EXHIBIT 10.2.15
[ACURA LOGO]
AUTOMOBILE DEALER
SALES AND SERVICE
AGREEMENT
[GRAPHIC OMITTED]
AMERICAN HONDA MOTOR CO., INC.
PARAGRAPH A
This is an agreement between the Acura Division, American Honda Motor Co.,
Inc. (American Honda) and _________________________ (Dealer) a(n)_______________
doing business as __________________________________. By this agreement, which
is made and entered into at Torrance, California, effective the ____ day of
________, 19_______. American Honda gives to Dealer the nonexclusive right to
sell and service Acura Products at the Dealership Location. It is the purpose of
this Agreement, including the Acura Automobile Dealer Sales and Service
Agreement Standard Provisions (Standard Provisions), which are incorporated
herein by reference, to set forth the rights and obligations which Dealer will
have as a retail seller of Acura Products. Achievement of the purposes of this
Agreement is premised upon the mutual and continuing understanding and
cooperation between American Honda and Dealer and the expressed intention of
each to deal fairly with the consuming public.
For consistency and clarity, terms which are used frequently in this Agreement
have been defined in Article 12 of the Standard Provisions.
PARAGRAPH B
American Honda grants to Dealer the nonexclusive right to buy Acura Products
and to identify itself as an Acura dealer at the Dealership Location. Dealer
assumes the obligations specified in this Agreement and agrees to sell and
service effectively Acura Products within Dealer's Primary Market Area and to
maintain premises satisfactory to American Honda.
PARAGRAPH C
Dealer covenants and agrees that this Agreement is personal to Dealer, to the
Dealer Owner, and to the Dealer Manager, and American Honda has entered into
this Agreement based upon their particular qualifications and attributes and
their continued ownership or participation in Dealership Operations. The parties
therefore recognize that the ability of Dealer to perform this Agreement
satisfactorily and the Agreement itself are both conditioned upon the continued
active involvement in or ownership of Dealer by either:
(1.) the following person(s) in the percentage(s) shown:
NAME ADDRESS TITLE PERCENT OF OWNERSHIP
---------------------- ---------------------- ---------------------- ----------------------
(2.) ___________________________________________________________________________
an individual personally owning an interest in Dealer of at least 25% and who
has presented to American Honda a firm and binding contract giving to him the
right and obligation of acquiring an ownership interest in Dealer in excess of
50% within five years of the commencement of Dealership Operations and being
designated in that contract as Dealer operator.
PARAGRAPH D
Dealer represents, and American Honda enters into this Agreement in reliance
upon the representation, that ______________________ exercises the functions of
Dealer Manager and is in complete charge of Dealership Operations with authority
to make all decisions on behalf of Dealer with respect to Dealership Operations.
Dealer agrees that there will be no change in Dealer Manager without the prior
written approval of American Honda.
PARAGRAPH E
American Honda has approved the following premise as the location(s) for the
display of Acura Trademarks and for Dealership Operations.
New Car Showroom __________________________________________________________
Used Car Display __________________________________________________________
Sales and General Offices _________________________________________________
Parts and Service Facilities ______________________________________________
PARAGRAPH F
There shall be no voluntary change or involuntary change, direct or
indirect, in the legal or beneficial ownership or executive power or
responsibility of Dealer for the Dealership Operations, specified in Paragraphs
C and D hereof, without the prior written approval of American Honda.
PARAGRAPH G
Dealer agrees to maintain, solely with respect to the Dealership Operations,
minimum net working capital of $_________, minimum owner's equity of $_________,
and a line or lines of credit in the aggregate amount of $_________ with banks
or financial institutions approved by American Honda for use in connection with
Dealer's purchases of and carrying of inventory of Acura Products, all or which
American Honda and Dealer agree are required to enable Dealer to perform its
obligations pursuant to this Agreement. If Dealer also carries on another
business or sells other products, Dealer's total net working capital, owner's
equity and lines of credit shall be increased by an appropriate amount.
PARAGRAPH H
This Agreement is made for the period beginning ________________________ and
ending ________________________ unless sooner terminated. Continued dealings
between American Honda and Dealer after the expiration of this Agreement shall
not constitute a renewal of this Agreement for a term, but rather shall be on a
day-to-day basis, unless a new agreement or a renewal of this Agreement is fully
executed by both parties.
PARAGRAPH I
This Agreement may not be varied, modified or amended except by an instrument
in writing, signed by duly authorized officers of the parties, referring
specifically to this Agreement and the provision being modified, varied or
amended.
PARAGRAPH J
Neither this Agreement, nor any part thereof or interest therein, may be
transferred or assigned by Dealer, directly or indirectly, voluntarily or by
operation of law, without the prior written consent of American Honda.
__________________________________ By __________________________________
(Corporate or Firm Name) (Dealer)
ACURA DIVISION
AMERICAN HONDA MOTOR CO., INC.
(Corporate Seal)
By __________________________________________
ACURA
AUTOMOBILE DEALER
SALES AND SERVICE
AGREEMENT
STANDARD PROVISIONS
ACURA AUTOMOBILE DEALER SALES AND SERVICE AGREEMENT
STANDARD PROVISIONS
TABLE OF CONTENTS
PAGE
1. THE OBLIGATIONS OF AMERICAN HONDA ............................................................. 1
2. SALE OF ACURA PRODUCTS TO DEALER .............................................................. 3
3. THE OBLIGATIONS OF DEALER ..................................................................... 4
4. WARRANTY ...................................................................................... 6
5. ADVERTISING AND PROMOTIONAL PROGRAMS .......................................................... 7
6. TRADEMARKS AND SERVICE MARKS .................................................................. 7
7. GENERAL BUSINESS REQUIREMENTS ................................................................. 8
8. APPOINTMENT OF SUCCESSOR AND REPLACEMENT DEALERS .............................................. 9
9. TERMINATION OF AGREEMENT ...................................................................... 10
10. RIGHTS, OBLIGATIONS AND DEALINGS UPON TERMINATION ............................................. 13
11. GENERAL PROVISIONS ............................................................................ 16
12. DEFINITIONS ................................................................................... 18
ACURA AUTOMOBILE DEALER SALES AND SERVICE AGREEMENT
STANDARD PROVISIONS
The following Standard Provisions are, by reference, incorporated in and made a
part of the Acura Automobile Dealer's Sales and Service Agreement. These
Standard Provisions accompany the Acura Dealer's Sales and Service Agreement
which has been executed on behalf of both American Honda and Dealer.
