January 28, 2026
These Terms and Conditions of the Broker-Carrier Agreement (collectively, the “Agreement”) by and between BROKER and CARRIER (together which may be referred to as the “Parties” or individually as a “Party”), each as identified on the cover page, are made as of the Effective Date specified on the cover page. BROKER and CARRIER have caused their duly authorized representatives to execute this Agreement on the cover page in consideration of the mutual promises and agreements contained herein, together with the Addenda attached hereto and incorporated herein. This Agreement governs CARRIER’s relationship, as a for-hire carrier in interstate or intrastate commerce with BROKER and any goods that CARRIER transports for BROKER’s customers. CARRIER and BROKER may be individually referred to as a “Party” or collectively as the “Parties” in these Terms and Conditions.
BY TRANSPORTING GOODS FOR BROKER’S CUSTOMERS OR BY CLICKING TO ACCEPT OR AGREE TO THE AGREEMENT, CARRIER AGREES TO BE BOUND BY THESE TERMS AND CONDITIONS IN THE VERSION PUBLISHED AT THE TIME OF THE SHIPMENT. BROKER MAY REVISE AND UPDATE THESE TERMS AND CONDITIONS FROM TIME TO TIME AT ITS SOLE DISCRETION. ALL CHANGES ARE EFFECTIVE IMMEDIATELY WHEN POSTED AND APPLY TO THE SERVICES PROVIDED BY YOU THEREAFTER.
PLEASE READ THESE TERMS AND CONDITIONS CAREFULLY. THESE TERMS AND CONDITIONS CONTAIN A MANDATORY INDIVIDUAL ARBITRATION AGREEMENT REQUIRING THE USE OF ARBITRATION TO RESOLVE COVERED DISPUTES, RATHER THAN JURY TRIALS OR COURT TRIALS.
1. DESCRIPTION OF SERVICES. CARRIER agrees that it is solely responsible for providing motor carriage transportation services for goods tendered by BROKER pursuant to this Agreement and each applicable Addenda and “Rate Confirmation” (the “Services”), as well as all applicable federal, provincial, state, and local laws and regulations relating to the transportation of the freight covered by this Agreement and the applicable Addenda and Rate Confirmation. The Services shall be understood as “contract carriage” within the meaning of 49 U.S.C. § 13102(4)(B), and the Parties each expressly waive all rights and remedies they may have as to each other under 49 U.S.C., Subtitle IV, Part B, as permitted by 49 U.S.C. § 14101(b)(1), to the extent that such rights and remedies conflict with the terms of this Agreement.
2. TERM. The term of this Agreement shall be one year from the date hereof and thereafter it shall automatically be renewed for successive one (1) year periods, unless terminated, upon thirty (30) day’s prior written notice, with or without cause, by either Party at any time, including the initial term. In the event of termination of this Agreement for any reason, the Parties shall be obligated to complete the performance of any work in progress in accordance with the terms of this Agreement.
3. LAWFUL OPERATION. CARRIER represents and warrants that it holds and will maintain during this Agreement a valid motor carrier operating authority issued by the FMCSA and identified by the U.S. DOT Number and MC Docket Number set forth in the signature block below, if applicable, and all required insurance as well as all foreign or intrastate licenses and permits necessary to lawfully perform the Services. CARRIER represents that it does not have an “Unsatisfactory” or “Conditional” safety rating as determined by the FMCSA or a substantially equivalent rating issued by a state or other government agency having jurisdiction. CARRIER shall immediately notify BROKER if it receives an “Unsatisfactory,” “Conditional,” or equivalent safety rating, or if its required operating authorities, licenses, permits, or insurance are revoked, suspended, or rendered inactive for any reason and CARRIER shall cease providing the Services until such are restored.
4. CARRIER’S REPRESENTATIONS. CARRIER makes the following representations and warranties during the term of this Agreement:
A. Compliance with Laws. CARRIER is in, and shall maintain compliance during the term of this Agreement with all applicable federal, state, provincial, and local laws related to the performance of the Services including, but not limited to those requirements in the jurisdiction of operation that are equivalent to those set forth herein:
(i) Transportation of Hazardous Materials (including the licensing and training of Hazmat-qualified drivers), as defined in 49 C.F.R. §§ 172.800, 173, and 397 et seq. to the extent that any goods hereunder constitute Hazardous Materials;
(ii) Security regulations;
(iii) Owner/operator lease regulations;
(iv) Loading, securement, or tarping of freight regulations;
(v) Implementation and maintenance of driver safety regulations including, but not limited to, hiring, controlled substances and alcohol testing, and hours-of-service regulations,
(vi) Federal and state labor regulations and OSHA;
(vii) Sanitation, temperature, and contamination requirements for transporting food, perishable, and other products, including, but not limited to compliance with the Food Safety Modernization Act (21 U.S.C. § 2201 et seq.) and its implementing regulations;
(viii) Qualification and licensing and training of drivers;
(ix) Implementation and maintenance of equipment per applicable safety regulations;
(x) Maintenance and control of the means and method of transportation including, but not limited to, performance of its drivers and owners/operators;
(xi) All applicable insurance laws and regulations including but not limited to Workers’ Compensation;
(xii) If applicable, all Occupational Accident benefits, whether insured or not; and
(xiii) Any specific requirements for each load as further communicated herein and/or in any rate confirmation.
B. CARRIER’s Personnel. CARRIER is solely responsible for any and all management, governing, discipline, direction, and control of its employees, owner/operators, authorized dispatch agents, and equipment with respect to operating within all applicable federal, state, and provincial legal and regulatory requirements to ensure the safe operation of CARRIER and owner/operators’ vehicles, drivers and facilities. For any shipments involving a vehicle that requires a commercial drivers’ license (“CDL”), it is CARRIER’s sole responsibility to ensure that each driver is duly qualified, in possession of a valid CDL or equivalent license, and otherwise meets all of the physical, training and other qualifications for commercial motor vehicle drivers set forth in the Federal Motor Carrier Safety Regulations (“FMCSRs”) or as may be applicable in the jurisdiction of operation. CARRIER and BROKER agree that the safe and legal operation of the CARRIER and its drivers shall completely and without question govern and supersede any service requests, demands, preferences, instructions, or information from BROKER or its customer(s) with respect to any shipment at any time.
