Exhibit
10.2.7.1
OLDSMOBILE DIVISION
DEALER SALES AND SERVICE AGREEMENT
Oldsmobile has a long-standing tradition of providing quality, family oriented
vehicles of good value. Building upon its heritage, Oldsmobile's mission is to
be the volume leader in the midsize and large vehicle segments, and to increase
its market share with upscale models in other growth segments. Oldsmobile
intends to fulfill this mission through the joint efforts of Oldsmobile and its
dealers.
The long-term growth and mutual success of Oldsmobile and its dealers also
depends significantly upon the ability and efforts of its dealers. Oldsmobile
expects its dealers to effectively sell, service, and protect the reputation of
Oldsmobile Products and to satisfy the customers of Oldsmobile Products in a
manner that demonstrates a caring attitude toward those customers.
CUSTOMER SATISFACTION
FIRST
Oldsmobile and Dealer recognize that customer satisfaction is essential to our
mutual business success. Therefore, Oldsmobile and Dealer are dedicated to
working together to assure complete satisfaction with our Products and services,
with the goal that each of our customers will remain lifelong members of the
Oldsmobile family.
Oldsmobile commits to advise Dealer no less than on a yearly basis of the
results of any dealer customer satisfaction index generated by Oldsmobile and to
relate such index to local and national geography. In the event that ratings of
the satisfaction of Dealer's customers place Dealer in an unsatisfactory
position relative to comparable indexes, Dealer shall, upon request of
Oldsmobile, cooperate in a comprehensive review of Dealer's performance and
participate in a customer satisfaction improvement program designed by Dealer
and Oldsmobile.
To enhance customer satisfaction, Oldsmobile has implemented the Oldsmobile Edge
programs. Dealer participation is essential to the success of these programs,
and Dealer agrees to participate in these programs. Oldsmobile may modify these
programs from time to time, and Oldsmobile will obtain dealer input before
adopting such modifications.
COMMUNICATION
SECOND
Oldsmobile and Dealer recognize the importance of good communication in our
business and marketing planning, and in our respective ongoing operations.
Oldsmobile has established the following dealer representative entities to
counsel with Oldsmobile, and may establish from time to time other
representative dealer entities to further enhance our mutual interests.
NATIONAL DEALER COUNCIL
The responsibility of the Oldsmobile National Dealer Council ("Council") is to
develop and maintain a business relationship between Oldsmobile and the dealer
body that fosters the mutual interests of both Dealer and Oldsmobile. The
Council is composed of dealer elected members representing the various
geographical areas of the United States and includes members that represent
large and small volume dealers. The Council meets with Oldsmobile at least
twice annually to discuss matters of mutual interest and importance. Much
progress and improvement has been made over the years as a result of Council
input, and Oldsmobile intends to continue this important link of communication
with its dealers.
In addition to the Council, and recognizing the important contribution of
dealers in fulfilling the Oldsmobile mission, Oldsmobile has established three
advisory committees to obtain dealer input. These committees are comprised of
Oldsmobile Dealer Operators selected by either the Council or Oldsmobile.
Dealer agrees that Dealer Operator will serve on the Council or on an Advisory
Committee when requested.
MARKETING ADVISORY COMMITTEE
The purpose of the Marketing Advisory Committee is to promote the exchange of
ideas and concerns between Oldsmobile and its dealers on topics relating to the
marketing of Oldsmobile Products. Topics may include advertising and incentive
activities, product option packages, special options, point of sale material,
customer satisfaction and similar activities relating to our mutual marketing
objectives.
SERVICE ADVISORY COMMITTEE
The purpose of the Service Advisory Committee is to provide for the exchange of
ideas and concerns between Oldsmobile and its dealers on service related
subjects. Subjects may include warranty coverage, customer satisfaction and
owner loyalty,
-2-
service merchandising, dealership premises, dealership training, tools and
equipment and service policies and procedures.
PRODUCT ADVISORY COMMITTEE
The purpose of the Product Advisory Committee is to obtain dealer input into
future product programs. Subjects may include product strategies, vehicle
specifications, model lineup changes, specialty vehicle programs and color and
trim selections.
DEALER OPERATOR
THIRD
Dealer agrees that the following Dealer Operator will provide personal services
in accordance with Article 2 of the Standard Provisions:
JOSEPH J. MITOLO
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DEALERSHIP IMAGE AND DESIGN
FOURTH
As the point of customer contact with Oldsmobile's Products, the appearance and
qualify of dealership Premises can affect the way customers perceive
Oldsmobile's 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 any reasonable
requirements Oldsmobile may establish to promote and preserve the image of
Oldsmobile and its dealers. Oldsmobile will take into account existing economic
and marketing conditions, and consult with the Dealer Marketing and Service
Advisory Committees, in establishing such requirements. To assist Dealer,
Oldsmobile will counsel and advise Dealer concerning facility appearance and
design.
ADVERTISING AND PROMOTIONAL ACTIVITY
FIFTH
Oldsmobile and Dealer agree to promote Oldsmobile Products in the conduct of
their business, refrain from any activity harmful to the reputation of
Oldsmobile Products and maintain uniformly high standards of ethical
advertising. Oldsmobile believes in and supports dealer advertising
associations and encourages Dealer to support and participate in Dealer's local
advertising association.
-3-
DEALER SALES REVIEW
SIXTH
Oldsmobile will provide to Dealer, at least annually, a written Dealer Sales and
Registration Report ("Report") advising Dealer of Dealer's retail sales index,
Dealer's state ranking, and Oldsmobile's retail registration index and fleet
registration performance in Dealer's Area of Primary Responsibility. Oldsmobile
may modify the sales review process from time to time and will obtain dealer
input before adopting such modifications.
A Retail Sales Index of 100 is the minimum standard for Dealer to be considered
in compliance with its commitment under Article 5.1 to effectively sell and
promote the purchase, lease and use of Oldsmobile Products. Oldsmobile also
expects Dealer to pursue available sales opportunities exceeding the minimum
acceptable standard. Additionally, Oldsmobile expectations for performance in
an area may exceed the minimum acceptable standard for individual dealer
compliance.
DEALER SERVICE REVIEW
SEVENTH
Oldsmobile commits to review at least annually, Dealer's responsibility to
provide efficient and quality service to Oldsmobile owners. The manner in which
that review will be conducted and those items which will be included in the
process will be set forth in the Service Policies and Procedures Manual.
Oldsmobile may modify the service review process from time to time and will
obtain the input of the Service Advisory Committee before adopting such
modifications.
TRAINING
EIGHTH
Oldsmobile and Dealer agree that professional and knowledgeable personnel are
essential to customer satisfaction and to the long-term success of Oldsmobile
and Dealer. Accordingly, Oldsmobile agrees to make available or recommend
product, sales, service and parts, accounting and business management training
for its dealers. Dealer agrees that its personnel will attend training
identified by Oldsmobile as necessary. If Oldsmobile identifies Dealer
deficiencies, Dealer agrees that its personnel will complete courses specified
by Oldsmobile. Oldsmobile agrees to consult with the Marketing and/or Service
Advisory Committee before adopting additional required training and will
consider the Marketing and/or Service Advisory Committee recommendations as to
content and frequency of additional required training. Oldsmobile and Dealer
acknowledge that competent training from other sources is available and that
Dealer may benefit from it.
-4-
TOOLS AND EQUIPMENT
NINTH
Oldsmobile and Dealer acknowledge that a properly equipped dealership promotes
customer satisfaction and sale of Oldsmobile Products. Oldsmobile agrees to
provide Dealer with lists of those tools and equipment that Oldsmobile regards
as essential. Dealer agrees that it will acquire and use essential tools and
equipment identified by Oldsmobile. Oldsmobile agrees to consult with the
Service Advisory Committee prior to requiring additional tools other than those
required to service new model Products.
BUSINESS MANAGEMENT RESPONSIBILITY
TENTH
If Dealer is an authorized dealer for more than one division of General Motors,
OLDSMOBILE DIVISION 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. OLDSMOBILE DIVISION will execute those documents for all
divisions.
TERM OF AGREEMENT
ELEVENTH
This Agreement shall expire on OCTOBER 01, 1997, 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 Oldsmobile at the expiration date if Oldsmobile
determines Dealer has fulfilled its obligations under this Agreement.
DISPUTE RESOLUTION PROCESS
TWELFTH
General Motors has long recognized that mutual respect, trust, and confidence
are vital to the relationship between General Motors and each authorized
dealer. In those instances where a dispute arises between Dealer and
Oldsmobile, Dealer is encouraged to present the matter to Oldsmobile management
for review. If the matter is not resolved through management review, Dealer is
encouraged to submit the dispute to the Dispute Resolution Process. Oldsmobile
will provide Dealer with a written copy of the Dispute Resolution Process.
Oldsmobile may modify the Dispute Resolution Process from time to time, and will
obtain dealer input before adopting such modifications.
-5-
INCORPORATION OF STANDARD PROVISIONS
THIRTEENTH
The "Standard Provisions" (GMMS 1013) are incorporated as a part of this
Agreement.
ADDITIONAL AGREEMENTS AND UNDERSTANDINGS
FOURTEENTH
The following agreements and understandings are hereby incorporated into this
Agreement:
(List any special letters, facility agreements, etc.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
IDENTIFICATION OF PARTIES AND EFFECTIVE DATE
FIFTEENTH
This Agreement, effective OCTOBER 02, 1992, is entered into by General
Motors Corporation, Oldsmobile Division ("Oldsmobile"), a Delaware corporation,
and
J & F OLDSMOBILE-ISUZU PARTNERSHIP, a
-X- NEW JERSEY corporation, incorporated on
DECEMBER 18, 1978;
--- proprietorship;
--- partnership;
doing business at 315 CLENDENNY AV ON RT 440
JERSEY CITY, NEW JERSEY 07304 ("Dealer").
EXECUTION OF AGREEMENT
SIXTEENTH
This Agreement and related agreements are valid only if signed:
(a) on behalf of Dealer by its duly authorized representative and, in the case
of this Agreement, by its Dealer Operator; and
-6-
(b) on behalf of Oldsmobile by its General Sales and Service Manager and his
authorized representative.