1. THE OBLIGATIONS OF AMERICAN HONDA
1.1 It is the obligation of American Honda to supply to Dealer, and to
all authorized dealers, Acura Products in a fair and reasonable manner
in order that Dealer may conduct Dealership Operations in a
businesslike manner. In fulfilling this obligation, Acura Products may
be supplied either on the basis of dealer order or on the basis of
allocation, depending on market conditions and availability. There are
numerous factors which affect the availability of Acura Products. Among
those factors are component availability and production capacity,
consumer demand, strikes and other labor troubles, weather and
transportation conditions, and government regulations. Because such
factors affect individual dealer supply, American Honda necessarily
reserves discretion in accepting orders and allocating and distributing
Acura Products, and its judgment and decision in such matters will be
final.
1.2 To assist Dealer in the fulfillment of its obligations under the
Agreement, which it has as a retail seller of Acura Products, American
Honda agrees to provide Dealer sales, service and parts support.
1.2.A. To assist Dealer in fulfilling its sales responsibility,
American Honda agrees to offer general and specialized product
information and to provide field sales personnel to advise and
counsel Dealer's sales organization on sales-related subjects
such as merchandising, training and sales management.
1.2.B. To assist Dealer in fulfilling its service and parts
responsibilities, American Honda agrees to offer, or cause to be
offered, general and specialized service and parts training
courses. Based on the service training needs of Dealer's service
personnel, to be determined by American Honda with the
assistance of Dealer, Dealer agrees to have members of Dealer's
service organization attend such courses. Further, American
Honda agrees to make available to Dealer field service personnel
capable of advising and counseling Dealer's service personnel on
service-related subjects, including product quality, technical
adjustments, repairs and replacement of product components,
recall, product improvement or product update campaigns which
American Honda may conduct, owner complaints, warranty
administration, service and parts merchandising, and training
and service management.
1.3 To assist Dealer in planning, establishing and maintaining the
Dealership Premises, American Honda will, at its sole option, make
available to Dealer, upon request, sample copies of building layout
plans or facility planning recommendations, including sales, service and
parts space and the placement, installation and maintenance of
recommended signs. In addition, representatives of American Honda will
be available to Dealer from time to time to counsel and advise Dealer
and its personnel in connection with Dealer's planning and equipping the
Dealership Premises.
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1.4 American Honda agrees to make available to Dealer, at reasonable cost,
such sales, service and parts manuals, brochures, special service tools
and equipment and other data for Acura Products as American Honda deems
necessary for Dealership Operations.
1.5 American Honda agrees to maintain a nationwide system of authorized
dealers of Acura Products. In order that those authorized dealers may be
assured of the benefits of comprehensive advertising of Acura Products,
American Honda agrees to establish and maintain general advertising
programs in such manner and amount as it may deem appropriate and will
make sales promotion and campaign materials available to Dealer.
1.6 American Honda agrees to compensate Dealer for the labor and parts used
by Dealer in performing its obligations under any American Honda
warranty and in connection with any recall, product improvement or
product update campaign which American Honda may undertake and require
Dealer to perform. Such compensation will be in such reasonable amounts,
and pursuant to such requirements and instructions, as American Honda
shall establish from time to time, and such compensation shall
constitute full and complete payment by American Honda to Dealer for
such work.
1.7 American Honda agrees to assume the defense of Dealer and to indemnify
Dealer against any money judgment, less any offset recovered by Dealer,
in any lawsuit naming Dealer as a defendant, where such lawsuit relates
to: (a) an alleged breach of any Acura warranty relating to Acura
Products; (b) bodily injury or property damage claimed to have been
caused by a defect in the design, manufacture or assembly of an Acura
Product prior to delivery thereof to Dealer (other than a defect which
could have been detected by Dealer in a reasonable inspection); or (c) a
misrepresentation or misleading statement of American Honda; provided,
however, that if any information discloses the possibility of Dealer
error or omission in servicing or otherwise (including but not limited
to Dealer not having performed all recalls of which Dealer has notice on
the Acura Product involved in the lawsuit if the defect subject to the
recall is alleged or contended to be a contributing cause of the breach
of warranty, injury or damage which is the subject matter of the
lawsuit), or should it appear that the Acura Product involved in such
lawsuit had been altered by or for Dealer, or if Dealer has violated any
of the provisions of this Paragraph 1.7, then Dealer will immediately
obtain its own counsel and defend itself, and American Honda will not be
obligated to defend or indemnify Dealer further. Dealer will promptly
notify American Honda of any claim which Dealer will assert American
Honda might be obligated to defend under this Paragraph 1.7. American
Honda will have not less than thirty (30) days to conduct a reasonable
investigation to initially determine whether or not American Honda is
obligated to defend under this Paragraph 1.7. Dealer will take the steps
necessary to protect its own interests involved in the lawsuit until
American Honda assumes the active defense of Dealer. American Honda
will, upon assuming the defense of Dealer, reimburse Dealer for all
attorneys' fees or court costs incurred by Dealer from the date of the
tender. American Honda, upon assuming Dealer's defense, will have the
right to retain and direct counsel of its own choosing, and Dealer will
cooperate in all matters during the course of defending the lawsuit. If,
upon final judgment in a lawsuit, it is determined that American Honda
wrongfully failed or refused to defend Dealer, American Honda will
reimburse Dealer for all costs and attorneys' fees incurred by Dealer
from the date of the tender of defense.
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2. SALE OF ACURA PRODUCTS TO DEALER
2.1 To the extent that Acura Products are the subject of dealer order, such
orders will be submitted and processed in accordance with procedures
established by American Honda. No order will be binding on American
Honda, as evidenced by either the issuance of an invoice or shipment of
the ordered Acura Products, and any such order may be accepted in whole
or in part. All orders by Dealer will be deemed firm orders and binding
upon the Dealer, except that at any time prior to acceptance, an order
may be canceled by Dealer by giving actual notice to American Honda in
writing of the desire by Dealer to cancel such order.
