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EXHIBIT 10.25
CHEVROLET-GEO
DEALER SALES AND SERVICE AGREEMENT
In reliance upon the Agreement by the parties to fulfill their respective
commitments, this Agreement, effective __________, is entered into by General
Motors Corporation, Chevrolet Motor Division ("Chevrolet"), a Delaware
Corporation and
__________________________________________________________________________, a
Dealer Firm Name
o __________ corporation, incorporated on __________;
o proprietorship;
o partnership;
o other - specify ___________________________________
doing business at ___________________________________________
___________________________________________("Dealer").
OVERVIEW AND PURPOSE OF THE
CHEVROLET-GEO DEALER SALES AND SERVICE AGREEMENT
The principle purposes of this Agreement are to:
A. A thorize the Dealer to sell and service Chevrolet and Geo products and to
represent itself as a Chevrolet-Geo Dealer.
B. Provide a framework within which Dealer and Chevrolet may accomplish their
mutual objectives.
C. Provide a means whereby Chevrolet and Dealer may identify specific sales,
CSI, facility and other requirements by which Dealer's performance under
this Agreement may be evaluated.
D. Identify other commitments, rights and responsibilities of Chevrolet and
Dealer.
Achieving Chevrolet's vision of market leadership while exceeding customer
expectations in selling and serving Chevrolet and Geo products is dependent in
a large part upon the maintenance of a quality network of authorized Dealers.
Since Dealer represents Chevrolet and Geo to the public, it is fundamental to
the success of Chevrolet that Dealer maintain its operations facilities and
business methods in a manner which will support the Chevrolet-Geo Dealer
Agreement. Chevrolet will conduct its operations and provide assistance, as
practicable within the scope and terms of this
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Agreement, to assist Dealer to accomplish the requirements of this Agreement
and the Chevrolet vision. Chevrolet will from time to time provide
instructions, programs, requirements and suggestions developed in accordance
with this Agreement to both supplement the Agreement and assist Dealer and
Dealer network.
Chevrolet's vision is to be. . . America's automotive leader. . . providing
Total Customer Enthusiasm through:
o Empowered people.
o Exceptional products.
o Excellent purchase and ownership experience.
providing outstanding value and a superior return on investment for all
stakeholders.
TERM OF AGREEMENT
First
This agreement shall expire on __________ or ninety days after the death or
incapacity of a Dealer operator or Dealer owner, whichever occurs first, unless
earlier terminated. Dealer is assured the opportunity to enter into a new
Dealer Agreement with Chevrolet at the expiration date if Chevrolet determines
Dealer has fulfilled its obligations under this agreement. Dealer will be
provided notice of possible nonrenewal of the agreement in accordance with
Article 13.2 of the standard provisions in order that Dealer may correct any
failure or breach of the Dealer Agreement prior to its expiration or
nonrenewal. If the breach of the agreement or failure to perform the conditions
of the agreement is corrected to the satisfaction of Chevrolet, a replacement
agreement will be offered at the appropriate time.
STANDARD PROVISIONS
Second
The "Standard Provisions" (Form GMMS-1013) are incorporated as part of this
agreement.
DEALER OPERATOR
Third
Dealer agrees that the following Dealer operator will provide personal services
in accordance with Article Two of the Standard Provisions.
_______________________________________________________________________________
_______________________________________________________________________________
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Fourth
Chevrolet and dealers recognize that the decisions made by Chevrolet Motor
Division directly impact the business and livelihood of its Dealer Body as well
as the ultimate satisfaction of its customers. Chevrolet, in accord with
members representing the Chevrolet dealer body, seek to enhance its decision
making process by establishing certain methods for the inclusion of the
collective Dealer Body input in all areas d rectly affecting our mutual
business concerns. The forum for this is generally provided through three
principle processes: The National Dealer Council, The National Dealer Council
Work Teams, and The Partnership Council.
A. NATIONAL DEALER COUNCIL
The purpose of the National Dealer Council is to establish a forum for
Chevrolet and its dealers to partner in determining Chevrolet's future
direction and strategies. Council members will participate in work teams and
other joint policy-making groups affecting our business. Much progress has been
made as a result of the National Dealer Council involvement, and Chevrolet is
committed to ensuring that this avenue continues.
o The National Dealer Council will consist of elected Chevrolet dealer
representatives from each Zone and serve a three year term. A dealer
operator must have at least three years experience as a Chevrolet
dealer and be involved in the day to day operations of the dealership
business in order to qualify for election.
o Council representatives will communicate with the dealer body in the
Zone they are representing by providing feedback on dealer council
activities and informing the Dealer Council and Chevrolet of dealer
body concerns.
o Dealer Council formally convenes up to three times a year. Individual
Council members may be asked to attend additional meeting throughout
the year in connection with their team assignments. Dealer Council
members will serve on work teams and participate in the decision
making process with Chevrolet Motor Division.
o Any training deemed necessary by the National Dealer Council to assist
in fulfilling their responsibilities will be provided by Chevrolet.
B. NATIONAL DEALER COUNCIL WORK TEAMS
National Dealer Council representatives, Chevrolet/GM management, and
Chevrolet Dealers will serve jointly on work teams which are created to focus
on issues of mutual concern to dealers and Chevrolet. The work teams will
utilize the consensus decision making process to achieve a best value decision
depending on the defined role of each group and the requirements of each issue
under consideration.
o Work teams will cover areas such as: Dealer Organization, Education
and Training, Product, Service/Parts, Distribution, Sales/Financial,
Marketing, and Total Customer Enthusiasm.
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The National Dealer Council and Chevrolet may establish, change or
discontinue teams as deemed necessary.
o Dealers may serve on a work team for up to a three year term. Meetings
will take place on an as needed basis through phone conversations, fax
system, or in person.
C. PARTNERSHIP COUNCIL
The responsibility of the Partnership Council is to coordinate work
team structures and activities of the National Dealer Council. The Partnership
Council is comprised of an equal number of Chevrolet Dealer Council members and
Chevrolet representatives which operate as a policy making body. The
Partnership Council will also address issues from the National Dealer Council
and inform the necessary work teams as needed.
SALES REVIEW
Fifth
The decision by Chevrolet to enter this agreement is based, in part, on
Dealer's commitment to effectively sell and promote the purchase, lease and use
of Chevrolet and Geo vehicles by consumers in Dealer's area of primary
responsibility. At least once each year, Chevrolet will provide Dealer a
written report on Dealer sales performance. The report will compare the
Dealer's retail sales to available retail market opportunity, by segment in the
Dealer's area of primary responsibility or area of geographic sales and service
advantage, whichever is applicable to determine the Dealer's sales performance.
Chevrolet will provide a written explanation of the sales review process to
Dealer, in order that Dealer may make business and marketing plans to take full
advantage of the market opportunity in Dealer's area of primary responsibility
and that Dealer may meet the requirements of Article 5 of the Standard
Provisions.
Any material change to the process will be determined in accordance with
Paragraph Fourth of the agreement.
SERVICE AND CUSTOMER SATISFACTION PERFORMANCE REVIEW
Sixth
Chevrolet at least once annually will review the service and customer
satisfaction performance of Dealer in a written report or reports. The reports
will be based primarily on customer responses to owner survey questions.
Chevrolet will periodically provide this information so that Dealer may make
business plans to correct any deficiencies and fulfill its obligations under
this agreement. The service and customer satisfaction review process is
currently under review. Any material change to the process will be determined
in accordance with Paragraph Fourth of this agreement.
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DEALERSHIP EQUIPMENT, TOOLS AND SOFTWARE
Seventh
a) Communication Equipment:
To improve Dealer and Chevrolet communications and customer satisfaction,
Dealer will install, maintain and use such communications equipment as is
designated by Chevrolet in accordance with Article 4.4.5 of the additional
provisions. Currently the following items are among those required by the terms
of the Dealer Agreement:
o GM Dealer Communication System (DCS)
o GM PULSAT Network
b) Tools and Equipment:
Dealer and Chevrolet acknowledge that a properly equipped dealership promotes
customer satisfaction and the sale of Chevrolet and Geo products. Chevrolet
agrees to provide Dealer with lists of those tools and equipment that Chevrolet
regards as essential in accordance with Article 7.2.4 of the Standard
Provisions. Dealer agrees that it will acquire and use essential tools and
equipment identified by Chevrolet.
c) New Tool Requirements:
Decisions on additional equipment, tool and communication requirements will be
determined in accordance with Paragraph Fourth of the agreement.
d) Software:
From time to time during the term of this Agreement, GM will make available to
Dealer certain information, data, software or firmware ("software")
electronically, incorporated into tools or other products or by other means.
This Software may be owned outright by GM, or jointly with, or wholly by, a GM
affiliated company or authorized supplier. Dealer agrees to limit its use of
the Software to Dealership Operations and comply with any other restrictions on
its use.
TRAINING
Eighth
Chevrolet will from time to time provide training which Chevrolet believes will
enhance Dealers ability to meet the requirements of the Dealer Agreement.
Dealer will, to the extent practicable, participate in that training. Further,
Chevrolet will on occasion designate certain training that will be required in
accordance with Article 8 of the additional provisions. Dealer agrees that it
will participate in any training so designated. Decisions on training
requirements will be determined in accordance with Paragraph Fourth of this
agreement.
