Lease agreement for drivers of O/O

terryandrene

Veteran Expediter
Safety & Compliance
US Coast Guard
Most, if not all, carriers do not interfere with the relationship an owner has with his driver(s). Each owner is free to develop the provisions included in an agreement he has with his drivers, provided they don't contradict the carriers agreement with the owner. Most owners I have met are very fair to their drivers and most drivers I have meet are happy with the relationship they have with their truck owners. There are exceptions; however, and I think we can provide a service to those that want to get into this business by providing them some guidance on what to look for in an agreement.

I've not been a driver, except for my wife, nor have I had a hired driver so I've not had a lease with anyone but, I bet many of you have. So how 'bout some of you posting a good version of an agreement. I think we can take the best of them all and put together a good universal, fill-in-the-blanks form for use by owners and pre-perusal by prospective drivers. Perhaps we can convince Lawrence to provide a link to a down-loadable for use by all.
 

BigBusBob

Veteran Expediter
Driver
1st, don't trust a handshake, not anymore. Driver here writing this.

An owner does NOT pay you, and you do NOT sign any agreement with him/her, then you have more power than you think as a driver.

Owner was not paying me, not paying me on time, and not paying me what I was owed. Owner was promising and promising backhauls for me, and more and more miles, I never saw either.

I took every load offered thru the Qualcomm, good and bad, small and big. In 4 months, I drove about 25,000 miles - pitiful in my eyes.

I drove truck home to Central FL where it was to be repaired and where I live, owner lives in Atlanta. After repairs were made, truck stayed at repair shop, I emptied sleeper and cab and all other belongings of mine off of the truck.

Why? The Owner wanted me to drive without an "original copy" up-to-date cab-card (registration) and an expired license plate.

He faxed me a copy of both, company told me prior to this that copies were illegal and that I needed original cab card. He told me "no, I spoke with the company and they said it was ok", well, I called company back and they said no, he didn't call, and that it was not ok.

Further, I called D.O.T. and spoke with an officer on the phone and he said it would be illegal and a (if caught/stopped) a moving violation, plus a $200.00 fine, to me, the driver-not the company or owner.

As far as the bonus money for staying 90 days, he told me he'd pay me 250 and the company would pay me 250. Well, he payed me 250, when asked about the company's 250, he told me he wasn't able to get a hold of a recruiter. I was, and the recruiter was not able to tell me anything. I have a feeling my other 250 has flown away with the breeze... right into the owner's back pocket.

What did I do? I pulled my gear from the rig, handed the keys to the shop foreman and told them the owner was coming to get the truck.

I called the owner and told him his rig was in FL and he could come get it anytime.

He said to me "I can't believe you did this to me", to which I replied "I can't believe you didn't pay me". He said "Why all this now?" I said "I signed no contract of any kind with you." and I hung up.

The point here... for everybody... is to get it in writing.

By the way, he owes his other driver $3,200, and the owner has so far spent $5,500 trying to get that resolved.

The rig has a custom sleeper, the bed is "above" the cab, and that is illegal to put a team into. The law states 2 ways, if the bed above the seats, you can't be in it while in motion, you can not be in the upper bunk while in motion.

The Names "he" operates BBS/Better Business Systems/BBS Transserv.
 

jg

Expert Expediter
Any agreement, to be fair, must have consideration flowing to both sides. So, what do drivers think is fair to include to protect the owner? A driver has the owners vehicle, which is an investment of $25,000 to 150,000. A driver can use that possession to "negotiate" a little with the owner. What does the owner have? The owner is obligated to pay for any failures of the driver, such as lost or damaged freight, lost or late paperwork/bills of lading, damage to shipper/receiver property or damage to property and person of other people. Most insurance coverage has high deductibles and disclaimers.
What should a driver agree to do for the owner if the driver abandons the truck, abandons the freight, draws off a comcard and spends it for unauthorized uses, gets in a wreck that is the drivers fault, fails to turn in paperwork so loads don't get paid to owner or to company (which then charges the owner for lost income), etc. etc.
Should the driver (who is an independent contractor running a business) have to put up a deposit? The owner has to put up a deposit with the whatever company he is leased to. Should the driver have funds deducted from each pay to go toward a deposit/security amount to compensate owner if vehicle is not returned, or returned dirty, or returned missing the CB, microwave, TV, refrig, etc? I agree completely that there should be a written agreement to show the rights and responsibilities of owner and operator. It will be interesting to see what each "side" of the team would like to have included in that agreement.
 

tazman

Expert Expediter
Wow....
You been through a lot since we spoke........
I knew you were having troubles....I guess this was the outcome

Hope your OK....

