General Terms And Conditions For Depot Services

General Terms And Conditions For Depot Services

CAI and Depot have entered into/or anticipate entering into an agreement related to the storage and/or repair of certain intermodal shipping Equipment, including but not limited to 20’ and 40’ dry van, open top, flat rack, refrigerated and other specialized shipping Equipment (individually and collectively, the “Equipment”), pursuant to an arrangement whereby such transaction will be governed by these General Terms and Conditions containing the specific commercial terms and conditions relating to particular Equipment (these General Terms and Conditions and any Depot Services Agreement from time to time entered into by the parties are referred to herein collectively as the “Agreement”).

  1. TERM OF AGREEMENT
    This Agreement will remain in effect until terminated pursuant to Section E or F below.
  2. SERVICES TO BE PROVIDED BY DEPOT
    1. Basic Services
      In consideration of the services and functions described in Sections 1(a) through 1(g) below and other services as Depot may perform as a depot manager at the Facilities as requested by CAI, CAI agrees to pay to Depot the rates and fees for services as described in Schedule A (the “Services”). Depot agrees to perform the Services in accordance with the specifications set forth in the latest version of CAI’s Depot M&R Manual (the “Manual”), a copy of which Depot acknowledges receipt and which, together with any modifications, amendments, revisions or updates thereof, form a part of this Agreement, and in particular but without limitation, Depot will:
      1. Inspection, Storage and Repair of Equipment
        Inspect such Equipment as may be delivered to the Facilities both upon delivery to the Facilities and prior to release by Depot of such Equipment from the Facilities (in each case upon receipt from CAI of the appropriate Acceptance or Release Number, as applicable, in accordance with the Manual), supervise the storage of the Equipment at the Facilities, and maintain and/or repair the Equipment in accordance with the Manual and the applicable IICL Repair Manuals in effect from time to time. In the event of a conflict between the repair standards set forth in the Manual and in the IICL Repair Manuals, the CAI repair standards as set forth in the Manual will prevail. Depot will, upon not less than 24 hours’ notice, make Equipment available for reinspection by CAI, CAI’s customers or their respective representatives, in each case free of handling or other charges. In the event that Depot fails to note damage to any Equipment in the Equipment Interchange Report issued by Depot pursuant to Section B(1)(e) hereof, Depot will be responsible to CAI for the cost of repairing such omitted damage.
        1. Inspection of Equipment shall be performed by Depot personnel who are knowledgeable of the most recent industry standards and IICL repair standards for all Equipment types.
        2. Repairs to Equipment shall be performed by Depot personnel who are knowledgeable of the most recent industry standards and IICL repair standards and qualified in industrial structural steel repairs including but not limited to welding, fitting and fabrication for all Equipment types.
        3. Inspection and repair to refrigerated Equipment shall be performed by Depot personnel who are qualified and knowledgeable of most recent standards of various box manufacturers as well as refrigeration machinery (cooling unit) manufacturers.
      2. Depot Resources
        Provide such labor, furniture, tools, fittings, materials and spare parts as may be necessary for the proper carrying out of the Services under this Agreement, including, without limitation, proper equipment for lifting and handling the Equipment.
      3. Reporting
        Report daily via Electronic Data Interchange (EDI) messaging format and protocol or an alternative format agreed by the parties to CAI headquarters by reference to Equipment numbers (i) all movements of Equipment to and from the Facilities (which Equipment may be accepted or released only against CAI’s Acceptance or Release Number, as applicable, in accordance with the Manual), (ii) details of damage found to have been suffered by the Equipment, (iii) repair authorizations for damaged Equipment received from CAI’s customers or their representatives when Depot has been instructed to seek such authorizations from CAI’s customers, and (iv) repairs and maintenance carried out on the Equipment located at the Facilities.
      4. Customer Invoicing
        Submit damage estimates and invoices to CAI and/or its customers as instructed by CAI as per the Manual or by any revision, modification or update thereof. Comply with such instructions as may be given by CAI as to the customer of CAI or customer’s representative to be invoiced in respect of repair and/or maintenance work carried out by Depot, and in respect of handling-in and/or handling-out charges incurred in connection with the Equipment.
