EXHIBIT 10(j)
Master Lease Agreement
Silsbee Trading
and Transportation Corp., a Texas Corporation, hereinafter "STTC"),
with an address at P. O. Box 695, Silsbee, Texas 77656, agrees to
lease to South Hampton Resources, Inc., a Texas Corporation,
(hereinafter "SHRCO"), with an address at P. O. Box 1636, Silsbee,
Texas 77656, which agrees to lease from STTC the Vehicles and
Equipment described in the Exhibits attached
hereto. This Master Lease Agreement shall be the
defining document for terms and conditions for the lease of each
vehicle or equipment or other asset specifically delineated on an
addendum which shall be completed for each individual asset, unless
said addendum specifically changes a term or condition as it
applies to that asset. This Master Lease Agreement shall be
in effect for as long as an individual piece of equipment or asset
is being leased under the date and term established by the addendum
for that asset. Upon expiration or termination of the Vehicle
lease, SHRCO shall return the vehicles to STTC at its location at
Highway 418 in Hardin County, Texas, in the same condition and
appearance as when received, ordinary wear and tear
excepted. Any holding over after the expiration of the
Vehicle lease shall be on a month-to-month basis and subject to all
the terms of this Lease.
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MAINTENANCE
AND REPAIR . STTC agrees, at its own cost and
expense, to provide with respect to the Vehicles
leased,: (a) all preventive maintenance, replacement
parts, and repairs to keep the Vehicles in good repair and
operating condition; (b) oil and lubricants necessary for the
efficient operation of the Vehicles; (c) all necessary tires and
tubes; (d) road service due to mechanical and tire failures; (e)
periodic exterior washing; (f)initial painting and lettering of
each Vehicle according to SHRCO specifications at the time the
Vehicle is placed into service, at a cost not exceeding 1% of the
initial cost of the vehicle, excluding taxes. In the
event any Vehicle shall be disabled for any reason, SHRCO and/or
its driver shall immediately notify STTC. SHRCO agrees
that it will not cause or permit any person other than STTC or
persons authorized by STTC to make any repairs or adjustments to a
Vehicle, and shall abide by its directions concerning
emergency
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repairs. In the event a Vehicle is
disabled due to mechanical or tire failure, STTC shall, within a
reasonable period of time after receipt of notification, properly
repair, or cause the repair of, the Vehicle. SHRCO will
cause its drivers to report any trouble concerning the Vehicle not
later than the date of occurrence and to check oil and coolant
levels in each Vehicle on a daily basis to prevent
damage.
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VEHICLE
LEASE SERVICE AGREEMENT. STTC will provide for inspections, preventive
maintenance, and routine repairs in such a manner and at such times
as to minimize the disruption of the normal use of the
Vehicle. SHRCO will deliver the Vehicles to the repair
facility and pick them up as needed after repairs or maintenance is
completed. Any tow charges resulting from routine
maintenance or repairs will be paid by STTC.
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FUEL. Shrco shall provide all fuel for the
Vehicles and shall be responsible for all reporting, taxes, and
charges associated therewith.
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LICENSES,
TAXES AND PERMITS . STTC shall, at its own expense,
register and title each Vehicle, and pay for any Vehicle inspection
fees, in the state of domicile of such Vehicle for the licensed
weight. STTC shall also pay the Federal Highway Use Tax and all
personal property tax applicable to such Vehicle in that domicile
state. If permitted by law, STTC shall obtain, at
SHRCO's expense, other vehicle licenses, registrations, or pro-rate
or state reciprocity plates, as SHRCO may request. Any
increase in these rates or fees or change in the method of
assessment over the allowance shown in Schedule "A" will be
paid for by SHRCO. Other than as set forth above, SHRCO
shall pay for all permits, plates, special licenses, fees, or taxes
(including any penalties or interest) required by SHRCO's business
or now or hereafter imposed upon the operation or use of the
Vehicles, or on this lease or on the charges accruing under this
lease, including, but not limited to, sales or use taxes, mileage
or ton mileage taxes, highway and bridge tolls, and any new and/or
additional taxes and fees.
