Loading...
HomeMy WebLinkAbout04-4650CLOUSE TRUCKING, 1NC., Plaintiff : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA : : CIVIL ACTION- v. : NO. 0 : MANUFACTURERS AND TRADERS : TRUST COMPANY d/b/a M&T BANK, : Defendant : NOTICE You have been sued in court. If you wish to defend against the claims set forth in the following pages, you must take action within twenty (20) days after this Complaint and Notice are served, by entering a written appearance personally or by attorney and filing in writing with the court your defenses or objections to the claims set forth against you. You are warned that if you fail to do so, the case may proceed without you and a judgment may be entered against you by the court without further notice for any money claimed in the Complaint or for any other claim or relief requested by the Plaintiffs. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCE FEE OR NO FEE: Cumberland County Bar Association 32 South Bedford Street Carlisle, PA 17013 (717)232-7536 MA~~F WILLIAMS I.D. No. 75901 Ten East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Plaintiff & OTTO Date: September 16, 2004 CLOUSE TRUCKING, 1NC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA : : CIVIL ACTION - EQUITY : : NO. COMPLAINT AND NOW, comes the Plaintiff, CLOUSE TRUCKING, INC., by and through its attorneys, MARTSON DEARDORFF WILLIAMS & OTTO, and avers as follows: 1. Plaintiff is a Pennsylvania business corporation with a business address of 2075 Ritner Highway, Carlisle, Cumberland County, Pennsylvania 17013. 2. Defendant is a New York banking institution having a place of business at 950 Walnut Bottom Road, Carlisle, Cumberland County, Pennsylvania 17013. 3. On August 11,2003, Defendant at Plaintiff' s request issued a $79,560.00 Irrevocable Clean Standby Letter of Credit (No. 17752) (the "Letter of Credit") for the benefit of Sirius America Insurance Company c/o Seaboard Underwriters, Inc. (the "Beneficiary"). A copy of the Letter of Credit is attached hereto as Exhibit "A.' 4. This Letter of Credit was issued in conjunction with Plaintiff acquiring liability insurance coverage for its business operations from the Beneficiary. 5. In acquiring insurance coverage from Beneficiary and obtaining the Letter of Credit, it was specifically represented to Plaintiffthat his insurance premium would be a pementage of his actual gross revenues for the policy period. This was a material representation which specifically enticed Plaintiff to choose the Beneficiary for its insurance coverage. 6. As of today, Plaintiff has paid all premiums due and owing to Beneficiary. 7. On September 3, 2004, Beneficiary presented a draw to Defendant demanding payment of $79,560.00 under the Letter of Credit. A copy of the letter is attached hereto as Exhibit 8. Plaintiff believes, and therefore avers, that Beneficiary is attempting to obtain payment for premiums not due and owing to it by demanding payment under the Letter of Credit. The Beneficiary is applying a different method to calculate a premium due and owing by Plaintiff in an attempt to fraudulently extract more money from Plaintiff. 9. Plaintiff believes, and therefore avers, that a material misrepresentation had been made to it regarding the calculation scheme being applied to its liability insurance policy premium in order to entice Plaintiff into acquiring the insurance in question. Plaintiff believes, and therefore avers, that Beneficiary is participating in an elaborate fraud designed to obtain payment under the Letter of Credit with knowledge that it is not entitled to the additional premiums. 10, Letters of Credit are governed by the Uniform Commercial Code, Article 5, Letters of Credit, 13 Pa.C.S. Section 5101 et seq. 11. Specifically, 13 Pa.C.S. Section 5109(a)(2), which was enacted in 2001 states: If an applicant ["Clouse'] claims that...honor of the presentation would facilitate a material fraud by the beneficiary on the issuer or the applicant, a court of competent jurisdiction may temporarily or permanently enjoin thc issuer from honoring a presentation or grant similar relief against the issuer or other persons only if the court finds that: (1) thc relief is not prohibited under the law applicable to an accepted draft or deferred obligation incurred by the issuer; (2) a beneficiary, issuer or nominated person who may be adversely affected is adequately protected against loss that it may suffer because the relief is granted; (3) all of the conditions to entitle a person to the relief under the law of this Commonwealth have been met; and (4) on the basis of the information submitted to the court, the applicant is more likely than not to succeed under the claim of forgery or material fraud and the person demanding honor does not qualify for protection under subsection (a)(1). (emphasis added). 12. Plaintiff believes, and therefore avers, that this Court is a court of competent jurisdiction, that this Court is not prohibited by the law of New York from granting an injunction,t that all parties will be protected if an injunction is issued since the Letter of Credit will remain in force, and Plaintiff has demonstrated a likelihood of success on merits if its claim to a material misrepresentation is proven. 13. Plaintiffwill suffer irreparable harm if the Defendant is not enjoined from paying the $79,560.00 over to Beneficiary. Not only will Plaintiff be forced to collect these funds from a corporation in a foreign jurisdiction after becoming indebted to the Defendant for that amount, but the fact that the U.C.C. specifically permits this Court to enjoin Defendant from honoring a presentment on a Letter of Credit indicates that the harm is irreparable per se. Moreover, because Clouse Trucking, Inc., is in financial distress, Defendant's honoring of the presentment could further irreparably damage the financial health of the business. 14. Plaintiffhas requested that Defendant dishonor the presentation by the Beneficiary, but Defendant has refused citing its need for a court order. ~New York has enacted a provision identical to 13 Pa.C.S. Section 5109 at Chapter 38, Article 5, Section 5-109. WHEREFORE, this Court is requested to enjoin Defendant from honoring the presentment under the Letter of Credit pursuant to 13 Pa.C.S. Section 5109(b). Date: September 16, 2004 Respectfully submitted, MARTSON DEARDORFF WILLIAMS & OTTO Carl C. Risch, Esquire I.D. No. 75901 Ten East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Plaintiff CLOUSE TRUCKING, 1NC., Plaintiff :IN THE COURT OF COMMON PLEAS OF :CUMBERLAND COUNTY, PENNSYLVANIA : :CIVIL ACTION - EQUITY : :NO. MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant VERIFICATION I, J. Edward Clouse, President of Clouse Trucking, Inc., hereby verify that, to the best of my knowledge, information, and believe, all averments in this document are tree and correct, and that I have the authority to make this verification. This statement of verification is made subject to the penalties of 18 Pa.C.S. Section 4904 relating to unsworn falsifications to authorities, which provides that ifI make knowingly false averments, I may be subject to criminal penalties. Date: September 16, 2004 .SEP. 14.~004 2:4~PM M&T TRADE SERVICES Trade services one Fountain Plaza Buffelo, NY 14205-1495 IRREVOCABLE CLEAN STANDBY LETTBR. OF CREDIT NO. 17752 HO. 270 P, 3 I Cable ^ddreas: M.~ND"I'IilA~K Telex Number; 420076 ~ Alaawer Back: MAIqDTBANK NYK ~wift Number: blANTUS ~ Telephone: (716) ~ i97 (800) 7~4-1-'68 PAGE 1 OF 2 ISSUING BANK: MANU'FACTURF.~S AND TRADERS TRUST COMPANY TRADE SERVICES - 2ND FLOOR ONE FOUNTAIN PLAZA BUFFALO, NEW YORK 14203-1495 ISSUE DATE: AUGUST 11, 2003 BENEFICIARY: SlPJUS AMERICA INSURANCE CO. C/O SEABOARD UNDERWY, ITERS, INC. 2563 EKIC LANE, SUITE K BURLINGTON, NC ~7215 APPLICANT: CLOUSB TRUCKING, INC. 2075 RITNER HIGHWAY CARLISLE, PA 17013 EXPIRATION DATE AT M&T BANK: SEPTEMBER 5, 2004 or any extended date MAXIMUM STATED AMOUNT: USD79,560.00 SEVENTY NINE THOUSAND FIVE HUNDRED SIXTy AND 00/I 00USD Manufacturers and Traders Trust Company ("M&T Bank") hereby establishes this In'evocable Letter of~redit in favor of the aforesaid banefidary for drawings up to Unit~l States $79,560, 00 effective August 11, ~003, this Letter of Credit is issued, presentable and payable at our office at M&T BANK, ATTN: TRADE SERVICES - 2ND FLOOK, ONE FOUNTAIN PLAZA, BUFFALO, NEW YOKK 14203-1495 and exoires with our close of business on September 5, 2004, The Term "Beneficiary" includes any successor by operation o flaw of the named Beneficiary included' limitation, any liquidator, rehabilitator, recoiver, or conservator, We hereby undertake to promptly honor your sight draft(s) drawn on us, indicating our Credit No. 1771 all or any part of this Credit if presented at our office specified in paragraph one on or before the expiry or any automatically extended expiry date, rithout , for luted Except a~ expressly stated herein, this undertaking is not subject to any agreement, condition, or qualification, The obligation of M&T Bank under this Letter of Credit is the individual obligation of M&T Bank, an( s in no way contlngent upon reimbursement with respect thereto. SEP. 14.2004 2:42PM and ~a~ef~ T,~t Trad~ 8er~ice~ One Fountain plaza Buffalo, NY 1420~-1495 M&T TRRDE SERVICES N0.278 P.4, Cable Address: MAN[:~BA qK Telex Number: 4~OO7~ Answer B~', MAN~ ~K NYK 8wl~ Numben MAGUS Telephone: (~6] 848~ 2 O1:2 j PAGE LETTER OF CREDIT NO. 17752 It is a condition of this Credit that it shall bc deemed automatically extended without amc?h~, ant for or~el~car from the expiry date hereof, or any future expiration date, unless 30 days prior to any expiration date MS~ Bank notifies the Beneficiary by registered mail that M&T l~ank elects not to consider this Letter of Cre~ it renewed for any such additional period, T~s Credit is subject to and governed by the Laws of the State of New York and the 1993 Revision ofth~ Um~rm Customs and Practice for Documentary ?edits of the Interaa6onal Chamber of Commerce J Pubhcatiun No. 50,0, and in the event of any confltct, the Laws of the State of N~v York will control. If~his Or.lit expires during and interruption of business as described in Article 17 of said Publication 500, M&T Bank thereby specifically agrees to effect payment if this Credit is drawn against within 30 days after tht resumption of bnsiness. MAbRIFAC~ AND TRADERS TRUST COM ?ANY C,andia L Assistant Vine President and Sr. Managez International Operations M&T TRRDE SERVICES M0.278 P.2 Manufactarers and Trader~ Trust Company "M&T Bank" Irrevocable Letter of Credit No. 17752 Date: September 3, 2004 At sight Pay To: Sirius America Imurance Company c/o Seaboard Underwriters, he. 3035 S. Church Street Burlington, NC 27216 Seventy Nine Thousand Five Hundred & Sixty Dollars ($79,560.00) For Value Received and Charge To Account of Irrevocable Letter of Credit No. 17752 '~Drawn under Manufacturers and Traders Trust Company ("M&T Bank") Irrevocable Lett~ of Credit No.17752 M&T B~nk One Fountain Plaza 2a~ Ploor Buffalo, New York 14205-1495 Attn: Trade Services By: Authorized Signatory Company CLOUSE TRUCKING, INC., PLAINTIFF MANUFACTURERS AND TRADERS TRUST COMPANYd/b/a M&T BANK, DEFENDANT IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA : 04-4650 CIVIL TERM ORDER OF COURT day of September, 2004, this ex parte order is For Plaintiff M&T Bank 950 Walnut Bottom Road Carlisle, PA 17013 :sal AND NOW, this entered enjoining defendant Manufacturers and Traders Trust Company d/b/a M&T Bank from honoring the presentation of Sirius America Insurance Company c/o Seaboard Underwriters, Inc., under the Irrevocable Clean Standby Letter of Credit No. 17752 seeking the payment of $79,560.00 pending a hearing to be conducted in Courtroom Number 2, Cumberland County Courthouse, Carlisle, Pennsylvania Tuesday, September 21,2004, at 11:15 a.m. This temporary injunction shall become effective upon plaintiff posting either a bond or cash in the amount of $5,000.00 with the Prothonotary pursuant tI Pennsylvania Rule of Civil~Proced..~ure 15....~_3Edgar B. Ba'~lby, j.~ 'l''(b)e'C~O~ Carl C. Risch, Esquire CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant S E 201 :IN THE COURT OF COMMON PLEAS OF :CUMBERLAND COUNTY, PENNSYLVANIA : :CIVIL ACTION - EQUITY : ORDER AND NOW, this__ day of ,2004, upon consideration of the attached Motion for Preliminary of Special Injunction, Defendant is hereby ENJOINED from honoring the presentation of Sirius America Insurance Company c/o Seaboard Underwriters, Inc. under the Irrevocable Clean Standby Letter of Credit No. 17752 seeking the payment of $79,560.00 pending a hearing on this matter. A hearing in the above-captioned matter is hereby set for ,2004, at o'clock, in Courtroom # , Cumberland County, Pennsylvania. BYTHECOURT CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY dPo/a M&T BANK, Defendant :IN THE COURT OF COMMON PLEAS OF :CUMBERLAND COUNTY, PENNSYLVANIA :CIVIL ACTION - EQUITY ; :NO. : : PLAINTIFF'S MOTION FOR PRELIMINARY OR SPECIAL INJUNCTION AND NOW, comes the Plaintiff, Clouse Trucking, Inc., by and through its attorneys, Martson Deardorff Williams & Otto, and hereby moves this Court for a preliminary injunction under Pa.R.C.P. 1531 enjoining and restraining Defendant pending final hearing and determination of this action from honoring the presentment by Sirius America Insurance Company c/o Seaboard Underwriters, Inc. ("Beneficiary"), under a certain Letter of Credit and in support avers as follows: 1. The Verified Complaint in Equity filed on September 16, 2004, is hereby incorporated herein as if fully set forth. 2. Unless Defendant is effectively restrained and enjoined from honoring the presentment under the Letter of Credit, as described with particularity in the Verified Complaint in Equity filed in this case and in this Motion, Plaintiff will suffer immediate, substantial, and irreparable harm by becoming indebted to Defendant in the amount of $79,560.00 and being forced to collect these funds from a corporation in a foreign jurisdiction. Moreover, because the U.C.C. specifically authorizes this Court to enjoin Defendant from honoring the presentment, the harm to Plaintiff is per se irreparable. Finally, because Clouse Trucking, Inc., is in financial distress, Defendant's honoring of the presentment would further irreparably damage the financial health of the business. The Plaintiffis simply requesting that this Court maintain the status quo. 3. Plaintiff filed his Verified Complaint in Equity on July 31, 1998. 4. The issuance ora preliminary injunction will not cause undue inconvenience or loss to the Defendant, but will prevent irreparable injury to the Plaintiff. 5. As a matte of law, Plaintiff has no adequate remedy at law to redress the injury that will be caused by the Defendant's honoring of the presentment. 6. Plaintiff is likely to succeed in proving at trial. 7. In view of the general validity of the Letter of Credit, Plaintiff avers that a bond is unnecessary in this case. However, if the Court orders that a bond or cash be posted under Pa.R.C.P. 1531 (b), Plaintiff requests that this Court order Defendant to pay the amount demanded in the presentment to the Prothonotaxy of Cumberland County pending final resolution of this matter. WHEREFORE, Plaintiffs respectfully request that this Court enter an Order preliminarily enjoining and restraining Defendant and their employees, agents, assigns, and successors in interest from honoring the presentment made by Sirius America Insurance Company c/o Seaboard Underwriters, Inc. ("Beneficiary") under the Letter of Credit No. 17752. MARTS~O~ WILLIAMS& OTTO By ~,~ ~._~A ~ Carl C. Risch, Esquire PA Attorney I.D. No. 75901 Ten East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Plaintiff Date: September 16, 2004 CLOUSE TRUCKING, 1NC., Plaintiff :IN THE COURT OF COMMON PLEAS OF :CUMBERLAND COUNTY, PENNSYLVANIA :CIVIL ACTION - EQUITY : :NO. MANUFACTURERS AND TRADERS TRUST COMPANY dPo/a M&T BANK, Defendant VERIFICATION I, J. Edward Clouse, President of Clouse Trucking, Inc., hereby verify that, to the best of my knowledge, information, and believe, all averments in this document are true and correct, and that I have the authority to make this verification. This statement of verification is made subject to the penalties of 18 Pa.C.S. Section 4904 relating to unsworn falsifications to authorities, which provides that if I make knowingly false averments, I may be subject to criminal penalties. Date: September 16, 2004 CLOUSE TRUCKING, 1NC., Plaintiff V. MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION NO. 04-4650 PRAECIPE TO: The Prothonotary of Cumberland County Please accept for filing the attached Affidavit of Return of Service. Respectfully submitted, MARTSON DEARDORFF WILLIAMS & OTTO Date: September 16, 2004 Carl C. Risch, Esquire I.D. No. 75901 Ten East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Plaintiff CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION NO. 04-4650 AFFIDAVIT OF RETURN OF SERVICE I, Kelley Decker, being duly sworn according to law, depose and say that: 1. I am a competent adult not a party to this action. 2. On September 16, 2004, at 2:05PM, I personally served the Defendant by handing a copy ofa (a) Verified Complaint, {b) Motion for Special or Preliminary Injunction, and (c) Order of Court dated September 16, 2004, to Kandy L. Coyle, Assistant Branch Manager, at the M&T Bank branch located at 1 West High Street, Carlisle, Cumberland County, Pennsylvania. Ms. Coyle identified herself as the person for the time being in charge of that regular place of business of Defendant. 3. I am permitted to serve the Defendant under Pa.R.C.P. 400(b)(1) because the civil action requests relief under Pa.R.C.P. 1531. Kelley Decker COMMONWEALTH OF PENNSYLVANIA COUNTY OF CUMBERLAND SS On this, the 16th day of September, 2004, before me the undersigned officer, personally appeared Kelley Decker known to me or satisfactorily proven to be the person whose name is subscribed to the within instrument and acknowledged that she executed the same for the purposes therein contained. In witness whereof, I hereunto set my hand and official seal. N~tary Public NOTARIAL SEAL CORRINE L. MYERS, NOTARY PUBLIC CARLISLE BORO, COUNTY OF CUMBERLAND MY COMM~SS{Ofl EXPIRES MAY 27, 2007 CLOUSE TRUCKING, INC., : Plaintiff : V. MANUFACTURERS AND TRADERS: TRUST COMPANY d/b/a M&T : BANK, : Defendant : IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 04-4650 CIVIL TERM ORDER OF COURT AND NOW, this 21st day of September, having been called following the issuance of a 2004, a hearing ex parte temporary injunction on September 16, 2004, and the position of defendant, Manufacturers and Traders Trust Company d/b/a M&T Bank, that it has no objection to a contJ, nuation of the temporary injunction pending litigation with the real party of interest, Sirius America Insurance Company/Seaboard Underwriters, Inc., on the merits of the issuance of a preliminary injunction pending litigation of the underlying dispute between those entities and plaintiff, Clouse Trucking, Inc., it is ordered, pursuant to Pennsylvania Rule of Civil Procedure 1931(d) that the ex parte temporary injunction entered on September 16, 2004, which is supported by the posting of $5,000.00 in cash pursuant to Pennsylvania Rule of Civil Procedure 1531(b), is continued generally to be reset following plaintiff's service upon the insurance/e<r~-~, s of a complaint and petition for a preliminary inunction// / the Co .~, -<~arl C. Risch, Esquire For Plaintiff ~ .Mark Warren, Esquire For Manufacturers and Traders Trust Company d/b/a M&T Bank prs ~ ~%~0~. CLOUSE TRUCKING, INC., Plaintiff IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants : NO. 04-4650 : : CIVIL ACTION NO___TICE_ · . ou wish to defend against the claims set forth in the You have been sued in co.urt I.f.,[ .... ,~,v (2 5 days ~gter this Complaint and. Notice are following pages, you must take action rattan rw~..~j, 0, - You are warned that if you fail to do served, by entering a written appearance personally or by attorney and filing in writing with the court your defenses or objections to the claims set forth against you. so, the case may proceed without you and a judgment may be entered against you by the court without further notice for any money claimed in the Complaint or for any other claim or relief requested by the Plaintiffs. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. ABLE TO AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE IF YOU CANNOT PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCE FEE OR NO FEE: Cumberland County Bar Association 32 South Bedford Street Carlisle, PA 17013 (717)232-7536 Carl C. Risch, Esquire I.D. No. 75901 Christopher E. Rice, Esquire I.D. No. 90916 Ten East High Street Carlisle,. PA 17013 (717) 243-3341 Attorneys for Plaintiff Date: September P'~dc), 2004 CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND' COUNTY, PENNSYLVANIA NO. 04-4650 CIVIL ACTION FIRST AMENDED COMPLAI_NT_ 1. Plaimiff, Clouse Trucking, Inc., is a Pennsylvania business corporation with a business address of 2075 Rimer Highway, Carlisle, Cumberland County, Pennsylvania 17013. 2. Defendant Manufacturers and Traders Trust Company dPo/a M&T Bank ("M&T") is anew York banking institution having a place of business at 950 Walnut Bottom Road, Carlisle, Cumberland County, Pennsylvania 17013. 3. Defendant Sirius America Insurance Company ("Sirius") is a Delaware Corporation with a service agent, United States Corporation Company, located at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808. 4. Defendant Seaboard Underwriters, Inc., ("Seaboard") is a Pennsylvania registered foreign business with a Pennsylvania service agent, CT Corporation, located at 1635 Market Street, Philadelphia, Pennsylvania 19103, and a North Carolina registered agent, Joseph P. Hutelmyer, located at 3035 S. Church Street, Burlington, North Carolina 27215. 5. On August 11, 2003, Defendant M&T at Plaintiff's request issued a $79,560.00 Irrevocable Clean Standby Letter of Credit (No. 17752) (the "Letter of Credit") for the benefit of Defendant Sirius and Defendant Seaboard. A copy of the Letter of Credit is attached hereto as Exhibit "A." 6. The Letter of Credit was issued in conjunction with Plaintiff acquiring liability insurance coverage, policy number LHT 1001139A, for its business, operations from Defendant Sirius and Defendant Seaboard. Copies of the Risk Management Services and Insurance Proposal ("Proposal") by Evans, Conger, Broussard & McCrea, Inc. ("ECBM"), and the Common Policy Declarations ("Policy") by Defendant Seaboard are attached hereto as Exhibit "B" and "C," respectively. 7. In acquiring insurance coverage from Defendant Sirius and Defendant Seaboard and obtaining the Letter of Credit, it was specifically represented to Plaintiff by ECBM that its insurance premium would be a percentage of its actual gross revenues for the policy period even though the written materials indicated that a "minimum premium" would apply. 8. The representation to Plaintiff that its insurance premium ("monthly payments") would be a percentage of its actual gross revenues for the policy period and that there was no "minimum premium," was a material representation which specifically enticed Plaintiff to choose Defendant Sirius and Defendant Seaboard for its insurance coverage. 9. Plaintiff was to make monthly payments for a one year policy period beginning July 5, 2003, and ending July 5, 2004. 10. Plaintiff made monthly payments based on a percentage of its actual gross revenues. 11. ECBM accepted Plaintiff' s payments as the entire insurance premium due each month on behalf of Defendant Sirius and Defendant Seaboard. ECBM then paid over these premiums to Defendant Sirius and Defendant Seaboard. 12. ECBM, however, voluntarily and without Plaintiffs knowledge or permission, supplemented Plaintiff' s premium payments in order to meet the "minium premium" demanded by Defendant Sirius and Defendant Seaboard. 13. As of today, Defendant Sirius and Defendant Seaboard have been paid all the premiums it is due under the insurance contract regaredless of the premium calculation scheme employed (minimum premium or a percentage of actual gross revenues). 14. On September 3, 2004, Defendant Sirius and Defendant Seaboard presented a draw to Defendant M&T demanding payment of $79,560.00 under the Letter of Credit. A copy of the letter is attached hereto as Exhibit "D." 15. plaintiffbelieves, and therefore avers, that Defendant Sirius and Defendant Seaboard are attempting to obtain payment for premiums not due and owing to it by demanding payment under the Letter of Credit. COUNT I - Injunction and Declaratory Relief _Plaintiff v. Defendant M&T, Defendant Sirius, ~!nd Defendant Seaboard 16. paragraphs 1-15 are incorporated herein by reference as if fully set forth below. 17. Plaintiff believes, and therefore avers, that a :material misrepresentation had been made to it regarding the calculation scheme being applied to !its liability insurance policy premium in order to entice Plmntiff into acquiring the insurance in qu :stion 18. Plaintiffbelieves, and therefore avers, that Defendant Sirius and Defendant Seaboard are participating in an elaborate fraud designed to obtain payment under the Letter of Credit with knowledge that it is not entitled to the additional premiums and with the intent to turn a portion of these funds over to a third party, ECBM, to compensate it for premiums paid on Plaintiff' s behalf without its permission or knowledge. 19. Letters of Credit are governed by the Uniform Commercial Code, Article 5, Letters of Credit, 13 Pa.C.S. Section 5101 etseq. 20. Specifically, 13 Pa.C.S. Section 5109(a)(2), which was enacted in 2001 states: If an applicant ["Clouse"] claims that...honor of the presentation would facilitate a material fraud by the beneficiary on 'the issuer or the applicant, a court of competent jurisdiction may temporarily or permanently enjoin the issuer from honoring a presentation or gr,aat similar relief against the issuer or other persons only if the court finds ~tat: (1) the relief is not prohibited under the law applicable to an accepted draft or deferred obligation incurred by the issuer; (2) (3) a beneficiary, issuer or nominated person who may be adversely affected is adequately protected against loss that it may suffer because the relief is granted; all of the conditions to entitle a person to the relief under the law of this Commonwealth have been met; and (4) on the basis of the information submitted to the court, the applicant is more likely than not to succeed under the claim of forgery or material fraud and the person demanding honor does not qualify for protection under subsection (a)(1). (emphasis added). 