Are you looking for a new gig ????

Call me when you have a minute...


Frank in Pa.
"The Beast in the East"
 

RichM

Veteran Expediter
Charter Member
Sad story Bob,but we have heard it before on both sides of the fence.
I agree with Teryy that a formal agreement, signed by both parties ,witnessed by a notary public would help out both sides.
It should clearly state what is expected of you as a driver,such as load acceptance %,availibilty %,any damage to the vehicle or cargo caused by the driver,any safety violations that could cause the owner to lose his contract etc.
For the driver the question of pay is the most important,what method of payment are you utilizing,percentage,miles,hourly, and so on.
When and how do you get paid.I know of one individual who has a checking account at the same bank as the owner,he gives the owner deposit slips for his account and the owner makes a weekly settlement.
The driver should be willing to have a small amount deducted from his weekly settlement as a escrow account.It should be in writing how much will be taken out and when the driver leaves the escrow minus any unforseen expenses for the owner,such as a missing CB,or travel costs for the owner to rescue the truck ,the escrow will be returned within 15 days.
Important point, is if you have an accident or have a breakdown on the road.Will he pay your travel costs to come home or your motel costs etc.
There are many good fleet owners out there and Bob based on what you have said now and in the past,I am sure you will find one.Good Luck.
 

BigBusBob

Veteran Expediter
Driver
"What should a driver agree to do for the owner if the driver abandons the truck?"
that statement depends on many things, especially the circumstances. In my reply above (the 1st reply in this thread) I think, and most involved directly and indirectly-think I did the right thing, so in my scenario... the answer would be "absolutely nothing".

The owner was not a driver, nor was he ever. He'd never driven an expediter rig, he'd barely been in his own rig for 24 hours since he's had it (about a year).

I asked him and mentioned to him that he should ride along with me for a few days or a week to see what it's like out there on the road, he always managed to skirt around a definite answer on that.
As a former charter bus driver and entertainer coach driver, I know that after awhile of listening to people, you tend to get an idea of who they are. The other driver of his... is currently in a lawsuit with him, and he's owed 3,200.00, I'm owed less than 1,000.00.

I would like to work for an owner again, though one that pays by the loaded mile, say .50 per mile.
Plus offers perks like a Nextel phone for the driver (that the owner pays for entirely) and/or satellite TV or XM Radio. A generator, Pallet jack, plenty of straps/load bars, a good air-ride drivers seat and air-ride passenger seat. I don't like to see my passenger getting beat up 'cause they're in a stock seat. A CD Changer that plays RW CD's (Music CD's you make on a PC), and an owner that gives you an expense account every week to use for truck washes and oil and additives. A company like PII only gives you $350 a week on your ComData Card, that gets ate up real fast (by just a solo) when you figure in fuel and a truck wash and cash advances. You fill up twice and most, if not all of it... is gone. They should allow 500 a week onto ComData to make it easier on the driver.

An idea for a driver is to make proposals to the owner with a contract and if not followed thru within 2-3 months then the driver has the right, without consequence, to walk away-no questions asked.
Reason, well, if you can't follow thru within 2 to 3 months, thats enough time wasted... time to move on.

The driver is the one doing the dirty work, the owner does the paper work. Both are taking risks, though the driver has the most risks in my opinion, his/her life and his/her job. There should be more consideration to drivers in lease agreements and contracts.
 

davekc

Senior Moderator
Staff member
Fleet Owner
You should always have a lease agreement that spells out everything to the driver and owner. 350 week seems like a tough number in todays climate. It would be benificial to have your own comcard and be able to pull 50% of the load once it is accepted. A owner should be able to set this up with no problem. The only time that is different with me would be for major repairs. Driver would have to call me for a approval number on the comcheck.
I have never done paid by the mile, but I don't see why it wouldn't work. It would work essentially the same way. Only difference would be rate on loaded miles, deadhead miles, or pay the same for both.
Who ever is paying the fuel should keep all the fuel surcharges, as well as detention time ect. Having everything in writing will save everyone a ton of grief.
 