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DEALER IDENTIFICATION, IMAGE AND FACILITIES
Ninth
Dealer and Chevrolet recognize that the appearance, signs, environment and
quality of Dealer's facility have significant impact on both Chevrolet and Geo
products and Dealer. Dealer, therefore, agrees that its dealership premises
will be properly equipped and maintained, and that the interior and exterior
retail environment and signs will comply with reasonable requirements Chevrolet
will establish to promote and preserve the image of Chevrolet and its Dealers.
Decisions on any material changes to the image, sign and/or dealership facility
requirements will be determined in accordance with Paragraph Fourth of this
agreement.
DISPUTE RESOLUTION
Tenth
Chevrolet recognizes that the mutual respect, trust and confidence which have
been the cornerstones of Chevrolet-Dealer relations are essential to
accomplishing the objectives of this Agreement. While the relationship between
Chevrolet and Dealer is a very positive one, Chevrolet recognizes that from
time to time there may be disagreements between Chevrolet and Dealer concerning
rights and obligations arising under this Dealer Agreement. It is contemplated
that most disagreements that may arise between Dealer and Chevrolet will be
resolved through discussion between Dealer and Chevrolet field management. In
fact, Dealer is strongly encouraged to discuss and to resolve any differences
through the local field office, the Chevrolet entity most familiar with Dealer
and its operations. However, in those instances where a disagreement between
Dealer and Chevrolet cannot be resolved, Dealer may choose to seek review
through the Dispute Resolution Process, which provides for senior sales
management review and Binding Arbitration. This process is always voluntary on
the part of Dealer and is voluntary on the part of Chevrolet except as provided
in the details of the Dispute Resolution Process as set forth in a separate
booklet (GMMS-1019).
BUSINESS MANAGEMENT RESPONSIBILITY
Eleventh
If Dealer is an authorized Dealer for more than one division of General Motors,
Chevrolet will be primarily responsible for administering the provisions of the
Dealer Agreements relating to the Dealer Statement of Ownership, dealership
location and premises addendum and capital standard addendum.
Chevrolet will execute or extend those documents for all divisions.
EXECUTION OF AGREEMENT AND RELATED DOCUMENTS
Twelfth
This agreement and related agreements are valid only if signed:
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(a) on behalf of Dealer by its duly authorized representative
and, in the case of this agreement, by its Dealer operator;
and
(b) this Agreement as set forth below, on behalf of Chevrolet by
its General Sales and Service Manager and his authorized
representative. All related agreements will be executed by
the General Sales and Service Manager or his authorized
representative.
Thirteenth
The following agreements and understandings are hereby incorporated into this
agreement:
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And all existing addenda (other than Successor Addendum) relating to Dealer
Statement of Ownership, Dealer Location and Premises Addendum, Capital Standard
Addendum, Area of Primary Responsibility, Motor Vehicle Addendum and Multiple
Dealer Operator Addendum, if applicable, which have not been re-executed at the
time of this agreement.
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Dealer Firm Nam
Chevrolet Motor Division
GENERAL MOTORS CORPORATION
By By
------------------------- ----------------------------------
Dealer Operator Date General Sales and Service Manager
By By
------------------------- ----------------------------------
Dealer Operator Date Authorized Representative Date
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STANDARD PROVISIONS
DEALER
SALES AND SERVICE
AGREEMENT
GENERAL MOTORS CORPORATION
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TABLE OF CONTENTS FOR STANDARD PROVISIONS
Page
ARTICLE 1. APPOINTMENT AS AUTHORIZED DEALER......................................1
ARTICLE 2. DEALER OPERATOR.......................................................1
ARTICLE 3. DEALER OWNER..........................................................2
ARTICLE 4. AUTHORIZED LOCATIONS..................................................2
4.1 Dealer Network Planning...............................................2
4.2 Area of Primary Responsibility........................................2
4.3 Establishment of Additional Dealers...................................2
4.4 Facilities............................................................3
4.4.1 Location......................................................3
4.4.2 Change in Location or Use of Premises.........................3
4.4.3 Size..........................................................3
4.4.4 Dealership Image and Design...................................4
4.4.5 Dealership Equipment..........................................4
ARTICLE 5. DEALER'S RESPONSIBILITY TO PROMOTE, SELL,
AND SERVICE PRODUCTS.........................................................4
5.1 Responsibility to Promote and Sell....................................4
5.2 Responsibility to Service.............................................5
5.3 Customer Satisfaction.................................................6
5.4 Business Planning.....................................................6
ARTICLE 6. SALE OF PRODUCTS TO DEALERS...........................................6
6.1 Sale of Motor Vehicles to Dealer......................................6
6.2 Sale of Parts and Accessories to Dealer...............................6
6.3 Prices and Other Terms of Sales.......................................6
6.3.1 Motor Vehicles................................................7
6.3.2 Parts and Accessories.........................................7
6.4 Inventory.............................................................7
6.4.1 Motor Vehicle Inventory.......................................7
6.4.2 Parts and Accessories.........................................7
6.5 Warranties on Products................................................8
ARTICLE 7. SERVICE OF PRODUCTS...................................................8
7.1 Service for Which Division Pays.......................................8
7.1.1 New Motor Vehicle Pre-Delivery Inspections and Adjustments....8
7.1.2 Warranty and Special Policy Repairs...........................8
7.1.3 Campaign Inspections and Corrections..........................8
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7.1.4 Payment for Pre-Delivery Adjustments, Warranty, Campaign
and Transportation Damage Work................................9
7.2 Parts, Accessories, and Body Repairs..................................9
7.2.1 Warranty and Policy Repairs...................................9
7.2.2 Representations and Disclosures as to Parts and Accessories...9
7.2.3 Body Repairs..................................................9
7.2.4 Tools and Equipment...........................................9
ARTICLE 8. TRAINING..............................................................9
ARTICLE 9. REVIEW OF DEALER'S SALES AND
SERVICE PERFORMANCE
........................................................................10
ARTICLE 10. CAPITALIZATION......................................................10
ARTICLE 11. ACCOUNTS AND RECORDS................................................10
11.1 Uniform Accounting System............................................10
11.2 Examination of Accounts and Records..................................10
11.3 Confidentiality of Dealer Data.......................................11
ARTICLE 12. CHANGES IN MANAGEMENT AND OWNERSHIP.................................11
12.1 Succession Rights Upon Death or Incapacity...........................11
12.1.1 Successor Addendum...........................................11
12.1.2. Absence of Successor Addendum................................11
12.1.3 Successor Dealer Requirements................................12
12.1.4 Term of New Dealer Agreement.................................12
12.1.5 Limitation on Offers.........................................12
12.1.6 Cancellation of Addendum.....................................12
12.2 Other Changes in Ownership or Management.............................12
12.3 Right of First Refusal to Purchase...................................13
12.3.1 Creation and Coverage........................................13
12.3.2 Purchase Price and Other Terms of Sale.......................14
12.3.3 Consummation.................................................14
12.3.4 Assignment...................................................14
12.3.5 Transfer Involving Family Members and Dealer Management......14
ARTICLE 13. BREACHES AND OPPORTUNITY TO REMEDY..................................15
13.1 Certain Acts or Events...............................................15
13.2 Failure of Performance by Dealer.....................................16
ARTICLE 14. TERMINATION OF AGREEMENT............................................16
14.1 By Dealer............................................................16
14.2 By Agreement.........................................................16
14.3 Failure to be Licensed...............................................17
14.4 Incapacity of Dealer Operator........................................17
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14.5 Acts or Events.......................................................17
14.6 Reliance on Any Applicable Termination Provision.....................18
14.7 Transactions After Termination.......................................18
14.7.1 Effect on Orders.............................................18
14.7.2 Termination Deliveries.......................................18
14.7.3 Effect of Transactions After Termination.....................18
ARTICLE 15. TERMINATION ASSISTANCE..............................................18
15.1 Deferral of Effective Date...........................................18
15.2 Purchase of Personal Property........................................19
15.2.1 Division's Obligations.......................................19
15.2.2 Dealer's Responsibilities....................................19
15.2.3 Payment......................................................20
15.2.4 Assignment of Rights.........................................20
15.3 Assistance on Premises...............................................20
15.3.1 Division's Obligation........................................20
15.3.2 Owned Premises...............................................21
15.3.3 Leased Premises..............................................21
15.3.4 Rent and Price...............................................22
15.3.5 Limitations on Obligation to Provide Assistance..............22
ARTICLE 16. DISPUTE RESOLUTION PROCESS..........................................22
ARTICLE 17. GENERAL PROVISIONS..................................................23
17.1 No Agent or Legal Representative Status..............................23
17.2 Responsibility for Operations........................................23
17.3 Taxes................................................................23
17.4 Indemnification by General Motors....................................23
17.5 Trademarks and Service Marks.........................................24
17.6 Notices..............................................................24
17.7 No Implied Waivers...................................................25
17.8 Assignment of Rights or Delegation of Duties.........................25
17.9 No Third Party Benefit Intended......................................25
17.10 Accounts Payable.....................................................25
17.11 Sole Agreement of Parties............................................25
17.12 Applicable Law.......................................................26
17.13 Superseding Dealer Agreements .......................................26
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STANDARD PROVISIONS
The Following Standard Provisions are part of Division's Dealer Sales and
Service Agreement (Form GMMS 1012).