      5. Equipment Interchange Report
        Complete an Equipment Interchange Receipt (hereinafter “EIR”) in accordance with the Manual for each item of Equipment delivered to or released from the Facilities. Depot shall be responsible without exception for obtaining on said EIR the signature of the customer/carrier or its trucker/representative returning or taking delivery of such item of Equipment and all of the other information required by such EIR. If so directed, Depot will forward copies of the EIR to CAI without delay to CAI’s local office or to such other address as is from time to time notified to Depot, and Depot’s copy will be retained for a minimum of five (5) years from the date of issuance.
      6. Repair Authorizations
        Depot will not make any repair to any item of Equipment without written or faxed authorization (with specific reference to such item of Equipment’s identification number) from CAI or from CAI’s customer (or such customer’s local representative) if CAI directs Depot to seek authorization for the repair from such customer or representative. If Depot is directed to seek authorization for repair work from CAI’s customer, Depot shall look to such customer exclusively for payment of any and all work or Services performed by Depot pursuant to the authorization received from such customer or its representative. Under no circumstances will CAI be responsible to Depot for the cost of any repair or maintenance work performed by Depot on any item of Equipment unless such repair or maintenance work was performed pursuant to an authorization from CAI to perform such work for CAI’s own account.
      7. Facilities Access
        Provide access to CAI’s representatives at all reasonable times to the Facilities and to such other locations at which Depot shall from time to time maintain records with respect to this Agreement and to the Equipment for the purpose of inspecting the work or Services being carried out by Depot and of inspecting all records, invoices and other documents maintained by Depot in connection with the work being performed by it on CAI’s behalf.
    2. Additional Requirements
      1. CAI Direction
        In the performance of the Services under this Agreement, Depot will comply with all reasonable directions given by CAI or its representative to Depot.
      2. Subcontracting
        Depot will not subcontract, assign nor delegate to any third party any of its obligations under this Agreement without CAI’s prior written or facsimile transmitted consent unless such subcontracting, assignment or delegation is specifically permitted on Schedule A to this Agreement. Any subcontracting, assignment, or delegation is considered null and void.
      3. Outside Contractors
        CAI reserves the right to seek cost estimates from third parties with respect to repair and/or maintenance work or modification of any of the Equipment located from time to time at the Facilities and to have such work performed by any such third parties. Depot agrees to permit such third-party contractors to remove and return items of Equipment from and to the Facilities, subject in such cases to the payment of normal handling out and handling in charges by CAI.
      4. Independent Contractor Status
        It is recognized by the parties hereto that Depot is an independent contractor providing Services to CAI on a contractual basis only, and that no other relationship, whether legal or financial, exists between Depot and CAI. Depot will not at any time while this Agreement remains in force or thereafter use CAI’s name or logo in connection with its business or hold itself out as CAI’s representative in any way to any third party without CAI’s prior written or facsimile transmitted permission.
      5. Nondisclosure
        Depot will not while this Agreement remains in force or thereafter disclose to any person not a director, officer, employee or representative of CAI any information of any kind relating to CAI’s business.
  3. INVOICING
    1. Self Billing. Each month, CAI will issue an invoice for such month (the “PO”) to Depot for all storage, handling, and repair sums due from CAI to Depot. CAI will do so no later than ten (10) business days following the month in which Depot earned such sums. Upon receipt of such PO, Depot agrees to review the PO and send written approval to CAI. Once CAI receives such written approval, CAI will, within forty-five (45) days, pay all sums due under such PO.
    2. Invoices for Other Services. For sums other than those detailed in Section C(1), Depot must invoice CAI. Such invoices must comply with the Manual. Depot must issue such invoices no later than ten (10) business days following the month in which Depot earned such sums. Upon receipt of any such invoice, CAI will, within sixty (60) days, (i) pay all sums due under such invoice, or (ii) notify Depot that CAI disputes some or all sums due under such invoice. If CAI notifies Depot of a dispute, CAI may withhold payment. Upon such notification, Depot must, within thirty (30) days, reconcile the dispute. By the end of such period, Depot must issue CAI a credit, provide CAI verification of correct billing, or both. Once CAI receives such credits or verifications, CAI agrees to pay any remaining sums due under such invoice.