jg

Expert Expediter
One thing that has to be remembered in all of these relationships is that the Internal Revenue Service is always checking for independent contractor vs. employee status. That's one of the reasons, allegedly, why some of the companies do so little for the owners/drivers......they have to avoid treating them as an employee. Likewise, the owners are limited in what they can do for a driver, or the driver will be classified by IRS as an employee. Usually, the more the owner supplies to the driver in the form of equipment, tools, steady pay, benefits, the more the driver is an employee.
However, that doesn't mean that an owner couldn't set a driver up as an employee from the get-go, but then the financial obligations and benefits would be a whole lot different.
Maybe the contract the owner has with his company could be the basis for the contract between the owner and the driver.....since the driver gets a percentage of what the company pays to the owner, maybe whatever the owner has to reimburse to the company for damage, the driver should reimburse to the owner, and whatever deposits the owner has to give the company, the driver should give the owner? But then would anyone ever drive???
I agree with a previous post that a driver takes a lot of risks because he is out in the field. But the owner takes a lot of financial risks, which is why newbies are advised to drive for someone else before buying their own unit. No financial obligation.
But if a loaded vehicle gets rolled and wrecked, the driver can walk away with no real financial liability, if he can walk at all. The owner, however, is in deep doo-doo, will owe big bucks to the shipper/receiver/company, and has no real way to ever collect from a driver. At minimum, drivers should demand to be paid as soon as the owner is, and should get copies of all payment papers that the owner receives, so that the driver knows exactly what was paid for every load, and exactly what the owner owes him.
 

BigBusBob

Veteran Expediter
Driver
Ok, I can see I might be very well involved with this thread, but that's a good thing.

Question to think about, You say Dave that the owner should get the detention time pay if he's paying the fuel? I agree with you on whoever pays the fuel gets the surcharges and all, that only makes sense, but the detention pay I think should belong to the driver.

why? it's the driver that is waiting, it may be the fuel of the truck being used, but it's the driver whose waiting, possibly missing a good load 'cause he/she has to wait to get unloaded. I just have to disagree with that, that the owner being the one to get the detention pay. Detention time happens because shippers and recievers at the dock just don't pay attention to time schedules of the docks. Drivers are the ones who are delayed getting home to family and loved ones because of detention time, not owners. Why should the owner get payed for my time away from my family?

The owner should get EM pay (empty move), should get DeadHead, and that's it. Dry Run pay should be split perhaps. Multiple stop pay should go to the driver-we're the one's doing the stops, not the owner. Load/unload pay should go to the driver, it's not like expediting has alot of "fingerprint loads". All Canada money should go to the driver-after all, we the drivers are the ones who get the wonderful pleasure of dealing with customs and border officers and brokers.

"whatever deposits the owner has to give the company, the driver should give the owner? But then would anyone ever drive???"

Answer from a driver, and many more will agree with me... NO. Why should I have to give money to the owner for his deposit on the QC or insurance? yes, I'm using it, but it's not going on my truck, it's going on his truck. I can see an arguement here, but I personally don't think the owner should require a driver to fork up money for deposits to the company. That owner will have a hard time finding drivers to do so. For an owner, deposits to the company are the cost of doing business in my opinion.

"if a loaded vehicle gets rolled and wrecked, the driver can walk away with no real financial liability"

Can a driver really "walk away" as you say? even if they don't suffer any "major" injuries, there's still the driving record, the consequences the driver has to pay in form of tickets (and there will be a ticket issued to the driver, their fault or not), what about the mental trauma the driver goes thru, the possible need for physical therapy? The driver does pay in some form or another.
Would you rather pay $800 for a towing fee? or deal with the loss of a hand or limited use of a leg or foot for the rest of your life? Those in my mind are "Real". The owner can recover, maybe the driver can not. Once that truck rolls or wrecks, injuries or not, that drivers record is marked for atleast 3 to 5 years.

"drivers should demand to be paid as soon as the owner is"

Something better, drivers should demand to be paid every Friday, for the work they did the previous week, like a "normal" job<whatever that is.
Make sure you're paid every Friday, so that you can use that money Friday night and over the weekend. The owner has money to use over the weekend, why can't the drivers?