C. Equipment. CARRIER agrees to provide the necessary equipment, maintained in compliance with the requirements of the FMCSA or the government authority having jurisdiction, and qualified personnel for completion of the transportation services required for BROKER and its customers. CARRIER is responsible for payment of all permits, escorts, route surveys, bridge surveys, utility assistance, and any other ancillary costs arising from or related to the Services and such costs are not collectable under this Agreement. CARRIER will not supply equipment that has been used to transport hazardous wastes, solid or liquid, regardless of whether they meet the definition in 40 C.F.R. § 261.1 et seq., or other similarly applicable laws or regulations. CARRIER agrees that all goods will be transported and delivered with reasonable dispatch, or as otherwise agreed in writing.
D. Cargo Security. CARRIER will comply with the security and cargo securement requirements set forth in this Agreement, applicable Addenda, the Rate Confirmation, or any instructions contained in the BOL or other shipping document. CARRIER agrees that it and its drivers shall be solely responsible for ensuring that all trailers are securely always sealed with the cargo seal provided by or approved by the shipper and padlocked while in transit and when left unattended to maintain the security and integrity of the load. CARRIER and its drivers are responsible for complying with all applicable laws and regulations, including the FMCSRs and cargo securement criteria set forth in 49 C.F.R. §§ 393.100-36.
E. Prohibition on Re-Brokering. CARRIER will not re-broker, co-broker, subcontract, assign, interline, or transfer the transportation of goods hereunder to any other person or entity conducting business under a different operating authority, without the prior written consent of BROKER. If CARRIER breaches this provision, BROKER shall have the right to pay the monies it owes CARRIER directly to the delivering carrier, in lieu of payment to CARRIER. Upon BROKER’s payment to the delivering carrier, CARRIER shall not be released from any liability to BROKER under this Agreement. AS A CONDITION OF ENTERING THIS AGREEMENT WITH BROKER, CARRIER’S AUTHORIZED REPRESENTATIVE WILL EXECUTE A SWORN CERTIFICATE AFFIRMING THAT CARRIER IS THE ACTUAL CARRIER BEING CONTRACTED AND THAT CARRIER WILL NOT RE-BROKER, CO-BROKER, SUBCONTRACT, ASSIGN, INTERLINE, OR TRANSFER A LOAD OUT TO ANOTHER CARRIER. CARRIER WILL FURTHER AFFIRM THAT IT UNDERSTANDS THAT A BREACH OF ITS CERTIFICATION MAY RESULT IN CRIMINAL OR CIVIL PENALTIES UNDER 49 U.S.C. 14906 AND/OR A PRIVATE RIGHT OF ACTION PURSUANT TO MAP-21 THAT ALLOWS A PARTY TO SUE FOR UNLICENSED BROKERAGE ACTIVITY. In the event any shipment is delayed or CARRIER otherwise fails to complete any trip undertaken by it, and BROKER must arrange for the completion of such trip with another carrier, CARRIER shall be responsible for reasonable and necessary costs, charges, fees, and expenses related thereto.
F. Emissions Compliance. In the event that any goods subject to the Agreement are transported within the State of California, or any other state or jurisdiction with specific requirements applicable to its equipment, CARRIER represents and warrants that it shall comply with, and shall use reasonable commercial efforts to ensure that it and its equipment comply with all applicable standards, requirements, and regulations of the California Air Resources Board (“CARB”) and other applicable federal, state and local legal requirements, including, but not limited to the: (i) Transportation Refrigeration Unit Regulation and Amendments (“TRU Regulation”) at 13 C.C.R. § 2477 et seq; (ii) Heavy-Duty Inspection and Maintenance Program (“Clean Truck Check”) at 13 C.C.R. § 2195 et seq; and (iii) Advanced Clean Fleet Regulation (“ACF Regulation”) at 13 C.C.R. § 2015 et seq. Upon BROKER’s reasonable request, CARRIER shall provide certificates evidencing CARRIER’s compliance with the above mentioned regulations. If CARRIER is operating in or through California but is not subject to the CARB regulations identified above, or any other CARB regulations later revised, adopted, or amended, CARRIER shall provide BROKER with signed statements, as required under certain CARB regulations, verifying that CARRIER is not subject to a particular regulation. CARRIER shall indemnify, defend, and hold harmless BROKER its shareholders, directors, officers, employees, successors, and assigns, from and against any penalties, fines, fees, claims, suits, disputes, or any other liability, imposed by the State of California because of CARRIER’s failure to comply with any applicable CARB regulations or reporting requirements. Notwithstanding the foregoing, BROKER shall not accrue any liability from its doing or not doing so, nor shall this, in any way, waive CARRIER’s obligations under this Agreement.
G. Food Shipments. For purposes of this Agreement, “Food Products” shall have the meaning as defined in Addendum A, the Food Shipment Addendum, which is attached hereto and incorporated by reference for all shipments of Food-Grade Products transported under this Agreement.
H. Taxes. CARRIER assumes full responsibility and liability for payment of the following items: All applicable federal, state, and local payroll taxes, taxes for unemployment insurance, old age pensions, workers’ compensation, and social security, with respect to persons engaged in the performance of its transportation services hereunder. BROKER shall not be liable for any of the payroll-related tax obligations specified above and CARRIER shall indemnify, defend, and hold BROKER harmless from any claim or liability imposed or asserted against BROKER for any such obligations.
5. RECEIPTS AND BILLS OF LADING. CARRIER shall sign a BOL, produced by the shipper or CARRIER in compliance with 49 C.F.R. § 373.101 (and any amendments thereto), or other similarly applicable laws or regulations, for the property it receives for transportation under this Agreement. Any terms of the BOL (including but not limited to payment and credit terms, released rates, or released value) inconsistent with the terms of this Agreement shall not operate to alter or amend the provisions herein. CARRIER’s failure to issue a BOL or sign a BOL acknowledging receipt of the cargo shall not affect the liability of CARRIER. Prior to signing any BOL, it shall be the responsibility of CARRIER’s driver to count the goods, if applicable, described in the BOL, and to report any overages, shortages, or damages to BROKER before leaving with the load; otherwise, CARRIER will be liable for any shortages and subject to a $50 deduction of payment. Unless otherwise agreed in writing, CARRIER shall become fully responsible/liable for the freight when it signs the BOL or takes/receives possession of the freight and the trailer(s) is loaded, whichever occurs first, and with respect to the latter, regardless of whether a BOL has been issued, signed, or delivered to CARRIER. Such responsibility/liability shall continue until delivery of the shipment to the consignee and the consignee signs the BOL or delivery receipt. It is the exclusive obligation of CARRIER to secure the load, and in the event any part of a load has been secured by any party other than CARRIER, CARRIER shall inspect, and as necessary, correct the load securement to ensure compliance with all applicable laws and regulations.