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LEASE
CHARGES. SHRCO agrees to pay STTC the charges
provided for under this lease upon receipt of an
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invoice,
without deduction or offset. STTC will invoice SHRCO on
a monthly basis, including the billing of fixed charges in advance,
and payment shall be made to the location designated by
STTC. Unless SHRCO shall protest the correctness of any
invoice within seven (7) days of its receipt, SHRCO agrees that
such invoice shall be presumed to be correct. Should
SHRCO fail to pay any charges when due, SHRCO shall pay interest on
such delinquent amounts at one and one-half percent (1-1/2%) per
month or the maximum permissible rate allowed in the jurisdiction
in which SHRCO's principal place of business is located, whichever
is lower, from the date on which payment was due until paid,
together with all expenses of collection and reasonable attorneys'
fees. This interest charge shall not be construed as an
agreement to accept late payments.
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VEHICLE USE
AND DRIVERS . SHRCO shall use the Vehicle only in
the normal and ordinary course of its business and operations and
in a careful, non-abusive manner, and not beyond its capacity and
SHRCO shall not make any alterations to the Vehicle without STTC's
prior written consent. Subject to the terms of this
lease, from the time of delivery to SHRCO of any Vehicle covered by
this lease, SHRCO shall have exclusive possession, control,
supervision and use of the Vehicle until its return to
STTC. SHRCO agrees that all Vehicles shall be operated
by safe, qualified, properly licensed drivers, who shall
conclusively be presumed to be SHRCO's agent, servant or employee
only, and subject to its exclusive direction and
control. The Vehicles shall not be
operated: (a) by a driver in possession of or under the
influence of alcohol or any controlled drug, substance, or
narcotic; (b) in a reckless or abusive manner; (c) off an improved
road; (d) on an under inflated tire; (e) improperly loaded or
loaded beyond maximum weight; or (f) in violation of any applicable
laws, ordinances, or rules; and SHRCO shall protect, defend,
indemnify and hold STTC harmless from and against all fines,
claims, forfeitures, judgments, seizures, confiscations or
penalties arising out of any such occurrence. SHRCO will
be responsible for all expenses for removing or towing any mired or
snowbound Vehicle. SHRCO agrees not to use or
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any Vehicle to
be used for the transportation of hazardous materials as defined by
regulations promulgated by the Unite States Department of
Transportation, unless otherwise agreed to in writing by STTC, nor
for any illegal purpose. SHRCO will cause each Vehicle
to be stored in a safe location. Upon receipt of a
written complaint from STTC specifying any reckless, careless or
abusive handling by any driver of the Vehicle(s), SHRCO shall
prohibit the driver so identified from operating the
Vehicle(s). In the event that SHRCO shall fail to do so
or shall be prevented from so doing by any agreement with anyone on
the driver's behalf, SHRCO shall reimburse STTC in full for any
loss and expense incurred by STTC as a result of operation or use
of the Vehicle(s) by such driver; and SHRCO shall protect, defend,
indemnify and hold STTC and its shareholders harmless from and
against any costs, expenses or damages arising out of the operation
of any Vehicle(s) by such driver, notwithstanding that STTC may be
designated in this lease as responsible for extending liability
coverage or assuming the risk of loss of, or damage to, the
Vehicle. SHRCO authorizes STTC to investigate the
driving record of each driver and test such driver with respect to
his ability to operate the Vehicle to which he will be assigned,
without prejudice to any right or remedy of STTC under this lease.
The drivers shall be selected and employed by SHRCO. STTC will have
no responsibility for compensation, supervision or control of such
drivers.
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PHYSICAL
DAMAGE TO VEHICLES . SHRCO assumes the risk of loss of,
or damage to, the Vehicle(s) covered by this lease from any and
every cause whatsoever, including, but not limited to, casualty,
collision, upset, fire, theft, malicious mischief, vandalism,
graffiti, glass breakage, and mysterious disappearance, except as
otherwise provided in this le
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