Contract analysis

I. Identification and Capacity of Affiant

1. My name is Marcus Ellington. I am over the age of eighteen years, of sound mind, and competent to make this affidavit. I have never been convicted of a felony or a crime involving moral turpitude. I have personal knowledge of the facts set forth herein, and all statements contained in this affidavit are true and correct.

2. I serve as the Chief Executive Officer of Stonefield Logistics Group Inc. ("Stonefield" or "SLG"), a Texas corporation duly organized and existing under the laws of the State of Texas, with its principal office located at 4100 Commerce Street, Suite 1200, Dallas, Texas 75226. I have served in this capacity since June 2019, when SLG was acquired by Crestpoint Industrial Partners Fund III, LP.

3. In my role as Chief Executive Officer, I am responsible for the overall management and strategic direction of SLG, including oversight of the company's key commercial relationships, carrier partnerships, and significant contractual commitments. I am authorized to execute contracts and binding agreements on behalf of Stonefield Logistics Group Inc. and to provide testimony and sworn statements in connection with le

4. SLG is a transportation and logistics company operating as a third-party logistics provider (commonly known as a "3PL provider") specializing in dedicated fleet management, intermodal drayage, and last-mile delivery services. SLG operates a managed transportation network spanning fourteen states throughout the Southern and Central United States, maintaining active relationships with approximately 340 carrier partn

II. The Dedicated Freight Services Agreement

5. On April 15, 2022, Stonefield Logistics Group Inc. (acting in the capacity of "Shipper") and Ridgeline Freight Carriers LLC ("Ridgeline" or "RFC"), an Oklahoma limited liability company registered to do business in the State of Texas, with its principal office at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159, entered into a written contract titled "Dedicated Freight Services Agreement" (hereinafter the

6. The DFSA was executed by me, Marcus Ellington, on behalf of Stonefield Logistics Group Inc. in my capacity as Chief Executive Officer, and by Gerald "Gerry" Brashear, Managing Member and sole owner of Ridgeline Freight Carriers LLC, on behalf of Ridgeline. The DFSA was the product of arms-length negotiations between the parties, which took place over a period of approximately six weeks prior to execution. Both par

7. A true and correct copy of the fully executed DFSA, including all schedules, exhibits, and addenda thereto, is attached hereto as Exhibit A and incorporated herein by reference for all purposes. This copy is maintained in Stonefield's ordinary course of business records and was retrieved from SLG's contract management system for purposes of this proceeding. A. Key Terms of the DFSA

8. The following is a summary of the key terms and provisions of the DFSA that are material to Plaintiff's claims and to this Motion for Default Judgment: (a) Term. Section 2.1 of the DFSA provides that the Agreement shall be effective for a period of thirty-six (36) months, commencing on April 15, 2022 and terminating on April 14, 2025, unless sooner terminated in accordance with the provisions of the Agreement. (b)

III. Ridgeline's Progressive Breach of the DFSA

9. From the commencement of the DFSA in April 2022 through approximately the end of June 2023, a period of approximately fifteen months, Ridgeline performed its obligations under the Agreement in a generally satisfactory manner. During this period, Ridgeline consistently deployed the contractually required minimum of twelve (12) dedicated Class 8 tractor-trailers with qualified drivers on SLG's Texas retail distribut

10. Beginning in July 2023, Ridgeline began failing to provide the contractually required minimum of twelve (12) dedicated trucks on SLG's Texas distribution lanes. The decline in Ridgeline's truck deployment was progressive and worsened significantly over the following months. Specifically, based on SLG's daily fleet deployment records maintained by our operations department, Ridgeline's truck deployment declined as

11. These service failures by Ridgeline caused significant and material disruptions to Stonefield's Texas retail distribution network. SLG's end-user customers depend upon timely and reliable delivery of freight within designated delivery windows, and Ridgeline's failure to provide the contractually committed truck capacity resulted in missed delivery windows, late and incomplete shipments, customer complaints and se