6. USE OF DISPATCH AGENTS. CARRIER agrees and acknowledges that BROKER will not work with a dispatch agent (as defined by the FMCSA as any person that provides dispatch services to more than one motor carrier) unless CARRIER indicates that during the Highway onboarding process. Upon such notification, the CARRIER or DISPATCH AGENT agrees to upload a copy of their fully executed pro forma Dispatch Agent Agreement to HIGHWAY as requested. Notwithstanding the use of any dispatch agent, CARRIER shall remain fully liable and responsible for all obligations, services, and liabilities under this Agreement. CARRIER acknowledges and agrees that nothing in this Agreement or the use of a dispatch agent shall be construed to protect or shield any dispatch agent from fines, penalties, or other legal consequences for engaging in unlawful brokerage activities as prohibited under 49 U.S.C. § 14916. CARRIER shall ensure that any dispatch agent used is aware of and complies with all applicable laws and regulations, including those pertaining to lawful brokerage activities.
7. RATES AND PAYMENT.
A. Rates. CARRIER shall invoice BROKER for its charges, as mutually agreed in writing, by fax, or by electronic means, contained in BROKER’s Rate Confirmation incorporated herein by this reference. The Rate Confirmation may include load and customer-specific operational requirements, and CARRIER shall be deemed to accept the rates, charges, and operational requirements provided in the Rate Confirmation upon CARRIER’s signature thereon or CARRIER’s acceptance of the shipment at origin. Additional rates for truckload or LTL shipments, or modifications or amendments of the above rates, or additional rates, may be established to meet changing market conditions, shipper requirements, BROKER requirements, and/or specific shipping schedules as mutually agreed upon, and shall be confirmed in writing (or by fax or email) by both Parties. Any such additional, modified, or amended rates or changes in rates shall automatically be incorporated herein by this reference. Additionally, any rates, which may be verbally agreed upon, shall be deemed confirmed in writing where CARRIER has billed the agreed rate and BROKER has paid it. All written confirmations of rates, including confirmations by billing and payment, shall be incorporated herein by this reference. Rates or charges, including but not limited to stop-offs, pickup, and delivery, out-of-route, storage, detention, loading or unloading, fuel surcharges, or other accessorial charges, tariff rates, released rates or values, or tariff rules or circulars, shall only be valid when included in a separately attached Rate Confirmation.
B. Lumper Fees. Authorized lumper fees will be reimbursed only if BROKER is notified at the time of delivery and CARRIER submits a valid lumper receipt with its invoice. If BROKER advances funds directly, whether through EFS check, virtual credit card or other Broker approved payment method to CARRIER to pay for a lumper fee, it is CARRIER’s responsibility to submit valid lumper fee documentation with its invoice. In the event that CARRIER is unable to provide valid lumper fee documentation, BROKER shall have the right to offset the CARRIER’s invoiced charges by the amount of any advanced funds. CARRIER is responsible for the truthful and accurate submission of all lumper fees incurred during the transportation of goods during this Agreement. In addition, CARRIER assumes full responsibility for any fraudulent lumper fees submitted by its drivers, owner/operators, employees, or any other employees acting on its behalf. In the event that BROKER discovers any fraudulent lumper fees after payment has been made to CARRIER, BROKER shall have the right to offset the amount of such fraudulent fees against any future payments due to the CARRIER under this Agreement or any other agreement between the Parties.
C. Payment. Parties agree that BROKER is the sole party responsible for payment of CARRIER’s charges. BROKER agrees to pay CARRIER’s invoice within thirty (30) days of receipt of the bill of lading or proof of delivery, provided CARRIER is not in default under the terms of this Agreement. CARRIER shall submit valid proof of delivery and bills of lading within 45 days of a shipment’s delivery. If CARRIER falls delinquent in this requirement such that it causes BROKER’s invoice to its customer(s) to be rejected, BROKER reserves the right to void CARRIER’s charges for the shipment. In the event of non-payment by BROKER, CARRIER waives any and all rights to seek payment from the customer, shipper, consignee, or any other third party involved in the shipment. CARRIER acknowledges that its sole recourse for payment is against BROKER. BROKER reserves the right to offset any amounts owed by CARRIER against payments due to CARRIER under this Agreement. This includes but is not limited to, claims for cargo damage, property loss, and any other valid claims arising from CARRIER’s services.