    3. Offsets: Sums Due to CAI. Such sums as may be due from Depot to CAI from time to time will be offset against the sums due to Depot from CAI, as mutually agreed, pursuant to this Agreement. However, if no monies are then due to Depot pursuant to Clause C(1) hereof, the sums due to CAI will be invoiced by CAI from time to time and will be paid by Depot to CAI within sixty days of receipt of the invoices therefor.
  4. LIABILITY AND INSURANCE
    1. Depot will use diligent care to protect the Equipment and any other property belonging to CAI at any time in its possession against loss, theft, damage and destruction from any cause whatsoever, whether or not beyond Depot’s control, and will be liable to CAI for any loss or damage whatsoever in relation to such Equipment and/or other property. In the event of loss of, damage to or destruction of Equipment or other CAI property located at the Facilities or at any other premises controlled by Depot, Depot will, notwithstanding Section D(3) below, pay to CAI when invoiced therefor, as applicable, the repair cost for such Equipment or CAI property, the Casualty Value of such Equipment (as set forth in Section D(4) below), or the replacement cost of such other CAI property. In addition, Depot will be liable to CAI for any financial loss of any kind suffered by CAI as a result of or in connection with any loss, theft or destruction of or damage to such Equipment or other CAI property arising from any failure by Depot properly to perform the Services under this Agreement. Depot’s obligations under this Section are separate from and independent of those set forth in Section D(3) of this Agreement.
    2. Depot will indemnify and hold CAI harmless from and against all expenses, losses, liabilities, damages and costs of any kind or nature, including, but not limited to, legal fees and costs which are incurred by CAI or for which CAI may become liable, directly or indirectly, by reason of or in connection with any accident or occurrence resulting in: loss or destruction of or damage to the Equipment while located at the Facilities or while under Depot’s control, personal injury, illness, death, loss of wages and/or earning capacity, and/or loss of or damage to any property which may arise at the Facilities or any other premises controlled by Depot or as a result of or in any way connected with the repairs or maintenance carried out by Depot on any of the Equipment or otherwise respecting the Equipment provided that said indemnity will not extend to liability for personal injury, illness, death and/or loss of or damage to any property solely caused by (i) the negligence of CAI, its directors, officers, employees or representatives; or (ii) a defect in any item of Equipment not related to maintenance or repair work performed by Depot. Furthermore, Depot agrees to indemnify and hold CAI harmless from and against any and all losses, damages, costs and expenses (including, without limitation, expenses in prosecuting or defending any claim or suit) with respect to loss or destruction of or damage to the Equipment while located at the Facilities or under Depot’s control, and any and all exclusions, deductibles and coinsurance obligations contained in the insurance policies required to be provided by Depot under Section D(3) of this Agreement. Depot’s obligations under this Section are separate from and independent of those set forth in Section D(3) of this Agreement.
    3. Depot will, before commencing any work of any kind on behalf of CAI, obtain from one or more reputable insurance companies a policy or policies of insurance reasonably satisfactory to CAI insuring against the risks and for at least the minimum limits of coverage set forth below (containing only standard exclusions and reasonable deductibles and/or co-insurance provisions) and will keep said policies, or acceptable replacements therefor, in effect throughout the term and during any wind-down period of this Agreement. Depot will provide CAI with evidence of renewal or acceptable replacement(s) of said policies prior to their respective expiration date(s) for so long as Depot’s obligations under this Section remain in effect. Depot will cause CAI to be named as additional insured and loss payee under such policies as its interests may appear, and shall periodically furnish CAI with certificates of insurance issued by the underwriters of such policies acknowledging CAI’s status as aforesaid and describing the coverages and principal exclusions of such policies. Depot shall also, upon written request from CAI, provide CAI with certified copies of all policies purchased by Depot from time to time in compliance with Depot’s obligations under this Section. In the event that Depot fails to pay renewal premiums for any policy required under this Section or otherwise to procure and maintain in effect policies of insurance in compliance with this Section, CAI may pay any such renewal premiums on Depot’s behalf or procure conforming insurance coverages on Depot’s behalf and may recover any sums expended therefor together with interest and reasonable administrative costs, from Depot. Depot’s purchase of insurance coverages in compliance with this Section D(3) shall not relieve Depot of any related obligations of Depot under Sections D(1) or D(2) of this Agreement to the extent that Depot’s liabilities to CAI thereunder exceed such insurance coverages and/or any benefits paid to CAI thereunder.