2.2 While it is the intent of American Honda to provide Acura Automobiles to
Dealer in such quantities and types as are ordered by Dealer, American
Honda and Dealer recognize that Acura Automobiles may not always be
available in desired quantities. It is therefore understood and agreed
that American Honda, at its sole election, will have the right to
allocate Acura Automobiles among authorized dealers of Acura Products in
a fair and reasonable manner. American Honda will provide to Dealer an
explanation, in writing, of any allocation system it may adopt.
2.3 American Honda will have the right at any time and from time to time to
establish and revise prices and other terms, including payment by
Dealer, for its sales of Acura Products to Dealer. Revised prices, terms
or provisions will apply to the sale of any Acura Products as of the
effective date of the revised prices, terms or provisions, even though a
different price or different terms may have been in effect at the time
such Acura Products were allocated to or ordered by Dealer.
2.4 American Honda will have the right to select the distribution points and
the mode of transportation and may pay carriers for all charges in
effecting delivery of Acura Products to Dealer. Dealer agrees to pay to
American Honda such charges for delivery as American Honda may assess.
Subject to the terms of sale which may be established from time to time
by American Honda, risk of loss to Acura Products will pass to Dealer
upon tender of the Acura Products to Dealer or its authorized agent, and
title will pass to Dealer upon receipt by American Honda of payment.
2.5 If Dealer should fail or refuse or for any reason be unable to accept
delivery of any Acura Products ordered by Dealer, or if Dealer should
request diversion of a shipment from American Honda, Dealer will be
responsible for and pay to American Honda, promptly on demand, all costs
and expenses incurred by American Honda in filling and shipping Dealer's
order and by reason of such diversion, including costs of demurrage and
storage, plus restocking charges as determined by American Honda.
American Honda may direct that such returned Acura Products be delivered
to another destination, but the amount charged Dealer for return to such
other destination will not be greater than the costs and expenses of
returning such Acura Products to their original place of shipment plus
any demurrage, storage and restocking charges.
2.6 As between American Honda and Dealer, American Honda assumes
responsibility for damage to Acura Products caused prior to delivery to
Dealer or its authorized agent.
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2.7 American Honda will not be liable in any manner for delay or failure
in supplying any Acura Products where such delay or failure is the
result of any event beyond the control of American Honda. Such event may
include, but is not limited to, any law or regulation or any acts of
God, foreign or civil wars, riots, interruptions of navigation,
shipwrecks, fires, strikes, lockouts, or other labor troubles,
embargoes, blockades, demand for, or delay or failure of any supplier
to deliver or in making delivery, of Acura Products.
2.8 American Honda reserves the right at any time to change or modify,
without notice, any specification, design or model of Acura Products. In
the event of any change or modification with respect to any Acura
Products, Dealer will not be entitled to have such or similar change or
modification made with respect to any other Acura Products, except as
may be required by applicable law. American Honda may, however, in its
sole discretion, make such changes or modifications to all Acura
Products in its inventory or control, whether or not invoiced to Dealer.
No such change will be considered a model year change unless specified
by American Honda.
2.9 American Honda may at any time discontinue, without obligation to Dealer
or Dealer's customers, the sale of any Acura Products, or models or
lines thereof or any other items, goods or services. Further, American
Honda will have no obligation, under any circumstances, to accept orders
for any Acura Products which are not in current inventory.
3. THE OBLIGATIONS OF DEALER
3.1 It is the obligation of Dealer to promote and sell, at retail, Acura
Products, and to promote and render service, whether or not under
warranty, for those products within the Dealer's Primary Market Area.
3.2 Dealer's performance of its sales obligations for Acura Products will be
evaluated by American Honda on the basis of such reasonable criteria as
American Honda may develop from time to time, including, but not limited
to, such reasonable sales objectives as American Honda may establish and
a comparison of Dealer's sales performance with other authorized dealers
of Acura Products.
3.3 To enable Dealer to fulfill its obligations satisfactorily, Dealer
agrees to establish and maintain an adequate and trained sales and
customer relations organization. Dealer further agrees to establish and
maintain a complete service and parts organization, including a
qualified service manager and a qualified parts manager and a number of
competent service and parts personnel adequate to care for the service
obligations to be performed by Dealer under the Agreement.
3.4 Dealer agrees to acknowledge, investigate and resolve satisfactorily all
complaints received from owners of Acura Products in a businesslike
manner in order to secure and maintain the goodwill of the public. Any
complaint received by Dealer which, in the opinion of Dealer, cannot be
readily remedied, shall be promptly reported to American Honda by
Dealer.
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3.5 Dealer agrees that it will not make any misrepresentations or
misleading statements regarding the items making up the total selling
price of Acura Products or as to the prices or charges relating to such
items. With the understanding that Dealer is the sole judge of the
price at which it sells Acura Products, dealer recognizes that a retail
customer has the right to purchase Acura Automobiles without being
required to purchase any optional equipment or accessories which the
purchaser does not want or order unless such equipment or accessories
are required under applicable laws or regulations.
3.6 Dealer agrees to make certain that all Acura Products sold by it have
received predelivery services and inspection in accordance with
applicable procedures and directives issued by American Honda. Dealer
further agrees that all Acura Products sold by it will be in proper
operating condition prior to delivery to any customer. To enable Dealer
to fulfill its obligations in this regard, Dealer agrees that an
appropriate number of its service personnel will be fully qualified to
perform all necessary predelivery service and inspection.
3.7 Dealer agrees to comply with, and operate consistent with, all
applicable provisions of the National Traffic and Motor Vehicle Safety
Act of 1966 and the Federal Clean Air Act, as amended, including such
applicable rules and regulations as may be issued thereunder, and all
other applicable federal, state and local motor vehicle safety and
emission control requirements. In the interests of motor vehicle safety
and emission control, American Honda agrees to provide to Dealer, and
Dealer to American Honda, such information and assistance as may
reasonably be requested by the other in connection with the performance
of obligations imposed on either party by the National Traffic and
Motor Vehicle Safety Act of 1966 and the Federal Clean Air Act, as
amended, and the rules and regulations issued thereunder, and all other
applicable federal, state and local motor vehicle safety and emission
control requirements.
3.8 Dealer agrees to conduct a used vehicle operation at or in connection
with the Dealership Premises, to the extent reasonably required to
enhance the opportunity for sales of Acura Automobiles.