D. Factoring. CARRIER shall provide BROKER with written notice providing BROKER with remittance instructions (“Notice of Release”) in the event CARRIER enters into any factoring, assignment, pledge, hypothecation, or granting of a security interest in CARRIER’s right to payment under this Agreement. Such factoring, assignment, or transfer shall not take effect until fifteen (15) days after BROKER receives the Notice of Release. Such Notice of Release shall at a minimum include the name and address of factoring company, assignee/transfer, date, date assignment is to begin, and terms of the assignment, and shall be considered delivered upon date of receipt. BROKER shall have the right to ask for, and CARRIER shall be obligated to furnish, any further documentation BROKER requires in order to satisfy itself as to the authenticity of, and payment requirements of the factoring arrangement(s). In the event that CARRIER fails to provide the Notice of Release, or fails to confirm the applicability of the Notice of Release in writing every six (6) months, BROKER shall have the right, in its sole discretion, to terminate this Agreement immediately. Such termination shall be in addition to any other rights or remedies available to BROKER under this Agreement or applicable law. Any factoring, assignment, pledge, hypothecation, or granting of a security interest in CARRIER’s right to payment under this Agreement shall in no event modify, limit, or terminate BROKER’s or its customer(s)’s right to offset or recoup or claims of BROKER or its customer(s) for offset, recoupment, loss, or damage to any cargo or other property, including personal injury, or any other claim which BROKER or its customer(s) may have against CARRIER for any reason. All of BROKER’s and its customer(s)’s claims and rights are specifically preserved and shall be superior to any such assignee’s, factor’s, or creditor’s rights or claims to payment, regardless of any notice to BROKER to the contrary. CARRIER shall notify any such factor, secured creditor, or assignee of BROKER’s rights in this regard. Further, if BROKER discovers that CARRIER has not provided a valid Notice of Release, CARRIER shall be deemed in breach of this Agreement and BROKER may at its sole discretion terminate this Agreement. BROKER’s remittance of payment in accordance with any Notice of Release shall be deemed payment to CARRIER in all regards and shall absolve BROKER of any liability with respect to payment to CARRIER for the services underlying such invoice. Should CARRIER provide multiple or conflicting Notices of Release, BROKER’s compliance with instructions in any Notice of Release shall absolve BROKER of any liability with respect to amounts owed to CARRIER for the services in question. BROKER’s payment obligations hereunder shall not be subject to more than one factoring/assignment agreement or payment at any one time. No multiple assignments, factoring or other such transfers by CARRIER is binding on BROKER. Should BROKER advance monies to CARRIER, such amounts will be treated as an advance of CARRIER’s funds and not subject to CARRIER’s factoring, assignee claims or other claims by third parties. Upon demand by BROKER, CARRIER, factoring company, assignee or third party, shall promptly return to BROKER advances it made to CARRIER. CARRIER shall defend, indemnify, and hold BROKER harmless from any losses, fees, claims, liability, actions, or damages (including reasonable attorneys fees) arising from or related to such assignment, factoring, granting of a security interest, or transfer of rights by CARRIER.
8. LIEN WAIVER AND SALVAGE. CARRIER, for itself and on behalf of all of its owners, directors, officers, partners, agents, owner/operators and insurers, agrees not to assert, and hereby waives, any lien that it might have on any goods transported hereunder. If, notwithstanding this waiver, CARRIER, its agents, subcontractors, or anyone purporting to act on its behalf should attempt to assert any such lien, CARRIER or such other Party shall reimburse BROKER or BROKER’s customer for its costs, including reasonable attorneys’ fees, in obtaining a release of the lien. Without limiting the foregoing, in the event that CARRIER retains any goods tendered hereunder and fails to transport such goods with due dispatch (whether due to an assertion of lien or any other reason), CARRIER acknowledges and agrees that such action would result in irreparable injury to BROKER, and that BROKER would therefore be entitled to obtain injunctive relief or an order of specific performance in relation to such breach, in addition to any other remedy available to it in law or equity (including recovering costs and damages) and would not be required to post a bond in such event. In addition, CARRIER waives the right to salvage value for refused goods, and the goods must be disposed at CARRIER’s expense when allowed by BROKER’s customer(s) in accordance with Broker’s customer instructions. When BROKER’s customer(s) approves disposal, CARRIER must provide BROKER with a “Certificate of Destruction” that is signed by CARRIER and by the destruction/recycling facility that is where the Carrier is instructed to dispose of the goods.
9. CARRIER’S LIABILITY FOR LOSS, DAMAGE, OR DELAY. CARRIER agrees that liability for cargo loss or damage shall be determined by 49 USC § 14706 (the Carmack Amendment). CARRIER shall be responsible for the full actual damage or loss to all articles while in its or its contractor’s care, custody, or control. Exclusions in CARRIER’s insurance coverage shall not exonerate CARRIER from liability and any gaps of coverage related to CARRIER’s liability shall be the responsibility of CARRIER. Unless otherwise agreed in writing, CARRIER’s measure of damages shall be based upon the actual cost incurred by BROKER’s customer, including the replacement cost of such goods and any direct cost associated with packaging, handling, and shipment of those goods. No limitation of cargo liability for loss, damage, or delay to cargo shall apply.
10. LOSS, DAMAGE, AND DELAY CLAIMS. CARRIER shall comply with 49 C.F.R. §370.1 et seq. and any amendments and/or any other applicable regulations adopted by the FMCSA, U.S. DOT, or any applicable state regulatory agency, for processing all loss and damage claims and salvage. Notwithstanding the terms of 49 CFR 370.9, CARRIER shall pay, decline, or make a settlement offer in writing on all cargo loss or damage claims within 90 days of receipt of the claim. Failure of CARRIER to pay, decline, or offer settlement within this 120-day period shall be deemed admission by CARRIER of full liability for the amount claimed and a material breach of this Agreement.
11. INDEMNIFICATION. CARRIER shall defend, indemnify, and hold BROKER and its customers, and their subsidiaries, and affiliates, respective officers, directors, shareholders, employees, agents, shippers, successors, and assigns from and against any and all actual, potential, threatened, or pending claims, demands, actions, causes of action, liabilities, judgments, fines, penalties, orders, decrees, awards, costs, expenses, including administrative costs and attorneys’ fees, settlements, and claims (collectively “Claims”) arising out of or relating to:
A. Loss or damage to property, or personal injury, including death, which may be sustained by the Parties, their employees, or third parties, arising out of or in connection with the performance of the Services;
B. Breach of any representations, warranties, covenants, terms, or conditions in this Agreement, Addenda, or Rate Confirmation, or violation of any applicable law or regulation by CARRIER, its personnel, agents, or contractors, including hours-of-service requirements and CARB regulations;
C. Employment-related claims asserted by CARRIER’s personnel including for claims of joint or co-employment, employee benefits, or Workers’ Compensation; or
D. The negligence or intentional misconduct of CARRIER, its employees, independent contractors, or agents.
CARRIER’s indemnification obligations under this Section shall survive any termination of the Agreement.