J & F OLDSMOBILE-ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealership Name
OLDSMOBILE DIVISION
General Motors Corporation
By /s/ Joseph Mitolo 10-2-92 By /s/ D. E. Lahti
-------------------------- ----------------------------------
Dealer Operator Date General Sales and Service Manager
By /s/ Illegible 10-2-92
-----------------------------------
Authorized Representative Date
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OLDSMOBILE DIVISION
MOTOR VEHICLE ADDENDUM
TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
J & F OLDSMOBILE-ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
----------------------------------
City, State
Effective November 1, 1990, Dealer, as an authorized Oldsmobile dealer, has a
non-exclusive right to buy the following new Motor Vehicles marketed by
Oldsmobile Division of General Motors Corporation:
PASSENGER CARS
ACHIEVA, CUTLASS CIERA, CUTLASS SUPREME, EIGHTY-EIGHT ROYALE, NINETY-EIGHT
LIGHT DUTY TRUCK
BRAVADA, SILHOUETTE
This Motor Vehicle Addendum shall remain in effect unless and until superseded
by a new Motor Vehicle Addendum furnished Dealer by Oldsmobile. This Motor
Vehicle Addendum cancels and supersedes any previous Motor Vehicle Addendum
furnished Dealer by Oldsmobile.
OLDSMOBILE DIVISION
General Motors Corporation
By__________________________________
Signature Date
/s/ Illegible 10/2/92
------------------------------------
OLDSMOBILE ZONE MANAGER
(Dealer should file this Motor Vehicle Addendum with Dealer's current Dealer
Agreement.)
NOTICE OF
AREA OF PRIMARY RESPONSIBILITY
TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
Effective OCTOBER 02, 1992, the communities and area described below, shall
be Dealer's Area of Primary Responsibility for the undersigned division of
General Motors.
IN THE STATE OF: NEW JERSEY IN THE COUNTY OF: BERGEN
THE FOLLOWING WHOLE OR PARTIAL COMMUNITIES:
CLIFF PARK CLIFFSIDE PARK FAIRVIEW
IN THE STATE OF: NEW JERSEY IN THE COUNTY OF: BERGEN
AS DESCRIBED BY THE FOLLOWING U.S. CENSUS TRACTS:
63.00 181.00 182.00
IN THE STATE OF: NEW JERSEY IN THE COUNTY OF: HUDSON
THE FOLLOWING WHOLE OR PARTIAL COMMUNITIES:
BAYONNE BERGEN BERGEN POINT BERGENLINE
CASTLE POINT FORTY THIRD STRE GENERAL LAFAYETT GREENVILLE
GUTTENBERG HOBOKEN HUDSON CITY HUDSON HEIGHTS
JACKSON AVENUE JERSEY CITY JOURNAL SQUARE MEADOWVIEW
MILITARY OCEAN T MONITOR NORTH BERGEN PAMRAPO
PARK AVENUE SECAUCUS SUMMIT AVENUE TAURUS
TYLER PARK UNION CITY UPTOWN WASHINGTONSTREE
WEEHAWKEN WEST NEW YORK WEST SIDE WOODCLIFF
IN THE STATE OF: NEW JERSEY IN THE COUNTY OF: HUDSON
THE ENTIRE COUNTY LESS THE FOLLOWING U.S. CENSUS TRACTS:
58.02 103.99 123.00 124.00
125.00 126.00 127.00 128.00
129.00 130.00 131.00 132.00
133.00 134.00 135.00 136.00
[COUNTY CONTINUED ON FOLLOWING PAGE(S)]
NOTICE OF
AREA OF PRIMARY RESPONSIBILITY
TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
[COUNTY CONTINUED FROM PRECEDING PAGE(S)]
IN THE STATE OF: NEW JERSEY IN THE COUNTY OF: HUDSON
THE ENTIRE COUNTY LESS THE FOLLOWING U.S. CENSUS TRACTS:
137.00 138.00 139.00
The Area of Primary Responsibility will be employed by Division to review the
effectiveness of Dealer's performance under the Dealer Agreement, and for other
matters relating to Dealership Operations. The Area of Primary Responsibility
described herein will continue in effect until changed by written notice to
Dealer.
J & F OLDSMOBILE - ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
- --------------------------------------
City, State
OLDSMOBILE DIVISION
GENERAL MOTORS CORPORATION
By /s/ Illegible
------------------------------------
OLDSMOBILE ZONE MANAGER Date
DEALER STATEMENT OF OWNERSHIP
J & F OLDSMOBILE - ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
- ---------------------------------------------
City, State
- --- a proprietorship, -X- a partnership or --- a corporation incorporated on
DECEMBER 18, 1978
in the State of NEW JERSEY
The undersigned Dealer hereby certifies that the following information is true,
accurate and complete, as of OCTOBER 02, 1992
Names and Titles of
all individuals,
beneficiaries of
trusts or other
entities owning 5% or
more of Dealer and
entitled to receive
dividends or profits
from Dealer as a If a Corporation, Show
result of ownership Active Number of Shares and Class
in Value of the Owner- Percentage
Dealer- ship Interest of Each of
(Identify Holding ship Type* Voting Person Listed Based Ownership
Company owners on GMMS (Yes or Number or (Yes or on Dealership's of Record
1014-4) No) Shares Class No) Current Net Worth in Dealer
- -------------------------------------------------------------------------------------------------------------------------------
JOSEPH J. MITOLO YES $ 66,525 7.50%
PRESIDENT
'21' INT'L HOLDINGS, INC. NO $ 603,160 68.00%
SAM C. DIFEO NO $ 199,575 22.50%
VICE-PRESIDENT
EZRA P. MAGER NO $ 17,740 2.00%
$ %
$ %
TOTAL XXX $ 887,000 100.00%
* Indicate various classes of common or preferred stock issued. State Par Value
of each share of preferred stock.
Remarks:
J & F OLDSMOBILE-ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
By /s/ Joseph Mitolo 10/2/92 By /s/ Illegible 10/2/92
------------------------------------ ---------------------------------
OLDSMOBILE DIVISION
GENERAL MOTORS CORPORATION
J & F OLDSMOBILE - ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
---------------------------------
City, State
List below any person named on Page 1 that has any ownership in, or is active in
the management of, any other entity that merchandises General Motors Automotive
products.
Name Firm Name, Address and Position and Product Line(s)
'21' INT'L HOLDINGS, INC. DIFEO VOLKSWAGEN OF BRIDGEWATER
BOUND BROOK NJ
OLDSMOBILE PASS CAR
SAM C. DIFEO CROWN CADILLAC-OLDSMOBILE, INC.
WATCHUNG NJ
PRESIDENT
OLDSMOBILE PASS CAR CADILLAC PASS CAR
EZRA P. MAGER DIFEO VOLKSWAGEN OF BRIDGEWATER
BOUND BROOK NJ
OLDSMOBILE PASS CAR
List below any person named on Page 1 that has any ownership in, or is active in
the management of, any other entity that merchandises motor vehicles other than
those marketed by General Motors.
Name Firm Name, Address and Position and Product Line(s)
JOSEPH J. MITOLO J & F ISUZU
JERSEY CITY ,NEW JERSEY
PRESIDENT
ISUZU
SAM C. DIFEO HUDSON TOYOTA
JERSEY CITY ,NEW JERSEY
PRESIDENT
TOYOTA
SAM C. DIFEO J & F ISUZU
JERSEY CITY ,NEW JERSEY
PRESIDENT
ISUZU
STATEMENT OF HOLDING COMPANY OWNERSHIP
J & F OLDSMOBILE-ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
- --------------------------------------------------------
City, State
INVESTORS PERCENT OF
OWNERSHIP
OTHER INVESTORS 54.76%
MARSHALL S. COGAN 45.24%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
%
CAPITAL STANDARD ADDENDUM
TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
This Capital Standard Addendum, effective OCTOBER 02, 1992, is pursuant to
Article 10 of the Dealer Sales and Service Agreement in effect between General
Motors and Dealer.
General Motors has determined that the minimum net working capital
(standard) necessary for this Dealer to adequately conduct Dealership Operations
consistent with the Dealer's responsibilities is $687,000.00.
Dealer has established, or will, within a reasonable time, establish and
maintain actual dealer net working capital in an amount not less than the
minimum amount specified above.
GENERAL MOTORS
DEALER CAPITAL STANDARD PROGRAM
General Motors Corporation has endeavored, through the General Motors Capital
Standard Program, to help dealers develop sound financial positions. Over the
years, this Program has contributed substantially to the effectiveness and
relative permanency of General Motors dealers as a whole.
The purpose of the General Motors Dealers Capital Standard Program is to
establish the minimum amount of regularly needed net working capital which
should be provided by the owners through capital stock, other investment and
earnings.
A minimum net working capital standard is established for each dealer based on
the dealership operations it is expected to conduct under its Dealer Sales and
Service Agreement(s). Dealer having actual net working capital equal to the
standard established for the dealership operations contemplated at its
dealership location should have net working capital sufficient to operate
through normal variations in the business cycle, provided its management
prudently maximizes the use of those funds.
Net working capital, as it is commonly understood, is the difference between
current assets and current liabilities without reference to the source from
which the working capital has been obtained. As used herein, however, the
actual dealer net working capital to be compared to the standard shall be
determined by arriving at the sum of Total Current Assets plus Driver Training
Vehicles, Lease and Rental Units and Total Accumulated LIFO Writedown minus the
sum of Total Liabilities excluding those listed below.
Those liabilities which are not subtracted are:
1. Long term notes payable which are qualified long term debt. Qualified
long term debt is defined by the following criteria:
a. The note must be payable to an owner of Dealer.
b. Principal payments must be restricted to profits.
c. The amount to be excluded is limited to 50% of the standard.
This exception is made because an owner would be less inclined to collect
on a note payable at maturity than an outside creditor when payment of such
a note would place the dealership in financial jeopardy.
2. Long term notes payable secured by real property.
This exception is made because dealers are not required to own land and
buildings which they use. Many dealers, however, elect to acquire and hold
title to all or a portion of such real property, thereby investing a
portion of the total equity capital in land and buildings which would
otherwise be available for working capital purposes.