      1. Comprehensive General Liability including products liability: US$1,000,000.00 combined aggregate for bodily injury and/or property damage per accident or occurrence (including US$1,000,000.00 per person bodily injury.)
      2. All risks physical loss and damage: US$500,000.00 per event of loss.
    4. In calculating the Depreciated Casualty Value (“DCV”), as set forth below, the Casualty Value of the container is depreciated down to a value not less than fifty percent (50%) of the Casualty Value. The depreciation is calculated on a straight-line basis using a 15-year life span for the container with a fifteen percent (15%) residual value.
Container TypeCasualty Value
20′ Dry VanUS$2,700.00
40′ Dry VanUS$4,375.00
20′ High CubeUS$2,975.00
40′ High CubeUS$4,760.00
45′ High CubeUS$6,000.00
20′ Open TopUS$4,250.00
40′ Open TopUS$6,500.00
20′ Flat RackUS$6,000.00
40′ Flat RackUS$7,500.00
20′ ReeferUS$17,000.00
40′ ReeferUS$21,000.00
40′ 100T RolltrailerUS$26,000.00
62′ 100T RolltrailerUS$43,000.00
  1. DEPOT CHARGES
    1. Depot may not prior to the first anniversary of the effective date of this Agreement request any increase to the charges set forth on Schedule A hereto. Thereafter Depot may propose an increase in any of such scheduled charges with thirty (30) days’ prior written notice to CAI. Depot’s proposed increase to the existing scheduled charges shall only become part of this Agreement upon execution by CAI and Depot of a written addendum hereto incorporating such modifications. If CAI fails to reach agreement with Depot with respect the proposed increases within the thirty (30) day notice period, Depot may, following the expiration of the notice period, give written notice to CAI of its election to terminate this Agreement, such termination to take effect not less than one hundred twenty days following the date of receipt by CAI of the termination notice. Any Equipment remaining in the Facilities on the effective date of termination of this Agreement pursuant to this Section (other than Equipment currently undergoing or awaiting repair or maintenance work) shall become subject to Depot’s then-current charges for new customers. Following termination of this Agreement pursuant to this Section, CAI shall have ten (10) business days following the completion of repair and/or maintenance work on any items of Equipment in progress or awaiting estimation on the effective termination date to remove such items from the Facilities prior to incurring any charges for such items at Depot’s rates for new customers.
    2. Depot agrees to follow the CAI schedules for labor hours and follow procedures as stated in the latest version of the CAI Depot M&R Manual.
    3. CAI shall not be obligated to Depot for any cost associated with movement of the Equipment in the Depot Facilities unless specifically requested by CAI in writing. In the event that CAI will require access to Equipment for inspection, lease-out or sale which is inaccessible due to positioning of such Equipment in a stack, Depot may charge CAI a digging fee (“Digging Fee”) to retrieve such Equipment. Any mutually agreed Digging Fee, if applicable, shall be included on Schedule A attached hereto.
  2. TERMINATION OF THE AGREEMENT
    1. Either party may terminate this Agreement without cause following the first anniversary of the effective date hereof by giving ninety (90) days’ prior written notice of termination to the other party hereto. This Section F(1) shall not apply in the event Depot elects to terminate the Agreement pursuant to Section E for failure to reach agreement with CAI on an amended schedule of charges.
    2. Either party may terminate this Agreement for default if the other party hereto fails to comply with any of the terms of this Agreement or of any modification thereof by giving thirty (30) days’ prior written notice of termination for default to the defaulting party, specifying therein the details of such default.
    3. If a Receiver is appointed for Depot or Depot goes into liquidation, whether compulsory or voluntary (except for consolidation with or amalgamation into a solvent company), or any form or bankruptcy proceeding is filed by or against Depot, or if Depot enters into an arrangement with its creditors or suffers any distress or execution on its property, this Agreement will terminate immediately and without notice.