21. Plaintiff believes, and therefore avers, that this Court is a court of competent jurisdiction, that this Court is not prohibited by the law of New York from granting an injunction,~ and Plaintiff has demonstrated a likelihood of success c,n merits if its claim to a material misrepresentation is proven. 22. Plaintiffwill suffer irreparable harm if the Defendant is not enjoined from paying the $79,560.00 over to Beneficiary. Not only will Plaintiff be forced to collect these funds from a ~New York has enacted a provision identical to 13 Pa.C.S. Section 5109 at Chapter 38, Article 5, Section 5-109. corporation in a foreign jurisdiction after becoming indebted to the Defendant for that amount, but the fact that the U.C.C. specifically permits this Court to enjoin Defendant from honoring a presentment on a Letter of Credit indicates that the harm is irreparable per se. Moreover, because Clouse Trucking, Inc., is in financial distress, Defendant's honoring of the presentment could further irreparably damage the financial health of the business. 23. Plaintiff requested that Defendant M&T dishortor the presentation by Defendant Sirius and/or Defendant Seaboard, but Defendant M&T has refused, citing its need for a court order. 24. On or about September 16, 2004, Plaintiff sought .and was granted an Order from this Court temporarily enjoining Defendant M&T from honoring the presentation of Defendant Sirius in care of Defendant Seaboard under the Letter of Credit. The Court further requested that the Complaint be amended and that all necessary parties be joined. A Consent Form is attached hereto as Exhibit "E." 25. Thereafter, on or about September 22, 2004, Defendant Seaboard, by way of a letter to Defendant M&T, voided the full draw of $79,560.00, admitting that it is not owed the money demanded. 26. Simultaneously, Defendant Seaboard requested a new draw in the amount of $3,850.00. 27. Plaintiff does not owe Defendant Seaboard or Defendant Sirius the new amount requested or any amount for additional premiums. 28. Again, Plaintiff believes, and therefore avers, that Defendant Sirius and Defendant Seaboard are attempting to fraudulently obtain payment under the: Letter of Credit with knowledge that it is not entitled to the additional monies. WHEREFORE, this Court is requested to permanently enjoin Defendant M&T from honoring any presentment under the Letter of Credit pursuant to 13 Pa.C.S. Section 5109(b), declare the premiums under the insurance policy paid in full, and extinguish the Letter of Credit. COUNT II - Bad Faith Plaintiff v. Defendant Sirius and Defendant Seaboard 29. Paragraphs 1-28 are incorporated herein by reference as if fully set forth below. 30. On or about September 3, 2004, Plaintiff did not owe Defendant Sirius or Defendant Seaboard any premiums on the insurance policy. 31. It is believed, and therefore averred, that Defendant Sirius and Defendant Seaboard knew that it was not owed any money at the time it presented a draw to Defendant M&T. 32. It is believed, and therefore averred, that Defendant Sirius and Defendant Seaboard were knowingly and maliciously calling the Letter of Credit in order to, among other things, use the money to compensate third parties for funding it fronted on Plaintiff's behalf without Plaintiff's permission or knowledge. 33. Defendant Sirius and Defendant Seaboard were not entitled to the monies secured by the Letter of Credit at any time they presented a draw to Defendant M&T. 34. Defendant Sirius' and Defendant Seaboard's ill will attempt to call the Letter of Credit for the full amount and for any amount thereafter constituted outrageous, vexatious, and malicious conduct. 35. Plaintiff has suffered both court costs and attorney fees as a result of Defendant Sirius' and Defendant Seaboard's conduct. WHEREFORE, Plaintiffrequests this Honorable Corox award punitive damages and access court costs and attorney fees against Defendant Sirius and Defendant Seaboard, along with any other such relief the Court deems necessary and proper. Date: September'2-~ ,2004 Respectfully submitted, MA?S,~ .~RFF WILLIAIMS & OTTO By \ k,~,/A ~ Carl C.'~i~ch, l~squire I.D. No. 75901 Christopher E. Rice, Esquire I.D. No. 909116 Ten East High Street Carlisle, PA 17013 (717) 243-3341 Attorneys for Plaintiff .SEP,14,EO~4 2:42PM M&T TRRDE SERVICES HO,Z78 P.3 Trade services One Fountain Plaza Bul'falo, NY 1,~203-1495 IRREVOCABLE CLEAN STANDBY LETTER OF CREDIT NO. 17752 cable Addres,; M/~NDTBA Telex Nurcber: 420076 Ar~swer Beck: MANDTBA Swift Number: MANTUS ,' Telephone: (716) 848-8 (800) 724-1 PAGE 1 OF 2 ISSUING BANK: MANUFACTURERS AND TRADBRS TRUST COMPANY TRADE SBRVICES - 2ND FLOOR ONE FOUNTAIN PLAZA BUFFALO, NEW YORK 14203-1495 ISSUE DATE: AUGUST tl,2003 BENEFICIARY: SIRIUS AMERICA INSURANCE CO. C/O SEABOARD UNDERWRITERS, INC. 2563 ERIC LANE, SUITE K BUI'~INGTON, NC 27215 APPLICANT: CLOUSB TRUCKING, INC. 2075 RITNER HIGHWAY CARJ.,ISLE, PA 17013 EXPIRATION DATE AT M&T BANK: SEPTEMBER 5, 2004 or tiny extended date MAXIMUM STATED AMOUNT: USD79,Sd0.00 SEVENTY NINE THOUSAND FIVB HUNDRED SIXTY AND 00/100USD Manufacturers and Traders Trust Company ("M&T Bank") hereby est;lblishes this In'evocable Letter of in favor of the aforesaid beneficiary for drawings up to United States $79,560. 00 effective August 11, this Letter of Credit is issued, presentable and payable at our office at M&T BANK, AT"IN: TRADE SERVICES - 2ND FLOOR, ONE FOUNTAIN PLAZA, BUFFALO, NEW YORI( 14203-1495 and with our close of business on September 5, 2004. The Term "Beneficiary" includes any successor by operation o flaw of thc named Beneficiary included limitation, any liquidator, rehabilitator, receiver, or conservator. We hereby undertake to promptly honor your sight draft(s) drawn on us, indicating our Credit No. 1775 all o~ any part of this Credit ifpre~ented at our office specified in paragraph one on or before the expiry or any automatically extended expiry date. Except as expressly stated herein, this undertaking is not subject to any agreement, condition, or qualifi The obligation of M&T Bank under this Letter of Credit is the individual obligation of M&T Bank, an( no way contingent upon reimbursement with respect thereto. ~K ~NYK 97 68 2rcdit ,ires 'ithout for Lated tion, in Exhibit "A" Trade S~,rvicss One Fountal~ plaza Buffalo, NY 14203-1495 M&T TRADE SERVICES H0.278 P.4 Cable Address: MANDTEI,~ Telex Number', 420076 Answer Beck: MANDTB,~ Swift Number; MANTU$ Telephone: (716) 8484 (880) 794-' PAGE 2 OF 2 LETTER OF CREDIT NO. 17752 It is a condition oft_his Credit that it shall be deemed automatically extended without amendment for one from the expiry date hereof, or any future expiration date, unless 30 d~,ys prior to any expiration date M& Bank notifies the Beneficiary by registered mall that M&T Bank elect~t not to consider this Letter of Cre( renewed for any such additional period, This Credit is subject to a.ud governed by the Laws of the State of New York and the 1993 Revision of th Uniform Customs and Practice for Documentary Credits of the International Chamber of Commerce Publication No. 500, and in the event of any conflict, the Laws of the State of New York will control. If Credit expires dt~ng and interruption of business as described in Arti,:le 17 of said Publication 500, M& Bank thereby specifically agrees to effect payment if this Credit is drawn against within 30 days after the resumption of business, MAN-UFACTUKER,8 AND TP._A. DERS TRUST COM Claudia L, ConroY~ / Assistant Vice President and St, Managm Intemati0nal Operations IK I K NYK :68 rear ds 2075 RITNER HIGHWAY CARLISLE, PA 17013 PRESENTED BY: Charles H. Bernier Evans, Conger, Broussard & McCrea One Bala Plaza - Suite 640 Ba3a Cynwyd, PA 19004 Date: July, 2003 Exhibit "B" This proposal provides a general description of the coverage recommended for your consideration and is not intended to provide coverage, l~hile the general description might outline certain spec(ftc conditions and exclusions that apply to the contract offered, it does not contain all of the provisions, conditions, limitations, and exclusions applicable to those insurance contracts. Please refer to the actual policies fi~r specific terms, conditions, limitations, and exclusions that will govern in the event oj' a loss. In evaluating your exposures to loss, we have been dependent upon information provided by you. If there are areas that need to be evaluated prior to binding of coverages, please bring these areas to our attention. Should your exposures change after coverage is bound, such as the beginning of new operations, acquiring additional locations, or hiring employees in other states, please let as know immediately. HIGHER LIMITS AND ADDITIONAL COVERAGES ARE AVAILABLE AT YOUR REQUEST. Pennsylvania The insurer with whom the insurance is to be placed is not admitted to transact business in this Commonwealth and is subject to limited regulation by the Department; and in the event of insolvency of the insurer, losses will not be paid by tha Pennsylvania Insurance Guaranty Association. There will be a charge for Surplus Lines Taxes also. Clouse Trucking 2 ECBM One Bala Plaza - Suite,, 640 Bala Cynwyd, PA (610) 668-7100 FAX (610) 667-2208 Clouse Trucking 3 ECBM offers a full array of: Commercial and Personal Property and Casualty Asset Protection Plans and, Group and Individual Life and Income Protection Plans. Steven Ebbecke Vice President Ext. 1227 Sebbecke~ecbm.com · Business Continuation and Succession Planning · Key Executive Programs including Deferred Compensation Plans · Personal Retirement and Estate Planning · Personal Life and Disability Products , I Arnold Klein Vice President Ext. 1335 .~klein~ecbm.com * Group Medical Plans including altemative funding programs · Group disability, life, and long term care plans · 401K Plans Clouse Trucking 4 The following is our proposal for your Risk Management Program effective July 5, 2003. The protection and growth of your assets requires more ifhan the traditional insurance approach. It requires an overview of your operations, your exposures to loss, helping you reduce the size and likelihood of losses; determining you~r ability to pay for them and finally transferring those exposures you can not afford under a coordinated, creative insurance program. Clouse Trucking 5 The First Step ...... Identifying Your Exposures Before we can help you we have to get to know you. Our credo: "Assume Nothing; Question Everything." Of course, our experience in the your Industry provides some knowledge, but the most important advantage it provides is the ability to ask the right questions. Utilizing a specialty designed checklist and interview process, inspection of your facility and other techniques, we attempt to help you idemify all areas of concern and work with you to develop priorities as well as a financial profile to establish alternative approaches. Exposures identification takes place every year. We will review changes in your operations such as new entities, markets, locations; changes in the industry that affect your operations, and update you on the status of the insurance marketplace. We will also review claims activity to uncover trends in losses or possible new hazards that require loss control for prevention or reduction of future similar claims. Annually, this consist:s of: * Annual Exposure Analysis - Utilizing various techniq,,~es such as questionnaires, inspections, flow charts and financial analysis, review exposures to loss, financial capacity to absorb risk and legal obligations. * Annual Risk Management Assessment - Develop alternative approaches to control and finance risks identified. * Insurance Information Data Base - Maintain essential underwriting information such as premium basis and exposure history. Assist in development of insurance values and income insurance needs. · Contract Review - Review purchase orders, leases, and contract insurance provisions including hold harmless/indemnification clauses. Annual Insurance Marketing The analysis of your exposures and alternative techniques will require the placement of certain insurance coverages. We will review existing retention and insurance programs for possible improvements, not limited to pricing. Coverages to be placed with insurance carriers are negotiated and quoted to you in advance of the renewal. You decide when you need the information to make the proper decision for your company and we will respond as directed. To control the insurance marketing, we will: · Analyze losses to identify potential pricing changes Update premium exposures such as vehicles, revenues, annually · Assist in development of property and business incotne values · Determine insurance marketing strategy in partnersMp with you · Prepare coverage specificagions · Negotiate coverage, pricing and payment terms with insurance marketplace · Present annual summary of insurance marketing results to you · Review policies when received and process changes during the policy term Clouse Trucking 6 Controlling the Elements of Exposures ........ Our surveys and facility inspections help us isolate, analyze and evaluate your exposures so they can be controlled and reduced by loss prevention and safety engineering--or transferred to others by contractual agreements, such as a Hold Harmless clause. We have developed relationships with several highly professional loss control specialists that are available to provide sophisticated and valuable assimaace to our cliems. · Coordinate with your insurance carder a program to evaluate your ergonomic and industrial hygiene issues, particularly with respect to lifting, chemical exposure and hearing related exposures. Claims Review for Exposure Identification - Your cntrrent andpast loss experience paints a picture of the physical hazards and unsafe practices you face. We will review your claims experience routinely and develop a plan that addresses the issues contributing to your losses. · Site surveys - Develop loss control program with insurance company to help identify visible hazards and develop methods for reducing lihelihood of loss. · Review income loss exposures - Assist in development of methods to reduce possible catastrophe income loss exposures. · Outsource special needs - On a fee basis, specialists can be provided in areas of concern. Some special services include and OSHA and DOT compliance audits. Additional services outlined in the Service Presentation portion of this proposal. · Review Owner/Operator contracts and insurance pn~grams. Provide assistance in transferdng exposures. Clouse Trucking 7 Claims Management... the true test of performance The true measure of our performance occurs at the ti~ae of a loss. As advocates for our clients, our experienced claims staff responds quickly andl assertively. We have found communication to be a critical element in the success of any claims situation and we work very hard to keep you informed at all times. Since the claims portion of any insurance program can be as much as 70% of the cost, controlling claims has more impact on your long-term co~,'ts than any other component. Our Claims Specialists work to: Workers' Compensation Claims Auditing Program -auditing of all open claims with outstanding reserves in arcess of $10,000 on quarterly basis. See the following explanation of the program and how it benefits you. * 24 Hour Claim Service - Our clients can reach an ECBM employee 24 hours a day and 365 days a year. In the event of a serious incident, we have arranged for round the clock accident investigation to provide early intervention in the event of a large loss. · Emergency Spill Program - This 24 hour on-call service reduces the potential cost offuel or cargo spills that occur from vehicle accidents. Early intervention by specialists contracted to provide this service to our clients significantly reduces the amount of the loss and results in clean up before regulatory agencies are involved, relieving you of potential legal problems. · Protect your interests in any claims event - We control the property claims process to assure that you receive prompt and adequate compensation for your losses. We review liability cases for possible subrogation and to make sure that settlements are not overstated. · Relieve you of the burden of the claims process - Ourprofessional claims staff will work with you and become part of your organization giving you more time for income generating activities. Communicate with you in significant claims issues. Provide vehicle accident kits for all drivers. Provide all personnel assigned claims reporting duties with claims handling and reporting instructions. Management of Claims Data Base - Assist in management and control of claims through use of technology. Develop claims data base to provide analytical information. We believe that excellence in service is the foundation for' a long-term relationship with you. Clouse Trucking 8 Clouse Trucking, Inc. C.B. Milk Service, Inc. Clouse Trucking, Inc. 401(k) Profit Sharing Plan Property Only J. Edward & Calene M. Clouse J. Edward Clouse, Trustee of the Irrevocable Trust of T. Clouse/ H. Kutz/ V. Aullenbacher The above represents the schedule of Named Insureds on t~e proposed policies. Please review carefully and advise us of any changes that are necessary. An entity that is not listed is not covered. Clouse Trucking 9 #1 #2 #3 2075 Rimer Highway Carlisle, PA 17013 3638 Division Highway East Earl, PA 17519 2071 Rimer Highway Carlisle, PA 17013 Location Schedule //4 2085 Rimer Highway Carlisle, PA #5 #6 #8 #9 #10 #11 //12 #13 329 Springfield Road Shippensburg, PA ~ Mi. W. of Oakville, s/s Pond Level Rd. No. Newton Twp, Cumberland Co., PA 17241 No. Side Pond Level Rd. No. Newton Twp., Cumberland Co., PA E/S Springfield Rd. 2 Mi, SE of Oakville No. Newton Twp., Cumberland Co., PA No. Side Rt. 533 & Clouse Rd. No. Newton Twp., Cumberland Co., PA 4 Mi. E. Of Newville, West S. Mt. Rock Rd. West Pennsbom, Cumberland Co., PA N/S Rt. 322 @ Junction of Earl and E. Earl Twp. East Earl, Lancaster £b., PA 17519 Old Route 22 E. Hanover Twp. Lebanon Co., PA 17003 ~A Mi. No. of Inter Rt. 74 & 174 Monroe Twp., Cumberland Co., PA 17013 #14 30 Plank Road, Shrewsbury, PA 17257 Clouse Trucking 10 #16 1460A W. Patrick St. Frederick, MD 21702 #17 Intersection Rtes. 34 & 134 Carlisle, PA Clouse Trucking 11 Insurance Company: First l~nancial Insurance Company A. M. Best's Rating: A- VII Policy Date: Limits Of Insurance: General Aggregate Limit (other than Products/ Completed Operations) - $2,000,000 Products/Completed Operations Aggregate Limit - Included Personal and Advertising Injury Limit - $1,0C~3,000 Each Occurrence Limit - $1,000,000 Fire Legal Liability Limit - any one fire - $ 50,000 Medical Expense Limit - any one person - $ 5,000 CoYerage: Extended Coverages: Premises/Operations Independent ContracLors Products/Completed Operations Personal Injury Blanket Contractual Host Liquor Law Broad Form Property Damage Incidental Medical Malpractice Limited Worldwide Products Non Owned Watercraft - 26' length limitation Additional Persons Insured - Employees Extended Bodily Injury Advertising Injury Liability Automatic Coverage for Newly Acquired Organizations (90 days) Fire Damage Liability - Real Property Premises Medical Payments Clouse Trucking 12 Exclusions: (continued) Certain Computer Related Losses Sexual Action Communicable Diseases Abuse/Molestation Fungus/Dry Rot/Decay Assault/Battery Deductible: Premium Basis: $500 Bodily Injury/Property Damage per claim Tmckmen Payroll - $20,000 each (Locations #1,14 & 16) Dwelling - One Family (Locations # 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, &17) Premium: $6,021. O0 Inspection Fee: 200.00 Stamping Fee: 15.00 Surplus Lines Tax: 180. 63 Total: $6,416. 63 Optional Terrorism Premium: $310 Premium is subject to audit adjustment. Terms and conditions: Policy is 25% earned at inception. Subject to favorable inspection. Policy is minimum and deposit. Signed Terrorism Form required to bind coverage. Clouse Trucking 13 Insurance Company: Lloyd's of London A. M. Best's Rating: A- XV Policy Date: July 5, 2003 - Jui~ 5, 2004 Real Prooertv: Amount of Insurance: Insured Perils: Valuation: Coinsurance: Deductible: Personal Property: Amount of Insurance: Insured Perils: Valuation: Coinsurance: Deductible: Loc 1) $48~,000 Loc 14) 1- $150,000 2- $75,000 Loc 2) Loc 11) $210,0~0 Loc 12) $150,000 Loc 13) $201,200 Special Form Coverage subject to policy exclusions and provisions. Replacement Cost 8O% $2,500 per occurrence Loc 1) $375,0~0 Loc 11) $10,000 Loc 2) $210,000 Loc 13) $4,000 Special Form Coverage subject to policy exclusions and provisions. Replacement Cost 80% $2,500 per occurrence Clouse Tracking 14 Conditions & Exclusions: Exclusion -Certain Computer Rela~ed Losses 25% Minimum Earned Premium No Flat Cancellations Subject to completed and signed application. Premium: $14,802.00 Policy Fee: 100.00 Surplus Lines Tax: ~?.~..06 Stamping Fee: 15.00 Total: $15,361.06 Optional Terrorism Premium: $1,035 Terrorism Selection/Rejection Form must be signed to bind coverage. will be happy to recommend experts to assist you. Higher limits are available upon request. Please review the amounts of i~urance you have chosen to be sure that they are adequate. Upon your request we ] Clouse Trucking 15 Insurance Company: A. M. Best's Rating: Policy Date: Location: Liability: Bodily Injury and Property Damage: Auto Medical Payments: Deductible: TBD July 5, 2005 - J,~Ely 5, 2OO4 1) 2075 Ritner Highway, Carlisle, PA 2) 1460A West Pa~ck St., Frederick, MD 3) 30 Plank Road, Shrewsburg, PA $1 ,~0,000 Combined Single Limit $5,0~0 Per Person $250 - Completed Operations Property Damage Payroll: $72,800 Clouse Trucking 16 Insurance Company: A. M. Best's Rating: Policy Date: Amount Of lnsurance: Deductible: Coverage: Travelers Indemnity Company A++ XV July 5, 2003 - July 5, 2004 $50,000 per vehicle $50,000 per terminal $50,000 per catastrophe Legal Liability for Direct Physical Loss to Covered Property subject to policy exclusions and provisions. Additional Coverages: Pollution Cleanup Earned Freight Charges $5,000 $2,500 Estimated Receipts: $10,000,000 Rate: $. 276 per hundred of receipts Minimum Retained Premium: $27,600 Annual Reporting and Annual Adjustment Clouse Trucking 17 Insurance Company: A. M. Best's Rating: Policy Dale: Policy Form: Coverage Symbols: Liability: Bodily Injury & Property Damage: Hired Auto Liability: Non-Ownership Liability: First Party Benefits: (PA) Uninsured Motorist Underinsured Motorist Endorsements: MCS 9O Broadened Pollution Coverage for Covered Autos (CA9948) Sirius America A XI Jury $, 2003 - Ju~ s, ~o~ Trackers Any Vehicle $1,000,000 Combined Single Limit Included Included Medical Exp~mses: $5,000 Income Loss: None Accidental Death: None Funeral Benefits: None Extraordinao~ Medical Benefits: None $35,000 Non-Stacked $35,000 Non-Stacked Included Included Clouse Trucking 18 (continued) Vehicle Schedule: 88 Tractors 105 Trailers 12 Service Vehicles Premium Basis: $9,000,000 Estimated Gross Receipts $4.42 per hundred of receipts Estimated Annual Premium: $397,800 90% Minimum Annual Prelnium: $358,020 Escrow Deposit: $79,560 Monthly Reporting of Receipts along with payment. Terrorism Premium: $3,978 Terms and conditions: Signed Terrorism form required to bind. Signed applic,'ttion required. Acceptable Financials. Satisfactory Loss Control Must participate in SafetyFirst Program See Attached MVR Analysis - all action must be Taken to bind coverage. Clouse Trucking 19 Insurance Company: A. M. Best's Rating: Policy Date: Liability: Bodily Injury and Property Damage: First Party Benefits: (PA) Medical Benefits: Income Loss: Accidental Death: Funeral Benefits: Progressive Nortkern Insurance Company A+ XV Jury 5, 2003 - Ju!'y $, 2004 Any Vehicle $1,000,000 Combined Single Limit on all Owned vehicles, $5,000 None None None Broadened First Party Benefits: None Extraordinary Medical Benefits: None Uninsured Motorist Underinsured Motorists: Vehicle Schedule: $35,000 Bodily Injury - Non Stacked $35,0(10 Bodily Injury -Non Stacked 1992 Oldsmobile S#1G3HN53L2NH336541 1990 Ford Van S#1FDEE14N8LHA95217 1991 Ford S#1FACP50U8MAI70153 1992 Infiniti S#JNKNGO1C2NM212374 1992 Oldsmobile S#1G3HY53IANH356393 1988 Oldsmobile S#1G3HY54C6JW391893 1986 Ford Van S#1FTEE14N7GHA31230 1991 Ford S#1FAPP36X7MK114027 Total Estimated Premium: $7,257 Premium subject to underwriting at Progressive Insurance Company Clouse Trucking 20 Insurance Company: Policy Date: Coverage: Form A: Employee Dishonesty: Form B - Forgery or Alteration: Hartford Fidelity and Bonding July 5, 2003 - July 5, 2004 Loss of money, securities and other property due to employee dishonesty. Amount of Insurance: $200,000 per occurrence Deductible: $1,000 per occurrence Loss due to forgery or alteration of checks or drafts made or drawn by or drawn upon you. Amount of intsurance: $200,000 per occurrence Deductible: $1,000 per occurrence Conditions & Exclusions: Exclusion-Certain Computer Related Losses Clouse Tracking 21 Insurance Company: Lexington Insurance Company Policy Date: Limit Of Liability: Self Insured Retention: Policy Highlights: Exclusions: Underlying Limits: General Liability: Automobile Liability: Employer's Liability: Premium Adjustment: July 5, 2003 - J,~ly 5, 2004 $1,000,000 F. ach Occurrence $1,000,000 Aggregate $10,000 "Pay on Behalf of" Defense Costs in addition to Policy Limits This policy contains certain restrictions or exclusions including but not limited to the following. Please refer to the actual insurance contract for specific detail. Asbestos Liability Pollution Liability Employment Related Practices Certain Computer Related Losses E.R.I.S.A. Uninsured/Underinsured Mowrists, PIP, or First Party Benefits Occupational Disease Real and Per.sonal Property in the Care, Custody .'md Control of the Insured. Projects Cowered Under Wrap-up $1,000,000/$2,000,000 General Aggregate $1,000,000 each Accident $500,000/$500,000/$500,000 Annual Premiml~: Clouse Tracking 22 COVERAGE COMP~VY PREMIUM GENERAL LIABILITY First Financial _~_ $6~ 416. 63 -PROPERTY Lloyd's of Iow.al_on $15~361. 