12. During the period of Ridgeline's declining performance, I personally communicated with Gerald Brashear on multiple occasions, including by telephone on or about July 18, 2023, August 9, 2023, September 5, 2023, and October 3, 2023, regarding Ridgeline's failure to meet its contractual obligations. In those conversations, Mr. Brashear acknowledged that Ridgeline was experiencing significant operational challenges,

13. Samuel Trujillo, SLG's Vice President of Operations, who oversaw the day-to-day management of the Ridgeline relationship and monitored daily fleet deployment data, communicated with Ridgeline's dispatch and operations personnel on a near-daily basis during this period and can confirm the progressive service degradation described herein. Mr. Trujillo reported directly to me regarding the deteriorating performance

14. On October 18, 2023, Stonefield Logistics Group Inc. sent a formal written notice of material breach (the "Cure Notice") to Ridgeline Freight Carriers LLC at its principal office address of 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159, and to Gerald "Gerry" Brashear, individually, at his personal residence address of 2314 Quail Creek Drive, Edmond, Oklahoma 73034. The Cure Notice was transmitted via

15. The Cure Notice specifically identified the material breaches committed by Ridgeline, including Ridgeline's sustained and continuing failure to provide the minimum twelve (12) dedicated Class 8 tractor-trailers with qualified drivers as required under Section 3.1 of the DFSA, and the resulting breach of the Minimum Monthly Revenue Commitment under Section 3.2 of the DFSA. The Cure Notice further stated that, in a

16. The Cure Notice expressly informed Ridgeline and Brashear that, in the event Ridgeline failed to cure the identified breaches within the 30-day cure period, Stonefield would exercise its rights and remedies under Section 14 of the DFSA, including the right to terminate the Agreement, recover liquidated damages under Section 14.3, recover re-procurement costs under Section 14.4, and enforce the personal guaranty a

17. A true and correct copy of the Cure Notice dated October 18, 2023, together with the certified mail receipts evidencing delivery, is attached hereto as Exhibit B and incorporated herein by reference for all purposes.

V. Failure to Cure and Cessation of Operations

18. The thirty-day cure period specified in the Cure Notice expired on November 17, 2023. Ridgeline Freight Carriers LLC failed to cure the material breaches identified in the Cure Notice within the prescribed cure period. At no time during the cure period did Ridgeline restore its truck deployment to the contractually required minimum of twelve (12) dedicated tractor-trailers. To the contrary, Ridgeline's deployment

19. Neither Ridgeline nor Gerald Brashear submitted any written cure plan, proposed any alternative performance arrangement, or otherwise communicated any meaningful intention to bring Ridgeline into compliance with its obligations under the DFSA during the 30-day cure period. Mr. Brashear did not respond to the Cure Notice in writing.

20. On or about December 8, 2023, Ridgeline ceased all freight operations entirely. On that date, the remaining Ridgeline trucks were pulled off SLG's Texas distribution lanes, and Ridgeline's dispatch office became unresponsive to communications from SLG's operations team. To my knowledge, based on inquiries made by SLG's operations department and by SLG's counsel, Ridgeline has not resumed freight operations at any

21. At no time following the expiration of the cure period on November 17, 2023 has Ridgeline or Gerald Brashear communicated to Stonefield any plan to resume services, cure the identified defaults, or satisfy any of Ridgeline's outstanding obligations under the DFSA.