3.9 American Honda and Dealer recognize that it may be necessary for
American Honda to formulate new or different policies or directives to
meet new or changing technology, laws or circumstances. In the
operation of Dealer's business and in the sale and promotion of Acura
Products, in rendering service and in all other activities of the
Dealership Operations, Dealer will follow all reasonable directives,
suggestions and policies of American Honda. All written directives,
suggestions and policies of American Honda contained in any of its
bulletins or manuals, which are in effect as of the date of the
Agreement or are issued thereafter, will be deemed a part of the
Agreement.
3.10 Dealer agrees that it will, at all times, maintain in effect all
licenses required for Dealership Operations and for the Dealership
Premises.
3.11 Dealer agrees that it will comply with all laws, rules, regulations and
guides relating to the conduct of its business.
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3.12 Dealer agrees that it will perform any and all warranty, recall,
product improvement or product update service in compliance with
instructions and directives issued by American Honda, regardless of
where the Acura Product involved was purchased. To protect and maintain
the goodwill and reputation of Acura Products and the Acura Trademarks,
Dealer agrees that it will not charge any customer for warranty service
or any work done in connection with such warranty, recall, product
improvement or update or any other service as to which Dealer is
reimbursed by American Honda.
3.13 Dealer fully understands that the success of its Dealership Operations
depends to a great extent upon the amount of net working capital,
owner's equity, flooring and lines of credit which Dealer maintains.
Accordingly, for the benefit of both American Honda and Dealer, Dealer
agrees that it will, at all times, pay for Acura Products promptly and,
to do so, maintain its minimum net working capital, owner's equity,
flooring and lines of credit in the amounts specified in Paragraph G of
the Agreement. American Honda will have the right, reasonably, to
specify an increased amount of minimum net working capital, owner's
equity, flooring, or lines of credit to be used in Dealership
Operations and Dealer agrees promptly to establish and maintain the
increased amount. Dealer and American Honda agree to execute such new
documents as American Honda may reasonably require to evidence revised
capital requirements.
3.14 Dealer agrees to assume the defense of American Honda and to indemnify
American Honda against any money judgment, less any offset recovered by
American Honda, in any lawsuit naming American Honda as a defendant
where such lawsuit relates to: (a) an alleged failure by Dealer to
comply, in whole or in part, with any obligation assumed by Dealer
pursuant to the Agreement, (b) Dealer's alleged negligent or improper
repairing or servicing of Acura Products, or such other motor vehicles
or equipment as may be sold or serviced by Dealer, or (c) Dealer's
alleged breach of any contract between Dealer and Dealer's customer, or
(d) Dealer's alleged misrepresentation or misleading statement, either
direct or indirect, to any customer of Dealer. American Honda may, at
its sole option and at its expense, participate in defending any such
lawsuit.
4. WARRANTY
4.1 Dealer understands and agrees that the only warranties that will be
applicable to Acura Products will be such written warranty or
warranties as may be furnished by American Honda. Except for its
express liability under such written warranties, American Honda neither
assumes nor authorizes any other person or party to assume for it any
other obligation or liability in connection with any Acura Product or
component thereof.
4.2 Dealer agrees that it will expressly incorporate any warranty furnished
by American Honda with an Acura Automobile as a part of each order form
or other contract for the sale of such Acura Automobile by Dealer to
any buyer. Dealer further agrees that it will deliver to the buyer of
all Acura Products, at the time of delivery of such Acura Products,
copies of such applicable warranties as may be furnished by American
Honda. Dealer agrees to abide by and implement in all other respects
American Honda's warranty procedures in effect at the time of Dealer's
sale.
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5. ADVERTISING AND PROMOTIONAL PROGRAMS
5.1 Dealer agrees to develop and actively utilize programs for the
advertisement and promotion of Acura Products and its servicing of
such products. Such programs will include the prominent display and use
or demonstration of Acura Automobiles. Dealer further agrees to
cooperate with all reasonable promotional programs developed by
American Honda.
5.2 Dealer agrees that it will not advertise, promote or trade in Acura
Products or the servicing thereof in such a manner as to injure or be
detrimental to the goodwill and reputation of American Honda and the
Acura Trademarks. Dealer further agrees that it will not publish or
otherwise disseminate any advertisement or announcement or use any form
or media of advertising which is objectionable to American Honda.
Dealer agrees to discontinue immediately any advertisement or form of
advertising deemed objectionable upon request of American Honda.
5.3 Subject to applicable federal, state or local ordinances, regulations
and statutes, Dealer agrees to erect and maintain, at the Dealership
Location, at Dealer's expense, authorized product and service signs of
types required by American Honda, as well as such other authorized
signs as are necessary to advertise the Dealership Operations
effectively and as are required by American Honda.
6. TRADEMARKS AND SERVICE MARKS
6.1 Dealer agrees that American Honda has the exclusive right to use and to
control the use of the Acura Trademarks and but for the right and
license granted by Paragraph 6.2 hereof to use and display the Acura
Trademarks, Dealer would have no right to use the same.
6.2 Dealer is hereby granted the nonexclusive right and license to use and
display the Acura Trademarks at the Dealership Premises. Such use or
display is limited to that which is necessary in connection with the
sale, offering for sale and servicing of Acura Products at retail at
the Dealership Location. Dealer agrees that it will promptly
discontinue the use of any of the Acura Trademarks or change the manner
in which any of the Acura Trademarks is used when requested to do so by
American Honda.
6.3 American Honda and Dealer recognize that Dealer is free to sell Acura
Products to customers wherever they may be located. However, in order
that American Honda may establish and maintain an effective network of
authorized dealers for the sale and service of Acura Products, Dealer
specifically agrees that it will not display Acura Trademarks, or,
either directly or indirectly, establish any place or places of
business for the conduct of any of its Dealership Operations except at
the locations and for the purpose described in Paragraph E of the
Agreement without the prior written approval of American Honda. Dealer
further agrees that the rights and license granted by Paragraph 6.2
hereof will be automatically canceled upon a change in the location of
the Dealership Location unless such change in location was previously
approved in writing by American Honda. Dealer further agrees that such
right and license terminates with the termination of the Agreement.
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6.4 If Dealer refuses or neglects to keep and perform its obligations
assumed under this Article 6 or under Paragraph 10.3 hereof, Dealer
will reimburse American Honda for all costs, attorneys' fees and other
expenses incurred by American Honda in connection with any action to
require Dealer to comply therewith.