06 GARAGE TBD MOTOR TRUCK CARGO Travelers Indemnity $27,600 TRUCKERS ' LIABILITY Sirius America $397,800 PPT Auto -- Progressive $7257 CRIME Hartford $93~ UMBRELLA l,~rington $81~ 685 TOTAL ~'$'I1MATED ANNUAL $537,055.69 PREMIUM hpce proposal is based on the limits and values you have chasen. Higher limits are available on request. Please refer to your policies for specific terrr~, conditions, limitations, and lusions. ,4 specimen copy of policies is available for your review Clouse Trucking 23 .C°VERAGE DEPOSIT BALANCE General Liability $6,416.63 -_ Properly $15,361.06 _. Garage TBD Motor Truck Cargo $27,600, Truckers' Liabilit~ $79,560 Monthly Repons PIT Auto $7,25 7 ~Ct~me $936 Umbrella $81,685_ rOrA~ $2 ~ S, S ~ ~. Clouse Trucking 24 Truckers Liability Stratford Insurance Company Declined due to losses, territory of operation and ela~ of busin~n~. 'Eraaplre Fire & Marine l)eelined_ due to class of bnaln~s. Declined due to class of busings. CNA Inaurance Company Csn~l Insurance Company National Indemni~y Company AIG United National Declined due to class of business and radius of operations. Quoted $750,000 .Ann~ml Pr~mi~_!~3a Declin~ due to age of vphiel~. Non-Renewed due to end of program. Clouse Trucking 25 FIRST FINANCIAL INSURANCE COMPANY THE BURLINGTON IN~JRANCE COMPANY GUILFORD INSURANCE COMPANY POLICYHOLDER DISCLOSURE NOTICE OF TERRORIrSM INSURANCE COVERAGE (FOF M C) Policy No.: Type of Commemial Policy: Llal~il~t~ - You ate hereby notified that under the Tern~m Risk Insurance ~ of 2002, effective~November 26, 2002. that you r~w have a right ba purchase insurance coverage for losses a~lslltg out of a~-'ts of terrorism, ss defined in Section 102(1) of the Act. The term 'act of terroff~m' mean~ any act that is cml~aed by ~e Secretary of Transuty, in concurrence wfUt the ~ecretary of State, and the Attorney Geaerel of the United Slatas - to be ~n sot of terro~sm; to be a violent act or an act that is dangerous to human fie; pmperb,; or infrastruc~re; to have resulted in damage wilhln the Unlta~ b"teths or outside Ihs United States in the case of an air Un/ted Sla~s mission; and to ha~e been =ommltta~ by an kldl¥1~lual ¢=~er'or vessel or the premless of or indlvlduels acting on behalf of Pe..rson or ~reign ktterest, as pa~' Gl'an e/fort to coerce Ihs civilian , any foreign podcy or anect the conduct o population of the United States or to influence the f the Unra~l States Govemmenl by coercion - YOU SHOULD I~3~OVV THAT COVERAGE PROVIDED FOR LOSSES CAUSED BY CERTIFIED ACT~ OF TERRORISM IS PARTIALLY REIMBURSED BY THE UNITED STATES UNDER A FORMULA ESTABLISHED 8Y FEDERAL LAW. UNDER THIS FORMULA, THE UNITED STATES PAYS 90% OF COVERED TERRORISM LOSSES EXCEEDING THE STATUTORILY ESTABUSHED DEDUCTIBLE PAID BY THE INSURANCE COMPANy PROV1DIN(3 THE COVERAGE. THE PREMIUM CHARGED FOR THIS COVERAGE DO~S NOT INCLUDE ANy CHARGES FOR THE PORTION C~ LOSs COVERED BY THE FEDERAL GO~,~RNMENT UNDER THE ACT, '~ELECTION OR I~--JECTION OF TE~e. RORI~.iNSUP._a~CE premium quote~ to rne plus anyI L I ~_...,~.~u urge[- me ~ ertormm Risk Ins~artoe Act of 2002, ~ ~m, er-e~e__~r losses arising ~ acts of ~rlnt Name Oats --* -- RETURN THIS COMPLETED FORM TO YOUR INSURANCE AGENT Form C 11{32 New Business Date POLICYHOLDER DISCLOSURE NOTICE OF TERRORISM INSURANCE COVERAGE 7~2~03 You are hereby notified that under the Terrorism Risk Insurance Act of 2002, effective November 26, 2002, thai you now have a right to purchase insurance coverage for losses arising out of acts of terrorism, as defined in Section 102(1) of the Act:. The term 'act of terrorism" means any act that is certified by the Secretary of the Treasury, in concurrence with the Secretary of State, and the Attorney General of the United States--to be an act of terrorism; to be a violent act or an act that is dangerous to human life, properly; or infrastructure; to have resulted in damage within the United States, or ~outside the United States in the case of an air carrier or vessel or the premises of a United States mission; and to have been cemmillted by an individual or individuals acting on behalf of any foreign pemon or foreign interest, as part of an effort to coerce the civilian population of the United States or to influence the policy or affect the conduct of the United States Government by coercion. Coverage under your existing policy may be affected as follows: YOU SHOULD KNOW THAT COVERAGE PROVIDED BY THE APPLIED FOR POLICY FOR LOSSES CAUSED BY CERTIFIED ACTS OF TERRORISM IS PARTIALLY REIMBURSED BY THE UNITED STATES UNDER A FORMULA ESTABLISHED BY FEDERAL LAW. UNDER THIS FORMULA, THE UNITED STATES PAYS 90% OF COVERED TERRORISM LOSSES EXCEEDING THE STATUTORILY ESTABLISHED DEDUCTIBLE PAID BY THE INSURANCE COMPANY PROVIDING THE COVERAGI-'. THE PREMIUM CHARGED FOR THIS COVERAGE IS PROVIDED BELOW AND DOES NO~ INCL~UDE ANY CHARGES FOR THE PORTION OF LOSS COVERED BY THE FEDERAL GOVERNMENT UNDER THE ACT. I hereby elect to purchase Terrorism coverage for a prospective premium of $ 3,978.00 . I hereby elect to'ave the ;xclusion for terror sln coverage reinstated. I understand that I will have no coverage for losses aris ng from acts of terrorism that were previously excluded, Policyholder/Applicant's Signature Pdnl Name Date SIRIUS AMERICA INSURANCE CO. Insurance Company Policy Number Sirius America Driver G-idelines Effective 11/1/01 1. Age 23. Any driver between 21 and 23 shoutld be reviewed very carefully for experience. Per DOT guidelines you must be 21 years of age to obtain a CDL A interstate license. A driver under the age of 23 would not be considered unless the entire risk operates intrastate only and qualifies with 2 years of experience with a CDL A. 2. Experience - 2 years driving similar equipment of weight, class and size. 3. License - CDL Class A license, which is currently in good standing. Must have CDL A for two years - CDL A permit does not count. 4. *Accidents - may have only one at fault accident, under $15,000 in the last three years. Police reports will be required in some instances. 5. NO major violations in the last three years are allowed. Major violations include: DUI, possession of alcohol or narcotics, implied consent violation, open bottle violations and refusal to submit violation. Leaving scene of an accident. Driving while under revocation or suspemdon; driving out of class. Reckless and careless driving. Exceeding speed limit by 20 mph or more. Falsifying reports (accident reports or log books) *Minor Violations - no more than five minor 'violations over the past three years. *Accident + 4 minor violations acceptable. *Accident + 5 violations .NOT acceptable. All accounts with 10+ units are required to participate in the SafetyFirst Program. Should a driver receive 2 adverse Motorists Observation Reports (MOR) within a one-year period the driver twill be placed on Probation. This is mandatory, ff a driver receives a third adverse report the driver must IMMEDIATELY be assigned to duties (.~iOD) other than driving. COMMON POLICY DECLARATIONS Policy Number [LHT1001139A102 Named Insured and Mailing Address (No.~ Street, Town or City, Country, Zip Code) Clouse Trucking, Inc. 2075 Ritner Highway Carlisle, PA 17013 Renewal of Number NEW Agent Seabo~rd Underwriters, Inc. 2563 Eric Lane, Suite K PO Box 1478 Burlington, NC 27216 Policy Period: From I 07/05/03 I 1o I 07~05~04 Business Description: Truckmen 12:01 A.M. Standard Time at your mailing address shown above (unless changed by the Section Declaca/ions) IN RETURN FOR THE PAYMENT OF THE PREMIUM, AND SUBJECT TO ALL THE TERMS OF THIS POLICY, WE AGREE WITH YOU TO PROVIDE THE INSURANCE AS STATED IN 'THIS POLICY THIS POLICY CONSISTS OF THE FOLLOWING COVERAGE PARTS FOR WHICH A PREMIUM IS INDICATED. THIS PREMIUM MAY BE SUBJECT TO ADJUSTMENT. PREMIUM 393,822 397,800 Commercial Property Coverage Part $ Commercial General Liability Coverage Part $ Commemial Crime Coverage Part $ Commercial Inland Msrine Coverage Pan $ Commercial Auto Coverage Part- Garage Form $ Commercial Auto Coverage Part- Motor Carder Form $ Premium for Terrorism Coverage: $ 3978 To'r-AL $ PREMIUM SHOWN $79560* at inception: $ 1'~ anniversary; $ 2r~ anniversary IS PAYABLE: Form(s) and Endorsement(s) shown made a part of this policy at time or issue*: SEE CA DS 21 (7/97) omits applicable Forms and Endorsements if shown in specific Coverage Part/Coverage Form Declarations Countersigned: Burlinglon, NC By: THESE DECLARATIONS TOGETHER WITH THE COMMON POLICY CONDITIONE. COVEFLAGE PART DECLARATIONS COVERAGE PART COVERAGE FORM(S) AND FORMS AND ENDORSEMENTS. IF ANY ISSUED TO FORM A PART THEREOF, COMPLETE THE ABOVE NUMBERED POLICY SAICOO5 04 OO Sirius America Insurance Company, Inc. Page Exhibit "C" MOTOR CARRIER DECLARATIONS POLICY NO.: LHTlOO1139A102 COMPANY NAME AREA SIRIUS AMERICA INSURANCE COMPANY ITEM ONE NAMED INSURED: MAILING ADDRESS: POLICY PERIOD: PRODUCER NAME AREA SEABOARD UNDERWRITERS, INC. Clouse Trucking, Inc. 2075 Ritner Highway Carlisle, PA 17013 From 07/05/03 to 07/05/04 at 12:01 A.M. Standard Time at your mailing address shown above. FORM OF BUSINESS: [] CORPORATION [] PARTNERSHIP [] LIMITED LIABILITY COMPANY [] INDIVIDUAL [] OTHER IN RETURN FOR THE PAYMENT OF THE PREMIUM, AND SUBJECT TO ALL THE TERMS OF THIS POLICY, WE AGREE WiTH YOU TO PROVIDE THE INSURANCE AS STATED IN THIS POLICY. Premium shown is payable: $ 79,560 LOC* at i~'~ception. (*Non Working LOC) ENDORSEMENTS ATTACHED TO THIS POLICY: IL 0021 - Broad Form Nuclear Exclusion (Not Applicable in N,ew York) SAIC005(4/00) CADS21(7t97),SA CO07,SAIC016,CA0020(10/01) CA )022(2/99).CA2301(12/93) ~L0003(7/02) iL0017 (11~98)~A2325(7~97)~A9948~A9954~CA~18~CA2192~CA2193'CA2237~L~246~IL~91~MCS9~ COUNTERSIGNED July 24, 2003 (Date) · p. BY ~orize~ NOTE OFFICERS' FACSIMILE SIGNATURES MAY BE INSERTED ELSEWHERE AT THE COMPANY'S OPTION. HERE, ON THE POLICY COVER OR CA DS 21 07 97 Copyright Insurance Serv ces Or,ce, inc.. 1997 Page 1 of 7 ITEM TWO SCHEDULE OF COVERAGES AND COVERED AUTOS This policy provides only those coverages where a charge is shown in the premium column below. Each of these coverages will apply only to those "autos" shown as covered "autos". "Autos" are shown as covered "autos" for a particular coverage by the entry of one or more of the symbols from the Covered Autos Section of lhe Motor Car- rier Coverage Form next to the name of the coverage. COVERED AU 1 OS -- (Entry of one or more of the Symbols from LIMIT The Covered Autos COVERAGES Section of the THE MOST WE WILL PAY FOR ANY PREMIUM Motor Carder ONE ACCIDENT OR LOSS Coverage Form shows which autos are covered autos.) LIABILITY 72 $ 1,000,000 CSL $ 357,066 PERSONAL INJURY 72 SEPARATELY STATED IN EACH P.LP. $ 34,556 PROTECTION (or equivatent No- ENDORSEME~'4T MINUS $ N/A DED. Fault Coverage) LIlT $5000 ! ADDED PERSONAL INJURY SEPARATELY STATED IN EACH ADDED PiP, PROTECTION (or equivalent ENDORSEMENT. Added No-Fault Coverage) PROPERLY PROTECTION SEPARATELY STATED IN THE P.P.I. INSURANCE (Michigan only) ENDORSEMENT MINUS $ DED, FOR EACH ACCIDENT. MEDICAL PAYMENTS $ $ UNINSURED MOTORISTS 72 $ 35,000 $ 800 UNDERINSURED MOTORISTS 72 $ 35,000 $ 1400 When No[ included in Uninsured Motorists Coverage) TRAILER INTERCHANGE ACTUAL CASH VALUE, COST OF REPAIR, $ COMPREHENSIVE OR $ WHICHEVER IS LESS. TRAILER INTERCHANGE ACiUAL CASH VALUE, COST OF REPAIR SPECIFIED CAUSES OF OR $ WHICHEVER IS LESS MINUS LOSS COVERAGE $25 DED. FOR I--ACH COVERED AUTO FOR LOSS CAUSED BY MISCHIEF OR VANDALISM. TRAILER INTERCHANGE ACTUAL CASH VALUE, COST Of REPAIR $ -- COLLISION COVERAGE OR $ WHICHEVER IS LESS MINUS $ DIED. FOR EACH COVERED AUTO. Page 2 of 7 Copyright, Insurance Serv cas Off ce Inc., 1997 CA DS 21 07 97 MOTOR CARRIER DECLARATIONS ITEM TVVO SCHEDULE OF COVERAGES AND COVERED AUTOS (Cont'd) COV bh:t:U AUTOS (Entry of one or more ct t~e symbols f~om LIMIT the Covered Autos COVERAGES Section of the THE MOST WE WILL PAY FOR ANY PREMIUM Motor Carrier ONE ACCIDENT OR LOSS Coverage Form shows which autos are covered autos,) PHYSICAL DAMAGE ACTUAL CASFI VALUE OR COST OF REPAIR, $ COMPREHENSIVE COVERAGE WHICHEVER IS LESS MINUS $ See sch DED. FOR EACH COVERED AUTO, BUT NO DEDUCTIBLE APPLIES TO LOSS CAUSED BY FIRE OR LIGH'FNING. PHYSICAL DAMAGE ACTUAL CASH VALUE OR COST OR REPAIR, $ SPECIFIED CAUSES OF LOSS WHICHEVER IS LESS MINUS $25 DED. FOR COVERAGE EACH COVERE'D AUTO FOR LOSS CAUSED BY MISCHIEF OR VANDALISM. PHYSICAL DAMAGE ACTUAL CASH VALUE OR COST OF REPAIR, $ COLLISION COVERAGE WHICHEVER IS LESS MINUS $ See sch DED. FOR EACH COVERED AUTO. PHYSCIAL DAMAGE I OWING $ For Each Disablement Of A AND LABOR (Not Available in ,, - , California) Private Passenger Auto. Pollution Liability Endorsement (CAg! 48) PREMIUM FOR ENDORSEMENTS $ Incl PREMIUM FOR TERRORISM COVERAGE $ 3978 · ESTIMATED TOTAL PREMIUM , $ 397.800 · This policy may be subject to t~nal audit. CA DS 21 07 97 Copyright, Insurance Services Office, Inc., 1997 Page 3 of 7 ITEM THREE SCHEDULE OF COVERED AUTOS YOU OWN DESCRIPTION PURCHASED I TERRITORY Covered Year, Model, Trade Name, Body Type Original ActualI Town & State Auto Serial Number (S) Vehicle Identification Cost New Cost & Where The No. Number (Vin) NEW (N) Covered Auto USED (U) Will Be Principally Garaged 1 SEE SCHEDULE ~ $ $ 2 $ $ 3 $ $ 4 $ $ 5 $ $ CLASSIFICATI 3N Covered Radius Business Size GVW, Age Primary Secondary Code EXCEPT For Auto Of Use GCW Or Group Rating Rating Towing, All Physical No. Operation s:service Vehicle Seating Factor Factor Damage Loss ts r=retail Capacity Liab, Ph~-- Payable To You c--cocnmercla/ Darn. And The Loss Payee Named Below As Interests May Appear At The Time 1 SEE SCHEDULE Of The Loss. 2 3 4 5 Page 4 Of 7 Copyright, Insurance Services Office, Inc., 1997 CA DS 21 07 97 ITEM THREE SCHEDULE OF COVERAGED AUTOS YOU OWN (Cont'd) COVERAGES - PREMIUMS, LIMITS AND DEDUCTIBLES (Absence of a deductible Covered or limit entry in any column below means [hat the limit or deductible entry Auto in the corresponding ITEM TWO column applies instead.) No. LIABILITY PERSONAL INJURY ADDED PROPERTY PROTECTION AUTO MEDICAL I PROTECTION P.I.P. (Michigan Only) PAYMENTS Limit Premium Limit Stated Premium Limit Stated Limit Stated In Premium Limit Premium In Each P.I.P. In Each P.PJ. End. Minus Added P.I.P. End. Minus Deductible End. Deductible I Shown Below Premium Shown Below 1 $ $ SEE I $ SCHEDULE $ $ $ $ ..... ~- ...... ~"$ ...... 2 $ $ I$ $ $ $ $ -- 4 $ $ /$ $ $ $ $ $ $ 5 $ $ I$ $ $ $ $ $ Premium COVERAG :-S: ~ ~ - uct~ ) e Covered Or limit entry in any column below means ~hat the limit or deductible entry Auto in the corresponding ITEM TWO column applies instead.) No. COMPREHENSIVE SPECIFIED CAUSES COLLISION TOWING & LABOR OF LOSS PAYMENTS Limit Premium Limit Stated In Lirnit Stated Premium Limit Per Premium Stated In ITEM ITEM TWO In ITEM Disablement TWO Premium TWO Minus Minus Deductible Deductible Shown Shown Below Below I $ SEE $ SCHEDULE $ $ $ $ 2 , $ $ $ $ $ $ 3 $ $ $ $ $ $ 4 $ $ $ $ $ ,$ 5 $ $ $ $ -$ Premium CA DS 21 07 97 Copyright, Insurance Services Offic,a, Inc., 1997 Page 5 of 7 [] ITEM FOUR SCHEDULE OF HIRED OR BORROWED COVERED AUTO COVERAGE AND PREMIUMS LIABILITY COVERAGE - RATING BASIS COST OF HIRE -AUTOS USED IN YOUR MOTOR CARRIER OPERATIONS ESTIMATED COST OF HIRE RATE PER EACH $100 COST OF HIRE TOTAl ESTIMATED PREMIUM $ 15,000 $ Included $ Included in Liability Premium LIABILITY COVERAGE - RATING BASIS COST OF HIRE - AUTOS USED JN YOUR MOTOR CARRIER OPERATIONS ESTIMATED COST RATE PER EACH OF HIRE FOR $100 COST OF FACTOR (If Liability STATE EACH STATE HIRE Coverage Is Primary) PREMIUM $ $ TOTAL PREMIUM $ PHYSICAL DAMAGE COVERAGE LIMIT OF INSURANCE ESTIMATED RATE PER COVERAGES THE MOST WE WILL PAY ANNUAL EACH $100 DEDUCTIBLE COST OF ANNUAL COST PREMIUM HIRE OF HIRE ACTUAL CASH VALUE OR COST OF REPAIR, $ $ $ WHICHEVER IS LESS, MINUS $ DED, COMPREHENSIVE FOR EACH COVERED AUTO, BUT NO DEDUCTIBLE APPLIES TO LOSS CAUSED BY FIRE OR LIGHTNING. ACTUAL CASH VALUE OR COST OF REPAIR, $ $ $ SPECIFIED WHICHEVER IS LESS MINUS $ Deal. FOR CAUSES OF EACH COVERED ATUO FOR LOSS CAUSED By LOSS MISCHIEF OR VANDALISM. ACTUAL CASH VALUE OR COST OF REPAIR, $ $ $ COLLISION WHICHEVER IS LESS, MINUS $ DED FOR EACH COVERED AUTO. TOTAL PREMIUM $ Cost of Hire means- (a) The total dollar amount of costs you incurred for the hire of automobiles (includes trailers and semitrailers), and if not included therein, (b) The total remunerations of all operators and drivers helpers, of hired automobiles whether hired with a driver by lessor or an employee of the lessee, or any other third party, and, (c) The total dollar amount of any other costs (i.e., repair, maintenance, fuel, etc.) directly associated with op- erating the hired automobiles whether such costs are absorbed by the insured, paid to the lessor or owner, or paic] to others. Page 6 of 7 Copyright, Insurance Services Office, tnc., 1997 CA DS 21 07 97 [] ITEM FIVE SCHEDULE FOR NON-OWNERSHIP LIABILITY RATING BASIS Number Of Employees Number Of Partners NUMBERTOTAL PREMIUM 75-100 $ Included $ $ Included in Liability Premium ITEM SIX TRAILER INTERCHANGE COVERAGE COVERAGES LIMIT DAILY ESTIMATED OF RATE PREMIUM INSURANCE COMPREHENSIVE $ $ SPECIFIED STATED $ $ CAUSES OF LOSS IN ITEM TWO COLLISION $ $ TOTAL PREMIUM $ ITEM SEVEN SCHEDULE FOR GROSS RECEIPTS RATING BASIS - LIABILITY COVERAGE RATES ESTIMATED Per $100 Of Gross Receipts PREMIUMS YEARLY Gross Receipts LIABILITY AUTO MEDICAL LIABILITY AUTO MEDICAL COVERAGE PAYMENTS COVERAGE PAYMENTS 9,000,000 $ 4.42 $ $ 397,800 $ $ $ $ $ $ $ $ $ $ $ $ $ TOTAL PREMIUMS $ 397,800 $ ANNUAL MINIMUM PREMIUMS $ 358,020 $ MONTHLY MINIMUM PREMIUMS $ 29,835 When used as a premium basis: Gross Receipts means the total amount to which you are entitled for shippin9 or transporting property dunng the policy period regardless of whether you or any other carrier originate the shipment or transportation. "Gross Receipts" includes the total amount received from renting equipme~nl, with or without drivers, to anyone who is not a "motor carrier" and 15% of the total amount received from renting any equipment to any "motor carrier" Gross Receipts does not include: A. Amounts you pay to railroads, steamship lines, airlines and other motor carriers operating under their own ICC or PUC permits B. Advertising Revenue. C. Taxes which you collect as a separale item and remit directly to ~ governmental division. D. C.O.D. collections for cost of mall or merchandise including collection fees. E Warehouse storage fees. CA DS 21 07 97 Copyright, Insurance Services Office, Inc., 1997 Page 7 of 7 SCHEDULE OF COVERED A~UTOS YOU OWN EXTENSION OF DECLARATIONS POLICY NUMBER: LHTlOO1139A102 ITEM THREE SCHEDULE OF COVERED AUTOS YOUR OWN Covered DE$CRIIPTION STATED Territory Town & Slate Where the AMOUNT Auto Year Model; Trade Name; Body Type Covered Auto will be SCHEDULE ON FILE WITH COMPANY CLASS I~'ICATION I Copyright, Insurance Se vces Of ice, In¢. 1990 SCHEDULE OF COVERED AUTOS YOU OWN EXTENSION OF DECLARATIONS POLICY NUMBER: ITEM THREE SCHEDULE OF COVERED AUTOS YOLIR OWN (Cont'd) COVERAGES - PREMIUMS, LIMITS (Absence of a deductible or limit entry in any column below means that the limit of AND DEDUCTIBLES deductible entry in the corresponding ITEM TWO column applies instead) Includes copyrighted material of Insurance Services Office, lnc. Insurance Services Office, Inc., 1990 COMMERCIAL AUTO THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY MONTHLY REPORTING POLICY GROSS RECEIPTS OR MILEAGE This endorsement modifies insurance provided under the following: MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM The following changes are made: This endorsement, effective on part of Policy No. LHT1001139A102 07/05/03 at 12:01, standard time, forms a issued lo CIouse Trucking, Inc. The definition of Gross Receipts is as follows: You must keep an accurate record of all gross receipts or mileage (see item Seven of the Declarations) from your trucking business and report lo us monthly the full amount of such gross receipts or mileage for the preceding month. Such reperts will be sent by the fifteenth (15th) day of each month and you will pay the earned premium for that preceding month based on the rates shown in Item Seven of the Declarations. We will return the deposit after an audit is completed when the policy expires or is cancelled and you have submitted att monthly reports, When used in this endorsement: "Gross Receipts" means the total amount to which you are entitled for shipping or transporting property during the policy period regardless of whether you or any other carrier originate the shipment or transportation. "Gross Receipts" includes the total amount received from renting equipment, with or without drivers, to anyone who is not a trucker and 15% of the total amount received from renting any equipment to any trucker, "Gross Receipts" does not include: A. Amounts you pay to railroads, steamship lines, airlines and ather motor carriers operating under their own ICC or PUC permits. B. Advertising revenue. C. Taxes which you collect as a separate item and remit directly to a governmental division. D. C.O.D. collections for cost of mail or merchandising including collection fees. E. Warehouse storage fees "Mileage" means the total mileage, live and dead, of all units operated for the shipment or transportation of property during the policy period, whether the shipment originates with you or another carrier, and shall include the total mileage developed from the rental of equipment, with or without drivers, to any person or organization, other than a trucker and 10% of the mileage developed from the rental of equipment with or without drivers, to any trucker. SAIC 007 04 00 Page 1 of 1 Sirius America insurance Company, Inc. COMMERCIAL AUTO THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY PUNITIVE DAMAGES EXCLUSION This endorsement modifies insurance provided under the following: MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM The following changes are made: This endorsement, effective on part of Policy No. LHT1001139A102 issued to 07/05/03 at 12:01, standard time, forms a Clouse Trucking, Inc. in consideration of the premium charged, it is understood and agreed that this policy excludes any claim for punitive or exemplary damages whether arising out of acts of the insureds, insured's employees or any other person. All other terms and conditions of this policy remain unchanged. SAIC 016 04 00 Page 1 of 1 Sirius America Insurance Company, Inc. COMMERCIAL AUTO CA 0g 20 10 0'1 MOTOR CARRIER COVERAGE FORM Various provisions in this policy restrict coverage. Read the entire policy carefully to determine rights, duties and what is and is not covered. Throughout this policy the words "you" and "your" refer to the Named Insured shown in the Declarations. The words "we", "us" and "our" refer to the Company pro- riding this insurance. Other words and phrases that appear in quotation marks have special meaning. Refer to Section VI - Definitions. SECTION I - COVERED AUTOS Item Two of the Declarations shows the "autos" that are covered "autos" for each of your coverages. The following numerical symbols describe the "autos" that may be covered "autos". The symbols entered next to a coverage on the Declarations designate the only "autos" that are covered "autos". A. Description Of Covered Auto Designation Symbols Symbol Description Of Covered Auto Designation Symbols 61 Any "Auto" 62 Owned "Autos" Only the "autos" you own (and for Liability Coverage any "trailers" you don'l owr Only while connected to a power unit you own). This includes those "autos" you acquire ownership of after the policy begins. 63 i Owned Private Only the "private passenger lype" "autos" you own. This includes those "private Passenger Type passenger type" "autos" that you acquire ownership of after the policy begins. "Autos" Only 64 Owned Corn- Only those trucks, lractors and "trailers" you own (and for Liabilily Coverage any mercial "Autos .... trailers" you don't own while connected to a power unit you own). This includes Only those trucks, lractors and "trailers" you acquire ownership of after the policy begins. 65 Owned "Autos" Only those "autos" you own that are required to have No-Fault benefits in the state Subject To No- where they are licensed or principally garaged. This includes those "autos" you Fault acquire ownership of after the policy begins provided they are subject to the No- Fault law in the state where Ihey are licensed or principally garaged. 66 Owned "Autos" Only those "autos" you own that, because of the law in the state where they are Subject To A licensed or principally garaged, are required to have and cannot reject Uninsured Compulsory Motorists Coverage. This includes those "autos" you acquire ownership of after the Uninsured Mo- policy begins provided Ihey are subject to the same state uninsured motorists re- torists Law quirement. 67 Specifically Only those "autos" described in Item Three of the Declarations for which a pre- Described mium charge is shown (and for Liability Coverage any "trailers" you don't own white "Autos" attached to any power unit described in Item Three). 68 Hired "Autos" Only those "autos" you lease, hire, rent or borrow. This does not include any Only vale passenger type" "auto" you leasE;, hire, rent or borrow from any member of your household, any of your "employees", partners (if you are a partnership), mem- bers (if you are a limiled liability company), or agents or members of their house- holds. 69 "Trailers" In Only those "trailers" you do nol own while in your possession under a written Your Possession "trailer" or equipmenl interchange agreement in which you assume liability for "loss" Under A Written to the "trailers" while in your possession. Trailer Or Equipmenl In- terchange Agreement CA 00 20 10 01 © ISO Properties, Inc., 2000 Page 1 of 13 [] Symbol Description Of Covered Auto Designation Symbols 70 I Your '~frailers" Only those "trailers" you own or hire while in the possession of anyone else under a In The Posses- written "trailer" interchange agreemenL When Symbol "70" is entered next to a sion Of Anyone Physical Damage Coverage in Item Two of the Declarations, the Physical Damage Else Under A Coverage exclusion relating to "loss" to a "trailer" in the possession of anyone else Written Trailer does not apply to that coverage. Interchange Agreement 71 Nonowned Only those "autos" you do not own, lease, hire, rent or borrow that are used in "Autos" Only connection with your business. This includes "private passenger type" "autos" owned by your "employees" or partners (if you are a partnership), members (if you are a limited liability company), or members of their households but only while used in your business or your personal affairs. B. Owned Autos You Acquire After The Policy Begins 1. If Symbols 61, 62, 63, 64, 65 or 66 are entered next to a coverage in Item Two of the Declara- tions, then you have coverage for "autos" that you acquire of the type described for the re- mainder of the policy period. 