22. On December 22, 2023, Diane Ostrowski, General Counsel of Stonefield Logistics Group Inc., sent a formal written demand letter (the "Demand Letter") to Ridgeline Freight Carriers LLC and to Gerald Brashear, individually, via certified mail, return receipt requested, and via email. The Demand Letter was addressed to Ridgeline at 7820 South Meridian Avenue, Oklahoma City, Oklahoma 73159 and to Gerald Brashear at 23

23. The Demand Letter stated that Ridgeline had committed material breaches of the DFSA that were not cured within the 30-day cure period and that Stonefield was entitled to recover liquidated damages under Section 14.3 and actual re-procurement damages under Section 14.4 of the DFSA. The Demand Letter further stated that Gerald Brashear was personally liable for such damages under the personal guaranty set forth in

24. A true and correct copy of the Demand Letter dated December 22, 2023, is attached hereto as Exhibit C and incorporated herein by reference for all purposes.

25. Neither Ridgeline Freight Carriers LLC nor Gerald Brashear responded to the December 22, 2023 Demand Letter. No payment of any kind was received from Ridgeline or Brashear in response to the Demand Letter or at any time thereafter.

26. On January 29, 2024, Stonefield Logistics Group Inc. formally engaged the law firm of Calderwood & Harkness LLP, Dallas, Texas, to represent SLG in connection with the pursuit of breach-of-contract claims against Ridgeline Freight Carriers LLC and Gerald Brashear arising from the DFSA.

27. On February 5, 2024, Calderwood & Harkness LLP, acting on behalf of Stonefield, sent a pre-suit demand letter to Ridgeline Freight Carriers LLC and Gerald Brashear, via certified mail and email, demanding payment of Two Million Four Hundred Thirty-Seven Thousand Five Hundred Dollars ($2,437,500.00), representing the total amount of liquidated damages and re-procurement damages owed under the DFSA. The pre-suit de

28. Stonefield Logistics Group Inc. seeks recovery of the following categories of damages arising from Ridgeline's material breach of the DFSA: A. Liquidated Damages Under § 14.3

29. Section 14.3 of the DFSA provides for the payment of liquidated damages by Carrier in the event of a material default that is not cured within the 30-day cure period. The liquidated damages amount is calculated as the greater of: (a) twenty-five percent (25%) of the remaining unpaid Minimum Monthly Revenue Commitment for the unexpired portion of the term, or (b) Five Hundred Thousand Dollars ($500,000.00).

30. The date of default, for purposes of the liquidated damages calculation, is November 17, 2023, the date on which the 30-day cure period expired without cure by Ridgeline.

31. The DFSA was scheduled to expire on April 14, 2025. Accordingly, as of the date of default on November 17, 2023, the remaining unexpired term of the Agreement was approximately seventeen (17) months (from November 17, 2023 through April 14, 2025).

32. The remaining unpaid Minimum Monthly Revenue Commitment for the unexpired term is calculated as follows: $325,000.00 per month × 17 months = $5,525,000.00

33. Twenty-five percent (25%) of the remaining Minimum Monthly Revenue Commitment is calculated as follows: $5,525,000.00 × 0.25 = $1,381,250.00

34. Because the amount of $1,381,250.00 exceeds the $500,000.00 floor established by Section 14.3(b) of the DFSA, the applicable liquidated damages amount under Section 14.3 is $1,381,250.00. B. Re-Procurement Damages Under § 14.4

35. Following Ridgeline's default and subsequent complete cessation of freight operations on or about December 8, 2023, Stonefield was compelled to procure substitute carrier services on an emergency basis at spot-market and surge-pricing rates in order to maintain continuity of its Texas retail distribution network and to fulfill its contractual obligations to its end-user customers. The necessity of procuring subst

36. During the period from November 18, 2023 through January 15, 2024, a period of approximately fifty-nine (59) days, Stonefield incurred documented re-procurement costs totaling $1,056,250.00. These costs consisted of the following categories of expenses: (a) Emergency spot-market freight charges paid to substitute carriers engaged to cover routes previously serviced by Ridgeline on SLG's Texas retail distribution

37. These re-procurement costs are recoverable under the consequential damages carve-out in Section 14.4 of the DFSA, which expressly permits the Shipper to recover actual, documented re-procurement costs incurred as a result of Carrier's material default, in addition to the liquidated damages amount payable under Section 14.3. The carve-out in Section 14.4 was specifically negotiated between the parties to address t