    4. If Depot ceases to be actively in the business of operating a container depot, if effective control of Depot passes out of the hands of [•] or if Depot proposes to relocate the operations presently conducted at the Facilities to other premises, CAI may terminate this Agreement by written notice of termination delivered to Depot sixty (60) days or such shorter period of time as may exist prior to the effective date of such cessation of operations, change of control or relocation of operations. Whether CAI elects (i) to terminate this Agreement as aforesaid and move all CAI Equipment located in Depot’s current facility to alternative depot facility/ies reasonably acceptable to CAI, or (ii) to ratify such change in control and/or relocation of Depot’s operations, all costs associated with modification of this Agreement and relocation of the Equipment in Depot’s current facility (including, but not limited to drayage, handling, documentation and insurance) shall be for the account of and paid by Depot as provided by Section C(2) hereof.
    5. Immediately upon the effective termination date of this Agreement (as provided in this Section or in Section E above), Depot will make available for pick-up by CAI all Equipment then in its possession. If any item of Equipment (other than an item of Equipment delivered to Depot in damaged condition, the repair cost of which has not yet been estimated or an item in the course of repair or maintenance pursuant to Section F(7), below) is not made available to CAI within three (3) working days of the effective date of termination of this Agreement, Depot agrees to pay CAI rental charges at CAI’s then current spot lease rate for a like item of Equipment for each day that such item of Equipment remains in the possession of Depot and to indemnify CAI against all costs and expenses of any kind, including, but not limited to, legal costs and fees, which CAI may incur as a result of or in connection with Depot’s failure to make such Equipment available to CAI.
    6. Immediately upon the effective termination date of this Agreement, all customer lists, operations manuals, and other documents or property belonging to CAI which is in Depot’s possession will be returned promptly to CAI.
    7. Immediately upon the effective termination date of this Agreement, all customer lists, operations manuals, and other documents or property belonging to CAI which is in Depot’s possession will be returned promptly to CAI.
    8. If any item of Equipment has been delivered to Depot in damaged condition and the cost of repair has not yet been estimated or any item of Equipment is under repair or maintenance at the effective date of termination of this Agreement, Depot will, upon CAI’s request, make such repair estimate and complete the said maintenance or repair work, which work will be invoiced and paid for in accordance with the terms of this Agreement.
    9. Depot will at no time while this Agreement remains in force or thereafter assert any lien of any kind, whether materialman’s, mechanic’s, workman’s, repairman’s, employee’s, drayman’s, garage-man’s or any other like liens arising in the ordinary course of business or by operation of law against any of the Equipment or any other property of CAI.
    10. The termination of this Agreement for any reason will not release either party from the obligation to pay any sums which may be owing to the other party or from the obligation to perform any duty or discharge any liability arising before such termination.
    11. CAI WILL NOT BE LIABLE TO DEPOT WHILE THIS AGREEMENT IS IN FORCE, OR AFTER THE TERMINATION THEREOF FOR ANY REASON WHATSOEVER, FOR ANY CONSEQUENTIAL OR ECONOMIC LOSS WHATEVER, WHEREVER, AND HOWEVER ARISING, INCLUDING, WITHOUT PREJUDICE TO THE GENERALITY OF THE FOREGOING, ANY LOSS OF PROFITS, PRESENT OR PROSPECTIVE, OR ANY LOSS IN CONNECTION WITH ANY EXPENDITURE, INVESTMENT, OR COMMITMENT MADE BY DEPOT RELATING TO THIS AGREEMENT OR DEPOT’S DUTIES HEREUNDER.
  3. CONTAINER PURCHASE AND SALES
    1. Provided that this Agreement has not then been terminated and further provided that Depot is not then in default of its obligations hereunder, CAI may from time to time sell Equipment to Depot in quantities as mutually agreed in writing.
    2. Upon receipt of Depot’s notice to purchase such Equipment (“Purchase Date”), CAI will issue an invoice to Depot for the purchase price of the Equipment. Storage charges for the Equipment purchased shall discontinue on the Purchase Date. Title for the Equipment shall pass to Depot upon payment of the purchase invoice in full therefor on an AS-IS/WHERE-IS basis. Any taxes or duties which become payable by virtue of the transfer of title shall be for the Depots account.