7. GENERAL BUSINESS REQUIREMENTS
7.1 It is to the mutual benefit of Dealer and American Honda that uniform
accounting systems and practices be maintained by authorized dealers.
Accordingly, Dealer agrees to maintain such systems and practices as
are required by American Honda. In the event Dealer engages in the sale
of any other product, Dealer agrees to maintain and keep separate
records and books relating to the sale and servicing of Acura Products.
7.2 Dealer agrees to furnish monthly to American Honda, on or before the
times designated by American Honda, on forms prescribed by American
Honda, a complete and accurate financial and operating statement
covering the preceding month and calendar-year-to-date operations and
showing the true and accurate condition of Dealership Operations.
Financial statements and other business information furnished to
American Honda will not be submitted to any third party unless
authorized by Dealer or required by law, or the information is
pertinent to a proceeding in which American Honda and Dealer are
parties.
7.3 Dealer agrees to keep complete and current records regarding the sale
and servicing of Acura Products and to prepare for American Honda such
reports, based on those records, as American Honda may reasonably
request. In order that policies and procedures relating to the
applications for reimbursement for warranty and other applicable work
and for other credits or reimbursements may be applied uniformly to all
authorized dealers, Dealer agrees to prepare, keep current and retain
records in support of requests for reimbursement or credit in
accordance with policies and procedures designated by American Honda.
7.4 Dealer agrees to permit, during reasonable business hours, American
Honda, or its designee, to examine, audit, reproduce and take copies of
all reports, accounts and records pertaining to the sale, servicing and
inventorying of Acura Products, including, but not limited to, records
in support of claims for reimbursement or credit from American Honda,
and with the prior approval of Dealer, which approval will not be
unreasonably withheld, to interview Dealer employees with respect
thereto.
7.5 Dealer agrees that Dealership Operations will be conducted in the
normal course of business during and for not less than the days of the
week and hours of the day customary for automobile dealerships in the
Primary Market Area.
7.6 Dealer agrees and understands that any retail price which may be
suggested by American Honda is merely a suggested price, and Dealer has
no obligation to sell any Acura Product at such price. Dealer further
understands and agrees that it is the sole judge of the price at which
it sells Acura Products and the price it charges others for service,
subject only to applicable local, state and federal laws, rules and
regulations.
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7.7 Dealer understands and agrees that it will be responsible for and will
pay any and all taxes, whether sales, use or excise, and all other
governmental or municipal charges imposed upon the sale of Acura
Products by American Honda to Dealer and will maintain accurate
records of the same, which records will be available to American
Honda, or its designee, during regular business hours for inspection.
7.8 Dealer understands and agrees that, while it has responsibility for
the promotion and retail sale and servicing of Acura Products within
the Primary Market Area, it has no territorial exclusivity. Further,
American Honda reserves the right, based upon reasonable criteria, to
appoint other authorized dealers of Acura Products in the Primary
Market Area.
8. APPOINTMENT OF SUCCESSOR AND REPLACEMENT DEALERS
8.1 The parties recognize that Acura Products are marketed through a system
of authorized dealers developed by American Honda and that customers
and American Honda have a vital interest in the preservation and
efficient operation of the system. American Honda has the
responsibility of continuing to administer the system and of selecting
the most suitable dealer candidate in each circumstance. Accordingly,
Dealer agrees that American Honda has the right to select each
successor and replacement dealer and to approve its owners and
principal management and the location of dealership facilities.
Further, Dealer agrees to provide written notice to American Honda of
any potential change in the involvement, ownership or management
specified in Paragraphs C and D of the Agreement. No change affecting
such involvement, ownership or management will be made without the
prior written approval of American Honda, which approval will not be
unreasonably withheld.
8.2 Upon Dealer's request, American Honda will execute with Dealer a
Successor Addendum designating proposed Dealer operators or owners of a
successor dealer to be established if the Agreement expires or is
terminated because of death or incapacity. The request must be executed
by all persons identified in Paragraph C of the Agreement and all
proposed dealer operators or owners and be submitted to American Honda
prior to such death or incapacity; provided that such proposed dealer
operators or owners must be acceptable to American Honda.
8.3 Dealer, but not American Honda, may cancel any executed Successor
Addendum. If American Honda notifies Dealer that it does not plan to
permit Dealership Operations to continue at the Dealership Location,
American Honda shall have no obligation to execute a new Successor
Addendum.
8.4 If the Agreement expires or is terminated because of death or
incapacity and Dealer and American Honda have not executed a Successor
Addendum, the remaining owners, successors or heirs may propose a
successor dealer entity to continue Dealership Operations at the
Dealership Location. Such proposal must be made within thirty days of
the event causing expiration or termination by submitting a written
proposal to American Honda. Such proposal will be accepted by American
Honda if it does not introduce new owners or if the proposed new owners
are acceptable to American Honda.
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8.5 Any successor dealer entity approved by American Honda pursuant to
this Article 8 must establish that it can conduct Dealership
Operations in an efficient and businesslike manner. Such successor
dealer entity will have one year to meet reasonable performance
criteria established from time to time by American Honda. In the event
such successor dealer entity fails to meet those criteria, such
failure will be separate grounds for termination of the Agreement.
9. TERMINATION OF AGREEMENT
9.1 The Agreement may be terminated, at any time, by mutual agreement of
American Honda and Dealer.
9.2 Dealer may terminate the Agreement, at any time, by giving American
Honda notice of such termination. Such termination shall be effective
upon the date specified by Dealer, or if no date is specified, then
upon receipt by American Honda of such notice.
9.3 American Honda may terminate the Agreement, at any time, by serving on
Dealer a written notice of such termination by certified or registered
mail to Dealer at the Dealership Premises. Subject to other provisions
of the Agreement, termination will be effective ninety (90) days after
mailing of such notice to dealer or such longer period as American
Honda may specify; provided, however, that termination will be
effective ten (10) days after mailing if for an occurrence of any
circumstance referred to in Paragraphs 9.4.A, 9.4.B, 9.4.J or 9.4.M
hereof.
9.4 It is recognized that each of the following grounds is within control
of Dealer or originates from action taken by Dealer or its
employee(s) and is contrary to the spirit and objectives of the
Agreement. Therefore, American Honda may terminate the Agreement upon
the occurrence of any of the following:
9.4.A Failure by Dealer to secure and continuously maintain any
license necessary for the conduct by Dealer of its business
pursuant to the Agreement or the termination or expiration
without renewal, or suspension or revocation of any such
license for any reason whatsoever, whether or not license is
reinstated.