My owner would pay me every Friday, but deposit it late... then it would not go into the bank until Monday or Monday night, so really I'd have to wait for my pay until Monday night or Tuesday morning.

"get copies of all payment papers that the owner receives, so that the driver knows exactly what was paid for every load"

This is a good idea, no actually it's a Great Idea and Highly Recommended to drivers driving for any owner. That lets you make sure that your 30% or 40% is 30 or 40% and not 28% or 38% as some owners have been known to try to get by with doing.

"the owners are limited in what they can do for a driver, or the driver will be classified by IRS as an employee"

I agree and disagree, owners can make sure the driver is happy with the equipment and has everything to do the job well.

Examples: 2 good seats, plenty of straps (atleast 15), enough load bars (atleast 4 to 6), a pallet jack helps, moving blankets help, good appliances in the sleeper, a good stereo, a generator on the rig will save the owner money-as well as provide a better nites sleep and provide the driver with more rest. How can a generator provide a driver with more rest? the driver does not have to fuel as much-less time fueling means more time... or less time fueling means more time available to accept loads, shower, watch TV, read, rest, and just plain old relax.

"owners are limited in what they can do for a driver"
No, their not really... they can provide the driver with a laptop (more for work than play), a cell phone, maps or mapping supplies/devices-like GPS units, satallite TV and/or XM radio, gift certificates as bonuses, storage boxes on the outside of the truck to free up space in the cab and sleeper. The owner could provide the driver with a mail box somewhere in the drivers regular freight lanes.
Naturally there'd be a contract signed between the owner and driver for any of these "perks" offered to the driver.

The owners should treat the drivers like they want to be treated...
I read somewhere that for every 6 drivers, they get one "good" driver. I'd say that same thing applies to drivers seeking owners to drive for. Only I think for drivers it's for every 2-3 bad owners, there's one "good owner".

That's my 2 cents worth-so far.
 

davekc

Senior Moderator
Staff member
Fleet Owner
I stand corrected. Fuel surcharge should be paid by who ever is paying for the fuel. Detention time should go straight to the driver. I have never taken a percentage of it. Thanks for catching that.:)
 

davekc

Senior Moderator
Staff member
Fleet Owner
I see alot of good points. There are issues regarding distinctions from employee to contract driver. In addition, I draw a major difference between someone who has driven for years with a proven track record, versus someone just starting, or with limited experience. The owner does have to absorb all the costs relating to a poor performing driver. That list is endless. Everything from having to be home all the time, crashes,vehicle recovery, refusing an excessive amount of loads, damage to equipment or improper use of it due to limited experience ect. The proven way to success for both parties is to find a good driver who can prove themselves and then reward them accordingly. That can be new equipment, generators, pay, ect. Ones track record and reputation, whether an owner or driver is the proven way to success.
On a side note; most issues regarding employee or contract driver issues are located at www.irs.gov
Additional information can also be found at www.ooida.com
.
 

BigBusBob

Veteran Expediter
Driver
I would have thought more owners would have put their 2 cents in, esp. regarding drivers, thought I brought up some interesting things, as did the others in this thread... would be interesting to see what owners are wanting from their drivers? Honesty and keeping the equipment up good I'm sure, and good record keeping too.

What do owners/would owners require of drivers?
 

davekc

Senior Moderator
Staff member
Fleet Owner
I think you hit on the most critical. Honesty, keeping up the equipment, some business as well as common sense, solid background and reputation, and a desire to work and succeed.
Might want to add, the ability to work independently. Many folks are hard workers, but can't perform without constant supervision.
I am sure there are many other items, but the above is at least a starting point that I personally would use.
 

minitruck

Expert Expediter
I have to take issue with the "detention time" confusion. Why should an owner get paid for detention time? Why should the driver get paid for detention time? Well it is like this and I am sure some will agree and some will disagree. This can go on forever but the only fair way to do it is to divide it by responsibilities. It is like the chicken and the egg thing. Which comes first.
Let's see now. If it were not for the owner there would not be a driver sitting there waiting to get loaded/unloaded. Right? Question is this. Who has the most responsibility? The owner by far has more on the line than the driver. I am not knocking drivers cause I have been on both sides of the fence. I have been an owner and I have been a driver. The owner has ALL the financial responsibilities which are drivers wages, truck payments, insurance, fuel, and etc, etc.
In a detention situation they both suffer. Driver makes no money and owner makes no money. So the only fair way is to divide it up (if you get paid for it) according to the responsibilities and that works out to 60% for the owner and 40% for the driver. At least both get something. Thank you letting me get my two cents in.