PURPOSE OF AGREEMENT
The purpose of this Agreement is to promote a relationship between
Division and its Dealers which encourages and facilitates cooperation and
mutual effort to satisfy customers, and permits Division and its dealers to
fully realize their opportunities for business success. Division has
established a network of authorized dealers operating at approved locations to
effectively sell and service its Products and to build and maintain consumer
confidence and satisfaction in Dealer and Division. Consequently, Division
relies upon each Dealer to provide appropriate skill, capital, equipment, staff
and facilities to properly sell, service, protect the reputation, and satisfy
the customers of Division's Products in a manner that demonstrates a caring
attitude toward those customers. At the same time, Dealer relies upon Division
to provide sales and service support and to continually strive to enhance the
quality and competitiveness of its Products.
This mutual dependence requires a spirit of cooperation, trust and
confidence between Division and its dealers. To facilitate attainment of
cooperation, trust and confidence, and to provide Division with the benefit of
dealer advice regarding many decisions which affect dealer business operations,
Division has established mechanisms to obtain dealer input in the
decision-making process. These mechanisms are described in Division's Dealer
Sales and Service Agreement.
This Agreement (i) authorizes Dealer to sell and service Division's
Products and represent itself as a Division Dealer; (ii) states the terms under
which Dealer and Division agree to do business together, (iii) states the
responsibilities of Dealer and Division to each other and to customers; and
(iv) reflects the mutual dependence of the parties in achieving their business
objectives.
ARTICLE 1. APPOINTMENT AS AUTHORIZED DEALER
Division appoints Dealer as a non-exclusive dealer of Division
Products. Dealer has the right to buy Products and the obligation to market and
service those Products in accordance with this Agreement and related documents.
ARTICLE 2. DEALER OPERATOR
This is a Personal Services Agreement, entered into in reliance on the
qualifications of Dealer Operator identified in Paragraph Third, and on
Dealer's assurance that Dealer Operator will provide personal services by
exercising full managerial authority over Dealership Operations. Dealer
Operator will have an unencumbered ownership interest in Dealer of at least 15
percent at all times. A Dealer Operator must be a competent business person, an
effective manager, must have demonstrated a caring attitude toward customers,
and should have a successful record as a merchandiser of automotive products
and services or otherwise have demonstrated the ability to manage a dealership.
The experience necessary may vary with the potential represented by each dealer
location.
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ARTICLE 3. DEALER OWNER
Division enters into this Agreement in reliance on the qualifications
of dealer owner(s) identified in the Dealer Statement of Ownership. Division
and Dealer agree each dealer owner will continue to own, both of record and
beneficially, the percentage stated in the Dealer Statement of Ownership,
unless a change is made in accordance with Article 12.
ARTICLE 4. AUTHORIZED LOCATIONS
4.1 DEALER NETWORK PLANNING
Because Division distributes its Products through a network of
authorized dealers operating from approved locations, those dealers must be
appropriate in number, located properly, and have proper facilities to
represent and service Division's Products competitively and to permit each
dealer the opportunity to achieve a reasonable return on investment if it
fulfills its obligations under its Dealer Agreement. Through such a dealer
network, the Division can maximize the convenience of customers in purchasing
Products and having them serviced. As a result, customers, dealers, and the
Division all benefit.
To maximize the effectiveness of its dealer network, Division agrees
to monitor marketing conditions and strive, to the extent practicable, to have
dealers appropriate in number, size and location to achieve the objectives
stated above. Such marketing conditions include Division's sales and
registration performance, present and future demographic and economic
considerations, competitive dealer networks, the ability of Division's existing
dealers to achieve the objectives stated above, the opportunities available to
existing dealers, and other appropriate circumstances.
4.2 AREA OF PRIMARY RESPONSIBILITY
Dealer is responsible for effectively selling, servicing and otherwise
representing Division's Products in the Area designated in a Notice of Area of
Primary Responsibility. Division retains the right to revise Dealer's Area of
Primary Responsibility at Division's sole discretion consistent with dealer
network planning objectives. If Division determines that marketing conditions
warrant a change in Dealer's Area of Primary Responsibility, it will advise
Dealer in writing of the proposed change, the reasons for it, and will consider
any information the Dealer submits. Dealer must submit such information in
writing within 30 days of receipt of notice of the proposed change. If Division
thereafter decides the change is warranted, it will issue a revised Notice of
Area of Primary Responsibility.
4.3 ESTABLISHMENT OF ADDITIONAL DEALERS
Division reserves the right to appoint additional dealers but Division
will not exercise this right without first analyzing dealer network planning
considerations.
Prior to establishing an additional dealer within Dealer's Area of
Primary Responsibility, Division will advise Dealer in writing and give Dealer
thirty days to present relevant information before Division makes a final
decision. Division will advise Dealer of the final decision, which will
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be made solely by Division pursuant to its business judgment. Nothing in this
Agreement is intended to require Dealer's consent to the establishment of an
additional dealer.
Neither the appointment of a dealer at or within three miles of a
former dealership location as replacement for the former dealer nor the
relocation of an existing dealer will be considered the establishment of an
additional Dealer for purposes of this Article 4.3. Such events are within the
sole discretion of Division, pursuant to its business judgment.
4.4 FACILITIES
4.4.1 LOCATION
Dealer agrees to conduct Dealership Operations only from the approved
locations(s) within its Area of Primary Responsibility. The Location and
Premises Addendum identifies Dealer's approved location(s) and facilities
("Premises"). If more than one location is approved, Dealer agrees to conduct
from each location only those Dealership Operations authorized in the Addendum
for such location.
4.4.2 CHANGE IN LOCATION OR USE OF PREMISES
If Dealer wants to make any change in location(s) or Premises, or in
the uses previously approved for those Premises, Dealer will give Division
written notice of the proposed change, together with the reasons for the
proposal, for Division's evaluation and final decision in light of dealer
network planning considerations. No change in location or in the use of
Premises, including addition of any other vehicle lines, will be made without
Division's prior written authorization.
Before Division requires any changes in Premises, it will consult with
Dealer, indicate the rationale for the change, and solicit Dealer's views on
the proposal. If, after such review with Dealer, Division determines a change
in Premises or location is appropriate, the Dealer will be allowed a reasonable
time to implement the change. Any such changes will be reflected in a new
Location and Premises Addendum or other written agreement executed by Dealer
and Division.
Nothing herein is intended to require the consent or approval of any
dealer to a proposed relocation of any other dealer.
4.4.3 SIZE
Dealer agrees to provide Premises at its approved location(s) that
will promote the effective performance and conduct of Dealership Operations,
and the Division's image and goodwill. Consistent with Division's dealer
network planning objectives and Division's interest in maintaining the
stability and viability of its dealers, Dealer agrees that its facilities will
be sized in accordance with Division's requirements for that location.
Division agrees to establish and maintain a clearly stated policy for
determining reasonable dealer facility space requirements and to periodically
re-evaluate those requirements to ensure that they continue to be reasonable.
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4.4.4 DEALERSHIP IMAGE AND DESIGN
The appearance of Dealer's Premises is important to the image of
Dealer and Division, and can affect the way customers perceive Division's
Products and its dealers generally. Dealer therefore agrees that its Premises
will be properly equipped and maintained, and that the interior and exterior
retail environment and signs will comply with any reasonable requirements
Division may establish to promote and preserve the image of Division and its
dealers.
Division will monitor developments in automotive and other retailing
to ensure that Division's image and facility requirements are responsive to
changes in the marketing environment.
Division will take into account existing economic and marketing
conditions, and consult with dealers as described in Division's Dealer Sales
and Service Agreement, in establishing such requirements.
4.4.5 DEALERSHIP EQUIPMENT
Effective performance of Dealer's responsibilities under this
Agreement requires that the dealership be reasonably equipped to communicate
with customers and the Division and to properly diagnose and service Products.
Accordingly, Dealer agrees to provide for use in the Dealership Operations any
equipment reasonably designated by Division as necessary to Dealer's effective
performance under this Agreement. Division will make such designations only
after having consulted with dealers as described in Division's Dealer Sales and
Service Agreement.
ARTICLE 5. DEALER'S RESPONSIBILITY TO PROMOTE, SELL,
AND SERVICE PRODUCTS
5.1 RESPONSIBILITY TO PROMOTE AND SELL
5.1.1 Dealer agrees to effectively, ethically and lawfully sell and
promote the purchase, lease and use of Products by consumers located in its
Area of Primary Responsibility. To achieve this objective, Dealer agrees to:
(a) maintain an adequate force of trained sales personnel;
(b) explain to Product purchasers the items which make up
the purchase price and provide purchasers with itemized
invoices;
(c) not charge customers for services for which Dealer is
reimbursed by General Motors;
(d) include in customer orders only equipment or accessories
requested by customer or required by law; and
(e) ensure that the customer's purchase and delivery
experience are satisfactory.
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If Dealer modifies or sells a modified new Motor Vehicle, or installs
any equipment, accessory or part not supplied by General Motors, or sells any
non-General Motors service contract for a Motor Vehicle, Dealer will disclose
this fact on the purchase order and xxxx of sale, indicating that the
modification, equipment, accessory or part is not warranted by General Motors
or, in the case of a service contract, the coverage is not provided by General
Motors or an affiliate.
5.1.2 Dealer is authorized to sell new Motor Vehicles only to
customers located in the United States. Dealer agrees that it will not sell new
Motor Vehicles for resale or principal use outside the United States. Dealer
also agrees not to sell any new Motor Vehicles which were not originally
manufactured for sale and distribution in the United States.
5.1.3 Division will conduct general advertising programs to promote
the sale of Products for the mutual benefit of Division and Dealers. Division
will make available to Dealer advertising and sales promotion materials from
time to time and advise Dealer of any applicable charges.