J & F OLDSMOBILE - ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
DEALER FIRM NAME
JERSEY CITY, NEW JERSEY
- --------------------------------------------------
City, State
OLDSMOBILE DIVISION
GENERAL MOTORS CORPORATION
By /s/ 10/2/92
---------------------------------------
OLDSMOBILE ZONE MANAGER Date
LOCATION AND PREMISES ADDENDUM
TO
GENERAL MOTOTS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
The undersigned Dealer and the undersigned Division of General Motors
Corporation, acting for itself and the other Division(s), if any, identified on
Page 4, hereby agree that as of the effective date shown below:
1. Part I on Page 3 hereof, entitled "Description of Premises,"
identifies the Location and describes the Premises at which Dealer is
authorized to conduct Dealership Operations under the Dealer
Agreement(s). Dealer also represents that Part I accurately reflects
the terms under which it occupies the premises and the manner in which
each is used for GM Dealership Operations.
2. Part II beginning on Page 4 hereof, entitled "Premises Space
Analysis," sets forth the actual space Dealer represents it uses in GM
Dealership Operations, and the actual space at the same locations used
by Dealer for a purpose other than GM Dealership Operations.
All changes in the Location and Premises that may be agreed upon by Dealer and
General Motors pursuant to provisions of Article 4.4 of the Dealer Agreement(s)
requirements shall be reflected in a new Location and Premises Addendum executed
by Dealer and General Motors.
J&F OLDSMOBILE - ISUZU PARTNERSHIP
- --------------------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
- ------------------------------------------------------
City, State
OLDSMOBILE DIVISION
GENERAL MOTORS CORPORATION
By /s/ Jospeh Mitolo
----------------------------
Signature Title
By By /s/ Illegible
---------------------------- -------------------------
Signature Title OLDSMOBILE ZONE MANAGER
10/2/92 10/2/92
- ------------------------------ -------------------------
Date Date
Identify any special letters in effect or special or unusual circumstances
relating to Dealership Premises:
(Turn to page 2 for instructions for completing this form)
INSTRUCTIONS FOR COMPLETING
LOCATION AND PREMISES ADDENDUM
Page 1 - When pages 3 and 4 are completed, page 1 of the Addendum should be
signed and dated by Dealer.
Page 3 - "LOCATION, USE AND OWNERSHIP OF PREMISES"
Column A - Indicate the STREET ADDRESS and USE of each separate location
used by Dealer in the GM Dealership Operation. Also indicate the distance
of each separate location from the main location, in tenths of miles. A
"separate" location is one that is not immediately adjacent to the
dealership main location.
Column B - Indicate by "X" whether the premises at each location are owned
and carried as a dealership asset or leased.
Column C - If premises are leased, indicate for each such location the name
of the lessor, the beginning and expiration date of the lease, the annual
rental and the terms of any renewal options.
SECTION D - Provide total roofed and unroofed square footage as indicated.
Page 4 - Part II - "PREMISES SPACE ANALYSIS"
In Columns A and C, indicate the actual number of stalls available in each
of the departments listed on lines 1 thru 8, used for operations under GM
Agreement(s). In Columns B and D, indicate the stalls used for operations
under "Other" product agreements. The following should be taken into
consideration when completing each line:
Line 1 - Specify the number of stalls in building and lot used for the
display of new cars and trucks ready for sale.
Line 2 - Number of stalls used for the display of used cars and trucks,
including used vehicles awaiting reconditioning and wholesaling.
Line 3 - Show productive service stalls available in building.
Line 4 - Number of stalls used for sheet metal repairs, panel refinishing,
frame straightening and all other body related services.
Line 5 and 6 - Number of stalls for service reception and customer parking.
Line 7 - Number of stalls in building and lot used for new vehicle storage.
Line 8 - Number of stalls devoted to employe and demo parking and
miscellaneous activities not included in line 1 above.
Line 9 - Total of lines 1 - 8.
Line 10 and 11 - Specify, in square feet, in Column A the space used for
operations under your GM Agreement and in Column C the space used for
"Other" operations.
Line 12 - Total of Lines 10 and 11.
GENERAL PROVISIONS
GM PULSAT NETWORK
EQUIPMENT INSTALLATION AGREEMENT
1. Consents. As used herein, "landowner" means each fee titleholder and all
other persons holding an interest in the Dealer's dealership premises where
Pulsat Equipment is to be installed ("Premises"), including land and
improvements, which interest affects Dealer's occupation and possession of the
Premises, and their respective successors and assigns. Dealer will obtain from
each landowner its consent to this Equipment Installation Agreement and to the
installation, maintenance, removal and operation of the Pulsat Equipment
pursuant to this Equipment Installation Agreement, and to any changes required
to be made to the Premises as deemed necessary by GM in order to provide
adequate support and any necessary power wiring or any electrical equipment.
Such consent of landowners will acknowledge the clear and unencumbered title to
said Pulsat Equipment in GM and the right to remove the Pulsat Equipment as
provided herein. Dealer is responsible for any changes associated with such
consent. In the event Dealer is unable to obtain the consent of any landowner
in the form provided by or satisfactory to GM within ten days from the date of
execution hereof, then this Agreement will become voidable at the option of GM,
and upon GM's exercise of such option the parties will be released from all
obligations hereunder.
2. Installation Restrictions. It is agreed with respect to each piece of
Equipment subject to this Agreement that:
(a) It will comply with all applicable state and local laws, ordinances
and regulations, and all required installation permits therefore must be
obtained from the appropriate governmental authorities.
(b) In GM's judgment, it must be practicable from both an engineering and
a financial standpoint to install the Pulsat Equipment at the Premises.
Dealers will cooperate with and assist GM in accomplishing installation of the
Pulsat Equipment within the foregoing limitations. If no Equipment offered by
GM will meet the foregoing limitations, this Agreement will become null and void
and the parties will be released from all obligations hereunder.
3. Installations. Pulsat Equipment will be installed at such date and time as
may be reasonably scheduled by GM; GM will not be liable for any delays in
commencing or completing the installation thereof.
GM agrees to install the Pulsat Equipment upon the Premises in accordance with
the specifications set forth herein. Dealer agrees to allow GM to remove or
relocate any existing equipment which may interfere with or be duplicative of
Pulsat Equipment. Upon termination of this Agreement GM will not be responsible
for the replacement of any equipment so removed or relocated. Dealer will
provide normal power and any telephone hookup required for use of the Equipment.
4. Additional Equipment/Services. The basic Equipment configuration, basic
installation and basic maintenance provided without separate charge by GM are
described further in written procedures provided by GM from time to time, and
are subject to change if changes are made for dealers in general. Any agreement
or services required by Dealer in addition to the basic levels provided herein
are subject to a separate charge. GM offerings of additional equipment and
services for use with the GM Pulsat Network, and charges therefore, are also
described in the written procedures. Any charges hereunder will be calculated
in accord with GM's then published schedule of
(2)
charges, which is subject to change from time to time, and will be debited to
Dealer's open account.
Additional installation services may include such things as additional cable,
special footings, and related work required for a non-standard installation
resulting from inability to locate the satellite dish in close proximity to the
other Equipment or to mount it in a standard fashion, removal of unrelated
antennas, installation of an electrical outlet for operation of the Equipment,
or installation of additional television hookups within the Premises for
receiving the satellite video signal.
Installation of the Pulsat Equipment establishes Dealer's Premises as a node on
the GM Pulsat Network. To receive video applications, Dealer must provide the
necessary television and video recording equipment. To use the data
communications applications, Dealer must obtain hardware and software from an
authorized dealer systems provider and have a service agreement with GM for
access to GM's host computer.
5. GM's Property. All Pulsat Equipment installed pursuant to this Agreement
will be appropriately marked and identified as the property of GM (including its
affiliates). Dealer will ensure that such stickers, labels or plaques as become
affixed to the Equipment so as to mark and identify it as property of GM are not
removed, damaged or obscured. Dealer agrees to take such measures and
precautions as are necessary to ensure that Equipment remains on Dealer's
Premises as installed and is protected from damage, deterioration and other
abuse.
Upon GM's request Dealer will execute such documents as GM may require for
filing in public records to give notice that the Pulsat Equipment is the
property of GM bailed to Dealer. Dealer will take such further actions as GM
may from time to time require so as to protect GM's interest in the Equipment.
GM may inspect the Equipment at the Premises at any time during Dealer's normal
business hours.
6. Equipment Relocations. No Equipment subject to this Agreement will be
relocated except as expressly authorized by GM. Authorization by GM of any
relocation will be evidenced by a writing, which will be made part of this
Agreement effective as of the date noted thereon. The expense of any authorized
relocation will be borne by Dealer. In the event of any unauthorized
relocation, GM will have the option of restoring the Equipment to the location
specified herein, or of inspecting the Equipment as relocated and taking such
measures as GM deems appropriate to bring such Equipment into compliance with
GM's installation specifications, and in either such event Dealer will bear the
expense thereof.
7. Dealership Relocation. In the event Dealer relocates its dealership
operations to new premises, GM will have the option either of terminating this
Agreement without any further obligation or liability to Dealer hereunder, or
amending this Agreement to cover the new location, in which case this Agreement
will be amended accordingly and the new landowner consents obtained as
appropriate, and the expense of removing the Equipment from the old location and
of installing it at the new location will be borne by Dealer.
8. Termination. This Agreement will automatically terminate and be of no force
and effect, without notice, upon the termination by GM or Dealer of Dealer's
Dealer Sales and Service Agreement(s) with GM, the non-renewal of such Dealer
Sales and Service Agreement(s) upon the expiration of its term, the termination
of Dealer's DCS Service Agreement with GM, or if for any
(3)
reason Dealer vacates the Premises or ceases to operate them in the regular
course of business for the sale and service of GM vehicles as an authorized
dealer. Upon such termination Dealer will remain responsible for any damage to
the Equipment until it is removed.
This Agreement will not operate or be construed to extend, or imply intention to
extend, Dealer's Dealer Sales and Service Agreement(s) with GM beyond its
expiration or in any way whatsoever affect the rights and obligations of either
of the parties to such Dealer Sales and Service Agreement(s).
9. Taxes and Permits. GM will report and pay any personal property taxes
applicable to its property bailed to Dealer under this Agreement. Dealer will
cooperate with and assist GM in identifying any applicable personal property
taxes.
Dealer will cooperate with and assist GM in obtaining any permits or licenses
required for installation of the Equipment. Thereafter, Dealer will be
responsible for and obtain and maintain any permits or licenses necessary for
the Equipment. If Dealer fails for any reason to maintain such permits or
licenses, GM may do so and charge the cost of said permits or licenses, or any
other such cost due to such failure, to Dealer.