2. But, if Symbol 67 is entered next to a coverage in Item Two of the Declarations, an "auto" you acquire will be a covered "auto" for that cover- age only if: a. We already cover all "autos" that you own for that coverage or it replaces an "auto" you previously owned that had that cover- age; and b. You tel~ us within 30 days after you acquire it that you want us to cover it for that cover- age. C. Certain Trailers, Mobile Equipment And Temporary Substitute Autos If Liability Coverage is provided by lhis Coverage Form, the following types of vehicles are also cov- ered "autos" for Liability Coverage: 1. "Trailers" with a load capacity of 2,000 pounds or tess designed primarily for travel on public roads. 2. "Mobile equipment" while being carried or towed by a covered "auto". 3. Any "auto" you do not own while used with the permission of its owner as a temporary substi- tute for a covered "auto" you own that is out of service because of its: a. Breakdown; b. Repair; c. Servicin9; d. "Loss"; or e. Destruction. SECTION II - LIABILITY COVERAGE A. Coverage We will pay all sums an "insured" legally must pay as darna§es because of "bodily injury" or "property damage" to which this insurance applies, caused by an "accident" and resulting from the ownership, maintenance or use of a covered "auto". We will also pay all sums an "insured" legally must pay as a "covered pollution cost or expense" to which this insurance applies, caused by an "acci- dent'' and resulting from the ownership, mainte- nance= or use of covered "autos". However, we will only pay for lhe "covered pollution cost or ~- pense" if there is either "bodily injury" or "property damage" to which this insurance applies that is caused by the same "accident". We will have the right and duty to defend any "in- sured'r' against a "suit" asking for such damages or a "covered pollution cost or expense". However, we have no duty to defend any "insured" against a "suit" seeking damages for "bodily injury" or "prop- erty damage" or a "covered pollution cost or ex- pense" to which this insurance does not apply. We may investigate and settle any claim or "suit" as we consider appropriate. Our duty to defend or settle ends when the Liability Coverage Limit of Insur- ance has been exhausted by payment of judg- ments or settlements. 1. Who Is An Insured The following are "insureds": a. You for any covered "auto", b. Anyone else while using with your permis- sion a covered "auto" you own, hire or bor- row except: (1) The owner, or any "employee", agent or driver of the owner, or anyone else from whom you hire or borrow a covered "auto". Page 2 of 13 © ISO Properties, Inc., 2000 CA O0 20 10 01 [] (2) Your "employee" or agent if lhe covered "auto" is owned by that "employee" or agent or a member of his or her house- hold. (3) Someone using a covered "auto" while he or she is working in a business of selling, servicing, repairing, parking or sloring "autos" unless that business is yours. (4) Anyone other than your "employees", padners (if you are a partnership), members (if you are a limited liability company), a lessee or borrower of a covered "auto" or any of their "employ- ees'', while moving property to or from a covered "auto". (5) A partner (if you are a partnership), or member (if you are a limited liability company) for a covered "auto" owned by him or her or a member of his or her household. c. The owner or anyone else from whom you hire or borrow a covered "auto" that is a "trailer" while the "trailer" is connected to another covered "auto" that is a power unit, or, if not connected, is being used exclu- sively in your business. d. The lessor of a covered "auto" that is not a "trailer" or any "employee", agent or driver of the lessor while the "auto" is ~eased to you under a written agreement if the written agreement between the lessor and you does not require the lessor Io hold you harmless and then only when the leased "auto" is used in your business as a "molor carrier" for hire. e. Anyone liable for the conduct of an sured" described above but only to the ex- tent of thal liability. However, none of the following is an "insured": a. Any "motor carrier" for hire or his or her agents or "employees", other than you and your "employees": (1) If the "motor carrier" is subject to motor carrier insurance requirements and meets them by a means other than "auto" liability insurance. (2) If the "motor carrier" Ks not insured for hired "autos" under an "auto" liability in- surance form that insures on a primary basis the owners of the "autos" and their agents and "employees" while Ihe "autos" are leased to lhat "motor carrier" and used in hfs or her business. However, Paragraph a. above does not ap- ply if you have leased an "auto" to the for- hire "motor carrier" under a written lease agreement in which you have held that "motor carrier" harmless. b,, Any rail, water or air carrier or its "employ- ees" or agents, other than you and your "employees", for a "trailer" if "bodily injury" or "property damage" or a "covered pollution cost or expense" occurs while the "trailer" is detached from a covered "auto" you are using and: (1) Is being transporled by the carrier; or (2) Is being loaded on or unleaded from any unit of transportalion by the carder. 2. Coverage Extensions a. Supplementary Payments In addition to the Limit of Insurance, we wilt pay for the "insured": (1) All expenses we incur. (2) Up to $2,000 for the cost of bail bonds (including bonds for related traffic law violations) required because of an "acci- dent'' we cover. We do not have to fur- nish these bonds. (3) The cost of bonds to release attach- ments in any "suit" against the "insured" we defend, but only for bond amounts within our Limit of Insurance. (4) All reasonable expenses incurred by the "insured" at our request, including actual loss of earnings up to $250 a day be- cause of time off from work. (5) All costs taxed against the "insured" in any "suit" against the "insured" we fend. ,[6) All interest on the full amount of any judgment that accrues after entry of the judgment in any "suit" against the sured" we defend; but our duty to pay inlerest ends when we have paid, of- fered to pay or deposited in court the part of the judgment that is within our Limit of Insurance. b. Out Of State Coverage Extensions While a covered "auto" is away from the state where it is licensed we will: CA 00 20 10 01 © ISO Properlies, Inc., 2000 Page 3 of '13 El (1) Increase the Limit of Insurance for Li- ability Coverage to meet the limit speci- fied by a compulsory or financial re- sponsibility law of the jurisdiction where the covered "auto" is being used. This extension does not apply to the limit or limits specified by any law governing "motor carriers" of passengers or prop- erty. (2) Provide the minimum amounts and types of other coverages, such as no- fault, required of out-of-state vehicles by the jurisdiction where the covered "auto" is being used. We will not pay anyone more than once for the same elements of "loss" because of these extensions. B. Exclusions This insurance does not apply to any of the fol- lowing: 1. Expected Or Intended Injury "Bodily injury" or "property damage" expected or intended from the standpoint of the "in- sured". 2. Contractual Liability assumed under any contract or agree- ment. But this exclusion does not apply to Ii- ability for damages: a. Assumed in a contract or agreement that is an "insured contract" provided the "bodily injury" or "property damage" occurs subse- quent to the execution of the contract or agreement; or b. That the "insured" would have in the ab- sence of the contract or agreement. 3. Workers' Compensation Any obligation for which the "insured" or the "insured's" insurer may be held liable under any workers' compensation, disability benefits or unemployment compensation law or any similar law. 4. Employee Indemnification And Employer's Liability "Bodily injury" to: a. An "employee" of the "insured" arising out of and in lhe course of: (1) Employment by the "insured"; or (2) Performing the duties related to the conduct of the "insured's" business or b, The spouse, child, parent, brother or sister of that "employee" as a consequence of Paragraph a. above, This exclusion applies: (1) Whether the "insured" may be liable as an employer or in any other capacity; and (2) To any obligation to share damages with or repay someone else who must pay damages because of the injury. But this exclusion does not apply to "bodily jury" to domestic "employees" not entitled to workers' compensation benefits or to liability assumed by the "insured" under an "insured contract". For the purposes of the Coverage Form, a domestic "employee" is a person en- gaged in household or domestic work per- formed principally in connection with a resi- dence premises. 5, Fellow Employee "Bodily injury" to any fellow "employee" of the "immured" arising out of and in the course of the fellow "employee's" employment or while per- forming duties related to the conduct of your business. 6. Care, Custody Or Control "Property damage" to or "covered pollution cost or .expense" involving property owned or trans- ported by the "insured" or in the "insured's" care, custody or control. But this exclusion does not apply to liability assumed under a sidetrack agreement. 7. Handling Of Property "Bodily injury" or "property damage" resulting from the handling of property: a. Before it is moved from the place where it is accepted by the "insured" for movement into or onto the covered "auto"; or b. After it is moved from the covered "auto" to the place where il is finally delivered by the "insured". 8, Movement Of Property By Mechanical De,vice "Bodily injury" or "property damage" resulting from the movement of properly by a mechani- cal device (other than a hand truck) unless Ihe device is attached to the covered "auto". 9. Operations "Bodily injury" or "property damage" arising out of the operation of any equipment listed in Paragraphs 6.b. and 6.c. of the definition of "mobile equipment". 10. Completed Operations "Bodily injury" or "property damage" arising out of "your work" after that work has been com- plo/ed or abandoned. Page 4 of 13 © ISO Properties, Inc., 20,00 CA 00 20 10 01 [] In the exclusion, your work means: a. Work or operations performed by you or on your behalf; and b. Materials, pads or equipment furnished in connection with such work or operations. Your work includes warranties or representa- tions made at any time with respect to the fit- ness, quality, durability or performance of any of the items included in Paragraphs a. or b, above. Your work will be deemed completed at the earliesl of the following times: (1) When all of the work called for in your conlract has been completed, (2) When all of the work to be done at the site has been completed if your contract calls for work at more than one site. (3) When that part of the work done at a job site has been put to its intended use by any person or organization olher than another contractor or subcontractor working on lhe same project. Work lhat may need service, maintenance, cor- rection, repair or replacement, but which is olh- erwise complete, will be treated as completed. 11. Pollution "Bodily injury" or "property damage" arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or es- cape of "pollutants": a. That are, or that are contained in any prop- arty that is: (1} Being transported or towed by, handled, or handled for movement into, onto or from, the covered "auto"; (2) Otherwise in the course of transit by or on behalf of the "insured"; or (3) Being stored, disposed of, treated or processed in or upon the covered "auto"; b, Before the "pollutants" or any property in which the "pollutants" are contained are moved from the place where they are ac- cepted by the "insured" for movement into or onto the covered "auto"; or c. After the "pollutants" or any property in which lhe "pollutants" are contained are moved from Ihe covered "auto" to the place where they are finally delivered, disposed of or abandoned by the "insured". Paragraph a. above does not apply to fuels, lu- bricants, fluids, exhaust gases or other similar "pollutants" that are needed for or result from Ihe normal electrical, hydraulic or mechanical functioning of the covered "auto" or its parts, if: ('1) The "pollutants" escape, seep, migrate, or are discharged, dispersed or released directly from an "auto" part designed by its manufacturer to hold, store, receive or dispose of such "poIlulants"; and (2) The "bodily injury", "property damage" or "covered pollution cost or expense" does not arise out of the operation of any equipment listed in Paragraphs 6.b. and 6.c. of the definition of "mobile equip~ Paragraphs b. and c. above of this exclusion da not apply to "accidents" that occur away from premises owned by or rented to an "in- sured" wilh respect to "pollutanls" not in or upon a covered "auto" if: (1) The "pollutanls" or any property in which the "pollutants" are contained are upset, overturned or damaged as a result of the maintenance or use of a covered "auto"; and (2) The discharge, dispersal, seepage, migration, release or escape of Ihe "pollutants" is caused directly by such upset, overturn or damage. 12. War "Bodily injury" or "property damage" due to war, whether or not declared, or any act or condition incident to war. War includes civil war, insur- rection, rebellion or revolution. This exclusion applies only to liability assumed under a con- tract or agreement. 13. Racing Covered "autos" while used in any professional or organized racing or demolition coolest or stu, nting activity, or while practicing for such contest or activily. This insurance also does not apply while that covered "auto" is being pre- pared for such a coolest or activity. C. Limit Of Insurance Regardless of the number of covered "autos", "in- sureds", premiums paid, claims made or vehicles involved in the "accident", the most we witl pay for the total of all damages and "covered pollution cost or expense" combined, resulting from any one "ac- cident" is the Limit of Insurance for Liability Cover- age shown in the Declarations. All "bo,Jily injury", "property damage" and "covered pollutic,n cost or expense" resulting from continu- ous or repeated exposure to substantially th~ same conditions will be considered as resulting from one "accident". CA 00 20 10 01 © ISO Propedies, Inc., 200,0 Page 5 of 13 No one will be entitled to receive duplicate pay- ments for the same elements of "loss" under this Coverage Form and any Medical Payments Coy- erage endorsement, Uninsured Motorists Cover- age endorsement or Underinsured Motorists Cov- erage endorsement edached to this Coverage Part. SECTION III - TRAILER INTERCHANGE COVERAGE A. Coverage 1, We will pay all sums you legally must pay as damages because of "toss" to a "trailer" you don't own or its equipment under: a. Comprehensive Coverage From any cause except: (1) The "trailer's" collision with another object; or (2) The "trailer's" overturn. b. Specified Causes Of Loss Coverage Caused by: (t) Fire, lightning or explosion; (2) Theft; (3) Windstorm, hail or earthquake; (4) Flood; (5) Mischief or vandalism; or (6) The sinking, burning, collision or derail- ment of any conveyance transporting the "trailer". c. Collision Coverage Caused by: (1) The "trailer's" collision with another object; or (2) The "trailer's" overturn. 2. We have the right and duty to defend any "in- sured'' against a "suit" asking for these dam- ages. However, we have no duty to defend any "insured" against a "suit" seeking damages for any "loss" to which this insurance does not ap- ply. We may investigate and settle any claim or "suil" as we consider appropriate. Our duty to defend or settle ends for a coverage when the Limit of Insurance for Ihat coverage has been exhausted by payment of judgments or settle- ments. 3. Coverage Extensions The following applies as Supplementary Pay- ments, in addition lo lhe Limit of Insurance, we will pay for you: a. All expenses we incur. b. The cost of bonds to release attachments, but only for bond amounts within our Limit of Insurance. c. All reasonable expenses incurred at our request, including actual loss of earnings up to $250 a day because of time off from work. d. All costs taxed against the "insured" in any "suit" againsl the "insured" we defend. e. All interest on the full amount of any judg- ment that accrues after entry of the judg- ment; but our duty to pay interest ends when we have paid, offered to pay, or de- posited in court the part of the judgment that is within our Limit of Insurance. B. Exclu,,~ions 1. We, will not pay for "loss" caused by or resulting from any of lhe following. Such "loss" is ex- cluded regardless of any other cause or event that contributes concurrently or in any se- quence to the "loss". a. Nuclear Hazard (1) The explosion of any weapon employing atomic fission or fusion; or (2) Nuclear reaction or radiation, or radioac- tive contamination, however caused. b. War Or Military Action t~1) War. including undeclared or civilwar; 112) Warlike action by a military force, in- cluding action in hindering or defending against an actual or expected attack, by any government, sovereign or other authority using military personnel or other agents; or ,[3) Insurrection, rebellion, revolution, usurped power or action taken by gov- ernmental authority in hindering or de- fending against any of these. 2. We will not pay for loss of use. 3. Otlher Exclusions We will not pay for "loss" caused by or resulting from any of the following unless caused by other "loss" that is covered by this insurance: a. Wear and tear, freezing, mechanical or electrical breakdown, b. Blowouts, punctures or other road damage to tires. C. Limit Of Insurance And Deductible The most we will pay for "loss" to any one "trailer" is the least of lhe following amounls minus any applicable deductible shown in the Declarations: 1. The actual cash value of the damaged or stolen property at the time of the "loss", Page 6 of 13 © ISO Properties, Inc., 2000 CA 00 20 10 01 [] 2. The cost of repairing or replacing the damaged or stolen property with other properly of like kind and quality. 3. The Limit of Insurance shown in Ihe Declara- tions. SECTION IV - PHYSICAL DAMAGE COVERAGE A. Coverage 1. We will pay for "loss" to a covered "auto" or its equipment under: a. Comprehensive Coverage From any cause except: (1) The covered "auto's" collision with an- olher object; or (2) The covered "auto's" overturn. b, Specified Causes Of Loss Coverage Caused by: (1) Fire, lightning or explosion; (2) Theft; (3) Windstorm, hail or earthquake; (4) Flood; (5) Mischief or vandalism; or (6) The sinking, burning, collision or derail- merit of any conveyance transporting the covered "auto". c. Collision Coverage Caused by: (1) The covered "auto's" collision with an- other object; or (2) The covered "auto's" overturn. 2. Towing - Private Passenger Type Autos We wilt pay up to the limit shown in the Decla- rations for towing and labor costs incurred each time a covered "auto" of the "private passenger type" is disabled. However, the labor must be performed at the place of disablement. 3. Glass Breakage - Hitting A Bird Or Animal- Falling Objects Or Missiles If you carry Comprehensive Coverage for the damaged covered "auto", we will pay for the following under Comprehensive Coverage: a. Glass breakage; b. "Loss" caused by hitting a bird or animal; and c. "Loss" caused by failing objects or missiles. However, you have the option of having glass breakage caused by a covered "auto's" collision or overturn considered a "loss" under Collision Coverage. 4. (;overage Extension a. Transportation Expenses We will also pay up to $20 per day to a maximum of $600 for temporary transporta- tion expense incurred by you because of the total theft of a covered "auto" of the "pri- vate passenger type". We will pay only for those covered "autos" for which you carry either Comprehensive or Specified Causes of Loss Coverage, We will pay for tempo- rary transportation expenses incurred dur- ing the period beginning 48 hours after the theft and ending, regardless of the policy's expiration, when the covered "auto" is re- turned to use or we pay for its "loss". b. Loss Of Use Expenses For Hired Auto Physical Damage, we will pay expenses for which an "insured" be- comes legally responsible to pay for loss of use of a vehicle rented or hired without a driver, under a written rental contract or agreement. We will pay for loss of use ex- penses if caused by: (1) Other than collision only if the Declare- lions indicate that Comprehensive Cov- erage is provided for any covered "auto"; (2) Specified Causes Of Loss only if the Declarations indicale that Specified Causes Of Loss Coverage is provided for any covered "auto"; or (3) Collision only if the Declarations indicate that Collision Coverage is provided for any covered "auto". However, the most we will pay for any e~- penses for loss of use is $20 per day, to a maximum of $600. B. Exclusions 1. We will not pay for "loss" caused by or resulting from any of the following. Such "loss" is ex- chJded regardless of any other cause or event that contributes concurrently or in any se- quence to the "loss". a. Nuclear Hazard (1) The explosion of any weapon employing atomic fission or fusion; or (2) Nuclear reaction or radiation, or radioac- tive contamination, however caused. b. War Or Military Action (1) War, including undeclared or civil war; CA 00 20 10 01 © ISO Properties, Inc., 2000 Page 7 of 13 [] (2) Warlike action by a military force, in- cluding action in hindering or defending against an actual or expected altack, by any government, sovereign, or other authority using military personnel or other agents; or (3) insurrection, rebellion, revolution, usurped power or action taken by gov- ernmental authority in hindering or de- fending against any of these. 2. We will not pay for "loss" to any of the follow- ing: a. Any covered "auto" while in anyone etse's possession under a written "trailer" inter- change agreement. But this exclusion does not apply to a loss payee; however, if we pay the loss payee, you must reimburse us for our payment. b. Any covered "auto" while used in any pro- fessional or organized racing or demolition contest or stunting activity, or while practic- ing for such contest or activity. We will also not pay for "loss" 1o any covered "auto" while that covered "auto" is being prepared for such a contest or activity. c. Tapes, records, discs or similar audio, vis- ual or data electronic devices designed for use with audio, visual or data electronic equipment. d. Any device designed or used to detect speed measuring equipment such as radar or laser detectors and any jamming appa- ratus intended to elude or disrupt speed measurement equipment. e. Any electronic equipment, without regard to whether this equipment is permanently in- stalled, that receives or transmits audio, visual or data signals and that is not de- signed solely for the reproduction of sound. f. Any accessories used with lhe electronic equipment described in Paragraph e. above. Exclusions 2.e. and 2.f, do not apply to: a. Equipment designed solely for the repro- duction of sound and accessories used with such equipment, provided such equipment is permanently installed in the covered "auto" or such equipment is removable from a housing unit which is permanently in- stabled in the "auto", and such equipment is designed Io be solely operated by use of the power from the "auto's" electrical system, in or upon the covered "auto"; or b. Any other electronic equipment that is: (t) Necessary for the normal operation of the "auto" or the monitoring of the "auto's" operating system; or {2) An integral pad of the same unit housing any sound reproducing equipment scribed in a. above and permanently in- stalled in the opening of the dash or console of the covered "auto" normally used by the manufacturer for installation of a radio. 3, We wilt not pay for "lose" caused by or resulting from any of the following unless caused by other "loss" that is covered by this insurance: a. Wear and tear, freezing, mechanical or electrical breakdown. b. Blowouts, punctures or other road damage to tires. 4. We will not pay for "toss" to a covered "auto" due to "diminution in value". C. Limits Of Insurance 1. The most we will pay for "loss" in any one "ac- ciclent" is the lesser of: a. The actual cash value of the damaged or stolen property as of the time of "loss"; or b. The cost of repairing or replacing the dam- aged or stolen property with other property of like kind and quality. 2. An adjustment for depreciation and physical condition will be made in determining aclual cash value in the event of a total "loss". 3. If a repair or repJacement results in better than like kind or quality, we will not pay for the amount of the betterment. D. Deductible For each covered "auto", our obligation to pay for, repair, return or replace damaged or stolen prop- erty will be reduced by the applicable deductible shown in the Declarations. Any Comprehensive Coverage deductible shown in the Declarations does not apply to "loss" caused by fire or lightning. Page 8 of 13 © ISO Properties, Inc., 2000 CA 00 20 10 01 D SECTION V - MOTOR CARRIER CONDITIONS The following conditions apply in addition to the Common Policy Conditions: A. Loss Conditions 1. Appraisal For Physical Damage Loss If you and we disagree on the amount of "loss", either may demand an appraisal of the "loss". In this event, each par~y will select a competent appraiser. The two appraisers will select a competent and impartial umpire. The apprais- ers will stale separately the actual cash value and amount of "loss". If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two will be binding. Each party will: a. Pay its chosen appraiser; and b. Bear lhe other expenses of the appraisal and umpire equally. If we submit to an appraisal, we will still retain our right to deny the claim. 