Gregg
 

jg

Expert Expediter
I agree that detention time should go to both owner and driver.
Here's why. Detention time is paid to compenssate you for lost time. You can't deliver the current load, you can't unload it, you can't get on the board for a new load offer, whatever. So some detention pay is owed to somebody. The driver is tied up and unable to earn any other money for himself from other loads....he should get some detention pay. The owners vehicle is also tied up and can't earn any money for the owner from other loads....so he should also get some detention pay.
Drivers sometimes say "Why should the owner get any pay, the owner doesn't sit with me during those detention times??" Well, the owner isn't sitting with the driver on any trips either, so if that logic applied across the board, why should the owner get any pay for delivering a load?? The answer is that BOTH SIDES have an investment in the business, both sides lose in a detention situation, and both sides should be compensated. That's my three cents worth (inflation).
As to fuel surcharge, it should all go to whoever pays fuel; hand load/unload I think should go to the driver, extra drop/stop pay gets divided. Okay, I gave four cents worth.
 

davekc

Senior Moderator
Staff member
Fleet Owner
There is no hard and fast rule on detention time. The only reason that I have paid the detention time to drivers is because when it comes to oil changes and maintenence, they are using their time. While I would pay for there repair, they are not reimbursed for time unless the truck is tied up for a while. At that point you are looking at a daily rate and a motel. Granted that neither party is making money when sitting, but that is just the cost of doing business. In general, drivers usually don't have the resources to go numerous days and make no income. They still have bills coming, and still need to eat. A well established owner should have the resources to get through these types of periods.
 

gambler

Expert Expediter
>I agree that detention time should go to both owner and
>driver.
>Here's why. Detention time is paid to compenssate you for
>lost time. You can't deliver the current load, you can't
>unload it, you can't get on the board for a new load offer,
>whatever. So some detention pay is owed to somebody. The
>driver is tied up and unable to earn any other money for
>himself from other loads....he should get some detention
>pay. The owners vehicle is also tied up and can't earn any
>money for the owner from other loads....so he should also
>get some detention pay.
>Drivers sometimes say "Why should the owner get any pay, the
>owner doesn't sit with me during those detention times??"
>Well, the owner isn't sitting with the driver on any trips
>either, so if that logic applied across the board, why
>should the owner get any pay for delivering a load?? The
>answer is that BOTH SIDES have an investment in the
>business, both sides lose in a detention situation, and both
>sides should be compensated. That's my three cents worth
>(inflation).
>As to fuel surcharge, it should all go to whoever pays fuel;
>hand load/unload I think should go to the driver, extra
>drop/stop pay gets divided. Okay, I gave four cents worth.

JG and MINITRK i agree completely!! the way i look at it is i pay my drivers their % on anything that is "revenue" generated meaning..loads..detention..layover..dry runs..backhauls anything else i keep as i am the one paying for all the fuel maintenance tolls etc. i think by reading bobs comments it reminds me of 2 "former" drivers of mine who after about 2 mos. in this biz.(i got em with about 1 min experience literally)figured they knew everything and felt like they werent making what they should for their contribution. i bumped them from 18% to 20% at 60days yet they routinely failed to do what was required of them which led to me spending extra $$ on repairs etc.as an o/o all i ask of my guys is an honest days work for an honest days $$ same as i gave when i was just a driver. too many people think they are on "vacation" while out there and need to be "supplied" with "toys" such as LAPTOPS/CELLPHONES/SAT.TV etc etc.why is that? i would have never dreamed of asking my bosses for such extravagent items. if you want a nicer seat then truck comes with BUY ONE if you want to jaw on the cell phn all day PAY FOR IT and if your worried about video games etc STAY HOME. i do offer my drivers incentives/bonuses etc but 9 out of 10 times they prefer a lil extra cash. i have offered xm radio etc etc and i do supply all drivers with new tv/vcr's etc as well as a $90,000 "investment" and i feel i cannot do much more than that and still stay in business. if they are working hard the reward is already there it's called a PAYCHECK (and in my guys case a pretty decent sized one!)that is something millions of people do not get. ALWAYS remember there are 2 sides to every story and walk in a mans shoes b4 you judge him.