5.2 RESPONSIBILITY TO SERVICE
5.2.1 Dealer agrees to maximize customer satisfaction by providing
courteous, convenient, prompt, efficient and quality service to owners of Motor
Vehicles, regardless of from whom the Vehicles were purchased. All service will
be performed and administered in a professional manner and in accordance with
all applicable laws and regulations, and this Agreement, including the Service
Policies and Procedures Manual, as amended from time to time.
5.2.2 Dealer agrees to maintain an adequate service and parts
organization as recommended by Division, including a competent, trained service
and parts manager(s), trained service and parts personnel and, where service
volume or other conditions make it advisable, a consumer relations manager.
5.2.3 Dealer and Division will each provide the other with such
information and assistance as may reasonably be requested by the other to
facilitate compliance with applicable laws, regulations, investigations and
orders relating to Products.
5.2.4 To build and maintain consumer confidence in, and satisfaction
with, Dealer and Division, Dealer will comply with Divisional procedures for
the investigation and resolution of Product-related complaints.
5.2.5 Division will make available to Dealer current service and
parts manuals, bulletins, and technical data publications relating to Motor
Vehicles.
5.3 CUSTOMER SATISFACTION
Dealer and Division recognize that appropriate care for the customer
will promote customer satisfaction with Division's Products and its dealers,
which is critically important to our current and future business success.
Dealer therefore agrees to conduct is operations in a manner which will promote
customer satisfaction with the purchase and ownership experience. Division
agrees to provide Dealer with reasonable support to assist Dealer's attainment
of customer satisfaction. At its
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discretion, Division will monitor the satisfaction of Dealer's customers, and
report the results to Dealer. Any written response from Dealer concerning a
customer satisfaction report issued to Dealer will become a part of the report.
5.4 BUSINESS PLANNING
To enable Dealer to most effectively meet its obligations under this
Agreement, and to enable Division to effectively support Dealer's efforts,
Dealer agrees to develop and implement a Business Plan if such is required by
Division.
ARTICLE 6. SALE OF PRODUCTS TO DEALERS
6.1 SALE OF MOTOR VEHICLES TO DEALER
Division will periodically furnish Dealer one or more Motor Vehicle
Addenda specifying the current model types or series of new Motor Vehicles
which Dealer may order under this Agreement. Division may change a Motor
Vehicle Addendum by furnishing a superseding one, or may cancel an Addendum at
any time.
Division will endeavor to distribute new Motor Vehicles among its
dealers in a fair and equitable manner. Many factors affect the availability
and distribution of Motor Vehicles to dealers, including component availability
and production capacity, sales potential in Dealer's Area of Primary
Responsibility, varying consumer demand, wether and transportation conditions,
governmental regulations, and other conditions beyond the control of General
Motors. Division reserves to itself discretion in accepting orders and
distributing Motor Vehicles, and its judgments and decisions are final. Upon
written request, Division will advise Dealer of the total number of new Motor
Vehicles, by series, sold to Dealers in Dealer's Zone or Branch during the
preceding month.
6.2 SALE OF PARTS AND ACCESSORIES TO DEALER
New, reconditioned or remanufactured automotive parts and accessories
marketed by General Motors and listed in current Dealer Parts and Accessories
Price Schedules or supplements furnished to Dealer are called Parts and
Accessories.
Orders for Parts and Accessories will be submitted and processed
according to written procedures established by General Motors or other
designated suppliers.
6.3 PRICES AND OTHER TERMS OF SALES
6.3.1 MOTOR VEHICLES
Prices, destination charges, and other terms of sale applicable to
purchases of new Motor Vehicles will be those established according to Vehicle
Terms of Sale Bulletins furnished periodically to Dealer.
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Prices, destination charges, and other terms of sale applicable to any
motor Vehicle may be changed at any time. Except as otherwise provided in
writing, changes apply to Motor Vehicles not shipped to Dealer at the time the
changes are made effective.
Dealer will receive written notice of any price increase before any
motor Vehicle to which such increase applies is shipped, except for initial
prices for a new model year or for any new model or body type. Dealer has the
right to cancel or modify the affected orders by delivering written notice to
Division within 10 days after its receipt of the price increase notice.
6.3.2 PARTS AND ACCESSORIES
Price and other terms of sale applicable to Parts and Accessories are
established by General motors according to the Parts and Accessories Terms of
Sale Bulletin furnished to Dealer.
Prices and other terms of sale applicable to Parts and Accessories may
be changed by General Motors at any time. Such changes apply to Parts and
Accessories not shipped to Dealer at the time changes become effective.
6.4 INVENTORY
6.4.1 MOTOR VEHICLE INVENTORY
Dealer recognizes that customers expect Dealer to have a reasonable
quantity and variety of current model Motor Vehicles in inventory. Accordingly,
Dealer agrees to order and stock and Division agrees to make available, subject
to Article 6.1, a mix of models and series of Motor Vehicles identified in the
Motor Vehicle Addendum in quantities adequate to enable Dealer to fulfill its
obligations in its Area of Primary Responsibility.
6.4.2 PARTS AND ACCESSORIES
Dealer agrees to stock sufficient Parts and Accessories made available
by General motors to perform warranty repairs and policy adjustments and meet
customer demand.
6.5 WARRANTIES ON PRODUCTS
General Motors warrants new Motor Vehicles and Parts and Accessories
(Products) as explained in documents provided with the Products or in the
Service Policies and Procedures Manual.
EXCEPT AS OTHERWISE PROVIDED BY LAW, THE WRITTEN GENERAL MOTORS
WARRANTIES ARE THE ONLY WARRANTIES APPLICABLE TO PRODUCTS. WITH RESPECT TO
DEALERS, SUCH WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES OR LIABILITIES,
EXPRESS OR IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE OR ANY LIABILITY FOR COMMERCIAL LOSSES BASED
UPON NEGLIGENCE OR MANUFACTURER'S STRICT LIABILITY. EXCEPT AS MAY BE PROVIDED
UNDER AN
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ESTABLISHED GENERAL MOTORS PROGRAM OR PROCEDURE, GENERAL MOTORS NEITHER ASSUMES
NOR AUTHORIZES ANYONE TO ASSUME FOR IT ANY OTHER OBLIGATION OR LIABILITY IN
CONNECTION WITH PRODUCTS, AND GENERAL MOTORS MAXIMUM LIABILITY IS TO REPAIR OR
REPLACE THE PRODUCT.
ARTICLE 7. SERVICE OF PRODUCTS
7.1 SERVICE FOR WHICH DIVISION PAYS
7.1.1 NEW MOTOR VEHICLE PRE-DELIVERY INSPECTIONS AND ADJUSTMENTS
Because new vehicle delivery condition is critical to customer
satisfaction, Dealer agrees to perform specified pre-delivery inspections and
adjustments on each new Motor Vehicle and verify completion according to
procedures identified in the Service Policies and Procedures Manual.
7.1.2 WARRANTY AND SPECIAL POLICY REPAIRS
Dealer agrees to perform (i) required warranty repairs on each
qualified Motor Vehicle at the time of pre-delivery service and when requested
by owner, and (ii) special policy repairs approved by Division. When the
vehicle is returned to the owner, Dealer will provide owner a copy and
explanation of the repair document reflecting all services performed.
7.1.3 CAMPAIGN INSPECTIONS AND CORRECTIONS
Division will notify Dealer of suspected unsatisfactory conditions on
Products and issue campaign instructions. Dealer agrees to inspect and correct
suspected unsatisfactory conditions on Products in accordance with the
instructions. Dealer will also determine that campaign inspections and
corrections have been made on new and used Motor Vehicles in its inventory
prior to sale, and follow-up on Products on which campaigns are outstanding.
Division may ship, and Dealer agrees to accept, unordered parts and
materials required for campaigns. Upon campaign completion, Dealer will receive
credit for excess parts and materials so shipped if they are returned or
disposed of according to Division's instructions.
7.1.4 PAYMENT FOR PRE-DELIVERY ADJUSTMENTS, WARRANTY, CAMPAIGN AND
TRANSPORTATION DAMAGE WORK
For Dealer's performance of service, pre-delivery inspections and
adjustments, warranty repairs, special policy repairs, campaign inspections and
corrections, and transportation damage repairs, Division will provide or pay
Dealer for the Parts and other materials required and will pay Dealer a
reasonable amount for labor. Payment will be made according to policies in the
Service Policies and Procedures Manual. Dealer will not impose any charge for
such service on owners or users except where a deductible or pro-rata charge
applies.
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7.2 PARTS, ACCESSORIES, AND BODY REPAIRS
7.2.1 WARRANTY AND POLICY REPAIRS
Dealer agrees to use only genuine GM or General Motors approved Parts
and Accessories in performing warranty repairs, special policy repairs, and any
other repairs paid for by Division, in accordance with the applicable
provisions of the Service Policies and Procedures Manual.
7.2.2 REPRESENTATIONS AND DISCLOSURES AS TO PARTS AND ACCESSORIES
In servicing vehicles marketed by General Motors, Dealer agrees to
disclose the use of non- General Motors parts and accessories as set forth in
Article 5.1.1.
7.2.3 BODY REPAIRS
Dealer agrees to provide quality body repair service for Motor
Vehicles. Dealer can provide this service through its own body shop, or by
arrangement with an alternate repair establishment.