12. INSURANCE.
A. Insurance Policies. CARRIER shall furnish BROKER with Certificate(s) of Insurance, or insurance policies providing thirty (30) days advance written notice of cancellation or termination, and unless otherwise agreed, subject to the following minimum policy limits:
(i) General liability $1,000,000.00;
(ii) Commercial auto liability (including hired and non-owned vehicles) of $1,000,000.00, unless a higher limit is required by applicable law ($5,000,000 if transporting hazardous materials including environmental damages due to release or discharge of hazardous substances);
(iii) Cargo damage/loss, $100,000.00 per shipment;
(iv) Workers’ compensation and, where applicable, Occupational Accident coverage with limits required by law.
B. Insurance Requirements CARRIER shall furnish BROKER with certificates of insurance for the coverages described in this Section in a form that is satisfactory to BROKER evidencing that the coverages required in this Section are in effect. With respect to CARRIER’s commercial auto liability policy, CARRIER’s certificate of insurance shall identify the vehicles, trailers and drivers covered under the policy. CARRIER shall provide BROKER with at least thirty (30) days notice prior to cancellation, material change, or non-renewal of any required insurance policy. All required insurance shall be maintained with reliable insurance companies having a Best rating of “A-” or better. CARRIER shall provide BROKER with a list of all applicable exemptions and exclusions to said insurance policies. All policies will contain a severability provision in favor of BROKER to the effect that the insurance coverage will not be invalidated with regard to the interest of BROKER by any act, failure to act, or neglect of CARRIER. It is expressly understood that BROKER does not represent and does not warrant that the types or minimum limits of the insurance set forth herein are adequate to protect the BROKER customer’s interests.
CARRIER’s broad form cargo insurance policies shall insure the cargo for its actual customer cost value and shall not exclude coverage for any particular commodity, negligent acts including erroneous temperature settings, refrigeration breakdown, unattended or unlocked vehicles, infidelity, fraud, dishonesty or criminal acts of CARRIER’s employees, agents, owner-operators, contractors, officers or directors. However, CARRIER will ultimately be responsible for all such losses irrespective of available insurance or other third party arrangements.
CARRIER shall name BROKER as an “Additional Insured” on the Bodily Injury and Property Damage policies described in this Section 12 and shall provide that: (a) BROKER shall not be obligated to pay any premiums for such insurance; (b) Such insurance is primary and non-contributory with respect to all insureds and additional insured thereunder; and (c) Such insurance is applicable separately to each insured and additional insured thereunder and covers claims, suits, actions or proceedings by each insured against any other insured.
If CARRIER is self-insured, CARRIER shall provide evidence of such, including proof of acceptance of self-insurance status by the U.S. Department of Transportation or other governing agency. The self-insured status shall meet all the conditions set forth in this Section 12 relating to coverage requirements and indemnification.
C. Compliance with Applicable Law. Except for the higher coverage limits that may be specified above, the insurance policies shall comply with the minimum requirements of the FMCSA and any other applicable regulatory state agency. Nothing in this Agreement shall be construed to avoid or limit CARRIER’s liability due to any exclusion or deductible in any insurance policy.
D. Assignment of Rights. CARRIER automatically assigns to BROKER all its rights to collect freight charges from BROKER’s customers or any responsible third party on receipt of payment of its freight charges from BROKER.
13. CHARGEBACKS. CARRIER agrees that each of the shipments tendered will be accomplished as specified in BROKER’s customer’s instructions and accepted at the time of tender, which may be achieved with reasonable dispatch in compliance with hours of service and all other applicable safety regulations. CARRIER will notify BROKER in advance of accepting any goods if the scheduled pickup or delivery may not be achieved by operating lawfully. CARRIER shall immediately notify BROKER in the event that it anticipates a late pickup or delivery, or an inability to make proper pickup or delivery for any reason including without limitation a motor vehicle accident. CARRIER acknowledges that BROKER’s customers have specific requirements for pickup and delivery due to the nature of their businesses and that if pickup or delivery is not made at an appointed time or within a designated window then BROKER may incur chargebacks from its customer(s). In such event, CARRIER shall be liable to BROKER for any chargebacks imposed on BROKER by its customer, except to the extent such delay resulted from BROKER’s sole negligence.
14. BROKER’S COMPENSATION. CARRIER expressly waives any and all rights it may have under 49 C.F.R. § 371.3 or any related regulations to access or inspect BROKER’s records, including but not limited to, records of transactions, freight rates, or other financial arrangements between BROKER and its customers. CARRIER acknowledges and agrees that such records contain proprietary and confidential information, and BROKER’s obligation to maintain the confidentiality of its agreements with shippers and other parties supersedes any rights of access CARRIER may otherwise have under applicable law. CARRIER further represents that it enters into this agreement with a full understanding of this waiver and confirms that it has no expectation or reliance on access to such records as part of its relationship with BROKER. In the event that this waiver is deemed unenforceable by a court of competent jurisdiction, CARRIER agrees that its right to review BROKER’s records under 49 CFR § 371.3 shall be limited to receiving redacted copies of the relevant transactions. Such redacted copies shall include only the information specifically required by 49 C.F.R. § 371.3, with all other information, including but not limited to shipper identities, pricing details, and any proprietary or confidential information, redacted or removed. BROKER has the sole discretion in determining the extent of redaction necessary to protect its business interests and those of its clients, provided that the redacted documents still comply with the minimum requirements of 49 C.F.R. § 371.3.
15. GENERAL CLAUSES.
A. Independent Contractor. It is understood and agreed that the relationship between BROKER and CARRIER is that of an independent contractor. None of the terms of this Agreement or any act or omission of either Party shall be construed for any purpose to express or imply a joint venture, partnership, principal/agent, fiduciary, employer/employee relationship between the Parties. CARRIER shall provide the sole supervision and shall have exclusive control over the operations of its employees, contractors, subcontractors, and agents, as well as all vehicles and equipment used to perform its transportation services hereunder. BROKER has no right to discipline or direct the performance of any driver and/or employees, contractors, subcontractors, or agents of CARRIER. CARRIER represents and agrees that at no time and for no purpose shall it represent to any party that it is anything other than an independent contractor in its relationship to BROKER.
B. Non-Exclusive Agreement. CARRIER and BROKER acknowledge and agree that this Agreement does not bind the respective Parties to exclusive services to each other. Either Party may enter into similar agreements with other carriers, brokers, freight forwarders, or shippers.