9.4.B Any change, transfer or attempted transfer by Dealer or any
Dealer Owner, voluntarily or by operation of law, of the whole
or any part of the Agreement or any interest or legal or
beneficial ownership therein or any right or obligation
thereunder, directly or indirectly, such as, for example only,
by way of a sale of an underlying ownership interest in Dealer
or the Dealership Premises or a change in the persons having
control or managerial authority, without prior written consent
of American Honda. Any purported change, transfer or assignment
shall be null and void and not binding on American Honda.
9.4.C Any dispute, disagreement, controversy or personal difficulty
between or among Dealer Owners or in the management of Dealer
which, in American Honda's opinion, may adversely affect the
conduct of Dealer's business, or the presence in the management
of Dealer of any person who, in American Honda's opinion, does
not have or no longer has requisite qualifications for his
position.
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9.4.D Impairment of the reputation or the financial standing of
Dealer or of any Dealer Owner subsequent to the execution
of the Agreement; or the ascertainment by American Honda of
any facts existing at or prior to execution of the Agreement
which tend to impair such reputation or financial standings; or
the failure of Dealer continuously to meet American Honda's
minimum requirements of net working capital, owner's equity or
line(s) of credit.
9.4.E Failure by Dealer to pay, within ten (10) days after written
demand from American Honda, any delinquent accounts or other
monies due to American Honda from Dealer.
9.4.F Submission or participation in the submission to American
Honda of any false or fraudulent statement, application,
report, request for issuance of reimbursement, compensation,
refund or credit, including but not limited to any false or
fraudulent claim for warranty work, labor rate, set-up
reimbursement or warranty coverage.
9.4.G Use by Dealer of any deceptive or fraudulent practice, whether
willful, negligent or otherwise, in the sale of any Acura
Product.
9.4.H Any conviction in any court of original jurisdiction of
Dealer or any Dealer Owner or any employee of the Dealership
Operations for any crime or violation of any law if, in the
opinion of American Honda, such conviction or violation may
adversely affect the conduct of the Dealership Operations or
tend to be harmful to the goodwill of American Honda or to the
reputation of Acura Products or the Acura Trademarks, or the
violation or refusal or neglect of Dealer to comply with the
provisions of the National Traffic and Motor Vehicle Safety Act
of 1966, as amended, or the Clean Air Act, or any rules,
regulations or standards under either of said Acts, including
but not limited to performance of any product update or recall
operation as directed by American Honda.
9.4.I Dealer's entering into any agreement, combination,
understanding or contract, oral or written, with any other
corporation, person, firm or other legal entity for the purpose
of fixing prices of Acura Products or otherwise violating any
law.
9.4.J Dealer's abandonment of Dealership Premises or failure to
maintain Dealership Operations as a going business, open during
customary business hours for the days and hours as are
customary for automobile dealerships in the Primary Market
Area, provided such failure is not due to causes beyond
Dealer's control. Failure of the Dealership Premises to remain
open for seven (7) consecutive days will constitute, without
more, such abandonment.
9.4.K Death or incapacity of any Dealer Owner or Dealer Manager,
subject to the provisions of Article 8.
9.4.L Failure of Dealer to make improvements, alterations or
modifications of its Dealership Premises which are required to
meet reasonable facility requirements of American Honda or
which Dealer has agreed or represented to American Honda that
Dealer will make or do.
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9.4.M The movement of Dealership Premises to a new location or the
establishment of an additional location for the sale or service
of any Acura Products without the prior written approval of
American Honda.
9.4.N The failure of Dealer to provide adequate representation,
promotion, sales or service, including warranty work, of any
Acura Products.
9.4.0 Dealer's breach of any provision of the Agreement or Dealer's
failure to comply with any contained in the Agreement.
9.5 The Agreement will also be terminated upon written notice by American
Honda in the event:
9.5.A Of termination of American Honda's distribution agreement as an
Acura Automobile distributor.
9.5.B Of withdrawal by American Honda from the market in which Dealer
is located.
9.5.C American Honda will, for any reason, discontinue the
distribution of Acura Automobiles.
9.6 Upon the occurrence of any of the following facts or circumstances, the
Agreement will terminate automatically, without notice or other action
by American Honda or Dealer; and upon such termination, any dealings
between American Honda and Dealer will be on a day-to-day basis at the
sole option of American Honda and may be discontinued at any time by
American Honda:
9.6.A Insolvency by any definition of Dealer; or
9.6.B The existence of facts or circumstances which would allow the
voluntary commencement by Dealer, or the involuntary
commencement against Dealer, of any proceedings under any
bankruptcy act or law or under any state insolvency law; or
9.6.C The appointment of a receiver or other officer having similar
powers for Dealer or the Dealership Premises; or
9.6.D Any levy against Dealer under attachment, garnishment or
execution or similar process which is not within ten (10) days
vacated or removed by payment or bonding.
9.7 American Honda may select any applicable provision under which it
elects to terminate the Agreement and give notice thereunder,
notwithstanding the existence of any other grounds for termination or
the failure to refer to such other grounds in the notice of
termination. The failure by American Honda to specify additional
ground(s) for cancellation in its notice will not preclude American
Honda from later establishing that termination is also supported by
such additional ground(s).
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9.8 The acceptance by American Honda of orders from Dealer or the
continued sale of Acura Products to Dealer or any other act or course
of dealing of American Honda after termination of the Agreement will
not be construed as or deemed to be a renewal of the Agreement for
any further term or a waiver of such termination. Any dealings after
termination will be on a day-to-day basis.
9.9 In all cases, Dealer agrees to conduct itself and Dealership
Operations until the effective date of termination and after
termination or expiration of the Agreement, so as not to injure the
reputation or goodwill of the Acura Trademarks or American Honda.
10. RIGHTS, OBLIGATIONS AND DEALINGS UPON TERMINATION
10.1 Upon the mailing of a written notice of termination or after date of
the expiration of the Agreement without renewal, American Honda will
have the right to cancel all pending orders of Dealer for Acura
Products, special tools and equipment, whether previously accepted by
American Honda or not, except as specifically otherwise provided in
this Section 10. Notwithstanding the foregoing, if American Honda
chooses to fill any orders, it will not be obligated to fill any
other orders and will not be precluded from changing the terms of any
sale.