7.2.4 TOOLS AND EQUIPMENT
Dealer agrees to provide essential service tools as required by
Division and other tools and equipment as necessary to fulfill its
responsibilities to properly diagnose and service Products.
ARTICLE 8. TRAINING
Properly trained personnel are essential to the success of Dealer and
Division, and to providing customers with a satisfactory sales and service
experience. Division agrees to make available or recommend to Dealer product,
sales, service and parts, accounting and business management training courses
for Dealer personnel. Division will make such training available as
conveniently in time and location as practical circumstances permit. Division
will assist Dealer in determining training requirements and periodically will
require that Dealer have personnel attend specific courses. Dealer agrees to
comply with any such reasonable training requirements and pay any specified
training charges. Division will consult with dealers as described in Division's
Dealer Sales and Service Agreement prior to determining the training courses or
programs from which an individual Dealer's requirements under this Article may
be established. Specific minimum service training requirements will be
described in Division's Service Policies and Procedures Manual.
Division will make available personnel to advise and counsel Dealer
personnel on sales, service, parts and accessories, and related subjects.
ARTICLE 9. REVIEW OF DEALER'S SALES AND
SERVICE PERFORMANCE
Dealer's performance of its obligations is essential to the effective
representation of Division's Products, and to the reputation and goodwill of
Dealer, Division, and other Division dealers. Periodically, Division will
review various aspects of Dealer's sales and service performance.
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Division and Dealer will use the review process to identify areas in which
improvements or changes are necessary so that Dealer can take prompt action to
achieve acceptable performance.
ARTICLE 10. CAPITALIZATION
The Capital Standard Addendum reflects the minimum net working capital
necessary for Dealer to conduct Dealership Operations. Dealer agrees to
maintain at least this level of net working capital. Division will issue a new
Addendum if changes in operating conditions or Divisional guidelines indicate
capital needs have changed materially.
To avoid damage to goodwill which could result if Dealer is
financially unable to fulfill its commitments. Dealer agrees to have and
maintain a separate line of credit from a financial institution available to
finance its purchase of new vehicles. The amount of the line of credit will be
sufficient for Dealer to meet its obligations under Article 6.4.
ARTICLE 11. ACCOUNTS AND RECORDS
11.1 UNIFORM ACCOUNTING SYSTEM
A uniform accounting system facilitates an evaluation of Dealer
business management practices and the impact of Division's policies and
practices. Division therefore agrees to maintain, and Dealer agrees to use and
maintain records in accordance with, a uniform accounting system set forth in
an accounting manual furnished to Dealer.
Dealer also agrees to timely submit true and accurate applications or
claims for payments, discounts or allowances; true and correct orders for
Products and reports of sale and delivery; and any other reports or statements
required by Division, in the manner specified by Division, and to retain such
records for at least two years.
11.2 EXAMINATION OF ACCOUNTS AND RECORDS
Dealer agrees to permit any designated representative of Division to
examine, audit, and take copies of any of the accounts and records Dealer is to
maintain under the accounting manual and this Agreement. Dealer agrees to make
such accounts and records readily available at its facilities during regular
business hours. Division agrees to furnish Dealer with a list of any reproduced
records.
11.3 CONFIDENTIALITY OF DEALER DATA
Division agrees not to furnish any personal or financial data
submitted to it by Dealer to any non-affiliated entity unless authorized by
Dealer, required by law, or pertinent to judicial or administrative
proceedings, or to proceedings under the Dispute Resolution Process.
ARTICLE 12. CHANGES IN MANAGEMENT AND OWNERSHIP
The parties recognize that customers and authorized dealers, as well
as shareholders and employees of General Motors, have a vital interest in the
continued success and efficient operation
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of Division's dealer network. Accordingly, Division has the responsibility of
continuing to administer the network to ensure that dealers are owned and
operated by qualified persons able to meet the requirements of this Agreement.
12.1 SUCCESSION RIGHTS UPON DEATH OR INCAPACITY
12.1.1 SUCCESSOR ADDENDUM
Dealer can apply for a Successor Addendum designating a proposed
dealer operator and/or owners of a successor dealer to be established if this
Agreement expires or is terminated because of death or incapacity. Division
will execute the Addendum provided Dealer is meeting its obligations under this
Agreement and under any Dealer Agreement which Dealer may have with other
Divisions of General Motors for the conduct of Dealership Operations at the
approved location; and the proposed dealer operator is, and will continue to
be, employed full-time by Dealer or a comparable automotive dealership, and is
already qualified or is being training to qualify as a dealer operator; and
provided all other proposed owners are acceptable.
Division may refuse to enter into a Successor Addendum with dealer if
Division has previously notified Dealer it does not plan to continue Dealership
Operations at the approved location, except for renewal of an existing
Successor Addendum where the same proposed dealer operator continues to be
qualified.
Upon expiration of this Agreement, Division will, upon Dealer's
request, execute a new successor addendum provided a new and superseding dealer
agreement is executed with Dealer, and Dealer, the proposed dealer operator and
dealer owners are then qualified as described above.
12.1.2. ABSENCE OF SUCCESSOR ADDENDUM
If this Agreement expires or is terminated because of death or
incapacity and Dealer and Division have not executed a Successor Addendum, the
Dealer Operator or, if there is not a remaining Dealer Operator, the remaining
dealer owners may propose a successor dealer to continue the operations
identified in this Agreement. The proposal must be made to Division in writing
at least 30 days prior to the expiration or termination of this Agreement,
including any deferrals.
12.1.3 SUCCESSOR DEALER REQUIREMENTS
Division will accept a proposal to establish a successor dealer
submitted by a proposed dealer operator under this Article 12.1 provided:
(a) the proposed successor dealer and the proposed dealer
operator are ready, willing and able to meet the requirements of a new
dealer agreement at the approved location)s);
(b) Division approves the proposed dealer operator and all
proposed owners not previously approved for the existing Dealership
Operations;
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(c) all outstanding monetary obligations of Dealer to
General Motors have been satisfied; and
(d) Dealer has not been previously notified that Division
may discontinue Dealership Operations at that location.
12.1.4 TERM OF NEW DEALER AGREEMENT
The dealer agreement offered a successor dealer will be for a three
year term. Division will notify the successor dealer in writing at least 90
days prior to the expiration date whether the successor dealer has performed
satisfactorily and, if so, that Division will offer a new dealer agreement.
12.1.5 LIMITATION ON OFFERS
Dealer will be notified in writing of the decision on a proposal to
establish a successor dealer submitted under Article 12.1 within 60 days after
Division has received from Dealer all applications and information reasonably
requested by Division. Division may condition its offer of a dealer agreement
on the relocation of dealership operations to an approved location by successor
dealer within a reasonable time. Division's offer of a new dealer agreement
under this Article 12.1 will automatically expire if not accepted in writing by
the proposed successor dealer within 60 days after it receives the offer.
12.1.6 CANCELLATION OF ADDENDUM
Dealer may cancel an executed Successor Addendum at any time prior to
the death of a Dealer Operator or Dealer Owner, or the incapacity of Dealer
Operator. Division may can el an executed Successor Addendum only if the
proposed dealer operator is no longer qualified under Article 12.1.1.
12.2 OTHER CHANGES IN OWNERSHIP OR MANAGEMENT
If Dealer proposes a change in Dealer Operator, a change in ownership,
or a transfer of the dealership business or its principal assets to any person
conditioned upon Division's entering into a dealer agreement with that person,
Division will consider Dealer's proposal and not arbitrarily refuse to approve
it, subject to the following:
12.2.1 Dealer agrees to give Division prior written notice of any
proposed change or transfer described above. Dealer understands that if any
such change is made prior to Division's approval of the proposal, termination
of this Agreement will be warranted and Division will have no further
obligation to consider Dealer's proposal.
12.2.2 Division agrees to consider Dealer's proposal, taking into
account factors such as (a) the personal, business, and financial
qualifications of the proposed dealer operator and owners, and (b) whether the
proposed change is likely to result in a successful dealership operation with
acceptable management, capitalization, and ownership which will provide
satisfactory sales, service,
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and facilities at an approved location, while promoting and preserving
competition and customer satisfaction.
12.2.3 Division will notify Dealer in writing of Division's decision
on Dealer's proposal within 60 days after Division has received from Dealer all
applications and information reasonably requested by Division. If Division
disagrees with the proposal, it will specify its reasons.
12.2.4 Any material change in Dealer's proposal, including change in
price, facilities, capitalization, proposed owners, or dealer operator, will be
considered a new proposal, and the time period for Division to respond shall
recommence.
12.2.5 Division's prior written approval is not required where the
transfer of equity ownership or beneficial interest to an individual is (a)
less than ten percent in a calendar year; and (b) between existing dealer
owners previously approved by Division where there is no change in majority
ownership or voting control. Dealer agrees to notify Division within 30 days of
the date of the change and to execute a new Dealer Statement of Ownership.
12.2.6 Division is not obligated to approve any proposed changes in
management or ownership under this Article unless Dealer makes arrangements
acceptable to Division to satisfy any indebtedness of Dealer to General Motors.
12.3 RIGHT OF FIRST REFUSAL TO PURCHASE
12.3.1 CREATION AND COVERAGE
If Dealer submits a proposal for a change of ownership under Article
12.2, Division will have a right of first refusal to purchase the dealership
assets regardless of whether the proposed buyer is qualified to be a dealer. If
Division chooses to exercise this right, it will do so in its written response
to Dealer's proposal. Division will have a reasonable opportunity to inspect
the assets, including real estate, before making its decision.
