Audi Dealer Agreement
1. Appointment. Audi of America, Inc., a division of Volkswagen of America,
Inc. ("Distributor"), having a place of business at
___________________________________________________, appoints
_____________________________________________("Dealer"), doing business under
the fictitious name ________________________ _________________, having its place
of business at ______________ _____________________________________, as an
authorized dealer in Audi brand motor vehicles and genuine parts and accessories
therefor. Accordingly, the parties agree as follows:
2. Standard Provisions. The Dealer Agreement Standard Provisions (the
"Standard Provisions") (Form No. Deal. 92AB) are part of this Agreement. Any
term not defined in this Agreement has the meaning given such term in the
Standard Provisions.
3. Ownership and Management. To induce Distributor to enter into this
Agreement, Dealer represents that the persons identified in the Statement of
Ownership and Management, which is attached as Exhibit A, are Dealer's Owners
and Executives. Distributor is entering into this Agreement in reliance upon
these representations, and upon the continued provision by such persons of their
personal services in fulfillment of Dealer's obligations under this Agreement.
Accordingly, Dealer agrees there will be no change in Dealer's Owners without
Distributor's prior written consent, and no change in Dealer's Executives
without prior notice to Distributor.
4. Minimum Financial Requirements. Dealer agrees to comply and maintain
compliance with the minimum financial requirements established for Dealer from
time to time in accordance with the Operating Standards. Throughout the term of
this Agreement those minimum financial requirements are subject to revision by
Distributor, after review with Dealer, in light of operating conditions and the
development of Dealer's business and business potential.
5. Dealer's Premises. Distributor has approved the location of Dealer's
Premises as specified in the Dealer Premises Addendum, attached as Exhibit B,
Dealer agrees that, without Distributor's prior written consent, it will not (a)
make any major structural change in any of Dealer's Premises, (b) change the
location of any of Dealer's Premises or (c) establish any additional premises
for Dealer's Operations.
6. EXCLUSION OF WARRANTIES. EXCEPT FOR DISTRIBUTOR'S WARRANTIES, AND EXCEPT
AS PROVIDED IN ARTICLE 9(1) OF THE STANDARD PROVISIONS, THERE ARE NO EXPRESS OR
IMPLIED WARRANTIES OR OBLIGATIONS OF THE MANUFACTURER OR DISTRIBUTOR AS TO THE
QUALITY OR CONDITION OF AUTHORIZED PRODUCTS, OR AS TO THEIR MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE, AND, TO
THE EXTENT PERMITTED BY LAW, DEALER WILL EXCLUDE ANY AND ALL SUCH WARRANTIES AND
OBLIGATIONS IN ITS SALES OF AUTHORIZED PRODUCTS.
7. Term. The term of this Agreement begins on the date of its delivery to
Dealer or on January 1, 1992, whichever is later. This Agreement shall continue
in effect until December 31, 1996, or _____________, 199__, whichever is
earlier, unless sooner terminated by either party or superseded by a new Dealer
Agreement with Distributor.
8. Governing Law. This Agreement will be construed in accordance with the
laws of the State of ___________________. Should the performance of any
obligation under this Agreement violate any valid law of such jurisdiction, then
this Agreement shall be deemed modified to the minimum extent necessary to
comply with such law.
9. Additional Terms and Conditions. The Addenda attached hereto as Exhibits
A though _____ are part of this Agreement, and are incorporated into this
Agreement by this reference.
Dated: _______________, 19__.
Audi Of America, Inc.
By:___________________________
Zone Manager
Dealer
By:___________________________
Title:
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Exhibit A to
Audi Dealer Agreement
Dated _____________, 19__.
Statement Of Ownership And Management
1. Dealer firm name:___________________________________________
2. Principal place of business:________________________________
3. Dealer is a ( ) proprietorship
( ) partnership
( ) corporation, incorporated on __________
____ under the laws of the State of
____________________________________.
4. The following persons are the beneficial and record owners of Dealer:
If a Corporation, Percentage of
Name and Address of Each Number and Ownership
Record and Beneficial Class of Shares of Record
Owner of Dealer Number Class in Dealer
5. The following persons are Dealer's Officers:
Name and Address Title
A-1
6. The following person functions as General Manager of Dealer. As such, he is
an agent of Dealer and is authorized, and Distributor is entitled to rely on his
authority, to make all decisions on behalf of Dealer with respect to Dealer's
Operations.
Name and Address Title
Dealer hereby certifies that the foregoing information is true and complete as
of the date below. Distributor has entered into this Agreement in reliance upon
the qualifications, and the continued provision of personal services in the
ownership and management of Dealer by, the persons identified above.
This Exhibit cancels any prior Statement of Ownership and Management.
Dated:_________________ 19___.
Audi Of America, Inc.
By:__________________________
Zone Manager
Dealer
By:___________________________
Title:
A-2
Exhibit B to
Audi Dealer Agreement
Dated ___________, 19__.
