardous
waste transporter requirements at 40 CFR Part 263 or any applicable state
counterpart.
c. Carrier shall deliver any hazardous waste tendered by Shipper only to
the "designated facility" listed on the manifest accompanying the hazardous
waste. Carrier must have regulatory authority to transport waste and hazardous
waste within the applicable state or provincial jurisdictions.
16. Surviving Obligations.
If any provision of this Agreement should be found to be unenforceable or
should become in contravention of any applicable laws or regulations, the
parties shall remain obligated by that which remains or such provision shall be
superseded by the appropriate provisions of such laws or regulations, so long as
such laws or regulations remain in force and effect, whichever is applicable.
17. Required Notices.
a. Shipper shall give Carrier prior notice of the toxic, flammable, or
otherwise hazardous nature, if any, of the product to be shipped.
b. Carrier must notify Shipper within ten calendar (10) days when Carrier's
Department of Transportation safety rating falls below the rating of
"satisfactory".
c. Carrier shall notify Shipper of any notices of DOT hazardous material
violations received by Carrier while Carrier is in possession of Shipper's
freight, immediately upon Carrier's receipt of any such violation.
18. Confidentiality.
The rights and obligations hereunder are personal to each party to this
Agreement. No party may disclose the existence of, or any of the terms of this
Agreement to any non-party without the prior written consent of the other
parties except (1) as required by law, in particular securities laws applicable
to Shipper; (2) to a corporate parent, subsidiary, or affiliate; or (3) to an
authorized audit agency for audit or other financial purposes.
19. Governing Law and Jurisdiction.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Nebraska (without giving effect to the principles of
conflict of laws which might otherwise result in the application of the law
another jurisdiction) and Title 49 of the United States Code. Litigation
regarding this contract may be brought only in the courts in the State of
Nebraska.
20. Force Majeure.
In the event either party is unable to meet any of its obligations under
this Agreement as a result of acts of God, acts of government, war, strike or
other labor disturbance, or any other cause beyond its reasonable control, the
obligations of the party affected by the force majeure condition shall be
suspended for the duration of same; provided, however, that both parties shall
make all reasonable efforts to continue to meet their obligations for the
duration of the force majeure condition. The suspension of any obligations owing
to force majeure shall neither cause the term of this Agreement to be extended
nor affect any rights accrued under this Agreement prior to the force majeure
condition. Nothing in this Section 20 shall apply to relieve Carrier from its
responsibility and liability for cargo loss, damage, contamination, or delay in
delivery set forth in Section 11 of this Agreement or its indemnification
obligations under Section 12 of this Agreement, except as otherwise set forth in
those sections.
21. Notices.
All notices required to be given under this Agreement shall be in writing
and sent either by first class U.S. Mail or overnight mail, postage prepaid, and
addressed to the respective parties at the following addresses, or at such other
addresses as one party may furnish to the other by written notice:
Carrier Shipper
Western Oil Trans Inc NEDAK Ethanol LLC
Attn: Xxxx Xxxxxxxxx Attn: Xxxxxx Xxxxxxxxx
000 X Xxx 00 - XX Xxx 00 00000 Xxxxxxxxx Xxxx - XX Xxx 000
Xxxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
22. Assignment and Benefit.
This Agreement shall not be transferred or assigned in whole or in part by
either party without the prior written consent of the other party. This
Agreement shall be binding upon and inure to the benefit of the parties and
their lawful successors and assigns.
23. Entire Agreement.
This instrument states the entire agreement between the parties and there
are no other agreements or understandings whatsoever, expressed or implied,
relating to the subject matter hereof. All amendments to this Agreement shall be
in writing and signed by both parties.
24. Waiver.
No waiver by either party of any breach of this Agreement by the other
party shall be considered a waiver of any succeeding breaches.
25. Document Retention.
Carrier agrees to obtain signed receipts, upon forms satisfactory to
Shipper, from all persons to whom Carrier shall make deliveries, and Carrier
shall retain said receipts for at least two (2) years following such delivery
and shall, upon request, make said receipts available to Shipper for its
inspection and/or use. Carrier agrees to retain this Agreement or a true and
correct copy of the document for the life of the Agreement and for three (3)
years thereafter.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives as of the day and year first
above written.
NEDAK ETHANOL LLC
By: /s/ Xxxxxx Xxxxxxxxx
Title: President and General Manager
WESTERN OIL TRANS INC
By: /s/ Xxxx Xxxxxxxxx
Title: President
EXHIBIT A
TRANSPORTATION RATE
The Freight charges for shipments from the Origin Loading Point of Xxxxxxxx
Ethanol Storage Site to the Destination Unloading Point of X'Xxxxx Ethanol
Storage Site shall be $0.01299 per gallon unloaded.
BULK FUEL SURCHARGE
1. Shipper & Carrier agree that the fuel surcharge is established on a
"cents per gallon" basis and then applied to the base rate which was
established above.
2. Each billing date (15th & 30th) the price of the fuel surcharge will
be established using the price of #2 diesel fuel at a non-affiliated
location such as Cubby's in O'Neill, NE. This price will set the
additional surcharge based on the attached charge.
3. The fuel surcharge is fixed to the extent that it does not change from
the time of tender of shipment during the course of the transportation
of that shipment.
FUEL SURCHARGE PER GALLON UNLOADED
$2.499 DIESEL FUEL BASE
CHANGE EVERY 25 CENTS INCREASE
FUEL PRICE SURCHARGE
$2.499 0
--------------------------------
$2.749 .0003
-------------------------------
$2.999 .0006
-------------------------------
$3.249 .0009
-------------------------------
$3.499 .0012
-------------------------------
$3.749 .0015
-------------------------------
$3.999 .0018
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EXHIBIT B
FORM OF SHIPPING DOCUMENT