2. Duties In The Event Of Accident, Claim, Suit Or Loss We have no duty to provide coverage under this policy unless there has been full compli- ance with lhe following duties: a. In the event of "accident", claim, "suit" or "loss", you must give us or our authorized representative prompt notice of the "acci- dent'' or "loss". Include: (1) How, when and where the "accident" or "loss" occurred; (2) The "insured's" name and address; and (3) To the extent possible, the names and addresses of any injured persons and witnesses. b. Additionally, you and any other involved "insured" must: (t) Assume no obligation, make no payment or incur no expense without our consent, except at the "insured's" own cost. (2) Immediately send us copies of any re- quest, demand, order, notice, summons or legal paper received concerning the claim or "suit", (3) Cooperate with us in the investigation or settlement of the claim or defense against the "suit". (4) Authorize us to obtain medical records or other pertinent information. (5) Submit to examination at our expense, by physicians of our choice, as often as we reasonably require. C. If there is a "loss" to a covered "auto" or its equipment you must also do the following: (1) Promptly notify the police if the covered "auto" or any of its equipment is stolen. (2) Take all reasonable steps to protect the covered "auto" from further damage. Also keep a record of your expenses for Consideration in the settlement of the c~aim. (3) Permit us to inspect the covered "auto" and records proving the "loss" before its repair or disposilion. (4) Agree to examination under oath at our request and give us a signed statement of your answers. 3. Legal Action Against Us No one may bring a legal action against us un- der this Coverage Form until: a. There has been full compliance with all the terms of this Coverage Form; and b. Under Liability Coverage, we agree in writ- ing that the "insured" has an obligation to pay or until the amount of that obligation has finally been determined by judgment after trial. No one has the right under this policy to bring us into an action to determine the "insured's" liability. 4. Loss Payment - Physical Damage Coverages At our option we may: a. Pay for, repair or replace damaged or stoten property; b. Return the stolen property at our expense. We will pay for any damage that results to the "auto" from the theft; or c. Take all or any part of the damaged or stolen property at an agreed or appraised value. If we pay for the "ross", our payment will include the applicable sales tax for lhe damaged or stolen property. 5. Transfer Of Rights Of Recovery Against Others To Us If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, Ihose rights are transferred to us. That person or or- ganization must do everyll~ing necessary to se- cure our rights and must do nothing after "acci- dent'' or "loss" to impair them. CA 00 20 10 01 © ISO Properties, Inc., 2000 Page 9 of 13 E~ B. General Conditions 1. Bankruptcy Bankruptcy or insolvency of the "insured" or the "insured's" estate will not relieve us of any obli- gation under this Coverage Form. 2. Concealment, Misrepresentation Or Fraud This Coverage Form is void in any case of fraud by you at any time as it relates to this Coverage Form. It is also void if you or any other "Insured", at any time, intentionally con- ceal or misrepresent a material fact concern- ing: a. This Coverage Form; b. The covered "auto"; c. Your interest in the covered "auto"; or d. A claim under this Coverage Form, 3. Liberalization If we revise this Coverage Form to provide more coverage without additional premium charge, your policy will automatically provide the additional coverage as of the day the revi- sion is effective in your state. 4, No Benefit To Bailee - Physical Damage Coverages We will not recognize any assignment or grant any coverage for the benefit of any person or organization holding, storing or transporting property for a fee regardless of any other provi- sion of this Coverage Form. 5. Other Insurance - Primar~ And Excess Insurance Provisions a. While any covered "auto" is hired or bor- rowed from you by another "motor carrier", this Coverage Form's liability coverage is: (1) Primary if a written agreement between you as the lessor and the other "motor carrier" as the lessee requires you to held the lessee harmless. (2) Excess over any other collectible insur- ance if a written agreement between you as the lessor and the other "motor car- rier'' as the lessee does not require you to hold the lessee harmless. b. While any covered "auto" is hired or bor- rowed by you from another "motor carrier" this Coverage Form's liability coverage is: (1) Primary if a written agreement between the other "motor carrier" as the lessor and you ss the lessee does not require the lessor to hold you harmless, and then only while the covered "auto" is used exclusively in your business as a "motor carrier" for hire. (2) Excess over any other collectible insur- ance if a written agreement between the other "motor carrier" as the lessor and you as the lessee requires the lessor to hold you harmless. c. 'While a covered "auto" which is a "trailer" is connected to a power unit, this Coverage Form's Liability Coverage is: (1) Provided on the same basis, either pr~- mary or excess, as the liability coverage provided for the power unit if the power unit is a covered "auto". (2) Excess if the power unit is not a covered "auto". d. Any Trailer Interchange Coverage provided by this Coverage Form is primary for any covered "auto". e. Except as provided in Paragraphs a., b., c. and d. above, this Coverage Form provides pdmary insurance for any covered "auto" you own and excess insurance for any cov- ered "auto" you don't own. f. For Hired Auto Physical Damage Coverage, any covered "auto" you lease, hire, rent or borrow is deemed to be a covered "auto" you own. However, any "auto' that is leased, hired, rented or borrowed with a driver is not a covered "auto". g, Regardless of the provisions of Paragraphs a., b., c., d. and e. above, this Coverage Form's Liability Coverage is primary for any liability assumed unde~ an "insured con- tract". h. When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the lim- its of all the Coverage Forms and policies covering on the same basis. 6. Premium Audit a, The estimated premium for this Coverage Form is based on the exposures you told us you have when this policy began. We will compule the final premium due when we determine your actual exposures. The esti- mated total premium will be credited against the final premium due and the first Named Insured will be billed for the balance, if any. The due date for the final premium or retro- spective premium is the date shown as the due date on the bill. If the estimated total premium exceeds the final premium due, the first Named Insured will gel a refund. Page ~10 of 13 © ISO Properlies, Inc., 2g00 CA 00 20 tO 0'1 [] b. If this policy is issued for more than one year, the premium for this Coverage Form will be computed annually based on our rates or premiums in effect at the beginning of each year of the policy. 7, Policy Period, Coverage Territory Under this Coverage Form, we cover "acci- dents'' and "losses" occurring: a. During the policy period shown in the Decla- rations; and b. Within the coverage territory. The coverage territory is: a. The United States of America; b. The territories and possessions of the United States of America; c. Puerto Rico; d. Canada; and e. Anywhere in the world if: (1) A covered "auto" of the "private passen- ger type" is leased, hired, rented or rowed without a driver for a period of 30 days or less; and (2) The "insured's" responsibility to pay damages is determined in a "suit" on the merits, in the United States of America, the territories and possessions of the United States of America, Puerto Rico, or Canada or in a settlement we agree to. We also cover "loss" to, or "accidents" involv- ing, a covered "auto" while being transported between any of Ihese places. 8. Two Or More Coverage Forms Or Policies Issued By Us If this Coverage Form and any other Coverage Form or policy issued to you by us or any com- pany affiliated with us apply to the same "acci- dent'', the aggregate maximum Limit of Insur- ance under all the Coverage Forms or policies shall not exceed the highest applicable Limit of Insurance under any one Coverage Form or policy. This condition does not apply to any Coverage Form or policy issued by us or an af- ~liated company specifically to apply as excess insurance over this Coverage Form. SECTION VI - DEFINITIONS A. "Accident" includes continuous or repeated expo- sure to the same conditions resulting in "bodily jury" or "property damage". B. "Auto" means a land motor vehicle, "trailer" or semitrailer designed for travel on public roads but does not include "mobile equipment". C. "Bodily injury" means bodily injury, sickness or disease sustained by a person including death re- suiting from any of these. D. "Covered pollution cost or expense" means any cost or expense arising out of: 1, Any request, demand, order or statutory or regulatory requirement; or 2. Any claim or "suit" by or on behalf of a govem- rnental authority demanding that the "insured" or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of "pol- lutants''. "Covered pollution cost or expense" does not include any cost or expense arising out of the aclual, alleged or threatened discharge, disper- sal, seepage, migration, release or escape of "pollutants": a. That are, or that are contained in any prop- erty that is: (1) Being transported or towed by, handled, or handled for movement inlo, onto or from the covered "auto"; (2) Otherwise in the course of transit by or on behalf of the "insured"; (3) Being stored, disposed of, treated or processed in or upon the covered "auto"; b. Before the "pollutants" or any property in which the "pollutanls" are contained are moved from Ihe place where they are ac- cepted by the "insured" for movement into or onto the covered "auto"; or c, After the "pollutants" or any property in which the "pollutanls" are contained are moved from the covered "auto" to the place where they are finally delivered, disposed of or abandoned by the "insured". Paragraph a. above does not apply to fuels, lubricants, fluids, exhaust gases or other similar "pollutants" that are needed for or result from the normal electrical, hydraulic or mechanical functioning of lhe covered "auto" or its parts, if: f, 1) The "pollutants" escape, seep, migrate, or are discharged, dispersed or released directly from an "auto" part designed by its manufacturer to hold, store, receive or dispose of such "pollutants"; and (2) The "bodily injury", "property damage" or "covered pollulion cost or expense" does not arise out of the operation of any equipment fisted in Paragraphs 6,b. or 6.c. of the definition of "mobile equip- ment''. CA 00 20 10 01 © ISO Properties, Inc., 2000 Page 11 of 13 [] Paragraphs b. and c. above do not apply to "accidents" that occur away from premises owned by or rented to an "insured" with re- spect to "pollutants" not in or upon a cov- ered "auto" if: (1) The "pollutants" or any property in which the "pollutants" are contained are upset, overturned or damaged as a result of the maintenance or use of a covered "auto"; and (2) The discharge, dispersal, seepage, migration, release or escape of the "pollutants" is caused directly by such upset, overturn or damage. E. "Diminution in value" means lhe actual or per- ceived loss in market value or resale value which results from a direct and accidental "loss". F. "Employee" includes a "leased worker". "Em- ployee'' does not include a "temporary worker". G. "Insured" means any person or organization quali- fying as an insured in the Who Is An Insured provi- sion of the applicable coverage. Except with re- spect to the Limit of Insurance, the coverage afforded applies separately to each insured who is seeking coverage or against whom a claim or "suit" is brought. H, "Insured contract" means: 1. A lease of premises; 2. A sidetrack agreement; 3. Any easement or license agreement, except in connection with construction or demolition op- erations on or within 50 feet of a railroad; 4. An obligation, as required by ordinance, to indemnify a municipality, except in connection with work for a municipality; 5. That part of any o[her contract or agreement pertaining to your business (including an in- demnification of a municipality in connection with work performed for a municipality) under which you assume the tod liability of another to pay for "bodily injury" or "property damage" to a third party or organization. Tort liability means a liability that would be imposed by law in the ab- sence of any contract or agreement; 6. That part of any other contract or agreement, entered into, as part of your business, pedain- lng to the rental or lease, by you or any of your "employees", of any "auto". However, such contract or agreement shall not be considered an "insured contract" to the extent that it obli- gates you or any of your "employees" to pay for "property damage" to any "auto" rented or leased by you or any of your "employees". An "insured contract" does not include that part of any contract or agreement: a. That indemnifies a railroad for "bodily in- jury" or "property damage" arising out of construction or demolition operations, within 50 feet of any railroad property and affecting any railroad bridge or trestle, tracks, road- beds, tunnel, underpass or crossing; or b. That pertains to the loan, lease or rental of an "auto" to you or any of your employees, if the "auto" is loaned, leased or rented with a driver; or c, That holds a person or organization en- gaged in the business of transporting prop- erty by "auto" for hire harmless for your use of a covered "auto" unless the covered "auto" is used in your business as a "motor carrier" for hire as in Section II, Paragraph A.l.d, of the Who Is An Insured provision. "Leased worker" means a person leased to you by a laber leasing firm under an agreement between you and the labor leasing firm, to perform duties related to the conduct of your business. "Leased worker" does not include a "temporary worker". "Loss" means direct and accidental loss or dam- age. "Mobile equipment" means any of the following types of land vehicles, including any attached ma- chinery or equipment: 1, Bulldozers, farm machinery, forklifts and other w~hicles designed for use principally off public roads; 2. Vehicles maintained for use solel7 on or next to premises you own or rent; 3, Vehicles that travel on crawler treads; 4. Vehicles, whether self-propelled or not, main- tained primarily to provide mobilily to perma- nently mounted: a. Power cranes, shovels, loaders, diggers or drills; or b Road construction or resurfacing equipment such as graders, scrapers or rollers; 5, Vehicles not described in Paragraphs 1., 2., 3. or 4. above that are not self-prope~led and are maintained primarily to provide mobility to per- manently attached equipment of the following types: a. Air compressors, pumps and generators, including spraying, welding, building clean- ing, geophysical exploration, lighting and well servicing equipment; or b. Cherry pickers and similar devices used to raise or lower workers. Page 12 of 13 © ISO Properties, Inc., 2:000 CA 00 20 10 01 [] 6. Vehicles not described in Paragraphs 1,, 2., 3. or 4. above maintained primarily for purposes other than the transportation of persons or cargo. However, self-propelled vehicles with the following types of permanently attached equipment are not "mobile equipment" but will be considered "autos": a. Equipment designed primarily for: (1) Snow removal; (2) Road maintenance, but not construction or resurfacing; or ($) Street cleaning; b. Cherry pickers and similar devices mounted on automobile or truck chassis and used to raise or lower workers; and c, Air compressors, pumps and generators, including spraying, welding, building clean- lng, geophysical exploration, lighling or well servicing equipment. L. "Motor Carrier" means a person or organization providing transportation by "auto" in the further- ance of a commercial enterprise. M. "Pollutants" means any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed. N. "Private passenger type" means a private passen- get or station wagon type "auto" and includes an "auto" of the pick-up or van type if not used for business purposes. O. "Property damage" means damage to or loss of use of tangible property. P. "Suit" means a civil proceeding in which: 1. Damages because of "bodily injury" or "prop- erly damage" or 2. A "covered pollution cost or expense", to which this insurance applies, are alleged. "Suit" includes: a~. An arbitration proceeding in which such damages or "covered pollution costs or ex- penses" are claimed and to which the "in- sured" must submit or does submit with our consent; or b, Any other alternative dispule resolution proceeding in which such damages or "coy- ered pollution costs or expenses" are claimed and to which lhe "insured" submits with our consent. Q. "Temporary worker" means a person who is fur- nished to you Io substilule for a permanent "em- ployee" on leave or to meet seasonal or short-term worklload conditions. R. "Trailer" includes a semitrailer or a dolly used to convert a semitrailer into a trailer. But for Trailer Inlerchange Coverage only, "trailer" also includes a cont~dner. CA 00 20 10 01 © ISO Properties, Inc., 2000 Page 13 of '13 [] COMMERCIAL AUTO CA 00 2202 99 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. CHANGES IN COMMERCIAL AUTO COVERAGE FORMS This endorsement modifies insurance provided under lhe following: BUSINESS AUTO COVERAGE FORM BUSINESS AUTO PHYSICAL DAMAGE COVERAGE FORM GARAGE COVER, AGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM SECTION I -LOSS OF USE Changes In Physical Damage Coverage Coverage Extension under Physical Damage Cov- erage is replaced by the following: Coverage Extensions A. Transportation Expenses We will pay up to $15 per day to a maximum of $450 for temporary transportation expense incurred by you because of the total theft of a covered 'auto' of the private passenger type. We will pay only for those covered 'autos' for which you carry either Comprehensive or Specified Causes Of Loss Coverage. We will pay for temporary transportation expenses incurred during the period beginning 48 hours after the theft and ending, regardless of the policy's expiration, when the covered "auto" is returned to use or we pay for its "loss". B. Loss Of Use Expenses For Hired Auto Physical Damage, we will pay expenses for which an 'in§ured' becomes legally responsible to pay for loss of use of a vehicle rented or hired without a driver, under a written rental contract or agreement. We will pay for loss of use expenses if caused by: 1. Other than Collision only if the Declarations indicate that Comprehensive Coverage is provided for any covered "auto"; 2. Specified Causes Of Loss onry if the Declarations indicate that Specified Causes Of Loss Coverage is provided for any covered "auto"; or 3. Collision only if the Declarations indicate that Collision Coverage is provided, for any covered "auto". However, the most we will pay for any expenses for loss of use is $15 per day, to a maximum of $450. SECTION II - LIMITED WORLDWIDE COVERAGE FOR HIRED AUTOS Paragraph 7, Policy Period, Coverage Territory of the General Conditions is amended by the addition of the followin~[~: The coverage territory is extended to anywhere in the world if: a. A covered "auto' of the private passenger type is leased, hired, rented or borrowed without a driver for a Period of 30 days or less; and b. ']'he 'insured's" responsibility to pay damages is determined in a 'suit' on the merits, in the United States of America, the territories and possessions of the United States of America, Puerto Rico, or Canada or in a settlement we agree to. SECTION III- CHANGES IN DEFINITIONS A. The definition of 'insured contract' contained in Section V -Definitions of the Business Auto Coverage Form and Section VI - Definitions of Ihe Motor Carrier and T~uckers Coverage Forms is replaced by the following: "Insured contract" means: 1. A lease of premises; :2. A sidetrack agreement; :3. Any easement or license agreement, except in connection with construction or demolilion operations on or within 50 feet of a railroad; 4. An obligation, as required by ordinance, to indemnify a municipality, except in connection with work for a municipality; CA 00 22 02 99 Copyright, Insurance Services Office, Inc., 1998 Page I of 2 5. That part of any other contract or agreement pertaining to your business (including an indemnification of a municipality in connection with work performed for a municipality) under which you assume the tort liability of another to pay for 'bodily injury' or 'property damage' to a third pady or organization. Tort liability means a liability that would be imposed by law in the absence of any contract or agreement; 6. That pad of any contract or agreement enlered into, as part of your business, pertaining to the rental or lease, by you or any of your 'employees', of any 'auto'. However, such contract or agreement shall not be considered an 'insured contract' to the extent that it obligates you or any of your 'employees' to pay for 'property damage" to any 'auto' rented or leased by you or any of your 'employees". An 'insured contract' does not include that part of any contract or agreement: a. That indemnifies a railroad for 'bodily injury' or 'property damage' arising out of construction or demolition operations, within 50 feet of any railroad property and affecting any railroad bridge or tresUe, tracks, roadbeds, tunnel, underpass or crossing; or b. That pertains to the loan, lease or rental of an 'auto' to you or any of your 'employees', if the 'auto' is loaned, leased or renled wilh a driver; or c. That holds a person or organization engaged in the business of transporting property by "auto" for hire harmless for your use of a covered 'auto' over a 'route or territory that person or organization is aulhorized to serve by p, ublic authority. The definition of 'insured contract" contained in Section VI - Definitions of the Garage Coverage Form is replaced by the following: 'Insured contract" means: 1. A lease of premises; 2. A sidetrack agreement; 3. Any easement or license agreement, except in connection with construction or demolition operations on or within 50 feet of a railroad; 4. An obligation, as required by ordinance, to indemnify a municipality, except in connection with work for a municipality; 5. That part of any other contract or agreement pe~laining to your garage business (including, an indemnification of a municipality in connection with' work performed for a municipality} under which you assume the tort liability of another to pay for 'bodily injary' or 'property damage' to a third party or organization. Tort liability means a liability that would be imposed by law in the absence of any contract or agreement; 6. An elevalor maintenance agreement; 7. That part of any contract or agreement entered into, as part of your garage business, pertaining to the rental or lease, by you or any of your 'employees', of any 'aulo'. However, such contract or agreement shall not be considered an "insured contract" to the extent that it obligates you or any of your 'employees' to pay 'property damage' to any 'auto' rented or leased by you or any of your 'employees'. An "insured contract' does not include that part of any contract or agreement: 1. That indemnifies an architect, engineer or surveyor for injury or damage arising oul of; a. Preparing, approving or failing lo prepare or approve maps, drawings, opinions, reports, surveys, change orders, designs or specifications; or b. Giving directions or instructions, or failing to give them, if that is lhe primary cause of the injury or damage. 2. That indemnifies any person or organization: for damage by fire to premises rented or loaned to you. 3. That pertains to lhe loan, lease or rental of an 'auto', to you or any of your "employees" it the "auto" is loaned, leased or rented with a driver; or 4. That holds a person or organizalion engaged in the business of transporting property by 'auto" for hire ham'~less for your use of a covered 'auto" over a route or territory lhat person or organization is authorized to serve by public authority; or 5. That indemnifies a railroad for 'bodily injury' 'properly damage' arising out of constructio~ ; demolition operations, within 50 feet of any railroad properly' and affecting any railroad bridge or trestle, tracks, roadbeds, tunnel, underpass or crossing. Page 2 of 2 Copyright, Insurance Services Office, Inc., 1998 CA 00 22 02 99 COMMERCIAL AUTO CA 23 01 12 93 THIS ENDORSEMENT CHANGES THE POLICY. ,PLEASE READ IT CAREFULLY. EXPLOSIVES This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisiens of the Coverage Form apply unless modi- fied by the endorsement. LIABILITY COVERAGE is changed by adding lhe following exclusion: This insurance does not apply to: "Bodily injury" or "property damage" caused by the explosion of explesives you make, sell or transport. CA 23 01 12 93 Copyright, insurance Services Office, Inc., 1993 Page 1 of I [] IL O0 03 07 02 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. CALCULATION OF PREMIUM This endorsement modifies insurance provided under the following: BOILER AND MACHINERY COVERAGE PART CAPITAL ASSETS PROGRAM (OUTPUT POLICY) COVERAGE PART COMMERCIAL AUTOMOBILE COVERAGE PART COMMERCIAL GENERAL LIABILITY COVERAGE PART COMMERCIAL INLAND MARINE COVERAGE PART COMMERCIAL PROPERTY COVERAGE PART CRIME AND FIDELITY COVERAGE PART EMPLOYMENT-RELATED PRACTICES LIABILITY COVERAGE PART FARM COVERAGE PART LIQUOR LIABILITY COVERAGE PART OWNERS AND CONTRACTORS PROTECTIVE LIABILITY COVERAGE PART POLLUTION LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART PROFESSIONAL LIABILITY COVERAGE PART RAILROAD PROTECTIVE LIABILITY COVERAGE PART The following is added: The premium shown in the Declarations was computed based on rates in effect at the time the policy was issued. On each renewal, continuation, or anniversary of the effeclive date of this policy, we will compute lhe premium in accordance with our rates and rules then in effect. IL 00 03 07 02 © ISO Properties, Inc., 2001 Page 1 of I [] IL O0 17 11 98 COMMON POLICY CONDITIONS All Coverage Parts ir, cluded in this policy are subject to the following conditions. Ao Cancellation 1. The first Named Insured shown in the Declara- tions may cancel this policy by mailing or deliv- ering to us advance written notice of cancella- tion. 2. We may cancel this policy by mailing or deiiv- ering to the first Named Insured written notice of cancellation at least: a. 10 days before Ihe effective date of cancel~ lation if we cancel for nonpayment of pre- mium; or b. 30 days before the effective date of cancel- lafion if we cancel for any other reason. 