C. Non-Waiver. Failure of either Party to insist upon the performance of any of the terms, conditions, or provisions of this Agreement, or to exercise any right or privilege herein, or the waiver of any breach of any of the terms, conditions, or provisions of this Agreement, shall not be construed as thereafter waiving any such terms, conditions, provisions, rights or privileges, but the same shall continue and remain in full force and effect as if no forbearance or waiver had occurred.
D. Disputes. In the event of a dispute arising out of this Agreement, including but not limited to Federal or State statutory claims, the Party’s sole recourse (except as provided below) shall be to arbitration. Proceedings shall be conducted under the rules of either the Transportation Arbitration and Mediation PLLC (TAM), American Arbitration Association (AAA), Transportation ADR Council, Inc. (ADR), or the DRC (Fruit and Vegetable Dispute Resolution Corp) for fresh produce related claims at BROKER’s sole discretion. Arbitration proceedings shall be started within eighteen (18) months from the date of delivery or scheduled date of delivery of the freight, whichever is later. Upon agreement of the Parties, arbitration proceedings may be conducted outside of the administrative control of the TAM, AAA, ADR, or DRC. The decision of the arbitrators shall be binding and final and the award of the arbitrator may be entered as a judgment in any court of competent jurisdiction. The rationale and reasoning of the decision of the arbitrator(s) shall be fully explained in a written opinion. The prevailing party shall be entitled to recovery of costs, expenses, and reasonable attorney fees as well as those incurred in any action for injunctive relief, or in the event further legal action is taken to enforce the award of arbitrators. Arbitration proceedings shall be conducted at the office of the AAA, ADR, DRC, or TAM nearest Hoffman Estates, IL, or such other place as mutually agreed upon in writing, or by conference call or video conferencing upon agreement of the Parties, or as directed by the acting arbitration association. Provided, however, either Party may apply to a court of competent jurisdiction for injunctive relief. Unless preempted or controlled by federal transportation law and regulations, the laws of the State of Illinois shall be controlling notwithstanding applicable conflicts of laws rules. The arbitration provisions of this paragraph shall not apply to enforcement of the award of arbitration.
E. No Back Solicitation. Unless otherwise agreed in writing, CARRIER shall not knowingly solicit freight shipments (or accept shipments) for a period of twelve (12) months following termination of this agreement for any reason, from any shipper, consignor, consignee, or other customer of BROKER, when such shipments of shipper customers were first tendered to CARRIER by BROKER. In the event of a breach of this provision, BROKER shall be entitled, for a period of 12 months following delivery of the last shipment transported by CARRIER under this Agreement, to a commission of thirty percent (30%) of the gross transportation revenue (as evidenced by freight bills) received by CARRIER for the transportation of said freight as liquidated damages. Additionally, BROKER may seek injunctive relief and in the event it is successful, CARRIER shall be liable for all costs and expenses incurred by BROKER, including, but not limited to, reasonable attorney’s fees.
F. Confidentiality. In addition to Confidential Information protected by law, statutory or otherwise, the Parties agree that all of their financial information and that of their customers, including but not limited to freight and brokerage rates, amounts received for brokerage services, amounts of freight charges collected, freight volume requirements, as well as personal customer information, customer shipping or other logistics requirements shared or learned between the Parties and their customers, shall be treated as Confidential, and shall not be disclosed or used for any reason without prior written consent. In the event of a violation of this Confidentiality paragraph, the Parties agree that the remedy at law, including monetary damages, may be inadequate and that the Parties shall be entitled, in addition to any other remedy they may have, to an injunction restraining the violating Party from further violation of this Agreement in which case the prevailing Party shall be liable for all costs and expenses incurred, including but not limited to reasonable attorney’s fees.
G. Assignment and Modifications. Neither Party may assign or transfer this Agreement, in whole or in part, without the prior written consent of the other Party. No amendment or modification of the terms of this Agreement shall be binding unless in writing and signed by the Parties.
H. Notices. All notices provided or required by this Agreement shall be made in writing and delivered, return receipt requested, to the addresses shown herein with postage prepaid; or by confirmed (electronically acknowledged on paper) fax, or by email with electronic receipt. The Parties shall promptly notify each other of any claim that is asserted against either of them by anyone arising out of the Parties’ performance of this Agreement. Notices sent as required hereunder, to the addresses shown in this Agreement shall be deemed sent to the correct address unless the Parties are notified in writing of any changes in address.
I. Severance; Survival. In the event any of the terms of this Agreement are determined to be invalid or unenforceable, no other terms shall be affected, and the unaffected terms shall remain valid and enforceable as written. The representations, rights, and obligations of the parties hereunder shall survive termination of this Agreement for any reason.
J. Counterparts. This Agreement may be executed in any number of counterparts each of which shall be deemed to be a duplicate original hereof.
K. Force Majeure. In the event that either Party is prevented from performing its obligations under this Agreement because of an occurrence beyond its control and arising without its fault or negligence, including without limitation, war, riots, rebellion, acts of God, acts of lawful authorities, fire, strikes, lockouts or other labor disputes, such failures to perform (except for any payments due hereunder) shall be excused for the duration of such occurrence. Economic hardships, including, but not limited to, recession and depression, shall not constitute force majeure events.
L. Order of Precedence. In the case of conflict or ambiguity arising between or among this Agreement, the Addenda, or any other document, the order of precedence of document interpretation shall be the applicable Rate Confirmation, the applicable Addenda, and then this Agreement.
M. Entire Agreement. Unless otherwise agreed in writing, this Agreement contains the entire understanding of the Parties and supersedes all verbal or written prior agreements, arrangements, and understandings of the Parties relating to the subject matter stated herein. The Parties further intend that this Agreement constitutes the complete and exclusive statement of its terms and that no extrinsic evidence may be introduced to reform this Agreement in any judicial or arbitration proceeding involving this Agreement.
Addendum A
Food Shipment Addendum
This Food Shipment Addendum (the “Addendum”) to the Broker-Carrier Agreement (the “Agreement”) previously entered into and in effect between BROKER AND CARRIER modifies and supplements the Agreement with respect to CARRIER’s shipment of Food-Grade Products, as that term is defined herein. To the extent that any term, condition, or provision of this Addendum amends, modifies, or is inconsistent with the Agreement, the term, condition, or provision of this Addendum shall control and prevail. Terms not otherwise defined in this Addendum shall have the meanings ascribed to such terms in the Agreement.