12.3.2 PURCHASE PRICE AND OTHER TERMS OF SALE
(a) Bona Fide Agreement
If Dealer has entered into a bona fide written buy/sell agreement, the
purchase price and other terms of sale will be those set forth in such
agreement and any related documents, unless Dealer and Division agree to other
terms.
Upon Division's request, Dealer agrees to provide all documents
relating to the proposed transfer. If Dealer refuses to provide such
documentation or state in writing that such documents do not exist, it will be
presumed that the agreement is not bona fide.
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(b) ABSENCE OF BONA FIDE AGREEMENT
In the absence of a bona fide written buy/sell agreement, the purchase
price of the dealership assets will be determined by good faith negotiations by
Dealer and Division. If agreement cannot be reached within a reasonable time,
the price and other terms of sale will be established by arbitration according
to the rules of the American Arbitration Association.
12.3.3 CONSUMMATION
Dealer agrees to transfer the property by Warranty Deed, where
possible, conveying marketable title free and clear of liens and encumbrances.
The Warranty Deed will be in proper form for recording and Dealer will deliver
complete possession of the property when the Deed is delivered. Dealer will
also furnish copies of any easements, licenses or other documents affecting the
property and assign any permits or licenses necessary for the conduct of
Dealership Operations.
12.3.4 ASSIGNMENT
Division's rights under this section may be assigned to any third
party ("Assignee"). If there is an assignment, Division will guarantee full
payment of the purchase price by the Assignee. Division shall have the
opportunity to discuss the terms of the buy/sell agreement with a potential
Assignee.
Division's rights under this Article are binding on and enforceable
against any Assignee or successor in interest of Dealer or purchase of Dealer's
assets.
12.3.5 TRANSFER INVOLVING FAMILY MEMBERS AND DEALER MANAGEMENT
When the proposed change of ownership involves a transfer by a dealer
owner solely to a member or members of his or her immediate family, or to a
qualifying member of Dealer's Management, the Division's right of first refusal
will not apply. An "immediate family member" shall bed the spouse, child,
grandchild, spouse of a child or grandchild, brother, sister or parent of the
dealer owner. A "qualifying member of Dealer's Management" shall be an
individual who has been employed by Dealer for at least two years and otherwise
qualifies as a dealer operator.
ARTICLE 13. BREACHES AND OPPORTUNITY TO REMEDY
13.1 CERTAIN ACTS OR EVENTS
The following acts or events, which are within the control of Dealer
or originate from action taken by Dealer or its management or owners, are
material breaches of this Agreement. If Division learns that any of the acts or
events has occurred, it may notify the Dealer in writing. If notified, Dealer
will be given the opportunity to respond in writing within 30 days of receipt
of the notice, explaining or correcting the situation to Division's
satisfaction.
13.1.1 The removal, resignation, withdrawal, or elimination from
Dealer for any reason of any Dealer Operator or dealer owners without
Division's prior written approval.
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13.1.2 Any attempted or actual sale, transfer, or assignment by
Dealer of this Agreement or any of the rights granted Dealer hereunder or any
attempted or actual transfer, assignment or delegation by Dealer of any of the
responsibilities assumed by it under this Agreement contrary to the terms of
this Agreement.
13.1.3 Any change, whether voluntary or involuntary, in the record or
beneficial ownership of Dealer as set forth in the Dealer Statement of
Ownership furnished by Dealer, unless permitted by Article 12.2.5 or pursuant
to Division's written approval.
13.1.4 Any undertaking by Dealer or any of its owners to conduct,
either directly or indirectly, any of the Dealership Operations at any
unapproved location.
13.1.5 Any sale, transfer, relinquishment, or discontinuance of use
by Dealer of any of the Dealership Premises or other principal assets required
in the conduct of the Dealership Operations, without Division's prior written
approval.
13.1.6 Any dispute among the owners or management personnel of Dealer
which, in Division's opinion, may adversely affect the Dealership Operations or
the interests of Dealer or Division.
13.1.7 Refusal by Dealer to timely furnish sales, service or financial
information and related supporting data, or to permit Division's examination or
audit of Dealer's accounts and records.
13.1.8 A finding by a government agency or court of original
jurisdiction or a settlement arising from charges that Dealer, or a predecessor
of Dealer owned or controlled by the same person, had committed a misdemeanor
or unfair or deceptive business practice which, in Division's opinion, may
adversely affect the reputation or interests of Dealer or Division.
13.1.9 Wilful failure of Dealer to comply with the provisions of any
laws or regulations relating to the sale or service of Products.
13.1.10 Submission by Dealer of false applications or reports,
including false orders for Products or reports of delivery or transfer of
Products.
13.1.11 Failure of Dealer to maintain the line of credit required by
Article 10.
13.1.12 Failure of Dealer to timely pay its obligations to General
Motors.
13.1.13 Any other material breach of Dealer's obligations under this
Agreement not otherwise identified in this Article 13 or in Article 14.
If Dealer's response demonstrates that the breach has been corrected,
or otherwise explains the circumstances to Division's satisfaction, then
Division shall confirm this fact in writing to Dealer.
If, however, Dealer's response does not demonstrate that the breach
has been corrected, or explain the circumstances to Division's satisfaction,
termination is warranted and DIVISION may
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terminate this Agreement upon written notice to Dealer. Termination will be
effective 60 days following Dealer's receipt of the notice.
13.2 FAILURE OF PERFORMANCE BY DEALER
If Division determines that Dealer's Premises are not acceptable, or
that Dealer has failed to adequately perform its sales or service
responsibilities, including those responsibilities relating to customer
satisfaction and training, Division will review such failure with Dealer.
As soon as practicable thereafter, Division will notify Dealer in
writing of the nature of Dealer's failure and of the period of time (which
shall not be less than six months) during which Dealer will have the
opportunity to correct the failure.
If Dealer does correct the failure by the expiration of the period,
Division will so advise the Dealer in writing.
If however, Dealer does not correct the failure by the expiration of
the period, Division may terminate this Agreement by giving Dealer 90 days
advance written notice.
ARTICLE 14. TERMINATION OF AGREEMENT
14.1 BY DEALER
Dealer has the right to terminate this Agreement without cause at any
time upon written notice to Division. Termination will be effective 30 days
after Division's receipt of the notice, unless otherwise mutually agreed in
writing.
14.2 BY AGREEMENT
This Agreement may be terminated at any time by written agreement
between Division and Dealer.
Termination assistance will apply only as specified in the written
termination agreement.
14.3 FAILURE TO BE LICENSED
If Division or Dealer fails to secure or maintain any license required
for the performance of obligations under this Agreement or such license is
suspended or revoked, either party may immediately terminate this Agreement by
giving the other party written notice.
14.4 INCAPACITY OF DEALER OPERATOR
Because this is a Personal Services Agreement, Division may terminate
this Agreement by written notice to Dealer if Dealer Operator is so physically
or mentally incapacitated that the Dealer Operator is unable to actively
exercise full managerial authority. The effective date of termination
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will be stated in such written notice and will be not less than three months
after receipt of such notice.
14.5 ACTS OR EVENTS
If Division learns that any of the following has occurred, it may
terminate this Agreement by giving Dealer written notice of termination.
Termination will be effective on the date specified in the notice.
14.5.1 Conviction in a court of original jurisdiction of Dealer, or a
predecessor of Dealer owned or controlled by the same person, or any Dealer
Operator or dealer owner of any felony.
14.5.2 Insolvency of Dealer, or filing by or against Dealer of a
petition in bankruptcy; or filing of a proceeding for the appointment of a
receiver or trustee for Dealer, provided such filing or appointment is not
dismissed or vacated within thirty days; or execution by Dealer of an
assignment for the benefit of creditors or any foreclosure or other due process
of law whereby a third party acquires rights to the operation, ownership or
assets of Dealer.
14.5.3 Failure of Dealer to conduct customary sales and service
operations during customary business hours for seven consecutive business days.
14.5.4 Any misrepresentation to General Motors by Dealer or by any
Dealer Operator or owner in applying for this Agreement, or in identifying the
Dealer Operator, or record or beneficial ownership of Dealer.
14.5.5 Submission by Dealer of false applications or claims for any
payment, credit, discount, or allowance, including false applications in
connection with incentive activities, where the false information was submitted
to generate a payment to Dealer for a claim which would not otherwise have
qualified for payment.
Termination for failure to correct other breaches will be according to
the procedures outlined in Article 13.
14.6 RELIANCE ON ANY APPLICABLE TERMINATION PROVISION.
The terminating party may select the provision under which it elects
to terminate without reference in its notice to any other provision that may
also be applicable. The terminating party subsequently also may assert other
grounds for termination.
14.7 TRANSACTIONS AFTER TERMINATION
14.7.1 EFFECT ON ORDERS
If Dealer and Division do not enter into a new Dealer Agreement when
this Agreement expires or is terminated, all of Dealer's outstanding orders for
Products will be automatically canceled except as provided in this Article
14.7.
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Termination of this Agreement will not release Dealer or Division from
the obligation to pay any amounts owing the others, nor release Dealer from the
obligation to pay for Special Vehicles if Division has begun processing such
orders prior to the effective date of termination.
14.7.2 TERMINATION DELIVERIES.
If this Agreement is voluntarily terminated by Dealer or expires or is
terminated because of the death or incapacity of a Dealer Operator or death of
a Dealer Owner, without a termination or expiration deferral, Division will use
its best efforts consistent with its distribution procedures to furnish Dealer
with Motor Vehicles to fill Dealer's bona fide retail orders on hand on the
effective date of termination or expiration, not to exceed, however, the total
number of Motor Vehicles invoiced to Dealer for retail sale during the three
months immediately preceding the effective date of termination.