    3. Equipment purchased by Depot shall not be subject to any further Depot Service charges including but not limited to storage, handling, digging, labor or repair fees subsequent to the Purchase Date.
    4. Notwithstanding any presumption created by law regarding title to the Equipment covered by this Agreement, it is the expressed, negotiated intention of the parties that CAI shall retain title to all such Equipment until Depot elects to purchase any Equipment and makes payment of the purchase price for such Equipment in accordance with the terms hereof.
    5. In the event that Depot has performed Services pursuant to Section B of this Agreement for the inspection and estimate of Equipment which is sold to a CAI customer without repair, Depot may charge CAI an administrative fee (“Admin Fee”). Such Admin Fee shall apply only to Equipment which has (i) been inspected and estimated and recorded on the EIR, and (ii) did not receive repairs according to such EIR. Any mutually agreed Admin Fee, if applicable, shall be included on Schedule A attached hereto.
  4. MISCELLANEOUS
    1. Notices
      1. All notices required or permitted to be given by Depot to CAI pursuant to this Agreement shall be sent to the following address:
        CAI International, Inc.
        Steuart Tower
        1 Market Plaza, Suite 2400
        San Francisco, CA 94105
        Attention: Contracts Department
        Email: contracts@capps.com
        Tel: 415-788-0100
      2. All notices required or permitted to be given by CAI to Depot pursuant to this Agreement shall be sent to the address set forth in the Depot Services Agreement.
        • Any such notice shall be deemed to have been duly given or made and to have become effective (i) if delivered by hand, overnight courier, or facsimile to a responsible officer of the party to which it was addressed at the time of receipt thereof by such officer or the time stamp of such facsimile, and (ii) if sent by registered, certified or first-class mail, postage prepaid, on the fifth business day following the mailing thereof.
    2. Limitation on Assignability
      Depot will have neither the right nor the power to assign its interest in this Agreement nor to delegate the Services hereunder (except as otherwise expressly provided herein or on Schedule A hereto). Any assignment or delegation is considered null and void.
    3. Governing Law
      THIS AGREEMENT (INCLUDING SCHEDULE A AND ANY ADDENDA OR AMENDMENTS HERETO) (A) CONSTITUTE THE COMPLETE AGREEMENT BETWEEN THE PARTIES REGARDING THE SUBJECT MATTER OF THIS AGREEMENT AND REPLACE AND SUPERSEDE ANY PRIOR UNDERSTANDINGS OR AGREEMENTS REGARDING THE SAME, (B) IS BINDING UPON THE PARTIES, THEIR PERMITTED SUCCESSORS AND ASSIGNS AND SHALL BE CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE UNITED STATES OF AMERICA, AND EXCEPT WHERE INCONSISTENT THEREWITH, WITH THE LAWS OF THE STATE OF CALIFORNIA, AND (C) MAY ONLY BE AMENDED OR MODIFIED PURSUANT TO A WRITTEN INSTRUMENT SIGNED BY BOTH CAI AND DEPOT. WITH RESPECT TO ANY CLAIM OR CONTROVERSY ARISING OUT OF OR RELATING TO THIS AGREEMENT, CAI MAY REQUIRE THAT ANY DISPUTE OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL, AT CAI’S SOLE OPTION AND DISCRETION, BE BROUGHT ONLY IN STATE OR FEDERAL COURTS HAVING JURISDICTION OVER THE CITY AND COUNTY OF SAN FRANCISCO OR BEFORE THE AMERICAN ARBITRATION ASSOCIATION IN SAN FRANCISCO UNDER ITS COMMERCIAL ARBITRATION RULES. DEPOT CONSENTS TO JURISDICTION AND VENUE IN THOSE COURTS. CAI MAY OPT TO COMMENCE OR ALLOW PROCEEDINGS IN ANY OTHER JURISDICTION.
    4. Counterparts
      This Agreement may be executed in multiple counterparts all of which, taken together, shall be deemed to constitute but one and the same instrument.
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