10. Ordinance Changes. Dealer will notify GM of any changes in local
ordinances or regulations which affect the Equipment subject to this Agreement.
GM will perform any alterations or relocations necessary to comply with said
changes at Dealer's expense.
11. Dealer's Use of Equipment. Dealer agrees to use the Equipment only in
connection with authorized transmissions over the GM Pulsat Network and in
accordance with written procedures provided by GM from time to time. Dealer
further agrees to use the video programming only in connection with Dealer
business under its GM Dealer Sales and Service Agreement. Dealer will take no
action which may interfere with normal operation of the Equipment or increase
the expense of operating or maintaining the Equipment. No banners, signs,
lights, or other materials of any kind whatsoever will be attached or affixed to
the Equipment or any part thereof, including the satellite dish and its
supporting structure.
12. No assignments by Dealers. This Agreement may not be assigned by Dealer
except with the express prior written consent of GM. Any attempt by Dealer to
assign this Agreement without consent will be deemed a void assignment and
constitute default by Dealer of the terms and conditions hereof.
13. Operation and Maintenance. Dealer will use its best efforts to keep the
Equipment in good working order and condition and operate the Equipment in
accordance with written procedures provided by GM from time to time, which may
include routine maintenance procedures. Dealer will notify GM promptly whenever
the Equipment requires any repairs or services. GM will be responsible for
providing and paying for all such repairs or services; however, Dealer will
reimburse GM for any repairs or services which become necessary as a result of
abuse, misuse, or negligent use of the Equipment or failure to comply with
procedures prescribed by GM. Dealer will provide GM and its contractor with
access to the Premises and Equipment as required for repairs or services.
14. Equipment Damage or Destruction. In the event of damage to or destruction
of Pulsat Equipment by any cause whatsoever, GM may rebuild, replace or restore
said Equipment.
(4)
Dealer will be solely responsible for damages to or destruction of Equipment
caused by or resulting from any act, omission or negligence of Dealer, its
agents, invitees, employes or guests. Dealer will promptly reimburse GM for the
cost to GM to repair or replace Pulsat Equipment when damages result from
Dealer's or its agents', invitees', employees' or guests' act, omission or
negligence.
GM will carry at its expense Comprehensive General Liability Insurance on the
Equipment in the amount of at least two million ($2,000,000) dollars, combined
single limit. The maintenance of such insurance by GM will in no way limit or
release Dealer from liability as more particularly set forth herein. GM will
furnish a Certificate of Insurance upon request to any landowner.
IN NO EVENT WILL GM BE LIABLE TO DEALER OR THIRD PARTIES FOR ANY INDIRECT,
SPECIAL OR CONSEQUENTIAL DAMAGES SUCH AS BUT NOT LIMITED TO LOSS OF ANTICIPATED
PROFITS, OTHER ECONOMIC LOSS, LOSS OF USE OF EQUIPMENT OR MATERIALS, COST OF
SUBSTITUTE EQUIPMENT OR MATERIALS, OR DOWNTIME COST(S) IN CONNECTION WITH OR
ARISING OUT OF THE FURNISHING, FUNCTIONING OR USE OF ANY ITEM OF EQUIPMENT OR
SERVICE PROVIDED FOR IN THIS AGREEMENT.
15. Equipment Removal. It is agreed that the Pulsat Equipment is and at all
times pertinent hereto will remain personal property, owned by GM (including its
affiliates), and that even though attached or connected to real estate it will
not become or be deemed to be real estate improvements, fixtures or
appurtenances.
GM will have the right, at the expiration or termination of this Agreement, to
remove all Equipment bailed to Dealer pursuant hereto. GM will not be required
to remove any satellite dish foundations or footings in their entirety, but only
to grade level. In the case of a roof-mounted satellite dish, removal will be
deemed complete when any structure is removed to several inches above the roof
level, even though columns or supports may extend below. GM will endeavor to
complete the removal within ninety days following termination of this Agreement
or following GM's receipt of a written request therefore from Dealer or a
landowner in lawful possession of the Premises.
16. Defaults by Dealer. In the event Dealer is in default of any provision of
this Agreement for a period of sixty days, then GM may, at its option, terminate
this Agreement, remove the Pulsat Equipment from the Premises and be relieved of
all obligations to Dealer under this Agreement. Any waiver or non-enforcement
by GM of a breach of this Agreement on the part of Dealer will not constitute a
waiver of any further or future breach by Dealer. In the event of termination
of this Agreement pursuant to this section, Dealer will be responsible for any
damage to the Equipment until it is removed.
17. Advance Notice By Dealer. Dealer agrees to notify GM in writing at least
thirty days in advance of any impending sale, mortgage, or property lease
expiration of the real estate and improvements used by Dealer as dealership
facilities.
18. Equipment and Service Changes by GM. GM will have the right (but not the
duty) to change the Pulsat Equipment installed pursuant to this Agreement, and
related services, if similar changes are made for dealers in general. GM will
have the further right (but not the duty) to change the size, style, design,
specifications and type of Equipment or relocate any or all Equipment installed
pursuant to this Agreement if in the opinion of GM such change or
(5)
relocation is desirable to promote better performance. Any additional or
replacement equipment will be deemed Pulsat Equipment under this Agreement.
19. Assignment or Delegation By GM. All obligations under this Agreement to be
performed by GM may, at GM's option, be performed by parties with whom GM has
contracted for such performance or such parties as may be designated by GM to
perform the obligations. GM reserves the right to assign this Agreement.
20. Notices. All notices required by or permitted under this Agreement will be
in writing and will be deemed received when sent by certified or registered mail
properly addressed to the other party at the business address shown on the
Equipment Installation Agreement, or when actually delivered to the other party.
Either party may substitute for itself a new address by due notice to the other
party.
21. General. This Agreement, including these General Provisions and GM's
written procedures described herein, constitutes the full understanding of the
parties, and a complete and exclusive statement of the terms and conditions of
their agreement pertaining to the Pulsat Equipment. It cancels and supersedes
all prior understandings and agreements between them, whether express or
implied, pertaining to Dealer's acquisition and use of the Equipment. No
understanding or agreement which purports to modify or supplement this Agreement
will be binding unless hereafter made in writing and signed by the parties to be
bound thereby. This Agreement is binding on the parties and their respective
successors and permitted assigns. It is governed in all respects by the laws of
the State of Michigan. If any term, condition or provision of this Agreement or
the application thereof is judicially or otherwise determined to be invalid or
unenforceable, or if the parties mutually agree in writing to any revision of
this Agreement, the remainder of this Agreement and the application thereof will
not be affected, and this Agreement will otherwise remain in full force and
effect.
[PULSAT LOGO]
GM PULSAT NETWORK
EQUIPMENT INSTALLATION AGREEMENT
This Agreement is made between General Motors Corporation ("GM") and the party
identified below as "Dealer." Reference is made to (1) Dealer's Dealer Sales
and Service Agreement(s) for GM vehicles, (2) Dealer's DCS Service Agreement and
any other service agreement(s) pertaining to transmittal of authorized data over
the GM Pulsat Network. Where Dealer is not the landowner, this Agreement is
signed by Dealer's authorized representative in conjunction with a Consent and
Agreement of Landowner providing the landowner's consent for installation and
removal of the Equipment. This Agreement is effective upon signature by an
authorized Dealer representative and a GM Pulsat Network authorized
representative.
1. Dealer agrees to the installation, maintenance, removal and
operation of the Equipment described herein ("Pulsat Equipment" or
"Equipment"), which Equipment is bailed to Dealer in accord with this Agreement,
including the General Provisions attached hereto.
2. No separate charge is made to Dealer for a basic Equipment
configuration, Dealer's use of the Equipment in connection with the GM Pulsat
Network, basic installation, or basic GM provided maintenance. The basic
Equipment configuration, installation and GM provided maintenance are described
below and in the General Provisions. If the Dealer requires Equipment or
services other than or in addition to the basic levels, they are also described
below and will be subject to a separate charge.
3. Dealer acknowledges the Equipment is the property of GM
(including affiliated companies) held by Dealer in bailment. Upon termination
of the Agreement GM may remove from the installation premises all of the
Equipment installed hereunder, and GM's only obligations upon such removal will
be those described in the General Provisions.
Dealer 315 CLENDENNY AV ON RT 40
-------------------------
Address: JERSEY CITY, NEW JERSEY 07304
-----------------------------
Business Management Division (BMD): OLDSMOBILE DIVISION
-------------------------
Premises of Installation (if different from above): BMD Dealer
Code: 02015
-----
------------------------------
------------------------------
Basic Equipment: Optional Equipment/Services:
Digital Interface Unit (DIU) ___ Antenna De-icer
Integrated Receiver Decoder (IRD) ___ Extended Maintenance
Very Small Aperture Terminal (VSAT)___ ____________________
____________________
GM Pulsat Coordinator:
Name:______________________________________ Phone: _____________________
Alternate:_________________________________ Phone: _____________________
J & F OLDSMOBILE-ISUZU PARTNERSHIP
----------------------------------
Dealer Firm Name GENERAL MOTORS CORPORATION
By /s/ Joseph Mitolo 10/2/92 By /s/ Illegible
------------------------------------- --------------------------------
Signature and Title Date General Director, Dealer Systems
By /s/ Illegible 10/2/92
------------------------------------- --------------------------------
uthorized Representative Date
After signing above, mail document to: GM Pulsat Network, Administrative
Offices, P. O. Box 500, Troy, MI 48007-0500
PART I
DESCRIPTION OF PREMISES
J & F OLDSMOBILE - ISUZU PARTNERSHIP
---------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY OCTOBER 02, 1992
- ------------------------------------- -------------------------------
City, State Date of this GMMS
(Mo., Day, Yr.)
JANUARY 1973 JANUARY 1979
- ------------------- ------------------- -------------------------------
Facts Dealer Number Date Main Facility Date Main Facility Remodeled or
Constructed(Mo., Yr.) Added to (Mo., Yr.)