Dealer Premises Addendum
1. Dealer firm name:___________________________________________
2. Distributor has approved the location of the following premises, and no
others, for Dealer's Operations:
a. Sales Facilities:
____________________________________________________________
b. Authorized Automobile Storage Facilities:
____________________________________________________________
c. Service Facilities:
____________________________________________________________
d. Genuine Parts Storage Facilities:
____________________________________________________________
e. Used Car Lot:
____________________________________________________________
Dealer hereby certifies that the foregoing information is true and complete as
of the date below.
The Exhibit cancels any prior Dealer Premises Addendum.
Dated:____________________ 19__.
Audi Of America, Inc.
By:____________________________
Zone Manager
Dealer
By:____________________________
Title
B-1
Audi of America, Inc. [LOGO]
Sent Xxx Xxx & Xxxxxxx Xxxxxxx
Xxxxxxxxx 00, 0000
Xxxxxx Auto Group, Inc.
000 Xxxx Xxx., 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention of Xxxxxx X. Xxxxxxxx, Executive Vice President
RE: LETTER OF INTENT
Gentlemen:
We are pleased to advise you that the application of United Auto Group, Inc.
("UAG") to acquire all the outstanding shares of capital stock of Scottsdale
Jaguar, Ltd. d/b/a Scottsdale Audi ("Dealer") tentatively has been approved.
Audi of America, Inc., an unincorporated division of Volkswagen of America, Inc.
("Audi") is prepared to issue a new Statement of Ownership and Management (a
specimen copy of which is enclosed) to the Audi Dealer Agreement currently in
effect between Audi and Dealer (the "Dealer Agreement") when, in our sole
judgment, you have fulfilled our customary requirements and satisfied each of
the conditions set forth below. Each of these conditions has been discussed with
you by Audi's representatives.
1. The corporate existence of Dealer will continue unchanged, but for the
transfer of all shares of capital stock of Dealer from Xxxxxx Xxxxxxxxxxxxx
("Xxxxxxxxxxxxx") to UAG. Dealer will operate the Audi dealership referred to
herein and no other business of any kind, save and except for the other
automotive operations customarily conducted by Dealer as of the date hereof. You
will supply Audi upon request, for its review and approval, all documents
reflecting the existence, shareholdings, organization, officers and directors of
Dealer, and any agreements between or among Dealer, its affiliates and its
shareholders.
2. The officers of Dealer following the contemplated stock transfer will be as
follows:
Chairman: Xxxx Xxxxxxxxxx
President: Xxxxx Xxxxxxxxxxxxx
Treasurer: Xxxxx X. Xxxxxxx
Secretary: Xxxxx X. Xxxxxxx
General Manager: Xxxxxx X. Xxxxxxxx
3. All the capital stock of Dealer will be transferred to, and will continue to
be wholly owned, by UAG. UAG has 6,987,391 issued and outstanding shares of
capital stock, which are owned as follows:
Trace Auto Holdings, Inc. 40.3%
Aeneas Venture Corp. 32.2
AIF II, L.P. 20.5
Xxxx Xxxxx 2.2
Xxxxxx Xxxxxxxx 1.1
Xxxxx Xxxxx 1.1
Xxxxxx Xxxxxx 0.57
Natio Vie Development 0.57
Xxxx Xxxxxxxxxx 0.28
Xxxxxx Xxxxxxxxx 0.06
Xxxxxx Xxxxxxxx 0.06
Natio Fonds Venture 2 0.04
Amo Venture 0.04
Xxxxx Xxxxxxx 0.03
Xxxxx xxxxx xxx Xxxxx 0.03
4. The total Invested Operating Capital of Dealer will at no time be lower than
$1,000,000 of which no more than one-half will be in the form of borrowed funds.
5. The total Net Working Capital of Dealer will at no time be lower than
$2,300,000. The Owner's Equity of Dealer will at no time be lower than $600,000.
("Net Working Capital" and "Owner's Equity" shall have the respective meanings
ascribed to them in the Operating Standards for Audi Dealers, a copy of which
you have received.)
6. A Wholesale Credit Line for Dealer of at least $1,300,000 will be established
and maintained with a local financial institution acceptable to Audi for the
exclusive purpose of purchasing and maintaining an inventory of Audi
automobiles.
7. You acknowledge your understanding of, and to induce Audi to approve the
contemplated transaction you agree, to the requirements of Audi as they relate
to the dedication of a completely separate sales and service facility for
Dealer's Audi operations. You agree to negotiate with Audi in good faith toward
the establishment of a timetable for the separation of Audi dealership
operations from any other business operations of Dealer or of UAG, and the
establishment of specifications for such a separate Audi dealership facility.
You understand and agree that but for the representations of Dealer and UAG as
set forth in this paragraph, Audi would not enter into this Letter of Intent or
any other agreement with you.
8. You understand and agree that neither this Letter of Intent, the transactions
contemplated by this Letter of Intent, nor any amended Statement of Ownership
and Management to the Dealer
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Agreement which may ultimately be entered into pursuant to the terms hereof,
shall waive, modify, cancel or amend any other agreement heretofore in effect
between Audi and Dealer.