1. Food Products. For the purposes of the Agreement, this Addendum, and all applicable Rate Confirmations, “Food Products” shall include, but not be limited to, any substances, whether in raw, processed, or packaged form, that are intended for human or animal consumption and ingestion. This definition encompasses, without limitation: (a) fresh produce, including fruits, vegetables, and herbs; (b) grains, cereals, and their byproducts; (c) meat, poultry, fish, and seafood products; (d) dairy products and eggs; (e) processed and packaged foods; (f) beverages, including alcoholic and non-alcoholic drinks; (g) confectionery and baked goods; (h) dietary supplements and nutraceuticals; (i) food additives, flavorings, and colorings; (j) animal feed and pet food. This definition also includes primary packaging materials that come into contact with food products during storage or transportation. In case of any ambiguity, the term “Food Products” shall be interpreted broadly to ensure the highest standards of safety and compliance in transportation and handling.
2. Shipments of Food Products. CARRIER shall comply with the laws and regulations governing the safe and secure transportation of shipments consisting of Food Products that will ultimately be consumed by humans or animals (“Food Shipments”), including those required by local, provincial, state, and federal laws, regulations, ordinances and rules including, but not limited to, the Food Safety Modernization Act (21 U.S.C. § 2201, et. seq.), Federal Food, Drug, and Cosmetic Act (“FFDCA”) and all applicable implementing regulations, including the U.S. Food and Drug Administration’s (“FDA”) regulation addressing Sanitary Transportation of Human and Animal Food (21 C.F.R. Part 1, Subpart O (§ 1.900 et seq.)), as in effect from time to time (collectively, the “Food Safety Laws”). CARRIER further agrees as follows:
A. CARRIER shall ensure that all vehicles and transportation equipment that will be used in providing the Services, including transporting Food Shipments, are in an appropriate sanitary condition and satisfy the conditions set forth in Section 2 of this Addendum (the “Sanitary Conditions”).
B. CARRIER shall assign competent supervisory personnel to ensure all services are carried out in compliance with the requirements set forth in this Section and the Food Safety Laws.
C. CARRIER shall take effective measures, such as segregation, to protect Food Products from contamination by raw foods and nonfood items transported in the same load.
D. If CARRIER becomes aware of a possible material failure of temperature control or other conditions during transportation or handling that may render the Food Products unsafe, CARRIER shall not sell or otherwise distribute such food, and the CARRIER must take appropriate action including, as necessary, communication with BROKER, to ensure that the food is not sold or otherwise distributed unless a determination is made by a qualified individual that the temperature deviation or other condition did not render the food unsafe.
E. CARRIER shall develop and implement written procedures that: (i) specify practices for cleaning, sanitizing when necessary, and inspecting vehicles and transportation of equipment to ensure they are maintained in an appropriate sanitary condition; (ii) describe how CARRIER will comply with the requirements under this Section to demonstrate that it maintained appropriate temperature conditions during shipment, when applicable; (iii) record traceability of transportation equipment, including previous cargo hauled and any maintenance and intervening cleaning procedures for docks and equipment; (iv) establish appropriate training processes for each person under CARRIER’s supervision or control involved in providing the Services; and (v) before loading Food Products, CARRIER must confirm that the applicable vehicle or transportation equipment is in appropriate sanitary condition for the transport of such food in accordance with the Sanitary Conditions.
3. Equipment Requirements. CARRIER shall ensure that all equipment, including but not limited to trailers, containers, and other storage units, used for the transportation of Food Products meets the following requirements:
A. The equipment must be thoroughly cleaned and sanitized before loading and must be free from any odors that could potentially affect the quality, safety, or integrity of the Food Products being transported;
B. The interior/exterior must be free of any damage that could affect the Food Products (e.g., holes in the ceiling, container walls intact, protrusions in the floor);
C. Door closure and door seals must be completely intact and prevent entry of water, pests, dirt, and other foreign substances as well as maintain temperature for applicable loads;
D. The equipment floor should be ribbed or channeled construction for refrigerated loads (a flat floor design is acceptable if the product is stacked on pallets or remains on the trailer for less than four (4) hours, or the load is ambient);
E. The refrigeration unit must be: (i) free of external damage, unusual noises, and error codes that may indicate a malfunction; and (ii) equipped with a temperature display device that is capable of displaying the set point and actual temperature of the unit;
F. The equipment must be dry and free of any general condition that would adversely affect Food Product safety during transportation, as well as free of contaminants, mildew, mold wood chips, pallet splinters, dirt, filth, and other objectionable debris, the abnormal presence of moisture, water, or chemical that may have been the result of trailer leaks or improper cleaning, and any signs of insects, rodents, or other pest activity; and
G. The equipment used for Food Products must have never been used to transport hazardous materials, including but not limited to: waste, refuse, garbage, trash, fertilizers, herbicides, or solid or liquid waste of any kind whatsoever, whether hazardous or non-hazardous, or any other substances that could pose a risk of contamination to Food Products.
4. Security Seal Procedures for Food Products. These security seal procedures (the “Security Seal Procedure”) address the requirements for the application and removal of uniquely identified devices, such as, but not limited to seals (all such devices being referred to herein as “seals”) from trailers or containers for shipments tendered to CARRIER. The Security Seal Procedures apply to all loads tendered to CARRIER where a seal has been presented to the driver by the shipper or where the shipper has affixed a seal to the door(s) of the trailer or container. Only authorized personnel can remove the seal(s) upon arrival at the destination site unless required by in-transit inspections (DOT or other regulatory agencies, including but not limited to law enforcement) or special requirements known to BROKER. Exceptions must be investigated and documented in accordance with the specific procedures presented herein and immediately communicated to BROKER. In addition to any language in the Rate Confirmation, CARRIER and its drivers will comply with the Security Seal Procedure identified below.