LOCATION, USE AND OWNERSHIP OF PREMISES
A Identify by street address each separate B Indicate by C IF LEASED, INDICATE:
dealership location and describe how each (X) Whether Name of Lessor:
is used for GM operations. Specify: Beginning and Expiration
NEW VEHICLE SALES, USED VEHICLE Date of Lease
SALES, SERVICE, PARTS, OFFICE, Premises Are
NEW VEHICLE STORAGE, BODY SHOP,
etc. Also
indicate distance of each separate Annual Rental: $
location from main location. Dealer Leased Renewal Option: Term and
Asset Annual Rental
MAIN 315 CLENDENNY AV ON RT 440 X J&S EQUITY
JERSEY CITY, NEW JERSEY 06-01-1983 THRU 05-31-1993
NEW DISP. USED DISP, MECHANICAL, SERV $180,000
RECP, PARK-CUST, GEN OFFICE, PARTS 10 YEAR WITH 10 YEAR
2 45 BENNETT
JERSEY CITY, NEW JERSEY J&S EQUITY ASSOC.
SERV RECP, PARK-CUST, EMP PK/MSC X 06-01-1983 THRU 05-31-1993
0.1 MILES FROM MAIN SAME AS MAIN FACILITY
3 34-30 BENNETT STREET
JERSEY CITY, NEW JERSEY ADELE MIRTO
11-01-1987 THRU 10-31-1990
USED DISP, SERV RECP, NEW STORAGE X $36,000
0.1 MILES FROM MAIN
4 27-37 BENNETT STREET
JERSEY CITY, NEW JERSEY ADELE MIRTO
11-01-1987 THRU 10-31-1990
SERV RECP, PARK-CUST, EMP PK/MSC X $12,000
0.1 MILES FROM MAIN
5 599 RT. 440
JERSEY CITY, NEW JERSEY J & S FORD
NEW STORAG X $36,000
0.1 MILES FROM MAIN
6
MILES FROM MAIN
TOTAL DEALERSHIP IN SQUARE FEET
D GM Use Other Use Total Area
------------ --------------- ----------------
Total Building 22,074 14,350 36,424
Total Lot 37,000 4,000 41,000
Grand Total 59,074 18,350 77,424
(Location and Premises Addendum continued)
PART II
PREMISES SPACE ANALYSIS
J & F OLDSMOBILE - ISUZU PARTNERSHIP
------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY OCTOBER 02, 1992
- ---------------------------------------- ----------------------------
City, State Date of GMMS 1016 (Mo., Day, Yr.)
Actual Space in Number of Stalls TOTAL
Lot
DEPARTMENTAL ALLOCATION Building (Do not include building)
GM Use Other Use GM Use Other Use (A+B+C+D)
(A) (B) (C) (D) (E)
(1) New Vehicle Display 8 6 14
(2) Used Vehicle Display 67 67
(3) Productive Service - Mechanical 17 9 26
(4) Productive Service - Body
(5) Service Reception 5 1 6
(6) Parking Customer 70 22 92
(7) New Vehicle Storage 400 100 500
(8) Employee Parking and
Miscellaneous 35 5 40
(9) Total of Lines (1) through (8) 30 16 572 127 745
Actual Space in Square Feet TOTAL
GM Use Other Use (A + B)
(A) (B) (E)
(10) General Office 3,000 1,400 4,400
(11) Parts 6,000 2,950 8,950
(12) Total of Lines (10) and (11) 9,000 4,350 13,350
CAR LINES HANDLED
General Motors Division(s) Non-GM Lines Handled
OLDSMOBILE
GM space requirements are currently under review and updated GM space
requirements will be published in the Service Policy and Procedures
Manual.
SUCCESSOR ADDENDUM
TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
This Successor Addendum is effective OCTOBER 22, 1992 and
---------------------------------------
is executed pursuant to the provisions of Article 12.1 of the current Dealer
Agreement in effect between the undersigned Dealer and Division of General
Motors.
On the basis of the information provided by Dealer, in connection with the
Request for Execution of Successor Addendum, Division and Dealer Agree that:
1. Subject to paragraphs 2 and 3 below, the proposed dealer operator(s)
for purposes of designating and establishing a proposed successor
dealer as provided in Article 12.1 of the Dealer Agreement shall be
JOSEPH C. DIFEO
---------------------------------------------------------------
---------------------------------------------------------------
2. If more than one current Dealer Operator is named in 1 above,
a. the remaining Dealer Operator alone shall have the right to
designate a proposed successor dealer, or ___ Yes
b. all of the proposed dealer operators who remain or
survive,including the remaining Dealer Operator, shall acting
together have such rights, ___ Yes
3. The following person(s), if any, shall be proposed owner(s) (indicate
"none", if applicable):
NONE
- -------------------------------------------------------------------
- -------------------------------------------------------------------
4. Dealer may cancel an executed Successor Addendum at any time prior to
the death of any party named as Dealer Operator in Paragraph THIRD of
this Agreement. General Motors may cancel an executed Successor
Addendum only if the proposed dealer operator no longer complies with
the requirements of Article 12.1.1. The parties may execute a new and
superseding Successor Addendum by mutual agreement. If Division has
previously notified Dealer that it does not plan to continue
Dealership Operations at the Dealership Location, Division shall have
no obligation to execute a Successor Addendum, except for a renewal of
an existing Successor Addendum with the same proposed dealer operator
provided Dealer and the Proposed Dealer Operator comply with the
requirements of Article 12.1.1.
5. This Addendum shall become null and void upon the execution of a new
Dealer Agreement by Dealer and Division.
6. This Successor Addendum cancels and supersedes any previous Successor
Addendum between the parties.
J & F OLDSMOBILE - ISUZU PARTNERSHIP
--------------------------------------------------------------------
Dealer Firm Name
JERSEY CITY, NEW JERSEY
----------------------------------------------------------
City, State
OLDSMOBILE DIVISION
General Motors Corporation
By /s/ Joseph Mitolo, President By /s/ Illegible
----------------------------------- -------------------------------------
Signature and Title Date OLDSMOBILE ZONE MANAGER Date
The undersigned, as all Dealer Operator(s) and Owner(s) of Dealer, hereby
individually signify their concurrence with the above agreements and waive any
rights in conflict with the above agreements they may have or acquire under
either the Dealer Agreement or applicable law.
/s/ Jospeh Mitolo
- ------------------------------------- ----------------------------------------
DATE DATE
/s/ Sam C. DiFeo
- ------------------------------------- ----------------------------------------
DATE DATE
-27-
[LETTERHEAD OF OLDSMOBILE]
October 2, 1992
J & F Oldsmobile-Isuzu Partnership
315 Clendenny Avenue, Route 440
Jersey City, New Jersey 07304
Attention: Joseph J. Mitolo
Samuel C. DiFeo
Ezra P. Mager
Marshall S. Cogan
Gentlemen:
This "Letter Agreement" will confirm our discussions regarding your request that
Oldsmobile Division approve the ownership of your dealer entity J & F
Oldsmobile-Isuzu Partnership (30%) and DiFeo Partnership, Inc. (70%) - through a
holding company arrangement. This holding company arrangement is shown in
Exhibit 1.
The General Motors Corporation Dealer Sales and Service Agreement is a personal
service contract requiring that the person named as Dealer Operator in Paragraph
THIRD, Mr. Joseph J. Mitolo will actively exercise full managerial authority in
the Dealership Operations, and that all Owners of Dealer will each continue to
own, both of record and beneficially, the percentage of ownership set forth in
the Dealer Statement of Ownership. In order to maintain the reputation and
goodwill of Oldsmobile and its dealer network, Oldsmobile retains the right to
identify and approve each party participating in the financial ownership and
general management of dealerships selling and servicing its automotive product.
Experience has shown that successful dealerships, in general, are those in which
the individual or individuals who operate the dealership enjoy the financial
benefits resulting from their successful management. It has also been found
that a dealership cannot generally be operated satisfactorily where the handling
of operating details are subject to actual or potential interference by parties
who are solely financial participants.
Further, it has been Oldsmobile's policy for many years to be able to identify
and approve each party participating in the financial ownership and general
management of dealerships franchised by Oldsmobile Division.
Jersey City, New Jersey
Page Two
October 2, 1992
For reasons such as these, Oldsmobile has had an operating policy that provides
that Oldsmobile may approve ownership of a dealer entity by a corporation or
holding company, with the express provision that there be no change in the
composition of the financial interests and/or ownership comprising such
corporation or holding company unless such change has first been accepted and
approved by Oldsmobile in writing.
Further, that the Dealer Operator shall own an unencumbered interest in the
dealer company and/or of the holding company that is at least equivalent to 15%
of the greater of:
(a) The total equity investment of the dealer entity (excluding real estate);
-OR-
(b) The sum of the dealer entity's net working capital standard amount, plus
all fixed and other assets (excluding real estate) net of depreciation.
You have represented and certified to Oldsmobile that J & F Oldsmobile Corp.
will hold a 30% ownership in the DiFeo Oldsmobile Partnership and that EMCO
Motor Holding, Inc. a subsidiary of "21" International Holdings, Inc., will hold
a 70% ownership in Difeo Oldsmobile Partnership.
As evidenced by Attachment "A", Joseph J. Mitolo and Samuel C. DiFeo are sole
owners of J & F oldsmobile Corp. respectively.
It is represented and certified to Oldsmobile that EMCO Motor Holdings, Inc.,
70% owner of DiFeo Partnership, Inc., is owner by two stockholders: Ezra Mager,
and "21" International Holdings, Inc. as evidenced by Attachment "B".
It is further represented and certified to Oldsmobile that Marshall S. Cogan
personally holds a 45.24% equity ownership and 76.51% voting control in "21"
International Holdings, Inc. as evidenced by Attachment "C".
After considering all matters relevant to your request, Oldsmobile hereby
approves the ownership of the DiFeo Oldsmobile Partnership by J & F Oldsmobile
Corp. (30%) and EMCO Motor Holding, Inc. (70%), subject to the conditions and
understandings in the Supplemental Agreement to General Motors Dealer Sales and
Service Agreement.