14.7.3 EFFECT OF TRANSACTIONS AFTER TERMINATION.
Neither the sale of Products to Dealer nor any other act by Division
or Dealer after termination of this Agreement will be construed as a waiver of
the termination.
ARTICLE 15. TERMINATION ASSISTANCE
15.1 DEFERRAL OF EFFECTIVE DATE.
If this Agreement is scheduled to expire or terminate because of the
death or incapacity of a Dealer Operator or the death of a Dealer Owner and
Dealer requests an extension of the effective date of expiration or termination
thirty days prior to such date, Division will defer the effective date for up
to a total of eighteen months after such death or incapacity occurs to assist
Dealer in winding up its Dealership Operations.
15.2 PURCHASE OF PERSONAL PROPERTY.
15.2.1 DIVISION'S OBLIGATIONS.
If this Agreement expires or is terminated and Division does not offer
Dealer or a replacement dealer that has substantially the same ownership (more
than 50 percent including total family ownership) a new Dealer Agreement,
Division will offer to purchase the following items of personal property
(herein called Eligible Items) from Dealer at the prices indicated:
(a) New and unused Motor Vehicles of the current model year
purchased by Dealer from Division at a price equal to
the net prices and charges that were paid to General
Motors;
(b) Any signs owned by Dealer of a type recommended in
writing by Division and bearing any Marks at a price
agreed upon by Division and Dealer. If Division and
Dealer cannot agree on a price, they will select a third
party who will set the price;
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(c) Any essential tools recommended by Division and designed
specifically for service of Motor Vehicles that Division
offered for sale during the three years preceding
termination at prices established in accordance with the
applicable pricing formula in the Service Policies and
Procedures Manual; and
(d) Unused and undamaged Parts and Accessories that (i) are
still in the original, resalable merchandising packages
and in unbroken lots (in the case of sheet metal, a
comparable substitute for the original package may be
used); (ii) are listed for sale in the then current
Dealer Parts and Accessories Price Schedules (except
"discontinued" or "replaced" Parts and Accessories); and
(iii) were purchased by Dealer either directly from
General Motors or from an outgoing dealer as a part of
Dealer's initial Parts and Accessories inventory Prices
will be those dealer prices in effect at the time
general Motors receives the Parts and Accessories, less
any applicable allowances whether or not any such
allowances were made to Dealer when Dealer purchased the
Parts and Accessories. In addition, an allowance of five
percent of dealer price for packing costs and
reimbursement for transportation charges to the
destination specified by General Motors will be credited
to Dealer's account.
15.2.2 DEALER'S RESPONSIBILITIES.
Division's obligation to purchase Eligible Items is subject to Dealer
fulfilling its responsibility under this subsection.
Within fifteen days following the effective date of termination or
expiration of this Agreement, Dealer will furnish Division with a list of
vehicle identification numbers and such other information as Division may
request pertaining to eligible Motor Vehicles. Dealer will deliver the eligible
Motor Vehicles to a destination determined by Division that will be in a
reasonable proximity to Dealer's Premises.
Within two months following the effective date of termination or
expiration of this Agreement, Dealer will mail or deliver to General Motors a
complete and separate list of each of the Eligible Items other than Motor
Vehicles. Dealer will retain the Eligible Items until receipt of written
shipping instructions from General Motors. Within thirty days after receipt of
instructions, Dealer will ship the Eligible Items, transportation charges
prepared, to the destinations specified in the instructions.
Dealer will take action and execute and deliver such instruments as
necessary to (a) convey to Division and General Motors good and marketable
title to all Eligible Items to be purchased, (b) comply with the requirements
of any applicable state law relating to bulk sales or transfer, and (c) satisfy
and discharge any liens or encumbrances on Eligible Items prior to their
delivery to Division and General Motors.
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15.2.3 PAYMENT.
Subject to Article 17.10. Division will pay for the Eligible Items as
soon as practicable following their delivery to the specified destinations.
Payment may be made directly to anyone having a security or ownership interest
in the Eligible Items.
If Division has not paid Dealer for the Eligible Items within two
months after delivery, and if Dealer has fulfilled its termination obligations
under this Agreement, Division will, at Dealer's written request, estimate the
purchase price of the unpaid Eligible Items and all other amounts owed to
Dealer by General Motors. After deducting the amounts estimated to be owing
General Motors and its subsidiaries by Dealer, Division will advance Dealer 75
percent of the net amount owed Dealer and will pay the balance, if any, as soon
as practicable thereafter.
15.2.4 ASSIGNMENT OF RIGHTS.
If Division has decided to appoint a replacement dealer at Dealer's
location, Dealer may sell its eligible Items and, if approved in writing by
Division, assign its rights under this Article 15.2 to a designated replacement
dealer provided the replacement dealer assumes Dealer's obligations under this
Article.
15.3 ASSISTANCE ON PREMISES
15.3.1 DIVISION'S OBLIGATION
Subject to Article 17.10, Division agrees to give Dealer assistance in
disposing of the Premises if (i) this Agreement expires for any reason or is
terminated by Division under Articles 13.2 or 14.4 and (ii) Dealer is not
offered a new Dealer Agreement. Such assistance shall be given only on Premises
that are described in the Location and Premises Addendum and only if:
(a) they are used solely for Dealership Operations (or
similar dealership operations under agreements with
other Divisions of General Motors which will be
terminated simultaneously with this Agreement; and
(b) they are not substantially in excess of space
requirements at the time of termination or, if they are
substantially in excess, they became excessive because
of a reduction in the requirements applicable to
Dealer's facilities.
Any Dealer request for such assistance must be in writing and received
by Division within thirty days of the expiration or termination of this
Agreement.
Premises that consist of more than one parcel of property or more than
one building, each of which is separately usable, distinct and apart from the
whole or any other part with appropriate ingress or egress, shall be considered
separately under this Article 15.3.
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15.3.2 OWNED PREMISES
Division will provide assistance on owned Premises by either (a)
locating a purchaser who will offer to purchase the Premises at a reasonable
price, or (b) locating a lessee who will offer to lease the Premises. If
Division does not locate a purchaser or lessee within a reasonable time.
Division will itself either purchase or, at its option, lease the Premises for
a reasonable term at a reasonable rent. If the cause of termination or
expiration is a death or the incapacity of the Dealer Operator, Division may
instead pay Dealer a sum equal to a reasonable rent for a period of twelve
months immediately following the effective date of termination or expiration of
this Agreement.
15.3.3 LEASED PREMISES
Division will provide assistance on leased Premises by either:
(a) locating a tenant(s), satisfactory to lessor, who will
sublet for the balance of the lease or assume it; or
(b) arranging with the lessor for the cancellation of the
lease without penalty to Dealer; or
(c) reimbursing Dealer for the lesser of the rent specified
in the lease or settlement agreement or a reasonable
rent for a period equal to the lessor of twelve months
from the effective date or termination or expiration of
the balance of the lease term.
Upon request, Dealer will use its best efforts to effect a settlement
of the lease with the lessor subject to Division's prior approval of the terms.
Division is not obligated to reimburse Dealer for rent for any month during
which the Premises are occupied by Dealer or anyone else after the first month
following the effective date of termination or expiration.
15.3.4 RENT AND PRICE
Division and Dealer will fix the amount of a reasonable rent and a
reasonable price for the Premises by agreement at the time Dealer requests
assistance. The factors to be considered in fixing those amounts are:
(a) the adequacy and desirability of the Premises for a
dealership operation; and
(b) the fair market value of the Premises. If Division and
Dealer cannot agree, the fair market value will be
determined by the median appraisal of three qualified
real estate appraisers, of whom Dealer and Division will
each select one and the two selected will select the
third. The cost of appraisals will be shared equally by
Dealer and Division.
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15.3.5 LIMITATIONS ON OBLIGATION TO PROVIDE ASSISTANCE
Division will not be obligated to provide assistance on Premises if
Dealer:
(a) fails to accept a bona fide offer from a prospective
purchaser, sublessee or assignee;
(b) refuses to execute a settlement agreement with the
lessor if the agreement would be without cost to Dealer;
(c) refuses to use its best efforts to effect a settlement
when requested by Division; or
(d) refuses to permit Division to examine Dealer's books and
records if necessary to verify claims of Dealer under
this Article.
Any amount payable by Division as rental reimbursement or reasonable
rent shall be proportionately reduced if the Premises are leased or sold to
another party during the period for which such amount is payable. Payment of
rental reimbursement or reasonable rent is waived by Dealer if it does not file
its claim therefor within two months after the expiration of the period covered
by the payment. Upon request, Dealer will support its claim with satisfactory
evidence of its accuracy and reasonableness.
ARTICLE 16. DISPUTE RESOLUTION PROCESS
Division and Dealer agree that mutual respect, trust and confidence
are vital to the relationship between Division and Dealer. So that such
respect, trust and confidence can be maintained, and differences that may
develop between Dealer and Division may be resolved amicably, Division and
Dealer agree to resolve disputes in accordance with the Dispute Resolution
Process, a copy of which has been provided to Dealer.