3. We will mail or deliver our notice to the first Named Insured's last mailing address known to ils. 4. Nofice of cancellation will state the effective date of cancellafion, The policy period will end on that date. 5. If this policy is cancelled, we will send the first Named Insured any premium refund due. If we cancel, the refund will be pro rata. If the first Named Insured cancets, the refund may be less than pro rata. The cancellation will be ef- fective even if we have not made or offered a refund. 6. If notice is mailed, proof of mailing will be suffi- cient proof of notice. B. Changes This policy contains all the agreements between you and us concerning Ihe insurance afforded, The first Named Insured shown in the Declarations is authorized to make changes in the terms of this policy with our consent. This policy's terms can be amended or waived onty by endorsemenl issued by us and made a part of this policy. C. Examination Of Your Books And Records We may examine and audit your books and rec- ords as they relate to this policy at any time during the policy period and up to Ihree years afterward. D. Inspections And Surveys 1, We have the right to: a. Make inspections and surveys at any lime; b, Give you reports on the conditions we find; and c. Recommend changes. 2. VVe are not obligated to make any inspections, surveys, reports or recommendations and any such actions we do undertake relate only to in- surability and the premiums to be charged. We do not make safety inspections. We do not un- derlake to perform the duty of any person or organization to provide for the health or safety of workers or the public. And we do not warrant that conditions: a. Are safe or healthful; or b. Comply with laws, regulations, codes or standards. 3. Paragraphs 1. and 2, of this condition apply not only to us, but also to any rating, advisory, rate service or similar organization which makes in- surance inspections, surveys, reports or rec- ommendafions. 4. Paragraph 2. of this condition does not apply to any inspections, surveys, reports or recom- mendations we may make relative to certJfica- tic,n, onder state or municipal statutes, ordi- nances or regulations, of boilers, pressure ves- sels or elevators. Premiums The first Named Insured shown in the Declara- tions: 1. Is responsible for the payment of all premiums; 2. Will be the payee for any return premiums we pay. Transfer Of Your Rights And Duties Under This Policy Your rights and duties under this policy may not be transferred without our written consent except in the case of death of an individual named insured. If you die, your righls and duties will be transferred to your legal representative but only while acting within the scope of duties as your legal represen- tative. Unlil your legal representative is appointed, anyone having proper temporary cuslody of your property will have your rights and duties but only wilh respect to that property. tL 00 17 11 98 Copyright, Insurance Services Office lnc, 1998 Page I of I ~ IL 00 21 07 02 THiS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. NUCLEAR ENERGY LIABILIITY EXCLUSION ENDORSEMENT (Broad Form) This endorsement modifies insurance provided under the following: COMMERCIAL AUTOMOBILE COVERAGE PART COMMERCIAL GENERAL LIABILITY COVERAGE PART FARM COVERAGE PART LIQUOR LIABILITY COVERAGE PART OWNERS AND CONTRACTORS PROTECTIVE LIABILITY COVERAGE PART POLLUTION LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART PROFESSIONAL LIABILITY COVERAGE PART RAILROAD PROTECTIVE LIABILITY COVERAGE PART UNDERGROUND STORAGE TANK POLICY 1, The insurance does not apply: A. Under any Liability Coverage, to "bodily injury" or "property damage": (1) With respect to which an "insured" under the policy is also an insured under a nuclear energy liability policy issued by Nuclear ergy Liability Insurance Association, Mutual Atomic Energy Liability Underwriters, Nu- clear Insurance Association of Canada or any of their successors, or would be an in- sured under any such policy but for its ruination upon exhaustion of ils limit of li- ability; or (2) Resulting from the "hazardous propedies" of "nuclear material" and with respect to which (a) any person or organization is re- quired to maintain financial protection pur- suant to the Atomic Energy Act of 1954, or any law amendatory thereof, or (b) the "in- sured'' is, or had this policy not been issued would be, entitled to indemnity from the United States of America, or any agency thereof, under any agreement entered inlo by the United States of America, or any agency thereof, wilh any person or organi- zation. B. Under any Medical Payments coverage, to expenses incurred with respect to "bodily injury" resulting from the "hazardous properties" of "nuclear material" and arising out of lhe opera- tio~n of a "nuclear facility" by any person or or- ganization, C. U~,der any Liability Coverage, to "bodily injury" or "property damage" resulting from "hazardous preperties" of "nuclear material", if: (1) The "nuclear material" (a) is at any, "nuclear facility" owned by, or operated by or on he- half of, an "insured" or (b) has been dis- charged or dispersed therefrom; (2) The "noclear material" is contained in "spent fuel" or "waste" at any time possessed, handled, used, processed, stored, trans- ported or disposed of, by or on behalf of an "insured"; or (3) The "bodily injury" or "property damage" arises out of the furnishing by an "insured" of services, materials, parts or equipment in connection with the planning, construction, mainlenance, operation or use of any "nu- clear facility", but if such facility is located within the United States of America, its ter- ritories or possessions or Canada, this ex- clusion (3) applies only to "property dam- age" to such "nuclear facility" and any property Ihereat. IL 00 21 07 02 © ISO Properties, Inc., 2001 Page '/of 2 E3 2. As used in this endorsement: "Hazardous properties" includes radioactive, toxic or explosive propedies. "Nuclear material" means "source material", "Spe- cial nuclear material" or "by-product material". "Source material", "special nuclear material", and "by-product material" have Ihe meanings given them in the Atomic Energy Act of 1954 or in any law amendatory thereof. "Spent fuel" means any fuel element or fuel com- ponent, solid or Iiquid, which has been used or ex- posed to radiation in a "nuclear reactor". "Waste" means any waste material (a) containing "by-product material" other than the tailings or wastes produced by the extraction or concenlration of uranium or thorium from any ore processed pri- marily for ils "source material" content, and (b) re- suiting from the operation by any person or organi- zation of any "nuclear facility" included under the firsl lwo paragraphs of the definilion of "nuclear fa- cility". "Nuclear facility" means: (a) Any"nuclear reactor"; (b) Any equipment or device designed or used for (1) separating the isotopes of uranium or plutonium, (2) processing or utilizing "spent fuel", or (3) handling, processing or pack- aging "waste"; (c) Any equipment or device used for the proc- essing, fabricating or alloying of "special nuclear material" if at any time the total amount of such material in the custody of the "insured" at the premises where such equipment or device is located consists of or contains more than 25 grams of pluto- nium or uranium 233 or any combination thereof, or more than 250 grams of uranium 235; (d) Any structure, basin, excavation, premises or place prepared or used for the storage or disposal of "waste"; and includes the site on which any of lhe foregoing is located, all operations conducted on such site and all premises used for such operations. "Nuclear reactor'' means any apparatus designed or used to sustain nuclear fission in a self- supporting chain reaction or to contain a critical mass of fissionable material. "Property damage" includes all forms of radioac- tive contamination of property Page 2 of 2 © ISO Properties, Inc., 2001 IL O0 21 07 02 [] COMMERCIAL AUTO CA 23 25 07 97 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. COVERAGE FOR INJURY TO LEASED WORKERS This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to the Employee Indemnification And Employer's Liability exclusion (SECTION II) only, the defi- nition of "employee" in the Definitions Section is replaced by the following: "Employee" does not include a "leased worker" or a "temporary worker". CA 23 25 07 97 Copyright, Insurance Services Office, Inc, 1996 Page 1 of I [] COMMERCIAL AUTO CA 99 48 O9 02 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. POLLUTION LIABILITY- BROADENED COVERAGE FOR COVERED AUTOS - BUSINESS AUTO, MOTOR CARRIER AND TRUCKERS COVERAGE FORMS This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modi- fied by the endorsement. A. Liability Coverage is changed as follows: 1. Paragraph a. of the Pollution Exclusion ap- plies only to liability assumed under a contract or agreement. 2. With respect to the coverage afforded by Para- graph A.I. above, Exclusion B.6. Care, Cus- tody Or Control does not apply. B. Changes In Definitions For Ihe purposes of this endorsement, Paragraph D. of the Definitions Section is replaced by the following: D. "Covered pollution cost or expense" means any cost or expense arising out of: 1. Any request, demand, order or statulory or regulatory requirement; or 2. Any claim or "suit" by or on behalf of a gov- ernmental authority demanding that the "insured" or others test for, monitor, clean up, remove, contain, lreat, detoxify or neutralize, or in any way respond to, or assess the effects of "pollutants", "Covered pollution cost or expense" does not include any cost or expense arising dUI ol lhe actual, alleged or threatened discharge, disper- sal, seepage, migration, release or escape of "pollutants": a. Before the "pollutants" or any property in which the "pollutants" are contained are moved from lhe place where they are accepted by the "insured" for movement into or onto the covered "auto"; or b. After the "pollutants" or any properly in which the "pollutants" are contained are moved from the covered "auto" to the place where they are finally delivered, disposed of or abandoned by lhe "in- sured''. Paragraphs a. and b, above do not apply to "accidents" that occur away from premises owned by or rented to an "insured" with re- spect to "polJutants" not in or upon a cov- ered "auto" if: (1) The "pollutants" or any property in which the "pollutants" are contained are upset, overturned or damaged as a result of the maintenance or use of a covered "auto"; and (2) The discharge, dispersal, seepage, migration, release or escape of the "pollutants" is caused directly by such upset, overturn or damage. CA 99 48 09 02 © tSO Properties, Inc., 2002 Page 1 of I [3 POLICY NUMBER: LHT1001139A102 COMMERCIAL AUTO CA 99 54 07 97 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. COVERED AUTO DESIGNATION SYMBOL This endorsement modifies insurance provided under the following: BUSINESS AUTO COVER.AGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVER.AGE FORM TRUCKERS COVERAGE FORM BUSINESS AUTO PHYSICAL DAMAGE COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modi- fied by the endorsement. This endorsement changes the policy effective on the inceplion date of the policy unless another date is indicated below: ement E._~ffectiv e~ 07/05/0___.__~3 Insured; Clouse Trucking, Inc. Countersigned By: ,,,. , _ (Aulhorized Representative) Section I - Covered Autos is amended by adding the following: Item Two of the Declarations shows the "autos" that are covered "autos" for each of your coverages. The following numerical symbols may be used (in addition to the numerical symbols described in the Coverage Form) to de- scribe lhe "autos" that may be covered "autos". The entry of one of these symbols next to a coverage on the Dec- larations will designate the only "autos" that are covered "autos". Symbol I Description Of Covered Auto I:)esi~lnation Symbols For use with the Business Auto Covera~le Form 10 = Non-Trucking Coverage for all autos scheduled at inception and reported monthly thereafter for which there is a premium charged. For use with the Garage CoYerage Form 32 = For use with the Truckers Covera~Te Form 51 = All owned, hired, or non-owned autos operated in connection with your business, excluding private passenger type autos, for which a report of revenue or mileage is sent and premium paid 52 = All autos operated in connection with your business, excluding private passenger type autos, which have values scheduled at inception. Any additional autos acquired during the month preceding lhe receipt of subsequent monthly reports must be reported on the next report. If the auto is not scheduled on the first monthly report following the acquisition of the auto, there is coverage until such time lhe auto lis included on a report, no CA 99 54 07 97 Copyright, Insurance Services Office, Inc., 1997 Page 1 of 2 D Symbol 7 72 73 Description Of Covered Auto Designation Symbols For use with the Business Auto Physical Damage Coverage Form For use with the Motor Carrier Coverage Form All owned, h red, or non-owned autos operated in connection with your business, excluding private passenger type autos, for which a report of revenue or mileage is I sent and premium paid as defined in SAIC007 IAII autos operated in connection with your business, excluding private passenger [type autos, which have values scheduled at illception. Any additional autos acquired ~ during the month preceding the receipt of sub.~equent monthly reports must be [reported on the next report. If the auto is not .~;cheduled on the first monthly report ~ following the acquisition of the auto, there is no coverage until such time the auto ~ is included on a report. Page 2 of 2 Copyright, insurance Services Office, Inc., 1997 CA 99 54 07 97 [] COMMERCIAL AUTO CA 01 80 O9 97 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PENNSYLVANIA CHANGES This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM GARAGE COVERAGEFORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modi- fied by the endorsement. A. Changes In Liability Coverage 2, The following is added to Supplementary Payments: Prejudgment interest awarded against the "in- sured'' on the part of the judgment we pay. Any prejudgment interest awarded against Ihe "insured" is subject to the applicable Pennsyl- vania Rules of Civil Procedure. B, Changes In Conditions 1. The following is added to the Loss Condi- tions Section: Paragraph A.2.b.(5) of Ihe Duties In The Event Of An Accident, Claim, Suit Or Loss Condition is replaced by the following: After we show good cause, submit to exami- nation at our expense, by physicians of our choice. The following is added to the Transfer Of Rights Of Recovery Against Others To Us Condition: If we make any payment due to an "accident" and the "insured" recovers from another party in a separate claim or "suit", the insured shall hold the proceeds in trust for es and pay us back the amount we have paid less reason- able attorneys' fees, costs and expenses in- curred by lhe "insured" to the extenl such payment duplicates any amount we have paid under this coverage. The following is added to the General C0ndi- 1!ions Section: CONSTITUTIONALITY CLAUSE The premium for, and the coverages of, this Coverage Form have been established in reli- ance upon the provisions of the Pennsylvania Motor Vehicle Financial Responsibility Law. In the event a court, from which there is no appeal, declares or enters a judgment, the effect of which is to render the provisions of such stalule invalid or unenforceable in whole or in part, we shall have the right to recom- [)ute the premium payable for the Coverage Form and void or amend the provisions of the Coverage Form, subject to the approval of the, Insurance Commissioner. CA 01 80 09 97 Copyright, Insurance Services Office, Inc., 1997 Page 1 of I [] POLICY NUMBER: LHT1001139A102 COMMERCIALAUTO CA 21 92 08 02 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PENNSYLVANIA UNINSURED MOTORISTS COVERAGE - NONSTACKED For a covered "motor vehicle" licensed or principally garaged in, or "garage operations" conducted in, Pennsylva- nia, this endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modi- fied by the endorsement. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below: ement E~ffeclive_____~ 07/05/03 Insured: Clouse Trucking, Inc. (Authorized Representative SCHEDULE ~IMIT Each "Accident" OF INSURANCE (if no entry appears above, information required to complele this endorsemenl will be shown in the Declarations as applicable to this endorsement,) A. Coverage 1. We will pay all sums the "insured" is legally entitled to recover as compensatory damages from the owner or driver of an "uninsured motor vehicle". The damages must result from "bodily injury" sustained by the "insured" caused by an "accident" The owner's or driver's liability for these damages must result from the owner- ship, mainlenance or use of an "uninsured motor vehicle". 2. No judgment for damages arising out of a "suil" brought against the owner or operator of an "uninsured motor vehicle" is binding on us un- tess we: a, Received reasonable notice of the pen- dency of the "suit" resulting in Ihe judgment; and b. Had a reasonable opportunity to protect our interests in the "suit". B. Who Is An Insured If the Named Insured is designated in the Declara- tions ;as: 1. An individual, then the following are "insureds": a. The Named Insured and any "family mem- bers". b. Anyone else "occupying" a covered "motor vehicle" or a temporary substitute for a coy- ered "motor vehicle". The covered "motor vehicle" must be out of service because its breakdown, repair, servicing, "loss" destruction. CA 21 92 08 02 © ISO Properties, Inc., 2002 Page 1 of 4 c. Anyone for damages he or she is entitled to recover because of "bodily injury" sustained by another "insured". 2. A padnership, limited liability company, corpo- ration or any other form of organization, then the following are "insureds": a. Anyone "occupying" a covered "motor vehi- cle" or a temporary substitute for a covered "motor vehicle". The covered "motor vehi- cle" must be out of service because of its breakdown, repair, servicing, "loss" or de- struction. b, Anyone for damages he or she is entitled to recover because of "bodily injury" sustained by another "insured". C. Exclusions This insurance does not apply to any of the fol- lowing: 1. Any claim settled without our consent. How- ever, this exclusion does not apply if such set- tlement does not adversely affect our righls of recovery under this coverage. 2, The direct or indirect benefit of any insurer or self-insurer under any workers' compensation, disability benefits or similar law. 3. Anyone using a vehicle without a reasonable belief that the person is entitled to do so. 4. Punitive or exemplary damages. 5, "Bcdily injury" sustained by: a. An individual Named Insured while "occu- pying" or when struck by any vehicle owned by that Named Insured that is not a covered "auto" for Uninsured Motorists Coverage under this Coverage Form; b. Any "family member" while "occupying" or when struck by any vehicle owned by that "family member" that is not a covered "auto" for Uninsured Motorists Coverage under this Coverage Form; or c. Any "family member" while "occupying" or when struck by any vehicle owned by lhe Named Insured that is insured for Unin- sured Motorists Coverage on a primary ha- sis under any other Coverage Form or pol- icy. D. Limit Of Insurance 1. Regardless of the number of covered "motor vehicles", "insureds", premiums paid, claims made or vehicles involved in the "accident", the most we will pay for all damages resulting from any one "accident" is the Limit Of Insurance for Uninsured Motorists Coverage shown in the Schedule or Declarations. 2. Any amount payable for damages under this coverage shall be reduced by all sums paid by or for anyone who is legally responsible. This includes ail sums paid for the same damages under this Coverage Form's Liability Coverage, This also includes all sums paid for an "in- sured's" attorney either directly or as part of lhe amount paid to the "insured". 3. No one will be entitled to receive duplicate payments for the same elements of "loss" un- der this Coverage Form and any Liability Cov- erage Form, Medical Payments Coverage En- dorsement or Underinsured Motorists Cover- age Endorsement attached to this Coverage Part. We will not make a duplicate payment under Ibis Coverage for any element of "loss" for which payment has been made by or for any- one who is legally responsible. We will not pay for any element of "loss" if a person is entitled to receive payment for the same element of "loss" under any workers' compensation, disability benefits or similar law. E. Changes In Conditions The Conditions are changed for Pennsylvania Uninsured Motorists Coverage - Nonstacked as follows: 1, Duties In The Event Of Accident, Claim, Suit Or Loss is changed by adding the following: a. Promptly notify lhe police if a hit-and-run driver is involved, and b. Promptly send us copies of the legal papers if a "suit" is brought. 2. Legal Action Against Us ts replaced by the following: a. No one may bring a legal action against us under this Coverage Form until there has been full compliance with all the terms of Ibis Coverage Form. b. Any legal action against us under this Coy- erage Form must be brought within four years after the date of the "accident". How- ever, this Paragraph b. does not apply to an "insured" if, within four years after the date of the "accident", we or the "insured" have made a written demand for arbitration in ac- cordance with the provisions of this eh- ,dorsement. Page 2 of 4 © ISO Properties, Inc., 2002 CA 21 92 08 02 [~ 3. Transfer Of Rights Of Recovery Against Others To Us is changed by adding the fol- lowing: If we make any payment due to an "accident" involving an "uninsured motor vehicle" and the "insured" recovers from another party in a separate claim or "suit", the "insured" shall hold the proceeds in trust for us and pay us back the amount we have paid less reasonable attor- neys' fees, costs and expenses incurred by the "insured" to the extent such payment duplicates any amount we have paid under this coverage. 4, Other Insurance in the Business Auto and Garage Coverage Forms and Other Insurance - Primary And Excess Insurance Provisions in the Truckers and Motor Carrier Coverage Forms are replaced by the following; a. If there is other applicable similar insurance available under more than one Coverage Form or policy, the following priorities of re- covery apply: First Second The Uninsured Motorists Coverage applicable to the vehicle the "insured" was "occupying" at the time of the "acci- dent''. The Coverage Form or policy affording Uninsured Motorists Coverage to lhe "insured" as an individual Named In- sured or "family member". b. Where there is no applicable insurance available under the first priority, the maxi- mum recovery under all (;overage Forms or policies in the second priority shall not ex- ceed the highest applicable limit for any one vehicle under any one Coverage Form or policy. c. Where there is applicable insurance avail- able under the first priority: (1) The Limit of Insurance applicable 1o the vehicle the "insured" was "occupying" under the Coverage Form or policy in the first priority, shall first be exhausted; and (2) The maximum recovery under all Cov- erage Forms or policies in the second priority shall not exceed the amount by which the highesl limit for any one vehi- cle under any one Coverage Form or policy in the second priority exceeds the limit applicable under the Coverage Form or policy in the first priority, d. If two or more Coverage Forms or policies have equal priority: (1) The insurer against whom the claim is first made shall process and pay the claim as if wholly responsible for all in- surem with equal priority; (2) The insurer thereafter is entitled to re- cover pro rata contribution from any other insurer on the same level of prior- ity for the benefits paid and the costs of processing the claim; and (3) If we are the insurer against whom the claim is first made, we will pay, subject to the limit of insurance for Uninsured Motorists Coverage shown in the Decla- rations, after all contributing insurers agree as to: (a) Whether the "insured" is legally anti- fled to recover damages from the owner or driver of an "uninsured motor vehicle"; and (b) The amount of damages. The following condition is added: ARBITRATION a. If we and an "insured" disagree whether the "insured" is legally entitled to recover dam- ages from the owner or driver of an "unin- sured motor vehicle" or do not agree as to the amount of damages that are recover- able by that "insured", then Ihe matler may be arbitrated. However, disputes concerning coverage under this endorsement may not be arbitrated. Either party may make a written demand for arbitration. In this event, each party will select an arbitrator. The two arbitrators will select a third, If Ihey cannot agree within 30 days, either may request that selection be made by a judge of a court having jurisdiction. Each party will pay the expenses it incurs and bear the expenses of the third arbitrator equally. b. Arbitration shall be conducted in accor- dance with the Pennsylvania Uniform Arbi- tration Act. Unlees both parlies agree olh- erwise, arbitration will take place in the county in which the "insured" lives. Local rules of law as to arbitration procedure and evidence will apply. A decision agreed to by two of the arbitrators will be binding. CA 21 92 08 02 © ISO Properties, Inc., 2002 Page 3 of 4 [] F. Additional Definitions As used in this endorsement: t. "Family member" means a person related to an individual Named Insured by blood, marriage or adoption who is a resident of such Named In- sured's household, including a ward or fosler child. 2. "Occupying" means in, upon, getting in, on, oul oroff. 