-2-
Jersey City, New Jersey
Page Three
October 2, 1992
Also, further subject to condition and understanding that the ownership of the
stock, J & F Oldsmobile, Corp. and EMCO Motor Holdings, Inc. set forth on the
"ownership attachments" hereto, will not be changed without the PRIOR written
approval of Oldsmobile, which will be evidenced solely by means of acceptable
replacement "ownership attachments" duly signed on behalf of Oldsmobile. It is
recognized that failure to obtain such prior written approval will constitute
cause for termination of the Dealer Agreement under Article 12.2.1. thereof. J
& F Oldsmobile, Corp. and EMCO Motor Holdings, Inc. agree to maintain accurate
records reflecting the owners and managers of the DiFeo Oldsmobile Partnership
and to provide new "ownership attachments" to Dealer and Oldsmobile upon
request.
Further, GM prior written approval is not required when there are ownership
changes in "21" International Holdings, Inc. provided there is no change in
Marshall S. Cogan's equity ownership and/or voting control in "21" International
Holdings, Inc. GM prior written approval is required for all changes in
Marshall S. Cogan's equity ownership and/or voting control in "21" International
Holdings, Inc.
By affixing your signatures to the Attachments "A", "B" and "C", you are
agreeing to all the terms and conditions as set forth in this "Letter
Agreement".
Very truly yours,
Oldsmobile Division
General Motors Corporation
/s/ J.J. Zubor
---------------
J.J. Zubor
Zone Manager
-3-
ATTACHMENT "C" TO LETTER AGREEMENT
With Oldsmobile Division
Dated: October 2, 1992
- --------------------------------------------------------------------------------
In accordance with provisions of the Letter Agreement dated October 2, 1992
between Oldsmobile Division, General Motors Corporation, and "21" International
Holding, Inc., the undersigned hereby represents and certifies to Oldsmobile
Division that the following information pertaining to record and/or beneficial
ownership of the capital stock of "21" International Holding, Inc. is true,
accurate, and complete.
Shares Owned Type or Book
Owner Of Record Beneficially Class Value $
- ----- ------------------------ --------- -------
See Attached Schedule ------------------------- --------- --------
of Owners ----------- ----------- ---------- --------- --------
- --------------------- ----------- ---------- --------- --------
- --------------------- ----------- ---------- --------- --------
T O T A L S ----------- ---------- $ 52,300,000
-----------------------
DECEMBER 31, 1991
By:/s/ M.S. Cogan
---------------------------
Marshall S. Cogan, Chairman
Date:
----------------------------
OWNERSHIP OF ABOVE HOLDING COMPANY AS OF DECEMBER 31, 1992, IS ACCEPTED AS
REPRESENTED ABOVE.
OLDSMOBILE DIVISION
General Motors Corporation
By:/s/ J.J. Zubor
----------------
J.J. Zubor
ATTACHMENT "B" TO LETTER AGREEMENT
With Oldsmobile Division
Dated: October 2, 1992
- --------------------------------------------------------------------------------
Statement of Ownership
EMCO Motor Holdings, Inc.
As of October 2, 1992
In accordance with provisions of the Letter Agreement dated October 2, 1992
between Oldsmobile Division, General Motors Corporation, and DiFeo Oldsmobile
Partnership, the undersigned hereby represents and certifies to Oldsmobile
Division that the following information pertaining to record and/or beneficial
ownership of the capital stock of EMCO Motor Holdings, Inc. - 100% owner of
DiFeo Partnership, Inc. - is true, accurate, and complete.
Shares Owned Type or Book
Owner Of Record Beneficially Class Value $
- ----- ------------------------ --------- -------
Ezra P. Mager 3.0% 17,740
- --------------------- ---------- -------- --------- -------
"21" International 97.0% 603,160
- --------------------- ---------- -------- --------- -------
Holdings, Inc.
- --------------------- ---------- -------- --------- -------
T O T A L S 100.0% $620,900
---------- -------- --------- -------
By:/s/ Ezra P. Mager OCTOBER 2, 1992
------------------------------
Ezra P. Mager, Pres/Sec/Treas.
/s/ M. S. Cogan By:
--------------------------- ---------------------------
Marshall S. Cogan, Chairman
Date: October 2, 1992
-------------------------
OWNERSHIP OF ABOVE HOLDING COMPANY AS OF OCTOBER 2, 1992, IS ACCEPTED AS
REPRESENTED ABOVE.
OLDSMOBILE DIVISION
General Motors Corporation
By: /s/ J.J. Zubor
-----------------
J.J. Zubor
ATTACHMENT "A" TO LETTER AGREEMENT
With Oldsmobile Division
Dated: October 2, 1992
- --------------------------------------------------------------------------------
Statement of Ownership
J & F Oldsmobile, Corp.
As of 10/2/92
In accordance with provisions of the Letter Agreement dated October 2, 1992
between Oldsmobile Division, General Motors Corporation, and DiFeo Oldsmobile
Partnership, the undersigned hereby represents and certifies to Oldsmobile
Division that the following information pertaining to record and/or beneficial
ownership of the capital stock of J & F Oldsmobile, Corp. is true, accurate, and
complete.
Shares Owned Type or Book
Owner Of Record Beneficially Class Value $
- ----- ------------------------ --------- -------
Samuel C. DiFeo 75 75% Common 66,525
- -------------------- ---------- ----------- --------- -------
Joseph J. Mitolo 25 25% Common 199,575
- -------------------- ---------- ----------- --------- -------
- -------------------- ---------- ----------- --------- -------
- -------------------- ---------- ----------- --------- -------
T O T A L S $ 266,100
---------- ----------- ----------------------
OCTOBER 2, 1992
By: /s/ Joseph J. Mitolo
--------------------
Joseph J. Mitolo
Sam C. DiFeo
--------------------
Sanuel C. DiFeo
OWNERSHIP OF ABOVE CORPORATION AS OF OCTOBER 2, 1992, IS ACCEPTED AS REPRESENTED
ABOVE.
OLDSMOBILE DIVISION
General Motors Corporation
By: /s/ J.J. Zubor
----------------
J. J. Zubor
Jersey City, New Jersey
Page Four
October 2, 1992
Agreed this 2nd day of October, 1992
DiFeo Oldsmobile Partnership
By: /s/ Joseph J. Mitolo
-----------------------
Joseph J. Mitolo
/s/ Samuel C. DiFeo
-----------------------
Samuel C. DiFeo
/s/ Marshall S. Cogan
-----------------------
Marshall S. Cogan
/s/ Ezra P. Mager
-----------------------
Ezra P. Mager
J & F Oldsmobile, Corp.
By: /s/ Samuel C. DiFeo
-----------------------
Samuel C. DiFeo
/s/ Joseph C. Mitolo
-----------------------
Joseph C. Mitolo
DiFeo Partnership, Inc. "21" International Holdings, Inc.
By: /s/ Marshall S. Cogan By: /s/ Marshall S. Cogan
----------------------- --------------------------
Marshall S. Cogan Marshall S. Cogan
/s/ Ezra P. Mager
-----------------------
Ezra P. Mager
EMCO Motor Holdings, Inc.
By: /s/ Marshall S. Cogan
-----------------------
Marshall S. Cogan
/s/ Ezra P. Mager
-----------------------
Ezra P. Mager
[LETTERHEAD OF OLDSMOBILE]
October 2, 1992
J & F Oldsmobile Partnership
315 Clendenny Avenue, Route 440
Jersey City, New Jersey 07304
Attention: Joseph J. Mitolo
Samuel C. DiFeo
Marshall S. Cogan
Ezra P. Mager
Gentlemen:
This Supplemental Agreement ("Agreement") is entered into between DiFeo
Oldsmobile Partnership, J & F Oldsmobile, Corp. DiFeo Partnership, Inc., EMCO
Motor Holdings, Inc. (EMCO), and "21" international Holdings, Inc. (THHI) and
General Motors Corporation, Oldsmobile Division.
WHEREAS, Oldsmobile has entered into a General Motors Corporation Dealer Sales
and Service Agreement ("Dealer Agreement") with DiFeo Partnership ("The
Partnership").
WHEREAS, "The Partnership" is the Dealer and J & F Oldsmobile, Corp. and DiFeo
Partnership, Inc. are the Dealer Owners as those terms are identified in the
Dealer Agreements; and
WHEREAS, the Division has entered into the Dealer Agreement in consideration for
the reliance upon certain understandings, assurances and representatives which
parties hereto wish to document;
NOW, THEREFORE, the parties agree as follows:
1. For purposes of the Dealer Agreements, including Paragraph Third and
Article 12.2 Joseph J. Mitolo shall be considered a Dealer Operator. The
Divisions have relied and will rely upon the personal qualifications and
management skills of Joseph J. Mitolo as Executive V-P of the Partnership. The
Partnership and EMCO represent that Joseph J. Mitolo with the concurrence of the
Executive Committee, has complete and irrevocable authority to make all
decisions, and enter into any and all necessary business commitments on behalf
of The Partnership and may take all actions normally required of a Dealer
Operator pursuant to Paragraph Third and Article 2 of the Dealer Agreement.
Neither The Partnership nor EMCO will revoke, modify or amend such authority
without prior written approval of Oldsmobile which will act on behalf of all
Divisions in administering this Agreement.
2. Mr. Joseph J. Mitolo's removal or withdrawal as Dealer Operator without
prior written consent shall constitute grounds for termination of dealer
Agreement. However, the Division recognizes that Mr. Mitolo's employment
responsibilities with The Partnership may change, as described in Section 1(d)
of the Employment Agreement, making it impractical for him to continue to
fulfill his responsibilities as Dealer Operator. In this event, or in the event
Mr. Mitolo leaves the employ of The Partnership or transfers his interests in
The Partnership pursuant to Sections 7.03 and 70.4 of Master Agreements and
Articles 7.2, 7.3 and 7.4 of the Partnership Agreement; then The Partnership
shall have the opportunity to propose a replacement Dealer Operator. the
Division will comparable to those of Mr. Mitolo The Partnership shall make every
effort to obtain the consent of the Division to proposed replacement dealer
Operator prior to Mr. Mitolo's withdrawal: if such is not practical in the
circumstances, The Partnership shall notify Oldsmobile writing within 10 days
following Mr. Mitolo's withdrawal. Within 60 days of that withdrawal, The
Partnership will submit to Oldsmobile a plan to replace Mr. Mitolo with
qualified Dealer Operator acceptable to Oldsmobile. the replacement Dealer
Operator must assume his responsibilities no later than 120 days following Mr.
Mitolo's withdrawal.