ARTICLE 17. GENERAL PROVISIONS
17.1 NO AGENT OR LEGAL REPRESENTATIVE STATUS
This Agreement does not make either party the agent or legal
representative of the other for any purpose, nor does it grant either party
authority to assume or create any obligation on behalf of or in the name of the
others. No fiduciary obligations are created by this Agreement.
17.2 RESPONSIBILITY FOR OPERATIONS
Except as provided in this Agreement, Dealer is solely responsible for
all expenditures, liabilities and obligations incurred or assumed by Dealer for
the establishment and conduct of its operations.
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17.3 TAXES
Dealer is responsible for all local, state, federal, or other
applicable taxes and tax returns related to its dealership business and will
hold General Motors harmless from any related claims or demands made by any
taxing authority.
17.4 INDEMNIFICATION BY GENERAL MOTORS
General Motors will assume the defense of Dealer and indemnify Dealer
against any judgment for monetary damages or rescission of contract, less any
offset recovered by Dealer, in any lawsuit naming Dealer as a defendant
relating to any Product that has not been altered when the lawsuit concerns:
17.4.1 Breach of the General Motors warranty related to the Product,
bodily injury or property damage claimed to have been caused solely by a defect
in the design, manufacture, or assembly of a Product by General Motors (other
than a defect which should have been detected by Dealer in a reasonable
inspection of the Product);
17.4.2 Failure of the Product to conform to the description set forth
in advertisements or product brochures distributed by General Motors because of
changes in standard equipment or material component parts unless Dealer
received notice of the changes prior to retail delivery of the affected Product
by Dealer; or
17.4.3 Any substantial damage to a Product purchased by Dealer from
General Motors which has been repaired by unless Dealer has been notified of
the repair prior to retail delivery of the affected Product.
If General Motors reasonably concludes that allegations other than
those set forth in 17.4.1, 17.4.2, or 17.4.3 above are being pursued in the
lawsuit, General Motors shall have the right to decline to accept the defense
or indemnify dealer or, after accepting the defense, to transfer the defense
back to Dealer and withdraw its agreement to indemnify Dealer.
Procedures for requesting indemnification, administrative details, and
limitations are contained in the Service Policies and Procedures Manual under
"Indemnification." The obligations assumed by General Motors are limited to
those specifically described in this Article and in the Service Policies and
Procedures Manual and are conditioned upon compliance by Dealer with the
procedures described in the Manual. This Article shall not affect any right
either party may have to seek indemnification or contribution under any other
contract or by law and such rights are hereby expressly preserved.
17.5 TRADEMARKS AND SERVICE MARKS
General Motors or affiliated companies are the exclusive owners or
licensees of the various trademarks, service marks, names and designs (Marks)
used in connection with Products and services.
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Dealer is granted the non-exclusive right to display Marks in the form
and manner approved by Division in the conduct of its dealership business.
Dealer agrees to permit any designated representative of Division upon the
Premises during regular business hours to inspect Products or services in
connection with Marks.
Dealer will not apply to register any Marks either alone or as part of
another xxxx, and will not take nay action which may adversely affect the
validity of the Marks or the goodwill associated with them.
Dealer agrees to purchase and sell goods bearing Marks only from
parties authorized or licensed by Division or General Motors.
Marks may be used as part of the Dealer's name with Division's written
approval.
Dealer agrees to change or discontinue the use of any Marks upon
Division's request.
Dealer agrees that no company owned by or affiliated with Dealer or
any of its owners may use any xxxx to identify a business without Division's
written permission.
Upon termination of this Agreement, Dealer agrees to immediately
discontinue, at its expense, all use of Marks. Thereafter, Dealer will not use,
either directly or indirectly, any Marks or any other confusingly similar marks
in a manner that Division determines is likely to cause confusion or mistake or
deceive the public.
Dealer will reimburse Division for all legal fees and other expenses
incurred in connection with action to require Dealer to comply with this
Article 17.5.
17.6 NOTICES
Any notice required to be given by either party to the other in
connection with this Agreement will be in writing and delivered personally or
by first class or express mail or by facsimile. Notices to Dealer will be
directed to Dealer or its representatives at Dealer's principal place of
business and, except for indemnification requests made pursuant to Article
17.4, notices by Dealer will be directed to the appropriate Zone or Branch
Manager of the Division(s) of General Motors.
17.7 NO IMPLIED WAIVERS
The delay or failure of either party to require performance by the
other party or the waiver by either party of a breach of any provision of this
Agreement will not affect the right to subsequently require such performance.
17.8 ASSIGNMENT OF RIGHTS OR DELEGATION OF DUTIES
Dealer has not paid any fee for this Agreement. Neither this Agreement
nor any right granted by this Agreement is a property right.
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Except as provided in Article 12, neither this Agreement nor the
rights or obligations of Dealer may be sold, assigned, delegated or otherwise
transferred.
Division may assign this Agreement and any rights, or delegate any
obligations, under this Agreement to any affiliated or successor company, and
will provide Dealer written notice of such assignment or delegation. Such
assignment or delegation shall no relieve Division of liability for the
performance of its obligations under this Agreement.
17.9 NO THIRD PARTY BENEFIT INTENDED
This Agreement is not enforceable by any third parties and is not
intended to convey any rights or benefits to anyone who is not a party to this
Agreement.
17.10 ACCOUNTS PAYABLE
All monies or accounts due Dealer are net of Dealer's indebtedness to
Division. General Motors and its subsidiaries. In addition, Division may deduct
any amounts due or to become due from Dealer to Division or General Motors, or
any amounts held by Division, from any sums or accounts due or to become due
from Division. General Motors or its subsidiaries.
17.11 SOLE AGREEMENT OF PARTIES
Except as provided in this Agreement, Division has made no promises to
Dealer, Dealer Operator, or dealer owner and there are no other agreements or
understanding, either oral or written, between the parties affecting this
Agreement or relating to any of the subject matters covered by this Agreement.
Except as otherwise provided herein, this Agreement cancels and
supersedes all previous agreements between the parties that relate to any
matters covered herein, except as to any monies which may be owning between the
parties.
No agreement between Division and Dealer which relates to matters
covered herein, and no change in, addition to (except the filling in of blank
lines) or erasure of any printed portion of this Agreement, will be binding
unless permitted under the terms of this Agreement or related documents, or
approved in a written agreement executed as set forth in Division's Dealer
Sales and Service Agreement.
17.12 APPLICABLE LAW
This agreement is governed by the laws of the State of Michigan.
However, if performance under this Agreement is illegal under a valid law of
any jurisdiction where such performance is to take place, performance will be
modified to the minimum extent necessary to comply with such law if it was
effective as of the effective date of this Agreement.
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17.13 SUPERSEDING DEALER AGREEMENTS
If Division offers a superseding form of dealer agreement to
Division's dealers generally at any time prior to expiration of this Agreement,
Division may terminate this Agreement by prior written notice to Dealer,
provided Division offers Dealer a dealer agreement in the superseding form for
a term of not less than the unexpired term of this Agreement.
Unless otherwise agreed in writing. The rights and obligations of
Dealer that may otherwise become applicable upon termination or expiration of
the term of this Agreement shall not be applicable if Division and Dealer
execute a superseding dealer agreement, and the matured rights and obligations
of the parties hereunder shall continue under the new agreement.
Dealer's performance under any prior agreement may be considered in an
evaluation of Dealer's performance under this or any succeeding agreement.
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GLOSSARY
1. AREA OF PRIMARY RESPONSIBILITY - The geographic area designated by
Division from time to time in a Notice of Area of Primary
Responsibility.
2. DEALER - The corporation, partnership or proprietorship that signs the
Dealer Agreement with Division.
3. DEALER AGREEMENT - The Dealer Sales and Service Agreement, including
the Agreement proper that is executed, the Standard Provisions, all of
the related Addenda, the Accounting and Service Policies and
Procedures Manuals, and the Terms of Sale Bulletins.
4. DEALERSHIP OPERATIONS - All operations contemplated by the Dealer
Agreement. These operations include the sale and service of Products
and any other activities undertaken by Dealer related to Products,
including rental and leasing operations, used vehicle sales and body
shop operations and finance and insurance operations whether conducted
directly or indirectly by Dealer.
5. DIVISION - The unit of General Motors Corporation that has entered
into a Dealer Agreement with Dealer authorizing it to market and
service Division's Motor Vehicles.
6. GENERAL MOTORS - General Motors Corporation.
7. MOTOR VEHICLES - All current model types or series of new motor
vehicles specified in any Motor Vehicle Addendum and all past General
Motors motor vehicles marketed through Motor Vehicle Dealers.
8. PRODUCTS - Motor Vehicles, Parts and Accessories.
9. SERVICE POLICIES AND PROCEDURES MANUAL - The Manual issued
periodically which details certain administrative and performance
requirements for Dealer service under the Dealer Agreement.
10. SPECIAL VEHICLES - Motor Vehicles that have limited marketability
because they differ from standard specifications or incorporate
special equipment.
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EXHIBIT C
Examples of acceptable and not acceptable printed media advertising are shown
below:
ACCEPTABLE NOT ACCEPTABLE
--------------------------------------- --------------------------------------
CHEVROLET FORD USED Chevrolet
New New New Ford
New New Used Used
Used Chrysler Chevrolet
Used at Used at Ford
Chevrolet Ford Chevrolet
Location Location Used
1 2 3 4
Location Location Location Locations - - - -
--------------------------------------- --------------------------------------
Television, radio or other electronic media and any other means of advertising
will clearly identify the GM authorized locations and separate the brands of
vehicles at each authorized location.
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