3. "Uninsured motor vehicle" means a land motor vehicle or "trailer": a. For which no liability bond or policy applies at the time of an "accident". b. For which an insuring or bonding company: (t) Denies coverage; (2) Is or b~comes insolvent; or (3) Is or becomes involved in insolvency proceedings. c. For which neither the driver nor owner can be identified. The vehicle or "lrailer" must: (1) Hit an "insured", a covered "motor vehi- cle'' or a vehicle an "insured" is "occu- pying''; or (2) Cause an "accident" resulting in "bodily injury" to an "insured" without hitting an "insured", a covered "motor vehicle" or a vehicle an "insured" is "occupying". If there is no physical contact with the hit- and-run vehicle, the facts of the "accident" must be proved, However, an "uninsured motor vehicle" does not include any vehicle: a. Owned or operated by a self-ir)surer under any applicable motor vehicle law, except a self-insurer who is or who becomes insol- vent and cannot provide the amounts re- quired by that motor vehicle law; or b. Designed for use mainly off public roads while not on public roads. 4. "Motor vehicle" means a vehicle which is self- propelled except one which is propelled solely by Jhuman power or by electric power obtained from overhead trolley wires, but does not mean a w~hicle operated upon rails. Page 4 of 4 © ISO Properties, Inc., 2002 CA 21 92 08 02 [] POLICY NUMBER: LHT1001139A102 COMMERCIAL AUTO CA 21 93 08 O2 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PENNSYLVANIA UNDERINSURED MOTORISTS COVERAGE - NONSTACKED For a covered "motor vehicle" licensed or principally garaged in, or "garage operations" conducted in, Pennsylva- nia, this endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisiens of the Coverage Form apply unless medi- fled by the endorsement. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below: Endorsement Effective: 07/05103 Named Insured: Clouse Trucking, Inc. (Authorized Representative) SCHEDULE IMIT OF INSURANCE Each "Accident" (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable to this endorsement.) A. Coverage 1. We will pay all sums the "insured" is legally entitled to recover as compensatory damages from the owner or driver of an "underinsured motor vehicle'L The damages must result from "bodily injury" sustained by the "insured" caused by an "accident". The owner's or driver's liability for these damages must result from the ownership, maintenance or use of an "undednsured motor vehicle". 2. We will pay under this coverage only if a. or b. below applies: a. The limits of any applicable liability bonds or policies have been exhausted by payment of judgments or settlements; or b. A tentative settlement has been made be- tween an "insured" and the insurer of the "underinsured motor vehicle" and we: (1) Have been given prompt written notice of such tentative settlement; and (2) Advance payment to the "insured" in an amount equal to lhe tentative settlement within 30 days after receipt of notifica- tion. 3. No judgment for damages arising out of a "suit" brought against the owner or operator of an "underinsured motor vehicle" is binding on us unless we: a. Received reasonable notice of the pen- dency of the "suit" resulting in the judgment; and CA 21 93 08 02 © ISO Properties, Inc., 2002 Page '1 of 4 [] b, Had a reasonable opportunity to protect our interests in the "suit". B. Who Is An Insured If the Named Insured is designated in the Declara- tions as: 1. An individual, then the following are "insureds": a, The Named Insured and any "family mem- bers''. b. Anyone else "occupying" a covered "motor vehicle" or a temporary substitute for a cov- ered "motor vehicle", The covered "motor vehicle" must be out of service because of its breakdown, repair, servicing, "loss" or destruction. c. Anyone for damages he or she is entitled to recover because of "bodily injury" sustained by another "insured". 2, A partnership, limited liability company, corpo- ration or any other form of organization, then the following are "insureds": a, Anyone "occupying" a covered "motor vehi- cle" or a temporary substitute for a covered "motor vehicle". The covered "motor vehi~ cie" must be out of service because of its breakdown, repair, servicing, "loss" or de- struction. b. Anyone for damages he or she is entitled to recover because of "bodily injury" sustained by another "insured", C. Exclusions This insurance does not apply to any of lhe fol- lowing: 1. The direct or indirect benefit of any insurer or self-insurer under any workers' compensation, disability benefits or similar law. 2. Anyone using a vehicle without a reasonable belief that lhe person is entitled to do so. 3. Punitive or exemplary damages. 4. "Bodily injury" sustained by: a. An individual Named Insured while "occu- pying'' or when struck by any vehicle owned by that Named Insured that is not a covered "auto" for Underinsured Motorists Coverage under this Coverage Form; b. Any "family member" while "occupying" or when struck by any vehicle owned by that "family member" that is not a covered "aulo" for Underinsured Motorists Coverage under this Coverage Form; or c. Any ''family member" while "occupying" or when struck by any vehicle owned by the Named h~sured that is insured for Underir> sured Motorists Coverage on a primary ba- sis under any other Coverage Form or poi- icy. D. Limit Of Insurance 1. Regardless of the number of covered "motor vehicles", "insureds", premiums paid, claims made or vehicles involved in the "accident", the most we will pay for all damages resulting from any one "accident" is the Limit of Insurance for Undednsured Motorists Coverage shown in the Schedule or Declarations. 2. No one will be entitled to receive duplicate payments for the same elements of "loss" un- der this Coverage Form and any Liability Cov- erage Form, Medical Payments Coverage En- dorsement or Uninsured Motorists Coverage Endorsement attached to this Coverage Part. We will not make a duplicate payment under this Coverage for any element of "loss" for which payment has been made by or for any- ooe who is legally responsible. We will not pay for any element of "loss" if a person is entitled to receive payment for the same element of "loss" under any workers' compensation, disability benefits or similar law. E. Changles In Conditions The coeditions are changed for Pennsylvania Un- derinsured Motorists Coverage - Nonstacked as follows: ~1. Duties In The Event Of Accident, Claim, Suit Or Loss is changed by adding the following: a. Promptly send us copies of the legal papers if a "suit" is brought. b, A person seeking Uederinsured Motorists Coverage must also promptly notify us. in writing, of a tentative setllement between the "insured" and the insurer of the "under- insured motor vehicle" and allow us 30 days to advance payment to the "insured" in an amount equal to the tentative settlement to preserve our rights against the insurer, owner or operator of such "underinsured motor vehicle". 2. Legal Action Against Us is replaced by the following: a. No one may bring a legal action against us under this Coverage Form until there has been full compliance with all the terms of this Coverage Form. Page 2 of 4 © ISO Properties, Inc., 2002 CA 2t 93 08 02 [] b, Any legal action against us under this Cov- erage Form must be brought within four years after the date of the "accident." c. Paragraph 2.b, above of this condition does not apply if, within four years after the date of the "accident": (1) We or the "insured" have made a written demand for arbitration in accordance with the provisions of this endorsement; or (2) The "insured" has filed an action for "bodily injury" against the owner or op- erator of the "underinsured motor vehi- cle'' and such action is: (a) Filed in a court of competenl jurisdic- tion; and (b) Not barred by the applicable state statute of limilations. In the event that the four year time limitation identified in this condition does not apply, the applicable state statute of limitations will govern legal action against us under this Coverage Form. 3. Transfer Of Rights Of Recovery Against Others To Us is changed by adding the fol- lowing: If we make any payment due to an "accident" involving an "underinsured motor vehicle" and the "insured" recovers from another party in a separate claim or "suit", the "insured" shall hold the proceeds in trust for us and pay us back the amount we have paid less reasonable attor- neys' fees, costs and expenses incurred by the "insured" to the extent such payment duplicates any amount we have paid under this coverage. Our rights do not apply under this provision with respect to Underinsured Motorists Coverage if we: a. Have been given prompt written nolice of a tentative settlement between an "insured" and the insurer of an "underinsured motor vehicle"; and b. Fail to advance payment to the "insured" in an amount equal to the tentative settlement within 30 days after receipt of notification. If we advance payment Io the "insured" in an amount equal to the tentative settlement within 30 days after receipt of notification: a. That payment will be separate from any amount the "insured" is entitled to recover under the provisions of Underinsured Mo- torists Coverage; and First Second b. We also have a right to recover the ad- vanced payment. 4. Other Insurance in the Business Auto and Garage Coverage Forms and Other Insurance - Primary And Excess Insurance Provisions in the Truckers and Motor Carrier Coverage Forms are replaced by the following: a. If there is other applicable similar insurance available under more than one Coverage Form or po[icy, the following priorities of re- covery apply: The Underinsured Motorists Coverage applicable to the Vehicle the "insured" was "occupying" at the time of the "acci- dent''. The Coverage Form or policy affording Underinsured Motorists Coverage to the "insured" as an individual Named In- sured or "family member". b. Where there is no applicable insurance available under the first priority, the maxi- mum recovery under all Coverage Forms or policies in the second priority shall not ex- ceed the highest applicable limit for any one vehicle under any one Coverage Form or policy. c. Where there is applicable insurance avail- able under the first priority: (1) The Limit of insurance applicable to the vehicle the "insured" was "occupying" under the Coverage Form or policy in the first priority, shall first be exhausted; and (2) The maximum recovery under all Cov- erage Forms or policies in the second priority shall not exceed the amount by which the highest limit for any one vehi- cle under any one Coverage Form or policy in the second priority exceeds the limit applicable under the Coverage Form or policy in the first priority, d. If two or more Coverage Forms or policies have equal priority: (1) The insurer against whom the claim is first made shall process and pay the claim as if wholly responsible for all in- surers with equal priority; CA 21 93 08 02 © ISO Properties, Inc., 2002 Page 3 of 4 r"l (2) The insurer thereafter is entitled to re- cover pro rata contribution from any other insurer for the benefits paid and the costs of processing the claim; and (3) If we are the insurer against whom the claim is first made, we will pay, subject to the timit of insurance for Underinsured Motorists Coverage shown in the Decla- rations, after all contributing insurers agree as to: (a) Whether the "insured" is legally enti- tled to recover damages from the owner or driver of an "underinsured motor vehicle"; and (b) The amount of damages. 5. The following condition is added: ARBITRATION a. If we and an "insured" disagree whether the "insured" is legally entitled to recover dam- ages from Ihe owner or driver of an "under- insured motor vehicle" or do not agre~ as to the amount of damages that are recover- able by that "insured", then !he matter may be arbitrated. However, disputes concerning coverage under this endorsement may not be arbitrated. Either party may make a written demand for arbitration. If so agreed, each party will select an arbitrator, The two arbitrators will select a third. If they cannot agree within 30 days, either may request that selection be made by a judge of a court having jurisdiction. Each party wilt pay the expenses it incurs and bear the expenses of the third arbitralor equally. b. Arbitration shall be conducted in accor- dance with the Pennsylvania Uniform Arbi- tration Act, Unless both parties agree oth- erwise, arbitration will take place in the county in which the "insured" lives. Local rules of law as to arbitration procedure and evidence will apply. A decision agreed to by two of the arbitrators will be binding. F. Additional Definitions As used in this endorsement: 1. "Family member" means a person retated to an individual Named Insured by blood, marriage or adoption who is a resident of such Named In- sured's household, including a ward or foster child. 2. "Occupying" means in, upon, getting in, on, out or off. 3. "Underinsured motor vehicle" means a vehicle for which the sum of all liability bonds or poli- cies that apply at the time of an "accident" do not provide al least the amount an "insured" is legally entitled to recover as damages. However, an "underinsured motor vehicle" does not include any vehicle: a. Owned or operated by a self-insurer under any applicable motor vehicle law; or b. Designed for use mainly off public roads while not on public roads. 4. "Motor vehicle" means a vehicle which is self- propelled except one which is propelled solely by human power or by electric power obtained from overhead trolley wiresv but does not mean a w~hicle operated upon rails. Page 4 of 4 © ISO Properties, Inc., 2002 CA 21 93 08 02 ;~ POLICY NUMBER: LHT1001139A102 COMMERCIAL AUTO CA 22 37 03 95 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PENNSYLVANIA BASIC FIRST PARTY BENEFIT For a covered "auto" licensed or principally garaged in, or "garage operations" conducted in, Pennsylvania, this endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, lhe provisions of the Coverage Form apply unless modi- fied by the endorsement. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below. Endorsement Effective: 07/05/03 Named nsured: ClouseTruckng, lnc. CounteL~Jned'~p'- (Authorized Representative) SCHEDULE Benefits Limit of Liability (per insured) Medical Expense Benefits Up to $5,000 (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable to this endorsemenl.) A. COVERAGE We will pay the Basic First Party Benefit in accor- dance with the "Act" to or for an "insured" who sustains "bodily injury" caused by an "accident" arising out of the maintenance or use of an "auto". BENEFITS Subject to the limit shown in the Schedule or Dec- larations, the Basic First Party Benefit consists of Medical Expense Benefits. These benefits consist of reasonable and necessary medical expenses incurred for an "insured's": 1. Care; 2. Recovery; or 3. Rehabilitation. This includes remedial care and treatment ren- dered in accordance with a recognized religious method of healing. Medical expenses will be paid if incurred within 18 months from the date of the "accident" causing "bodily injury". If within 18 months from the date of the "accident" causing "bodily injury" it is ascer- tainable with reasonable medical probability that further expenses may be incurred as a result of the "bodily injury", medical expenses will be paid with- out limitation as to the time such further expenses are incurred. WHO IS AN INSURED 1. You. 2. If you are an individual, any "family member". 3. Any person while "occupying" a covered "auto". 4. Any person while not "occupying" an "auto" if inj~ured as a result of an "accident" in Pennsyl- vania involving a covered "auto". If a covered "aulo" is parked and unoccupied, it is not an "auto" involved in an "accident" unless it was parked in a manner as to create an un- reasonable risk of injury. CA 22 37 03 95 Copyright, Insurance Services Office, Inc., 1994 Page 1 of 3 [] C. EXCLUSIONS We will not pay First Party Benefits for "bodily in- jury": 1. Sustained by any person injured while inten- tionally causing or attempting to cause injury to himself or herself or any other person. 2. Sustained by any person while committing a felony, 3, Sustained by any person while seeking to elude lawful apprehension or arrest by a law eh- forcement official. 4. Sustained by any person while maintaining or using an "auto" knowingly converted by that person, However, this exclusion does not apply to: a. You; or b. Any "family member". 5. Sustained by any person who, at the time of the "accident": a, Is the owner of one or more currently reg- istered "autos" and none of those "autos" is covered by the financial responsibility re- quired by the "Act"; or b. Is "occupying" an "auto" owned by that person for which the financial responsibility required by the "Act" is not in effect. 6. Sustained by any person maintaining or using an "auto" while located for use as a residence or premises. 7. Sustained by a pedestrian if the "accident" occurs outside of Pennsylvania. This exclusion, does not apply to: a. You; or b. Any "family member". 8. Sustained by any person while "occupying": a. A recreational vehicle designed for use off public roads; or b. A motorcycle, moped or similar type vehicle. 9. Caused by or as a consequence of: a. Discharge of a nuclear weapon (even if accidental); b. 'War (deolamd or undeclared); c. Civil war; d. Insurrection; or e. Rebellion or revolution, 10. From or as a consequence of the following whether controlled or uncontrolled or however caused: a. Nuclear reaction; b. Radiation; or c. Radioactive contamination. D. LIMIT OF INSURANCE t. Regardless of the number of covered "autos", prerniums paid, claims made, "autos" involved in the "accident" or insurers providing First Party Benefits, the most we will pay to or for an "insured" as the result of any one "accident" is the limit shown in the Schedule or in the Decla- rations. 2. Any amount payable under First Party Benefits shall be excess over any sums paid, payable or required to be provided under any workers' compensation law or similar law. E. CHANGES IN CONDrrlONS The CONDITIONS are changed for FIRST PARTY' BENEFITS as follows: 1, TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US does not apply. 2. The following CONDITIONS are added: NON-DUPLICATION OF BENEFITS No person may recover duplicate benefits for the same expenses or loss under this or any other similar automobile coverage including self-insurance. Page 2 of 3 Copyright, Insurance Services Office, Inc., 1994 CA 22 37 03 95 [3 PRIORITIES OF POLICIES We will pay First Party Benefits in accordance with the order of priority sel forth by the "Act". We will not pay if there is another insurer at a higher level of priority. The "First" category listed below is the highest level of priority and the "Fourth" category listed below is the lowest level of priority. The priority order is: First Second Thi~ Fou~h The insurer providing benefits to the "insured" as a named insured. The insurer providing benefits to the "in- sured" as a family member who is not a named insured under another policy pro- viding coverage under the "Act". The insurer of the "auto" which the insured" is "occupying" at the lime of the "acci- dent''. The insurer providing benefits on any "auto" involved in the "accident" if the "in- sured" is: a. Not "occupying" an "auto"; and b. Not provided First Party Benefits under any other policy. If two or more policies have equal pdority within the highest applicable number in the priority or- der: 1. The insurer against whom the claim is first made shall process and pay the claim as if wholly responsible; 2, If we are the insurer against whom the claim is first made, our payment to or for an "in- sured'' will not exceed the applicable limit shown in the Schedule or Declarations; 3. The insurer thereafter is entitled to recover pro rata contribution from any other insurer for the benefits paid and the costs of proc- essing the claim. If contribution is sought among insurers under the Foudh priority, proration shall be based on the number of involved motor vehicles; and 4. The maximum recovery under all policies shall not exceed the amount payable under the policy with the highest dollar limits of benefits. F, ADDI'TIONAL DEFINITIONS As used in this endorsement: 1. "Auto" means a self-propelled motor vehicle, or trailer required to be registered, operated or designed for use on public roads. However, "auto" does not include a vehicle operated: a. By muscular power; or b. On rails or tracks. 2. The "Act" means the Pennsylvania Motor Vehi- cle Financial Responsibility Law. 3. "Family member" means a resident of your household who is: a. Related to you by blood, marriage or adop- tion; or b. A minor in your custody or in the custody of any other "family member". 4. "Occupying" means in, upon, getting in, on, out or off. CA 22 37 03 95 Copyright, Insurance Services Office, Inc., 1994 Page 3 of 3 rq IL 02 46 07 02 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. PENNSYLVANIA CHANGES- CANCELLATION AND NONRENEWAL This endorsement modifies insurance provided under the following: BOILER AND MACHINERY COVERAGE PART CAPITAL ASSETS PROGRAM (OUTPUT POLICY) COVERAGE PART COMMERCIAL AUTOMOBILE COVERAGE PART COMMERCIAL GENERAL LIABiLiTY COVERAGE PART COMMERCIAL INLAND MARINE COVERAGE PART COMMERCIAL LIABILITY UMBRELLA COVERAGE PART COMMERCIAL PROPERTY COVERAGE PART CRIME AND FIDELITY COVERAGE PART EMPLOYMENT-RELATED PRACTICES UABILITY COVERAGE PART FARM COVERAGE PART FARM UMBRELLA LIABILITY POLICY LIQUOR LIABILITY COVERAGE PART POLLUTION LIABILITY COVERAGE PART PRODUCTS/COMPLETED OPERATIONS LIABILITY COVERAGE PART A. The Cancellation Common Policy Condition is replaced by the following: CANCELLATION '1, The first Named Insured shown in the Declara- lions may cancel this policy by writing or giving notice of cancellation. :2, Cancellation Of Policies In Effect Fo~ Less Than 60 Days We may cancel lhis policy by mailing or deliv- ering to the first Named Insured written notice of cancellation at least 30 days before the ef- fective date of cancellation. 3. Cancellation Of Policies In Effect For 60 Days Or More If this policy has been in effect for 60 days or more or if this policy is a renewal of a policy we issued, we may cancel this policy only for one or more of the following reasons: a. You have made a material misrepresenta- tion which affects Ihe insurability of the risk. Notice of cancellation will be mailed or de- livered at least 15 days before the effective date of cancellation b. You have failed to pay a premium when due, whether the premium is payable di- rectly to us or our agents or indirectly under a premium finance plan or extension of credit. Notice of cancellation will be mailed at least 15 days before the effective date of cancellation. c, A condition, factor or loss experience mate- rial to insurability has changed substantially or a substantial condition, factor or loss ex- perience material lo insurability has become known during the policy period. Notice of cancellation will be mailed or delivered at least 60 days before the effective date of cancellation, d, Loss of reinsurance or a substantial de- crease in reinsurance has occurred, which loss or decrease, at the time of cancellation, shall be certified to the Insurance Commis- sioner as directly affecling in-force policies. Notice of cancellation will be mailed or de- livered at least 60 days before the effective date of cancellation. e. Malarial failure to comply with policy terms, conditions or contractual duties. Notice of cancellation will be mailed or delivered at least 60 days before the effective date of cancellation IL 02 46 07 02 © ISO Properties, Inc., 2001 Page 1 of 2 [] f. Other reasons that the Insurance Commis- sioner may approve. Notice of cancellation will be mailed or delivered at least 60 days before the effective date of cancellation. This policy may also be cancelled from inception upon discovery that the policy was obtained through fraudulent statements, omissions or con- cealment of facts material to the acceptance of the risk or to the hazard assumed by us. 4. We will mail or deliver our notice to the first Named Insured's last mailing address known to us, Notice of cancellation will state the specific reasons for cancellation. 5. Notice of cancellation will state the effective date of cancellation. The policy pedod will end on that date, 6. If this policy is cancelled, we will send the first Named Insured any premium refund due. If we cancel, the refund will be pro rata and will be returned wilhin 10 business days after the ef- fective date of cancellation. If the first Named Insured cancels, Ihe refund may be less than pro rata and will be returned within 30 days af- ter the effective date of cancellation. The can- cellation will be effective even if we have not made or offered a refund. 7. If notice is mailed, it will be by registered or first class mail. Proof of mailing will be sufficient preof of notice. B. The following are added and supersede any provi- sions to the contrary: 1. Nonrenewal If we decide not to renew this policy, we wilt mail or deliver written notice of nonrenewal, stating the specific reasons for nonrenewal, to the first Named Insured at least 60 days before the expiration date of the policy. 