3. DiFeo Partnership, Inc. is wholly-owned subsidiary of EMCO, which in turn,
is a subsidiary or TIHI. DiFeo Partnership, Inc. hereby represents that its
representatives and assurances herein are within its authority to make and do
not contravene any directive, policy or procedure of EMCO or TIHI. DiFeo
Partnership, Inc. hereby represents that EMCO and TIHI are aware of and concur
with the representation of DiFeo Partnership, Inc. are herein.
4. Any change at all in ownership of DiFeo Partnership or EMCO or any change
in Marshall Cogan's equity ownership and/or voting control in TIHI shall be
considered a change in ownership of Dealer under terms of the Dealer Agreements,
and all applicable provisions of those Dealer Agreements will apply to any such
change.
5. Given the ultimate control which EMCO and TIHI have over DiFeo Partnership.
Inc. and J & F Oldsmobile, Corp. and, thus, J & F Oldsmobile - Isuzu
Partnership, and the Divisions strong interest in assuring that those who own
and control its dealers have interests consistent with those of the Divisions, J
& F Oldsmobile Isuzu Partnership, J & F Oldsmobile, Corp. and DiFeo Partnership,
Inc. agree that if an ownership interest is acquired in TIHI by a person or
entity which notifies TIHI via schedule 13D filed with the Securities and
Exchange Commission, The Partnership, J & F Oldsmobile, Corp. and DiFeo
Partnership, Inc. shall advise Oldsmobile in writing, providing a copy of that
Schedule. In the event that Item 4 of that Schedule discloses that the person
or entity acquiring such ownership interest intends or may intend either:
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(a) an acquisition of additional securities of TIHI or (b) an extraordinary
corporate transaction such as a merger, reorganization or liquidation, involving
TIHI or any of its subsidiaries or (c) a sale or transfer of material amount of
assets of TIHI or any of its subsidiaries or (d) any change in the present Board
of Directors or management of TIHI or (e) any other material change in TIHI
business or corporate structure or (f) any action similar to those noted above,
then, if the Divisions reasonably conclude that such person or entity does not
have interests compatible with those of General Motors, or is otherwise not
qualified to have an ownership interest in a General Motors dealership, the
Partnership, J & F Oldsmobile, Corp. and DiFeo Partnership, Inc. agree that
within one year of receipt of written notice from Oldsmobile of this fact, they
will, (1) transfer The Partnership's assets to a third party acceptable to the
Division (2) voluntarily terminate The Partnership's Dealer Agreements, or (3)
provide evidence to Oldsmobile such person or entity no longer has such
ownership interest in TIHI. However, The Partnership, J & F Oldsmobile, Corp.
and DiFeo Partnership, Inc. will have six additional months to accomplish 1,2,
or 3 above if at the end of one year. Oldsmobile concludes that The
Partnership, J & F Oldsmobile, Corp. and DiFeo Paernership's assets to a third
party acceptable to the Division, and the Partnership is otherwise effectively
fulfilling its obligations under its Dealer Agreement.
6. The executive Committee and Officers of The Partnership ad the Directors
and Officers of J & F Oldsmobile, Corp. DiFeo Partnership, Inc., EMCO, and TIHI
has all passed resolutions affirming the representations herein, copies of which
are attached hereto.
7. The parties agree that this Agreement shall Supplement the terms of the
dealer Agreements in accordance with Article 17.1 of the Dealer Agreements.
8. In the event that the policies of General Motors Corporation with regard to
the issues addresses herein should be modified, the parties agree to review such
modifications to determine modification to this Addendum is appropriate.
IN WITNESS WHEREOF, the parties have executed this Agreement this 2nd day of
October, 1992.
GENERAL MOTORS CORPORATION DiFEO OLDSMOBILE PARTNERSHIP
OLDSMOBILE DIVISION
By:/s/ By: /s/ Joseph J. Mitolo
________________________ ----------------------
Joseph J. Mitolo
/s/ Ezra P. Mager
----------------------
Ezra P. Mager
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Its: /s/ Sam C. DiFeo /s/ Marshall S. Cogan
---------------------------- ----------------- ----------------------
Sam C. DiFeo Marshall S. Cogan
"21" International Holdings EMCO Motor Holdings, Inc.
By:/s/ Marshall S. Cogan By:/s/ Marshall S. Cogan
----------------------- -----------------------
Marshall S. Cogan Marshall S. Cogan
Chairman Chairman
/s/ Ezra P. Mager
-----------------------
Ezra P. Mager, Pres
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[LETTERHEAD OF OLDSMOBILE]
December 20, 1993
Mr. George Lowrance
EMCO DiFeo Automotive Group
585 Route 440
Jersey City, NJ 07304
Dear Mr. Lowrance:
This will acknowledge your letters dated October 4, 1993 regarding your request
for a change in the ownership of EMCO Motor Holdings, Inc. for Fair Cadillac-
Oldsmobile-Isuzu Partnership, DiFeo Oldsmobile Partnership and J & F Oldsmobile-
Isuzu Partnership t/a DiFeo Oldsmobile.
Enclosed find executed new Attachment "B" Letter Agreements reflecting capital
stock and ownership changes in EMCO Motor Holdings, Inc. for each partnership.
Please have the respective officers of EMCO sign and date the Letter Agreements
and return to my attention. Upon completion of all required signatures, I will
forward you copies for the dealership records.
Should you have any questions, please contact me personally.
Sincerely,
/s/ M. A. LoBianco
M. A. LoBianco
Business Management Manager
MAL/mg
cc: J. J. Zubor
ATTACHMENT "B" TO LETTER AGREEMENT
With Oldsmobile Division
Revision Date: 12/14/1993
- --------------------------------------------------------------------------------
Statement of Ownership
EMCO Motor Holdings, Inc.
As of 12/14/93
In accordance with provisions of the Letter Agreement dated October 2, 1992,
between Oldsmobile Division, General Motors Corporation, and J & F Oldsmobile
- -Isuzu-Partnership t/a DiFeo Oldsmobile, the undersigned hereby represents and
certifies to Oldsmobile Division that the following information pertaining to
record and/or beneficial ownership of the capital stock of EMCO Motor Holdings,
Inc. - 100% owner of DiFeo Partnership, Inc. - is true, accurate and complete.
Shares Owned Type or Book
Owner Of Record Beneficially Class Value $
- ----- ---------- ------------ --------- -------
Ezra P. Mager 156,250 1.56% Common
"21" International 3,437,500 34.36% Common
Holdings, Inc.
Reserved "Options" 1,500,838 15.00% Common
OTHERS - see attached 4,911,000 49.08% Preferred
Schedule
T O T A L S 10,005,588 100.0% $ 77,860,000
By:/s/ Marshall S. Cogan Date: Dec 22, 1993
---------------------------
Marshall S. Cogan, Chairman
By:/s/ Joseph Herman By:/s/ E Mager
------------------------------ ------------------------------
Joseph C. Herman, Executive VP Ezra P. Mager, Pres/Sec/Treas.
OWNERSHIP OF ABOVE HOLDING COMPANY AS OF JAN 3, 1994, IS ACCEPTED AS REPRESENTED
ABOVE.
OLDSMOBILE DIVISION
General Motors Corporation
By:/s/ J.J. Zubor
------------------
J.J. Zubor
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SUPPLEMENTAL AGREEMENT TO
GENERAL MOTORS CORPORATION
DEALER SALES AND SERVICE AGREEMENT
This Supplemental Agreement ("Agreement") is entered into among J&F Oldsmobile-
Isuzu Partnership ("Dealer"), DiFeo Partnership, Inc. and UAG Northeast, Inc.
(each a "Dealer Owner" and collectively "Dealer Owners"), United Auto Group,
Inc. ("Public Company") and General Motors Corporation, Chevrolet Motor
Division, acting on behalf of itself, and _________N/A__________ (collectively
"Divisions").
WHEREAS, the Divisions have each entered into a General Motors Corporation
Dealer Sales and Service Agreement ("Dealer Agreement") with Dealer permitting
Dealer to conduct Dealership Operations on behalf of Divisions from approved
locations identified in the Dealer Agreement;
WHEREAS, the organization and ownership structure of Dealer and Dealer Owners
are such that the terms of the Dealer Agreement are not wholly adequate to
address the legitimate business needs and concerns of the Dealer, Dealer Owners
and Divisions; and
WHEREAS, Dealer, Dealer Owners and the Divisions have entered into their
respective Dealer Agreements in consideration for and reliance upon certain
understandings, assurances and representations which the parties hereto wish to
document;
NOW, THEREFORE, the parties agree as follows:
1. For purposes of the Dealer Agreement, including Paragraph Third and
Article 2, [individual to be approved by GM] shall be considered as Dealer
Operator. The Divisions have relied and will rely upon the personal
qualifications and management skills of Dealer Operator who also serves as
executive manager of the Dealer. Dealer and Dealer Owners hereby represent
that Dealer Operator has complete and irrevocable authority to make all
decisions, and enter into any and all necessary business commitments
required in the normal course of conducting Dealership Operations on behalf
of Dealer and may take all actions normally required of a Dealer Operator
pursuant to Paragraph Third and Article 2 of the Dealer Agreement. Neither
Dealer nor Dealer Owners will revoke, modify or amend such authority
without the prior written approval of Divisions. Because of the unique
structure of Dealer, the 20% ownership requirement contained in Article 2
shall not apply to Dealer Operator.
2. The removal or withdrawal of Dealer Operator without Divisions' prior
written consent shall constitute grounds for termination of the Dealer
Agreements subject to applicable law. However, the Divisions recognize
that employment responsibilities of the Dealer Operator with
Dealer and/or Dealer Owners may change, making it impractical for the
Dealer Operator to continue to fulfill his/her responsibilities as Dealer
Operator. In that case, or in the event Dealer Operator leaves the employ
of Dealer and/or Dealer Owners, Dealer shall have the opportunity to
propose a replacement Dealer Operator. The Divisions will not unreasonably
withhold approval of any such proposal, provided the proposed replacement
has the skills and qualifications to act as Dealer Operator pursuant to the
standard policies and procedures of General Motors Corporation.
Dealer shall make every effort to obtain the consent of the Divisions to a
proposed replacement Dealer Operator prior to the removal or withdrawal of
the approved Dealer Operator. If that is not practical, Dealer shall
notify Division in writing within 10 days following the withdrawal of the
approved Dealer Operator. Within 60 days of that withdrawal, Dealer will
submit to Division a plan and appropriate applications to replace Dealer
Operator with a qualified replacement acceptable to Division. The
replacement Dealer Operator must assume his/her responsibilities no later
than 90 days following the withdrawal of the approved Dealer Operator.