9. You will supply us with executed and authentic copies of the following
documents:
a. A letter from your financial institution verifying the amount of the
wholesale credit available for your purchase of Audi automobiles.
b. Proof of investment satisfactory to us verifying the amount of Dealer's
total invested capital.
c. Copies of both sides of all Stock Certificates issued by Dealer.
d. A certified list of the Officers and the Directors of Dealer.
e. All documents respecting the contemplated stock transfer.
10. Notwithstanding your compliance with the foregoing, you understand this
Letter of Intent may be revoked with no further liability on our part if:
a. An order is issued by any court or administrative agency, pursuant to
any law or regulation denying you or Dealer any license needed to conduct
the dealership operations contemplated by this letter or enjoining Audi
from entering into the Audi Dealer Agreement contemplated herein; or
b. In the judgment of our counsel there is a significant possibility any
such license may be denied or such an order may be issued.
11. You further understand, acknowledge and agree that:
a. Time is of the essence of all matters set forth in this Letter of
Intent.
b. In the event you or Dealer, for any reason within your control, shall
fail to timely fulfill any of the terms and conditions set forth herein,
Audi shall not be obligated to issue a new Statement of Ownership and
Management to the Dealer Agreement or to grant you or Dealer an extension
of time in which to complete your performance thereof.
c. You and Dealer hereby voluntarily assume the entire risk of the
undertakings contemplated herein. You and Dealer, by your approval and
acceptance of this Letter of Intent, and intending to be legally bound
hereby, further
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agree and covenant not to xxx Audi, its officers, directors, agents,
employees, parent, subsidiaries, successors or assigns with respect to any
or all damages you or Dealer may suffer by reason of taking any action in
reliance upon this Letter of Intent, in the event you fail to timely
fulfill any of the conditions set forth herein, and Audi thereafter fails
or refuses to amend its Dealer Agreement with Dealer.
d. The financial requirements set forth in this Letter of Intent are
subject to periodic review and change. You agree to comply promptly with
any such change in financial requirements. You also agree that an
additional investment may be required if any assets required to comply with
the Audi Dealer Agreement or the Operating Standards for Audi Dealers were
not included in our calculation of the aforementioned financial
requirements.
If all the conditions set forth in this Letter of Intent are satisfied on or
before October 15, 1996, Audi will issue a new Statement of Ownership and
Management to the Dealer Agreement. You agree that Audi shall have no obligation
to so amend such Agreement unless and until you have satisfied all conditions
contained in this Letter of Intent.
This Letter of Intent will not become effective unless executed by you and
received by the undersigned at the above address ten days from the date hereof.
Once this Letter of Intent becomes effective, it will remain valid until October
15, 1996, or the execution of a new Statement of Ownership and Management to the
Dealer Agreement, whichever occurs first. Please acknowledge
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your understanding of and agreement to the terms of this Letter of Intent by
signing it below and returning it to my attention.
My congratulations on behalf of Audi. Please call upon us for any assistance
that we may be able to provide.
Very truly yours,
VOLKSWAGEN OF AMERICA, INC.
d/b/a AUDI OF AMERICA, INC.
By:_____________________________
The undersigned acknowledge, accept and approve the terms set forth in this
Letter of Intent:
UNITED AUTO GROUP, INC. SCOTTSDALE JAGUAR, LTD.
By: s/Xxxxxx X. Xxxxxxxx By: s/Xxxxx Xxxxxxxxxxxxx
-------------------------- ----------------------------
Name:_________________________ Name: Xxxxxx Xxxxxxxxxxxxx
Title: Secretary Title: Chairman
Date: 9-18-96 Date: 9-19-96
_______________________________
Xxxxxx Xxxxxxxxxxxxx,
Executed as Dealer Principal
with no individual liability
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UNITED AUTO GROUP, INC.
Xxxxxx X. Xxxxxxxx
Executive Vice President
September 18, 1996
VIA FACSIMILE MAIL - 810/340-5140
Xx. Xxxxx Xxxxx
Manager, Network Development
Audi of America, Inc.
0000 Xxxxxx Xxxx
Xxxxxx Xxxxx, Xxxxxxxx 00000
Dear Xxxxx:
We are in receipt of your Letter of Intent, dated September 18, 1996, relative
to the proposed transfer involving Scottsdale Jaguar (on behalf of Scottsdale
Audi) and United Auto Group ("UAG") and we are in agreement with the terms
contained therein.
By this letter, we are asking your acknowledgment that, at the time of the
closing of the proposed transaction, and thereafter, UAG will be a publicly
traded company and that such is not a violation of the terms of the sales and
service agreement by and between Audi of America and the dealership. Audi
further understands that the offering for sale of some portion of its stock on
the public market will result in a change in the percentages of UAG stock owned
by the individuals as listed in paragraph 3 of your Letter. At the time of the
offering, and at all times thereafter, UAG will provide Audi with current
percentage ownerships by all individuals and entities listed in that paragraph
3.
Thank you for your attention to this request.
Sincerely,
s/ Xxxxxx
Xxxxxx Xxxxxxxx
UNDERSTOOD AND AGREED: s/________________________
XXXXX XXXXX
Audi of America, Inc.