38. Supporting documentation for these re-procurement costs, including invoices from substitute carriers, purchase orders, rate confirmations, and internal cost summaries prepared by Samuel Trujillo, Vice President of Operations, are maintained in Stonefield's ordinary course of business records and are available for production to the Court upon request. I have personally reviewed these records and attest that the to

39. The total damages sought by Stonefield Logistics Group Inc. in this action are summarized as follows:

40. The total damages amount of Two Million Four Hundred Thirty-Seven Thousand Five Hundred Dollars ($2,437,500.00) represents the full amount of Stonefield's claims for liquidated damages and re-procurement damages under the DFSA. Stonefield additionally seeks pre-judgment interest, reasonable attorneys' fees, and court costs as set forth in Plaintiff's Motion for Default Judgment and as provided for under Section 1

IX. Authentication of Exhibits

41. In connection with this Affidavit and Plaintiff's Motion for Default Judgment, I authenticate the following documents, which are attached hereto as exhibits: (a) Exhibit A — Dedicated Freight Services Agreement dated April 15, 2022. Attached hereto as Exhibit A is a true and correct copy of the fully executed Dedicated Freight Services Agreement between Stonefield Logistics Group Inc. and Ridgeline Freight Carrie

42. Each of the foregoing documents is a true, correct, and complete copy of the original, and each is a business record of Stonefield Logistics Group Inc. that was made and kept in the regular course of SLG's business, at or near the time of the events described therein, by a person with knowledge of the facts, as a regular practice of SLG's business activity.

X. Personal Guaranty of Gerald Brashear

43. As set forth above, Gerald "Gerry" Brashear, in his individual capacity as Managing Member and sole owner of Ridgeline Freight Carriers LLC, executed a personal, unconditional, and irrevocable guaranty of Ridgeline's obligations under Section 14 of the DFSA (the "Personal Guaranty"). The Personal Guaranty is set forth in Section 14.5 of the DFSA, a true and correct copy of which is included in Exhibit A attached

44. Under the terms of the Personal Guaranty, Brashear personally guaranteed the prompt and complete payment and performance of all monetary obligations of Ridgeline arising under Section 14 of the DFSA, including liquidated damages under Section 14.3, re-procurement costs under Section 14.4, and attorneys' fees and costs under Section 14.6. The Personal Guaranty is unconditional and is not subject to any conditions

45. The total damages claimed by Stonefield in this action—$2,437,500.00—fall within the $3,000,000.00 cap of the Personal Guaranty. Accordingly, Gerald Brashear is jointly and severally liable with Ridgeline Freight Carriers LLC for the full amount of damages claimed, together with any pre-judgment interest, reasonable attorneys' fees, and court costs awarded by this Court.

XI. No Cure, No Payment, No Communication

46. As of the date of this Affidavit, neither Ridgeline Freight Carriers LLC nor Gerald "Gerry" Brashear has cured, or taken any steps to cure, any of the material breaches identified in the October 18, 2023 Cure Notice.

47. Neither Ridgeline nor Brashear has made any payment of any kind toward the liquidated damages, re-procurement damages, or any other amounts owed to Stonefield under the DFSA.

48. Neither Ridgeline Freight Carriers LLC nor Gerald Brashear has filed an answer, responsive pleading, or any other appearance in this action within the time prescribed by the Texas Rules of Civil Procedure, or at any time thereafter.

49. To my knowledge, based on reasonable inquiry, Ridgeline Freight Carriers LLC has not filed a voluntary or involuntary petition for bankruptcy under Title 11 of the United States Code, nor has any bankruptcy proceeding involving Ridgeline been commenced in any jurisdiction. Similarly, to my knowledge, Gerald Brashear has not filed a voluntary or involuntary petition for bankruptcy. Ridgeline has, however, ceased a