2. Increase Of Premium If we increase your renewal premium, we will mail or deliver to the first Named Insured writ- ten notice of our intent to increase the premium at least 30 days before the effective date of the premium increase. Any netice of nonrenewal or renewal premium in- crease~ will be mailed or delivered to the first Named Insured's last known address. If notice is mailed, it will be by registered or first class mail. Proof of mailing will be sufficient proof of notice. Page 2 of 2 © ISO Properties, Inc_, 2001 IL 02 46 07 02 ~ PENNSYLVANIA NOTICE IL 09 10 07 02 An Insurance Company, its agents, employees, or service contractors acting on ils behalf, may provide services to reduce the likelihood of injury, death or loss. These services may include any of the following or related services incident to the application for, issuance, renewal or continuation of, a policy of insur- ance: 1, Surveys; 2, Consultation or advice; or 3, Inspections. The "Insurance Consultation Services Exemption Act" of Pennsylvania provides that the Insurance Com- pany, its agents, employees or service contractors acting on its behalf, is not liable for damages from injury, death or loss occurring as a result of any act or omission by any person in the furnishing of or the failure to furnish these services. The Act does not apply: · 1. If the injury, death or loss occurred during the actual performance of the services and was caus~:l by the negligence of the Insurance Com- pany, its agents, employees or service contractors; 2. To consultation services required to be performed under a written service contract not related to a policy of insurance; or 3. If any acls or omissions of the Insurance Com- pany, its agents, employees or service contractors are juHicially determined to constitute a crime, ac- tual malice, or gross negligence. Instruction to Policy Writers Attach the Pennsylvania Notice to all new and renewal certificates insurin~l risks located in Pennsylvania. IL 09 10 07 02 © ISO Properties, Inc., 20,31 Page 1 of I [] ENDORSEMENT FOR MOTOR CARRIER POLICIES OF INSURANCE FOR PUB~-. ,, LIABILITY UNDER SECTIONS 29 AND 30 OF THE MOTOR CARRIER ACT OF 1980 Issued to Clouse Truckin~ Inc. of RD #%, Box 112, Carlisle, PA Dated at B~]rllnE~nn: NC 27216 this 7th dayof July Amending Policy No. ~]T10011 ?,(::)Al Form Approved OMB No. 2125>0074 17013 .,2003 Effective Dale July 5 2003 Name of Insurance Compan~irius America Ins. Company ~y'/j~ ~ ~'l'~ Ij- ~j',~,s ' ~'~ Telephone Number ( 800 ) 222-2407 . Countersigned b The policy to which this endorsement is affached provides primary or excess insurance, as indicated by '[]', for the limits shown: ~ This insurance is primary and the company shall not be liable for amounts in excess of $ 1 ~000 t 000 for each accident. [] This insurance is excess and the company shall not be liable for amounts in excess of $ for each accident in excess of the underlying limit of $ for each accident Whenever required by the Federal Highway Administration (FHWA) or the Interstate Commerce Commission (ICC), the company agrees to furnish the FHWA or the ICC a duplicate cf said policy and all its endorsements. The company also agrees, upon telephone request by an authorized representative of the FHWA or the ICC, to verify that the policy Js in force as of a particular date. Cancellation of this endorsement may be effected by the company or the insured by giving (1) thirty-five (35) days notice in writing to the other party (said 35 days notice to commence from the date the notice is mailed, proof of mailing shall be sufficient proof of notice), and (2) if the insured is subject to the ICC's jurisdiction, by providing thirty (30) days notice to the ICC (said 30 days notice to commence from the date the notice is received by the ICC at its office in Washington, D.C.). DEFINITIONS AS USED IN THIS ENDC)RSEMENT ACCIDENT includes continuous or repeated exposure to conditions which results in bodily injury, prope~'y damage, or environmental damage which the insured neither expected nor intended. MOTOR VEHICLE means a land vehicle, machine, truck, tractor, trailer, or semitrailer propelled or drawn by mechanical power and used on a highway for transporting property, or any combination thereof. BODILY INJURY means injury to the body, sickness, or disease to any person, including death resulting from any of these. ENVIRONMENTAL RESTORATION means restitution for the The insurance policy to which this endorsement is attached provides automobile liability insurance and is amended to assure compliance by the insured, within the limits stated herein, as a motor carrier of property, with Sections 29 and 30 of the Motor Carrier Act of 1980 and the rules and regulations of the Federal Highway Administration (FHWA) and the interstate Commerce Commission (iCC). In consideration of the premium stated in the policy to which this endorsement is attached, the insurer (the company) agrees to pay, within the limits of liability described herein, any final judgment recovered against the insured for public liability resulting from negligence in the operation, maintenance or use of motor vehicles subject to the financial responsibility requirements of Sections 29 and 30 of the Motor Carrier Act of 1980 regardless of whether or not each motor vehicle is specifically described in the policy and whether or not such negligence occurs on any route or in any territory authorized to be served by the insured or elsewhere, Such insurance as is afforded, for public liability, does not apply to injury to or death of the insured's employees while engaged in the course of their employment, or property transported by the insured, designated as cargo. It is understood and agreed that no condition, provision, stipulation, or limitation contained in the poliO;/, this endorsement, or an)' other loss, damage, or destruction of natural resources arising out of the accidental discharge, dispersal, release or escape into or upon the land, atmosphere, watercourse, or body of water, of any commodity transported by a motor carrier. This shall include the cost of removal and the cost of necessary measures taken to minimize or m~igate damage to human health, the natural environment, fish, shellfish, and wildlife. PROPERTY DAMAGE means damage to or loss of use of tangible property. PUBLIC LIABILITY means liability for bodily injury, property damage, and environmental restoration. endorsemen'l thereon, or violation thereof, shall relieve the company from liability or from the payment of any final judgment, within the limits of liability herein described, irrespective of the financial condition, insolvency or bankruptcy of the insured. However, all terms, conditions and limitations in the policy to which the endorsement is attached shall remain in full force and affect as binding between the insured and the company. The insured agrees to reimburse the company for any payment made by the company on account of any accident, claim, or suit involving a breach of the terms of the policy, and for any payment that the company would not have been obligated to make under the provisions of the policy except for the agreement contained in this endorsement. It is further understood and agreed that, upon failure of the company to pay any final judgment recovered against the insured as provided herein, the judgment creditor may maintain an action m any court of competent jurisdiction against the company to compel such payment. The limits of the company's liability for the amounts prescribed in this endorsement apply separately, to each accident, and any payment under the policy because of any one accident shall not operate to re~uce the liability of the company for the payment of final jud~lments resultin~l from any other accident. The Motor Carrier Act of 1980 requires limits of financial responsibility acoording to the type of carriage and commomty transported by the motor carrier, it is the MOTOR CARRIER'S obligation to obtain the required limits of financial responsibility. THE SCHEDULE OF UMITS SHOWN ON THE NEXT PAGE DOES NOT PROVIDE COVERAGE. The limits shown in the scheduJe are for information purposes only. Form MCS-90 (Over) UNIFC~M ~NFORMAT]ON SERVICE~;. ~NC MC 1622k (10~P9) SCHEDULE OF LIMI'T'S Public Liability Minimum Type of Carriage Commodity T~ransported Insurance Property (nonhazardous). $ (1) For-hire (In interstate or foreign commerce). ~ (2)~ FOr-him and Pri~ate (in int~rs~at~-~. -, foreign, or intrastate commerce)..~ Hazardous substances, as defined in 49 CFR 171.8, transported in cargo tanks, i)ortahle tanks, or hopper- type vehicles with capacities in excess of 3,500 water gallons; or in bulk Divisions 1.1, 1.2, and 1.3 materials; any quantity of Division 2.3 Hazard Zone A or Division 6.1, Packing Group 1, Hazard Zone A material; in bulk Division 2.1 or 2.2; or itighway reute controlled quantities of a Class 7 matedal as defined in 49 CFR 173.403. 750,000 5,000,000 (3) For-hire and Private (In interstate or foreign commerce: in any quantity) or (In intrastate com- merce: in bulk only). (4) For-hire and Private (In interstate or foreign commerce). Oil listed in 49 CFR 172.101, hazardous materials and hazardous substances defined in 49 CFR 171.8 and listed in 49 CFR 172.101, It)ut not mentioned in (2) above or (4) below. Any quantity of Division 1.1, 1.2 or 1.3 material; any quantity of a Division 2.3, Hazard Zone A, or Division 6.1, Packing Group 1, Hazard Zone ^ material; or highway route controlled quantities of Class 7 material as defined in 49 CFR 173.403. 1,000,000 5,000,000 Note: The type of carriage listed under (1), (2), and (3) applies to vehicles with a gross vehicle weight rating of 10,000 pounds or more. The type of carriage listed under number (4) applies to atl vehicles with a gross vehicle weight rating of less than 10,000 pounds. SCHEDULE OF LIMITS Public Liability For-hire motor carriers of passengers operating in interstate or foreign commerce Minimum Vehicle Seating Capacity Insurance (1) Any vehicle with a seating capacity of 16 passengers or more. $ 5,000,000 (2) Any vehicle with a seating capacity of 15 passengers or less. 1,500,000 Seaboard Underwriters., Inc. PO Box 1478 2563 Eric Lane, Suite K, Burlington, NC 27216 336-229-1324 800-222-2407 336-229-6977 (fax) July 24, 2003 Insured Address City and Zip CIouse Trucking, Inc. 2075 Ritner Highway Carlisle, PA 17013 Dear Sir: RE: Policy No.: Company: Coverage: Effective: LHT1001139A102 Sirius America Insurance Company Liability 07/05/03 We welcome you as an insured under the above policy. The prompt and proper reporting of claims will help us to help you. Through your cooperation in reporting all claims, regardless of size and/or responsibility, we can best serve your interests. Claims for accidents involving your Sirius America Insurance Company policy will be handled by a third p~r; administrator, Criterion Claim Solutions, Post Office Box 4012 (300 West Broadway, Suite 1600), Councii Bluffs, IA 51502-4012, telephone (toll free) 888-816-2227. The fax number is 712-256-3801. Someone will be available to take your emergency claim report at this toll free reporting number, 24 hours a day, 7 days a week. While you may, at your discretion, report new claims either to ye,ur agent or directly to Criterion, claims of an urgent nature should always be repo?ted to Crtlerion immediatellJ so that a claims agent may give you appropriate assistance and further instructions on how to proceed. Enclosed with your policy you will find a brochure entitled "In C~se of Accident, Call ...". The telephone and fax numbers for reporting accidents to Criterion are found on this brochure, together with instructions and an accident report form which your driver should use to gather information at the scene. We are enclosing one brochure for each power unit insured under this policy, and encourage you to have your drivers keep the brochure in the glove box of his or her tractor until it is needed. Additional brochures are available on request through your agent. Wc ~vould also ask that you advise Seaboard (through your agent) of all new drivers who could be operating equipment insured under this policy, and that you provide a copy c,fthe driver's MVR. Once again, we welcome your business and look forward to a profitable relationship with your company. Sincerely, Ronald M. Joyce, CPCU Vice-Presidenl / Claims · ~.SEP. 14.2004 2:41PM M&T TRRDE SERVICES M0.278 P.O Manufaotm'ers and Traders Trust Company M&T Bank' Irrevocable Letter of C:edit Ne. 177~2 Date: September 3 2004 At sight Pay To: Sirius America Insurance Company c/o Seaboard Underwriters, Inc. 3035 $. Church Street Burlington, NC 27216 Seventy Nine Thousand Five I-Iundred & Sixty Dollars ($7!),560.00) For Value Received and Charge To Account of Irrevocable Letter of Credit No. Y7752 '~rawn under Manufacturers and Traders Trust Company ("M&T Bank") Irrevocable Lette of Credit No.17752 M&T Bank One Fom~taln Plaza 2ua Floor Buffalo, New York 14203-1495 Attn: Trade Serviee~ By: {~rhls Ame-'l'i'ea.,x~usurance Company Au~ofized Signatory Exhibit "D" I~J/SEP. ~8, E0041; J ~: 46PH?9-4~'M&T ~qMK COUHSELS OFFICE;~ MO. ?~0 P. 2/E ..... CLOUSE TRUCKING, INC,, Pla/nt/ff MANUFAC~ AND TRADERS TRUST COMPANY dfda M~T BANK, Sm/US AMBPJCA ~SUP. ANCE COMPANY ~d $~ABOARD IN TK~ CO[/P,T OF COMAiON PLEAS OF CUMBERLAND COUNTY, P~NNS%'LVANIA NO. 04-4650 CIWL AC/~ON CONSENTA~RM PURSUANT TO Pm.R.C.p. ; ~) By ~g ~bis Con~ Fo~, D~fe~ M~ ~ ~ Tm~ Comp~ ~a ~T B~, ~n~ ~ P~ff. Clo~= T~ ~c., ~nd[~ its Co~p~t ~r ~ a~o~ ~ above ~d ~ ~ ~ ~o~ono~'s Offi~ of C~d Co~ a F~ ~n~ Comp~I. A~ for Def~t M~,ff~ ~d ~ Exhibit "E" CLOUSE TRUCKING, 1NC., Plaintiff :IN THE COURT OF COMMON PLEAS OF :CUMBERLAND COUNTY, PENNSYLVANIA :CIVIL ACTION - EQUITY :NO. MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, Defendant VERIFICATION I, J. Edward Clouse, President of Clouse Trucking, Inc., hereby verify that, to the best of my knowledge, information, and believe, all averments in this document are true and correct, and that I have the authority to make this verification. This statement of verification is made subject to the penalties of 18 Pa.C.S. Section 4904 relating to unsworn falsifications to authorities, which provides that ifI make knowingly false averments, I may be subject to criminal penalties. Date: September 16, 2004 CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND cOUNTY, pENNSYLVANIA CIVIL ACTION - LAW NO. 04-4650 CIVIL CERTIFICATE OF SERVICE I, Christopher E. Rice, Esquire, ofMartson Deardorff Williams & Otto, hereby certify that a certified copy of the First Amended Complaint filed September 29, 2004, was served this date by depositing same in the Post Office at Carlisle, PA, first class mail, postage prepaid, addressed as follows: Mark Warren, Esquire Manufacturers and Traders Trust Company One Fountain Plaza Buffalo, NY 14203-1495 MARTSON DEARDORFF WILLIAMS & OTTO Christopher E. Rice, Esquire Attorney I.D. No. 90916 Ten East Higt~ Street Carlisle, PA 1.7013 (717) 243-3341 Attorneys fox' plaintiff Date: September 29, 2004 CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY dPo/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CiVIL ACTION - LAW NO. 04-4650 CiVIL CERTIFICATE OF SERVIC_E_E I, Christopher E. Rice, Esquire, ofMartson DeardorffWilliarns & Otto, hereby certify that a copy of the Order of Court dated September 16, 2004, anti a copy of Plaintiffs Motion for Preliminary or Special Injunction flied September 16, 2004, was served this date via certified mail, return receipt requested, by depositing same in the Post Office at Carlisle, PA, addressed as follows: Sirius America Insurance Company c/o United States Corporationt 2711 Centerville Road, Suite 400 Wilmington, DE 19808 Seaboard Underwriters, Inc. c/o Joseph P. Hutelmyer 3035 S. Church Street Burlington, NC 27215 MARTSON DEARDORFF WILLIAMS & OTTO By ~/~,~t_.... ~. ff~ Christopher E. Rice, Esquire Attorney I.D. Nc,. 90916 Ten East High S~treet Carlisle, PA 17013 (717) 243-3341 Date: September 29, 2004 Attorneys for Plaintiff CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY dPo/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants : IN THE COURT OF COMMON PLEAS OF : : CUMBERLAND COUNTY, PENNSYLVANIA : CIVIL ACTION : : NO. 04-4650 : AFFIDAVIT OF SERVICE OF FIRST AMENI)E___D COMPLAINT COMMONWEALTH OF PENNSYLVANIA ) :SS. COUNTy OF CUMBERLAND ) I hereby certify that a copy of the First Amended Complaint was mailed to Defendant Sirius America Insurance Company at c/o United States Corporation, 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808, on September 29, 2004, by certified mail, return receipt requested. Attached is the Post Office return receipt signed "Laura M. Cooper" and dated September 30, 2004. Sworn to and subscribed ROTARIN. SEAL T'TCTOIUA L OTTO, ROTARy PUBLIC CARLISLE UORO CUMBERLAND COUN ~ COMMI$$ ON ~PIRE$. BE0~2006'/7~ MARTSON DEARDORFF WILLIAMS & OTTO Christopher E. Ric~ Attorney ID No. 90916 Ten East High Street Carlisle, PA 17013 (717) 243-3341 5772 6624 CERTIFICATE OF S " ERVIt~_~E I, Jacqueline A. Decker, an authorized agent ofMartson DeardorffWilliams & Otto, hereby certify that a copy of the foregoing Affidavit of Service of First ~maended Complaint was served this date by depositing same in the Post Office at Carlisle, PA, first class mail ..... as follows: , ~,u~tage prepmd, addressed Mark Warren, Esquire Manufacturers and Traders Trust Company One Fountain Plaza Buffalo, New York 14203-1495 Sirius America Insurance Company c/o United States Corporation 2711 Centerville Road, Suite 400 Wilmington, Delaware 19808 Seaboard Underwriters, Inc. c/o Joseph p. Hutelmyer 3035 S. Church Street Burlington, North Carolina 27215 MARTSON DEARDORFF WILLIAMS & OTTO I en~l:~ast High Street Carlisle, PA 17013 (717) 243-3341 Dated: October 8, 2004 CLOUSE TRUCKING, INC., Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY dPo/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION NO. 04-4650 AFFIDAVIT OF SERVICE OF FIRST AMENDiED COMPLAINT COMMONWEALTH OF PENNSYLVANIA ) :SS. COUNTY OF CUMBERLAND ) I hereby certify that a copy of the First Amended Complaint was mailed to Defendant Seaboard Underwriters, Inc., at c/o Joseph P. Hutelmyer, 3035 S. Church Street, Burlington, North Carolina 27215, on September 29, 2004, by certified mail, return receipt requested. Attached is the Post Office return receipt signed "Melanie Waldron" and dated October 4, 2004. MARTSON DEARDORFF WILLIAMS & OTTO Christopher E. Rice, Esquire Attorney ID No. 90916 Ten East High Street Carlisle, PA 17013 (717) 243-3341 Sworn to and subscribed befor/e4~e~ this Octo/~ 11, 2004. Notary Public NOTARIAL SEAL 'VICTORIA L OTTO. NOTARY PUBLIC CARL SLE BORO, CUMBERLAND CouNTY| ~Ai~/COMM SSION EXP RES DEC. 2, 2006, 7003 3110 0004 5772 6600 ~ $1 .~ m T~tal Postage & Fees CERTIFICATE OF SERVICE I, Jacqueline A. Decker, an authorized agent ofMartson Deardorff Williams & Otto, hereby certifythat a copy of the foregoing Affidavit of Service of First 3anended Complaint was served this date by depositing same in the Post Office at Carlisle, PA, first class mail, postage prepaid, addressed as follows: Mark Warren, Esquire Manufacturers and Traders Trust Company One Fountain Plaza Buffalo, New York 14203-14195 Sirius America Insurance Company c/o United States Corporation 2711 Centerville Road, Suite ~[00 Wilmington, Delaware 19808 Seaboard Underwriters, Inc. c/o Joseph P. Hutelmyer 3035 S. Church Street Burlington, North Carolina 27215 MARTSON DEARDORFF WILLIAMS & OTTO J~qu~l)ne A. ]Decker Ten Efist High Street Carlisle, PA 1'7013 (717) 243-3341 Dated: October 11, 2004 CLOUSE TRUCKING, INC. Plaintiff, : v. : : MANUFACTURERS AND TRADERS : TRUST COMPANY d/b/a M&T BANK, : SIRIUS AMERICA INSURANCE : COMPANY and SEABOARD : UNDERWRITERS, INC., : : Defendants. : : IN THE COURT OF COMMON PLEAS OF : CUMBERLAND COUNTY, PENNSYLVANIA NO. 04-4650 CIVIL ACTION ANSWER OF DEFENDANT MANUFACTURERS AND TRADERS TRU.~T COMOPANY TO FIRST AMENDED CO~PLAINT Defendant MANUFACTURERS AND TRADERS TRUST COMPANY (~M&T"), by its attorney, Mark W. Warren, ]Esq., as and for its answer to the first amended complaint herein avers: 1. Admits paragraphs 1, 2, 3 and 4 of the complaint. 2. Admits paragraph 5 of the complaint, except denies that defendant Seaboard is a beneficiary under the Letter of Credit. 3. After reasonable investigation, M&T is without knowledge or information sufficient to form a belief as to the truth of the averments set forth in paragraphs 6, 7, 8, 9, 10, 11, 12 and 13 of the complaint. 4. Admits paragraph 14 of the complaint, except denies that the draw was presented to M&T on September 3, 2004. The draw is dated September 3, 2004 but was received by and presented to M&T on September 7, 2004. 5. After reasonable investigation, M&T is without knowledge or information sufficient to form a belief as to the truth of the averments set forth in paragraph 15 of the complaint. repeats and re-avers its responses to the paragraphs incorporated therein by reference. 7. After reasonable investigation, M&T is knowledge or information sufficient to form a belief as truth of the averments set forth in paragraphs 17 and 18 complaint. In response to paragraph 16 of the complaint, without to the of the 8. Admits paragraph 19 of the oomplaint, except additionally avers that the Letter of Credit is governed by New York law (which, however, is substantially identical to Pennsylvania law in relevant part). 9. Admits paragraph 20 of the complaint. 10. In response to paragraph 21 of the complaint, admits the jurisdiction of this Court but, after reasonable investigation, M&T is without knowledge or information sufficient to form a belief as to whether plaintiff has demonstrated a likelihood of success on the merits. 11. After reasonable investigation, M&T is without knowledge or information sufficient to form a belief as to the truth of the averments set forth in paragraph 22 of the complaint. 12. Admits paragraphs 23, 24, 25 and 26 of the complaint. 13. After reasonable investigation, M&T is without knowledge or information sufficient to form a belief as to the truth of the averments set forth in paragraphs 27 and 28 of the complaint. 14. In response to paragraph 29 of the complaint, repeats and re-avers its responses to the paragraphs incorporated therein by reference. 15. After reasonable investigation, M&T is without knowledge or information sufficient to form a belief as to the truth of the averments set forth in paragraphs 30, 31, 32, 33, 34 and 35 of the COmplaint. W~E~EFORE, being in the nature of a Stakeholder, M&T takes no position on the merits of plaintiff, s Claims against M&T's co-defendants and will abide the determination of the Court herein. Dated: Buffalo, New York October 18, 2004 Mark W. Warren, Esq. Admitted pro hac vice Attorney for Defendant Manufacturers and Traders Trust Company One M&T Plaza, 12th Floor Buffalo, New York 14240 (716) 842-5667 3 CLOUSE TRUCKING, INC. Plaintiff, MANUFACTURERS AND TRADERS : TRUST COMPANY d/b/a M&T BANK, : SIRIUS AMERICA INSURANCE : COMPANY and SEABOARD : UNDERWRITERS, INC., : Defendants. IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA NO. 04-4650 CIVIL ACTION VERIFICATION I, CLAUDIA L. CONROY, Assistant Vice President of defendant Manufacturers and Traders Trust Company, hereby verify that, to the best of my knowledge, information and belief, all averments in this document are true and Correct, and that I have the authority to make this verification. Tihis statement of verification is made subject to the penalties of 18 Pa.C.S. §4904 relating to unsworn falsifications to authorities, which provides that if I make knowingly false averments, I may be subject to criminal penalties. Dated: Buffalo, New York October 18, 2004 t-a~dia L. Conroy ~ CLOUSE TRUCKING, INC. Plaintiff, MANUFACTURERS AND TRADERS : TRUST COMPANY d/b/a M&T BANK, : SIRIUS AMERICA INSURANCE : COMPANY and SEABOARD : UNDERWRITERS, INC., : Defendants. IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA : NO. 04-4650 CIVIL ACTION CERTIFICATE OF SERVIC]Z I, Mark W. Warren, Esq., hereby certify that a true copy of the within Answer, dated October 18, 2004, was served this date by depositing the same with the Post Office in Buffalo, New York, first class mail, postage prepaid, addressed as follows: Christopher E. Rice, Esq. Martson Deardorff Williams & Otto Ten East High Street Carlisle, Pennsylvania 17013 Sirius America Insurance Company c/o United States Corporation 2711 Centerville Road, Suite 400 Wilmington, Delaware 19808 Dated: Seaboard Underwriters, Inc. c/o Joseph p. Hutelmyer 3035 S. Church Street Burlington, North Carolina 27215 Buffalo, New York October 18, 2004 Mark W. Warren, Esq. Admitted pro hac vice Attorney for Defendant Manufacturers and Traders Trust Company One M&T Plaza, 12th Floor Buffalo, New York 14240 (716) 842-5667 2 FINEMAN KREKSTEIN & HARRIS, P.C. By: JAY BARRY HARRIS, ESQUIRE Identification No. 33998 30 S. 17th Street, Suite 1800 Philadelphia, PA 19103-5413 (215) 893-9300 Attorney for Defendants Sirius America Insurance Company and Seaboard Underwriters, Inc. CLOUSE TRUCKING, INC. Plaintiff MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC. Defendants COURT OF COMMON PLEAS CUMBERLAND COUNTY CIVIL ACTION No. 04-4650 ENTRY OF APPEARANCE TO THE PROTHONOTARY: Kindly enter my appearance on behalf of the Defendants Sirius America Insurance Company and Seaboard Underwriters, Inc. in the above-captioned matter. FINEMAN KREKSTEIN & HARRIS, P.C. October 25, 2004 JAY./BA,~Y I-~tRIS Attorney for Defendants Sirius America Insurance Company and Seaboard Underwriters, Inc. F:kFILE$\DATAFILE\General\Currentk3491,7.ordl Created 9/29/04 9:32AM Revised 11/3/04 3 38PM 3491.7 CLOUSE TRUCKING, INC., Plaintiff Vo MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW NO. 04-4650 Crv'IL Judge Edgar B. Bayley CONSENT ORDER AND NOW, this [ q~'~., day of November, 2004, Defendant Manufacturers and Traders Trust Company d/b/aY M&T Bank is permanently enjoined from honoring the presentation of Sirius America Insurance Company c/o Seaboard Underwriters, Inc., uncler the Irrevocable Clean Standby Letter of Credit No. 17752 seeking the payment of $79,560.00, mad the bond or cash. paid pursuant to Pennsylvania Rule of Civil Procedure 1531(b) in the amount of $5,000.00 be released to Plaintiff Clouse Trucking, Inc. ,/Carl C. Risch, Esquire Counsel for Plaintiff v/tV[ark Warren, Esquire Counsel for Defendant M&T Bank ~l~_ a~s, Esquire Counsel for Defendant Sirius America Insurance Company and Seaboard Underwriters, Inc. ,v 11 By th~ Edgar B. Bayley,'7~ ~ RECEIPT FOR TRANSFER Cumberland County Prothonotary's Office Carlisle, Pa 17013 Receipt Date 11/19/2004 Receipt Time 9:28:11 Receipt No. 157590 CLOUSE TRUCKING INC 2075 RITNER HIHGWAY CARLISLE, PA 17013 Case Number 2004-04650 Remarks SPLIT FOR POUNDAGE Transaction BOND BOND BOND BOND Distribution Of Adjustment ........................... Payee This Adj PROTHONOTARY ESCROW CLOUSE TRUCKING INC PROTHONOTARY ESCROW CUMBERLAND CO GENERAL FUND 4,930.00- 4,930.00 70.00- 70.00 09313011192004 PYS405 Distribution Cumberland_County Prg~hoDotary'g Office manual Re±ease uneck Reg!~s5er Escrow Case No Accounting Amount Pa~e 1 11/19/2004 Tran Date Date Release 3873 CLOUSE TRUCKING INC BOND 2004- 04650 TRNS ESC IN 4930.00 11/19/2004 Payee total: 4930.00 Grand total: 4,930.00 Fc IFILESIDA T AFILEIGetleraJICurrel1tIJ491 .7 .praecipe. wpd Created 9/281041l:53AM Revised: 2/l5105 10A&AM CLOUSE TRUCKlNG, INC., Plaintiff v. MANUFACTURERS AND TRADERS TRUST COMPANY d/b/a M&T BANK, SIRIUS AMERICA INSURANCE COMPANY and SEABOARD UNDERWRITERS, INC., Defendants IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA NO. 04-4650 CIVIL ACTION PRAECIPE TO DISCONTINUE To the Prothonotary: Please mark this action against all Defendants settled and discontinued with prejudice. Date: February 15, 2005 MARTS ON DEARDORFF WILLIAMS & OTTO (?~ 1~ 5 fZ- Christopher E. Rice, Esquire AttorneyLD. No. 90916 10 East High Street Carlisle, P A 17013 (717) 243-3341 S 6\ ....... ~ g ~ ;r- -- ~ U\ .:t::: ~ ...., :r> ~ ~ ~' ';>.. ~