GOD BLESS ALL OF YOU AND THE USA!!
 

Dreamer

Administrator Emeritus
Charter Member
Wow... you really have drivers who will drive for 18-20%?




wow.






:eek:




Dreamer






[font color="blue"]
In the 60's people took acid to make the world weird. Now the world is weird, people take prozac to make it normal.[/font]​
 

BigBusBob

Veteran Expediter
Driver
Yes, I'd like to meet the people who are willing to drive for 18 to 20 percent of revenue as well. I've heard of one O/O at FedEx paying his teams 20%, and they ran 8 weeks out 2 weeks off, Cali to the east coast and back. I don't know though about 20% though, that seems awfully low to me as well. Unless the rigs making 1.65 per mile maybe, or more, then at 3,000 miles plus per week then thats about $1,000 to the driver a week.

In regards to the comments on cell phones, seats, and video games...

my outlook on that is - a happy driver makes for a happy company.

Do you want to sit in a rigid dining room chair for thousands of miles a month, or do you want to sit in a nice recliner for thousands of miles a month? Every owner sees their business in their own eyes, however every driver sees every owner differently. Not only does pay make a difference, but so does equipment and ammenities.

In my research/experience... Generally the owners that no longer drive and/or that do not drive that often - or maybe have never driven - are often the ones you don't want to work for.
Cash is nice, so is comfort, there can be a middle ground. You spend $90,000 on a rig, but can not afford good seats? But you can afford XM radio? I'd choose the good seats over the XM, the good seats you'll pay for once, XM you pay monthly for. Cell phones, well, how well do you want to be connected to your driver and how well connected/accessible do you want your driver to be?

20% sounds low, but it depends on how much the rigs are making per mile and how many miles a week they are running.

I don't think I'm on vacation when I'm out there, I think I am working to make a living. When you essentially "live ON" the road, and drive for a living... there's no such thing as being "on vacation". I realize there are some drivers out there that think it's all fun and games, but those are also the ones (I think) that get into accidents, get tickets, run into stuff and can't secure freight to save their own lives. They're "wheel holders", not drivers. Wheel holders are a dime a dozen. Drivers are not. Drivers are the ones that are actually "out there" doing the work, hauling the freight, dealing with all the BS on the road and with dispatchers and dock workers and weather - and some owners simply do not care or simply don't take notice of that. Why should I pay for a good seat if it's not my rig? if I did, I tell you what, when I left, I'd stick that old seat right back in there and take my investment with me.

Here we have a difference of opinions, thats all.

Maybe one could pay their drivers 18%, have a 96" sleeper, and have a cell phone provided by the owner, good seats, and/or other perks... 'cause possible the rig may be getting 1.65 per mile and running coast to coast and be clicking out 4,000 miles a week (team).
After nearly 3/4 of a million miles driven professionally I think I myself have paid my dues. I don't know, all I know is what I want... and that's not to be screwed by another owner again.
That's all for now, Later... Bob
 

gambler

Expert Expediter
dreamer..20% each!! thats a more than fair wage and is a somewhat consistent wage for decent drivers. or am i as an owner not entitled to make more than just the cost of my "overhead"? and yes my guys run a lot of miles,and i dont buy trucks with garbage seats,however im not gonna be putting $1500 seats in my truck for drivers to burn spil stuff on and generally abuse as is often the case. many drivers treat an owners equip like its a piece of crap instead of their source of income. a team that wants to treat my vehicle with respect and care and "minimalize" unnecessary repairs would definitely be welcome to nicer seats or a bigger sleeper or ?? but i dont feel i should be strongarmed into making this a vacation either. cell phones are a luxury not really a necessity and it would behove the driver to purchase one for himself if he would like to be avail for a load anywhere or to talk to family etc while on the road,as is a laptop. too many drivers are all about "what will you do for me' and not as willing to "give back". to me this is a give and take relationship. and if we are all making $$ we will all be happy. i do agree we can "agree to disagree" on several points. also for what its worth i have only just gotten out of the trucks in the last few mos. so i dont believe im "out of touch" with a drivers needs or complaints etc. also i for one try to reward "loyalty" with things like "paid birthdays" and "vacations" etc as well as other "perks".;)
 
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