A. Product Loading.
i. All trailers or containers shall be inspected before loading to ensure compliance with standard Food Safety Laws and ensure any seals from the previous trip are removed.
ii. All Food Products whether double stacked, palletized, or slip sheeted shall be appropriately blocked and braced to eliminate potential damage.
iii. Once loaded, the trailer or container doors (including side doors) shall be sealed with the shipper’s uniquely identified device (“seal”) and recorded on the transport documents. Each seal number will be recorded along with the vehicle trailer or container number, date, CARRIER name, etc. by the person (shipper) applying the seals. CARRIER’s driver must send a picture of the seal intact on the trailer or container doors and of the BOL to BROKER’s dispatch or a penalty will be assessed
iv. The use of key or combination locks in lieu of seals for transported materials does not constitute a sealed load. Although the locks provide a greater level of security, the key protocol required to maintain lock access integrity adds another level of risk to raw material and finished product shipments. All loads must have a seal(s) securing the vehicle during transport.
B. Product Transport.
i. If the seal is broken in the event of an in-transit regulatory inspection (DOT, Ag Dept., law enforcement, etc.) or the driver believes the load has shifted and needs to be inspected and secured, CARRIER’s’s driver must have additional seals with him and must reseal the door(s) after the inspection is completed and record the new seal numbers on the transport documents. Such procedures should be avoided, except in circumstances where the safe transport of the cargo is at issue. In such instances, CARRIER must call BROKER in advance of removing the seal (if possible, without compromising safety) so that potential removal of the seal can be coordinated with the shipper or other party in interest. After affixing the seal, the driver must also record the date, time, and circumstances surrounding the in-transit regulatory inspection on the transport documents.
ii. Drivers shall not leave an open, unlocked, or unsealed trailer or container unattended at any time.
iii. Where a shipment is being relayed by two or more drivers, the subsequent driver(s) must visually verify the trailer or container seal integrity and that the transport documents accurately record the correct seal numbers and indicate such inspection on the shipping documents.
C. Product Delivery.
i. When arriving at the receiver’s (consignee) facility, a receiving location employee must verify seal integrity and ensure the seal numbers match those on the driver’s transport documents. Only the receiving location’s designated individual may remove the seals once verified to match the driver’s transport documents, and neither CARRIER nor its driver or others shall remove a seal, except in the immediate presence of and at the instruction of a receiver. CARRIER’s driver is responsible for ensuring that the receiver signs the BOL as “SEAL INTACT.”
2. In the absence of a receiving location employee for off-shift deliveries or otherwise unattended locations, the driver assumes responsibility for the load until final inspection and subsequent receipt at the location. In the event a load or part of a load is rejected by the receiver, the load must be re-sealed by the receiver and the seal number noted on the Bill of Lading along with the rejection reason pending disposition or resolution of the issue.
5. Temperature-Control Procedures. These temperature-control procedures (the “Temperature-Control Procedures”) address the requirements for the transportation of Food Products tendered to CARRIER when maintaining the temperature of the Food Products is required and conveyed through written communication including, but not limited to the Rate Confirmation provided by BROKER or a Bill of Lading provided by the shipper. This is to ensure that all Food Products are shipped pursuant to applicable Food Safety Laws. CARRIER shall ensure temperature control and indicator devices are calibrated and in working condition at the specific temperature required for the Food Products shipped. It is the responsibility of the CARRIER to immediately notify BROKER (a written notification must be sent after any communication via phone) when the temperature of the Food Products may have been compromised. Exceptions must be investigated and documented in accordance with the specific procedures presented herein and immediately communicated to BROKER. In addition to any language in the Rate Confirmation, CARRIER and its drivers will comply with the Temperature-Control Procedures identified below.
A. Product Loading.
i. Before loading any Food Products requiring temperature control, CARRIER must verify that each mechanically refrigerated cold storage compartment or container to be loaded is adequately prepared for the transportation of such Temperature Controlled Food, including that such compartment or container has been properly pre-cooled when required, considering the Temperature Control Standards.
ii. The trailer or container doors should only be opened when the shipper is ready to load the trailer or container.
iii. Once loaded, the trailer or container doors (including side doors) shall be closed and sealed with the Shipper’s uniquely identified device (“seal”) and recorded on the transport documents. Each seal number will be recorded along with the vehicle trailer or container number, date, and CARRIER name by the person (shipper) applying the seals.
B. Product Transport.
i. If there is no electronic temperature warning system in place on the reefer unit, then the driver must keep a written log checking the temperature of the Reefer unit as often as possible but no less than three (3) times a day.
ii. Unless otherwise stated in a Rate Confirmation or the bill of lading. Upon inspection, if the temperature of the Reefer unit varies from the original setting greater than two (2) degrees plus or minus, the driver must inspect the reefer unit to determine the problem. If the temperature reefer unit continues to fail, then the CARRIER must do everything in its power to correct the problem immediately and notify Seal of the situation.
C. Product Delivery.
i. When arriving at the receiver’s (consignee) facility, a receiving location employee must verify the temperature of the reefer unit to ensure the temperature matches those on the instructions provided regarding temperature control with respect to the Food Products.
ii. CARRIER’s drivers will not open the trailer or container doors until the consignee has directed him to do so and is ready to offload the Food Products.
iii. If required and made available by the receiver, CARRIER’s driver must be present and witness any product temperature recording upon delivery and note the measurements on all copies of the delivering receipt.
6. Liability Related to Food Shipments.
A. CARRIER agrees that Food Shipments that have been transported or offered for transport, pursuant to this Agreement and Addendum, under conditions that are not in compliance with the written instructions or requirements set forth in the shipping document(s), including any seal, temperature, quality control standards and delivery date requirements, will be considered “adulterated” within the meaning of the FFDCA (21 U.S.C. §§ 342(a)(i)(4), 342(i)). CARRIER understands that adulterated shipments may be refused by the shipper, consignee, or receiver upon their tender for delivery at the destination, with or without inspection.
B. CARRIER assumes liability for the result of a breach of any of the foregoing requirements specified in this Addendum. CARRIER agrees that BROKER is not responsible for and shall in no way be held liable to CARRIER for CARRIER’s or any shipper’s consignee’s, receiver’s, or loader’s obligations or their failure to adhere to their respective obligations under the laws and regulations governing the safe and sanitary transport of food for human consumption, including the Food Safety Laws referenced above herein.