10.2 Not later than the effective date of the termination or expiration of
the Agreement, Dealer will cease to hold itself out as being
authorized to sell Acura Products and will discontinue selling Acura
Products or performing service as an authorized dealer.
10.3 In addition to the requirements of Section 10.2, not later than the
effective date of the termination or expiration of the Agreement,
Dealer will, at its sole expense, discontinue any and all uses of any
Acura Trademarks and any words, symbols and marks which are
confusingly similar thereto; will remove all signs bearing any Acura
Trademark and will destroy all stationery, repair orders, advertising
and solicitation materials, and all other printed matter bearing any
Acura Trademark or referring directly or indirectly to American Honda
or Acura Products in any way which might make it appear to members of
the public that Dealer is still an authorized dealer. The foregoing
will include, but not be limited to, discontinuing the use of an
Acura Trademark as part of Dealer's business and corporate name.
Dealer will also deliver to American Honda, at American Honda's place
of business, or to a person designated by American Honda, or will
destroy the same upon request by American Honda, any and all
technical or service literature, advertising and other printed
material then in Dealer's possession which relates to Acura Products
and which was acquired or obtained by Dealer from American Honda.
Dealer will destroy any sign bearing an Acura Trademark which has not
been repurchased by American Honda.
10.4 In the event the Agreement is terminated pursuant to the provisions
of Paragraph 9.3 hereof, upon request of American Honda for copying
Dealer's records of predelivery service, warranty service, recall or
update service or other service of Acura Products, Dealer will make
such records available. In the event the Agreement is terminated
pursuant to the provisions of Paragraphs 9.1 or 9.2 hereof, upon the
request of American Honda, Dealer will deliver to American Honda
copies of such Dealer records.
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10.5 Dealer may, at any time within five (5) days after the effective
date of termination or expiration of the Agreement, notify American
Honda in writing of Dealer's desire to have American Honda
repurchase from Dealer Acura Products in Dealer's inventory which
were purchased from American Honda and which, when American Honda
accepts sole possession:
10.5.A In the case of Acura Automobiles, are new and of the then
current model year, as designated by American Honda,
unused, undamaged and in first-class resalable condition
regardless of whether or not American Honda has exercised
its right of inspection; and
10.5.B In the case of Acura Parts, are new, listed as current in
the Parts Price Book, unused, undamaged, in their original
package and in first-class resalable condition.
10.6 Upon termination or expiration without renewal, upon request of
Dealer given no later than five (5) days after the effective date of
termination or expiration, American Honda will repurchase all signs
which use an Acura Trademark as were authorized in advance by
American Honda and all service information and materials, special
tools and equipment designed specifically for service of Acura
Automobiles and which were purchased from American Honda and are
usable on current Acura Products, provided that such signs,
information, materials, tools and equipment are less than five (5)
years old and are in good working order.
10.7 American Honda will repurchase from Dealer Acura Products and signs,
information, materials, tools and equipment as aforesaid on the
condition that Dealer furnishes an inventory to American Honda
within thirty (30) days after the termination or expiration without
renewal of the Agreement and complies strictly with all procedures
and conditions of repurchase issued by American Honda at the time of
repurchase. American Honda will have the right and option to assign
to another person or entity the right to purchase such Acura
Products.
10.7.A The price for Acura Products, other than tools, equipment,
information, materials and signs, will be the price at
which they were originally purchased by Dealer from
American Honda or the price last established by American
Honda for the sale of identical Acura Products, whichever
may be lower, and in either case will be less all prior
refunds and allowances made by American Honda with respect
thereto, if any. The price for tools, equipment,
information, materials and signs will be the price paid by
Dealer reduced by straight-line depreciation on the basis
of a useful life of five (5) years. In all cases, the price
will be reduced by any applicable restocking charge which
may be in effect at the time of American Honda's receipt of
goods to be repurchased.
10.7.B Dealer agrees to store Acura Products and other items which
American Honda desires or is obligated to repurchase until
receipt from American Honda of rejection of repurchase or
instructions for shipping and return to American Honda.
Dealer agrees to strictly follow and abide by all
instructions for return as may be issued from time to time
by American Honda. All Acura Products will be properly and
suitably packaged and containered for safe transportation
to American
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Honda. All damage regardless of nature or cause, will be
the responsibility of Dealer until the Acura Products are
inspected and accepted by American Honda for repurchase.
Storage of such Acura Products and other items will be at
Dealer's expense for a period of ninety (90) days after
Dealer requests repurchase and provides an inventory as
provided by Paragraphs 10.6 and 10.7 hereof. Thereafter,
Dealer will be entitled to charge American Honda a
reasonable storage charge.
10.7.C American Honda, or its designee, at such reasonable time
and for such a reasonable period of time as American Honda
may determine, will have the right to enter the premises
where items for repurchase are being held for the purpose
of checking the inventory submitted by Dealer or examining,
inspecting and inventorying any and all Acura Products. If
American Honda agrees to repurchase and Dealer fails to
furnish an inventory, Dealer will reimburse American Honda
for all costs of American Honda taking an inventory.
10.7.D Only those Acura Products meeting the requirements of
Paragraphs 10.5 and 10.6 hereof are or will be eligible for
return to American Honda. American Honda will not be
obligated to give Dealer credit for any Acura Products
which do not meet those requirements.
10.7.E Dealer warrants and represents that all Acura Products
tendered to American Honda for repurchase will be free of
all liens, encumbrances, security interests or attachments
at the time repurchase is requested by Dealer. Clear title
will be vested in American Honda upon receipt of goods.
Dealer will execute and deliver any documents necessary to
vest clear title in American Honda, and Dealer will be
responsible for complying with all applicable procedures,
including but not limited to those relating to bulk
transfers.
10.7.F Dealer will pay all freight and insurance charges from
Dealer to the place of delivery designated by American
Honda, provided that Dealer will not be liable for any
amount greater than the freight and insurance charges from
Dealer to American Honda's closest automobile warehouse or
parts center as American Honda may designate. Claims for
damage allegedly caused by any carrier will be the sole
responsibility of Dealer, and in no event will American
Honda be obligated to make a claim against a carrier or be
liable to Dealer for damage.