3. All of the partnership interests of Dealer are owned by Dealer Owners,
which, in turn, are wholly-owned subsidiaries of Public Company. Dealer,
Dealer Owners and Public Company hereby warrant that the representations
and assurances of each herein are within their respective authority to make
and do not contravene any directive, policy or procedure of Dealer, Dealer
Owners or Public Company. The parties hereto acknowledge that the
provisions of this Agreement shall not be applicable until such time as
Public Company completes a public offering of its stock.
4. Any material change in ownership of Dealer or of Dealer Owners, or any
event with respect to Public Company described in Paragraph 5 below, shall
be considered a change in ownership of Dealer under the terms of the Dealer
Agreements, and all applicable provisions of those Dealer Agreements will
apply to any such change. The Divisions have executed the Dealer
Agreements in reliance upon the ownership and management structure and any
material change in such structure (other than changes in ownership of
Public Company, which are discussed in Paragraph 5 below), shall be the
basis for a review of the agreements between us and whether changes and
modifications are required and whether the business relationship between us
should continue or terminate.
5. Given the ultimate control Dealer Owners have over Dealer, the control of
Dealer Owners by Public Company, and the Divisions' strong interest in
assuring that those who own
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and control their Dealers have interests consistent with those of the
Divisions, Dealer, Dealer Owners and Public Company agree that if an
ownership interest is acquired in Public Company by a person or entity
which notifies Public Company via Schedule 13D filed with the Securities
and Exchange Commission, Dealer shall advise Division in writing, and
attach a copy of that Schedule. In the Event Item 4 of that Schedule
discloses that the person or entity acquiring such ownership interest owns
or controls twenty percent (20%) of Public Company and intends or may
intend either: (a) an acquisition of additional securities of Public
Company or (b) an extraordinary corporate transaction such as a merger,
reorganization or liquidation, involving Public Company or any of its
subsidiaries or (c) a sale or transfer of a material amount of assets of
Public Company or any of its subsidiaries or (d) any change in the present
Board of Directors or management of Public Company or (e) any other
material change in Public Company's business or corporate structure or (f)
any action similar to those noted above, then, if the Divisions reasonably
conclude that such person or entity does not have interests compatible with
those of General Motors, or is otherwise not qualified to have an ownership
interest in a General Motors dealership, Dealer and Dealer Owners agree
that within 90 days of receipt of written notice from Division of this
fact, it will: (i) transfer the assets associated with Dealer to a third
party acceptable to the Division, (ii) voluntarily terminate the Dealer
Agreements in effect with Dealer, or (iii) provide evidence to Divisions
that such person or entity no longer has such an ownership interest in
Public Company. Should Dealer enter into an agreement to transfer its
assets to a third party, the right of first refusal described in Article
12.3 shall apply to any such transfer.
6. Dealer, Dealer Owners, Public Company and General Motors stipulate and
agree that the dispute resolution process for the appropriate General
Motors Division shall be the initial, exclusive source of resolution of any
dispute regarding the General Motors Dealer Agreement(s) and this
Supplemental Agreement including, but not limited to, involuntary
termination of the Dealer Agreement(s) and/or approval of Dealer Owner or
Public Company for additional investment in or ownership of General Motors
dealerships. Upon final determination through such dispute resolution,
each party shall have recourse to a review de novo by the appropriate state
court or administrative agency consistent with the provisions of state law.
The parties agree that should a party making such appeal lose the issues
presented on appeal, then that party shall pay the reasonable expenses,
including reasonable attorneys' fees, of the other party for the defense of
such de novo review. The parties further agree that if a dispute is
specific to a particular division, the appropriate divisional dispute
resolution
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mechanism will be used for the resolution of that particular matter.
7. Dealer, Dealer Owners and Public Company further stipulate and agree that
if Dealer, Dealer Owners, General Motors and the public are to realize the
potential benefits that Dealer, Dealer Owners and Public Company represent
to be the result of General Motors approving the ownership structure
proposed by Dealer Owners, then an integral component of the participation
by Dealer, Dealer Owners and Public Company is their agreement that all
such dealerships owned by Dealer Owners or Public Company shall fully
comply with General Motors Network 2000 Channel Strategy including proper
franchise alignment and facilities that are properly located and that are
in compliance with appropriate divisional image programs. The Channel
Strategy as it relates to Dealer is set forth in a memorandum dated
October 5, 1995, from Ronald L. Zarrella to all GM dealers, a copy of
which is attached hereto and in a facsimile from General Motors Corporation
to Dealer dated April 1, 1996.
Dealer and Dealer Owners further stipulate and agree that within 12 months
of the acquisition of any General Motors dealership that is not consistent
with the Channel Strategy, Dealer and Dealer Owners will have complied with
the Channel Strategy for that location. If Dealer and Dealer Owners fail
to do so within the time provided, then Dealer will terminate the
representation of such products as reasonably required by General Motors to
comply with the Channel Strategy. If such termination is required, General
Motors will compensate Dealer and Dealer Owners the total sum of Fifty
Thousand Dollars ($50,000) for each Dealer Agreement so terminated.
8. Dealer and Dealer Owners agree that all such dealerships shall be solely
for the exclusive representation of General Motors products and related
services and in no event shall be used for the display, sale or promotion
of any new vehicle other than those of General Motors Corporation or Saturn
Corporation.
Dealer and Dealer Owners agree that should Dealer cease to provide
exclusive representation of General Motors products, based on the proper
franchise alignment as determined by the Channel Strategy, then that shall
constitute good cause in and of itself for the termination of the Dealer
Agreements then in effect with Dealer and Dealer shall voluntarily
terminate the Dealer Agreements then in effect.
9. In the event of any termination of the Dealer Agreement or any transaction
or event that would, in effect, discontinue Dealership Operations from that
location, Dealer Owners agree to provide General Motors with: (a) a right
of first refusal on any bona fide offer to purchase the dealership
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facilities, (b) an assignment of any existing lease or lease options that
are available, or if desired by the Divisions, Dealer Owners agree to enter
into good faith negotiations for the sale or lease of the facility to the
Divisions or their assignee.
10. Dealer and Dealer Owners agree to provide to Divisions a list of the
officers and key management of Dealer and Dealer Owners along with those
individuals' key responsibilities in regard to the control and management
of Dealer. Dealer and Dealer Owners agree to propose to Divisions any
material changes in the individuals or their responsibilities. Such
proposal should be provided to the Divisions in writing sixty (60) days
prior to such change and shall include sufficient information to permit
Divisions to evaluate the proposed change consistent with normal policies
and procedures. For purposes of this Agreement, the term "key management"
shall mean Carl Spielvogel - Chairman and CEO, Arthur J. Rawl - Executive
Vice President and Chief Financial Officer, and George Lowrance - Executive
Vice President, Secretary and General Counsel.
11. Dealer Owners recognize that customers benefit from competition in the
marketplace and agree that any proposal to acquire additional GM
dealerships shall be subject to and considered consistent with the terms of
General Motors Multiple Dealer Investor/Multiple Dealer Operator policies
as set forth in NAO Bulletin 94-11, a copy of which has been provided to
Dealer Owners.
12. Dealer Owners agree that all General Motors dealerships in which Dealer
Owners maintain an investment will use Electronic Funds Transfer (E.F.T.)
for settlement of the dealership obligations to General Motors and that
General Motors will have right of offset for any unpaid debit balances for
any General Motors dealership in which Dealer Owners maintain or maintained
an investment at the time the indebtedness occurred and the right to
collect those amounts from the account for any other General Motors
dealership in which Dealer Owners maintain an investment.
13. Dealer and Dealer Owners agree that Dealer shall maintain, at all times,
sufficient working capital to meet or exceed the minimum net working
capital standards for the Dealer as determined from time to time by the
Divisions consistent with the normal practices and procedures of the
Divisions. Dealer and Dealer Owners shall provide such documentation as
reasonably requested by the Divisions to assure compliance with that
requirement. Dealer Owners shall submit an annual audited consolidated
balance sheet for the combined dealership operations of Dealer Owners.
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14. The parties agree that this Agreement shall supplement the terms of the
Dealer Agreements in accordance with Article 17.11 of the Dealer
Agreements.
15. In the event that the policies of General Motors Corporation with regard to
the issues addressed herein should be modified, the parties agree to review
such modifications to determine whether modification to this Agreement is
appropriate.
16. Nothing in this Agreement or the Dealer Agreement shall be construed to
confer any rights upon any person not a party hereto or thereto, nor shall
it create in any party an interest as a third party beneficiary of this
Agreement or the Dealer Agreement. Dealer and Dealer Owners hereby agree
to indemnify and hold harmless General Motors Corporation, its directors,
officers, employees, subsidiaries, agents and representatives from and
against all claims, actions, damages, expenses, costs and liability arising
from or in connection with any action by a third party in its capacity as a
stockholder of Public Company other than through a derivative stockholder
suit authorized by the Board of Directors of Public Company.
17. This Agreement is intended to modify and adapt certain provisions of the
Dealer Agreement and is intended to be incorporated as part of the Dealer
Agreement. In the event that any provision of this Agreement are in
conflict with other provisions of the Dealer Agreement Standard Provisions,
the provisions contained in this Supplemental Agreement shall govern.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of this 23 day
of July, 1996.
J&F Oldsmobile-Isuzu Partnership DiFeo Partnership, Inc.
/s/ Carl Spielvogel /s/ Carl Spielvogel
- ---------------------- ----------------------
By: Carl Spielvogel By: Carl Spielvogel
Title: Chairman and CEO Title: Chairman and CEO
Date: Date:
United Auto Group, Inc. UAG Northeast, Inc.
/s/ Carl Spielvogel /s/ Carl Spielvogel
- ---------------------- ----------------------
By: Carl Spielvogel By: Carl Spielvogel
Title: Chairman and CEO Title: Chairman and CEO
Date: Date:
General Motors Corporation
Chevrolet Division
/s/ G. M. Desmond
- ----------------------
By: G. M. Desmond
Title: Director, Dealer Organization
Date: June 12, 1996
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