10.7.G As a condition of repurchase and notwithstanding any other
agreement or offer to repurchase, payment for repurchase
will first be applied against any obligations or money owed
by Dealer to American Honda. All payment due from American
Honda to Dealer pursuant to any provisions of the Agreement
or in connection with the termination of the Agreement will
be made by American Honda after receipt of the goods to be
repurchased and after all debits and credits have been
ascertained and applied to Dealer's accounts, and Dealer
has delivered to American Honda the manufacturer's
certificate of origin or other document of title for Acura
Automobiles tendered to American Honda for repurchase. In
the event it be found that a balance is due from Dealer to
American Honda, Dealer will pay such sum to American Honda
within ten (10) days of written notice of such balance.
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11. GENERAL PROVISIONS
11.1 Dealer acknowledges that only the President or a designated Vice
President, Secretary or Assistant Secretary of American Honda is
authorized to execute the Agreement, agree to any variation,
modification or amendment of any of the provisions thereof, including
authorized location, or to make commitments for or on behalf of
American Honda. No other employee of American Honda may make any
promise or commitment on behalf of American Honda or in any way bind
American Honda. Dealer agrees that it will not rely on any statements
or purported statements except from personnel as authorized
hereinabove.
11.2 The Agreement contains the entire agreement between Dealer and
American Honda. Dealer acknowledges that no representations or
statements other than those expressly set forth therein were made by
American Honda or any officer, employee, agent or representative
thereof, or were relied upon by Dealer in entering into the
Agreement. The Agreement terminates and supersedes, as of the
execution thereof, all prior agreements relating to Acura Products,
if any.
11.3 Dealer hereby waives, abandons and relinquishes any and all claims of
any kind and nature whatsoever arising from or out of or in
connection with any prior agreement entered into between Dealer and
American Honda; provided, however, that nothing herein contained
shall be deemed a release or waiver of any claim arising out of prior
sales of Acura Products by American Honda to Dealer.
11.4 The Agreement is personal to the individuals identified as
principals, owner(s), partners or shareholder(s) in Paragraph C.
Neither the Agreement, nor any part hereof or any interest therein,
may be transferred or assigned by Dealer, in whole or in part,
directly or indirectly, voluntarily or by operation of law, without
the prior written approval of American Honda. Any attempted transfer
or assignment will be void and not binding upon American Honda.
11.5 All notices, notifications or requests under or pursuant to the
provisions of the Agreement will be directed to the address of the
principal places of business of the respective parties to the
Agreement. If either party cannot effect notice at the place of
business of the other because a party has abandoned its place of
business or refuses to accept notice, then, and only in such case,
notice may be served on American Honda through its designated agent
for service of process and upon Dealer through the Department of
Motor Vehicles (or its equivalent) in the state where the Dealership
Location is authorized by American Honda.
11.6 The waiver by either party of any breach or violation of or default
under any provision of the Agreement will not be a waiver by such
party of any other provision or of any subsequent breach or violation
thereof or default thereunder. The failure or delay of either party
to take prompt action upon any breach or violation of the Agreement
will not be deemed a waiver of the right to take action for such
breach, default or violation at any time in the future.
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11.7 Dealer agrees to keep confidential and not disclose, directly or
indirectly, any information which American Honda designates as
confidential.
11.8 The Agreement is and shall be deemed to have been entered into in
California and shall be governed by and construed in accordance with
the laws of the State of California.
11.9 If any provision of this Agreement should be held invalid or
unenforceable for any reason whatsoever or to conflict with any
applicable law, the Agreement will be considered divisible as to such
provisions, and such provisions will be deemed amended to comply with
such law, or if it cannot be so amended without materially altering
the tenor of the Agreement, then it will be deemed deleted from the
Agreement in such jurisdiction, and in either case, the remainder of
the Agreement will be valid and binding.
11.10 The terms of the Agreement may not be modified except in writing
signed by an authorized officer of the parties. Without limiting the
generality of the foregoing, no course of dealing will serve to
modify or alter the terms of the Agreement.
11.11 Dealer is an independent business. The Agreement does not constitute
Dealer the agent or legal representative of American Honda for any
purpose whatsoever. Dealer is not granted any expressed or implied
right or authority to assume or create any obligation on behalf of or
in the name of American Honda or to bind American Honda in any
manner or thing whatsoever. Dealer has paid no consideration for the
Agreement. Neither the Agreement nor any right granted under it is a
property right.
11.12 The expiration or termination of the Agreement will not extinguish
any claims American Honda may have for the collection of money or the
enforcement of any obligations which may be in the nature of
continuing obligations.
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12. DEFINITIONS
12.1 American Honda means American Honda Motor Co., Inc., a California
corporation, and the Acura Automobile Division that markets Acura
Automobiles.
12.2 Dealer means the person, firm, corporation, partnership or other
legal entity that signs the Agreement and each of the persons
identified in Paragraph C.
12.3 Dealer Manager means the principal manager of Dealer identified in
Paragraph D upon whose personal service American Honda relies in
entering into the Agreement.
12.4 Dealer Owner means the owner(s) of Dealer identified in Paragraph C
upon whose personal service American Honda relies in entering into
the Agreement.
12.5 Dealership Location means the location approved by American Honda for
the purpose of conducting Dealership Operations.
12.6 Dealership Operations means all operations contemplated by the
Agreement. These operations include the sale and service of Acura
Products, and any other activities undertaken by Dealer related to
Acura Products, including rental and leasing operations, used car
sales and body shop operations, and finance and insurance
operations, whether conducted directly or indirectly by Dealer.
12.7 Dealership Premises means the facilities provided by Dealer at its
Dealership Location for the conduct of Dealership Operations as
approved by American Honda.
12.8 Acura Automobiles means such new passenger cars as are from time to
time offered for sale by American Honda to Dealer for resale as part
of the Acura automobile line as defined by American Honda.
12.9 Acura Parts means parts, accessories and optional equipment marketed
by American Honda for use with Acura Automobiles.
12.10 Acura Products means Acura Automobiles and Acura Parts.
12.11 Acura Trademarks means the various trademarks, service marks, names
and designs which American Honda uses or is authorized to use in
connection with Acura Products or services relating thereto.
12.12 Primary Market Area means the geographical area designated for Dealer
by American Honda from time to time.
12.13 The Agreement means the Acura Automobile Dealer's Sales and Service
Agreement and these Standard Provisions which are incorporated
therein by reference.
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