EXHIBIT 10.7
MASTER AGREEMENT
This Master Agreement ("Agreement") is entered into by and between FAA
Serramonte, Inc. d/b/a Dodge of Serramonte ("SERRAMONTE DODGE"), a California
corporation; FAA Poway D, Inc., d/b/a Poway Dodge ("POWAY DODGE"), a California
corporation; FAA Dublin VWD, Inc., d/b/a Dublin Dodge ("DUBLIN DODGE"), a
California corporation; First America Automotive, Inc. ("FAA"), a Nevada
corporation; Thomas A. Price, President of SERRAMONTE DODGE and POWAY DODGE and
forty-one (41%) percent stockholder of FAA ("PRICE"); and Chrysler Corporation
("CHRYSLER"), a Delaware corporation.
Following is a statement of facts underlying this Agreement:
FAA proposes to purchase Asian Pacific Industries, Inc., d/b/a Valley
Dodge, and become an authorized Dodge dealer in Dublin, California by forming
the new corporation, DUBLIN DODGE.
FAA'S proposal to purchase Valley Dodge is contingent upon the approval of
CHRYSLER.
FAA owns the majority interest in a CHRYSLER Dealership, SERRAMONTE DODGE,
in Colma, California, which has poor customer satisfaction performance. FAA has
recently purchased the assets of POWAY DODGE in Poway, California and is now
seeking to purchase the assets of Valley Dodge under its new corporation to be
formed, DUBLIN DODGE, and has agreed to execute a Master Agreement concerning
the improvement of Customer Satisfaction Index ("CSI") at SERRAMONTE DODGE and
achievement of CSI requirements at POWAY DODGE and DUBLIN DODGE.
SERRAMONTE DODGE, POWAY DODGE, and PRICE desire FAA to purchase the assets
of Valley Dodge and operate the Dodge dealership under the new corporation,
DUBLIN DODGE.
NOW, THEREFORE, in consideration as set forth below, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. CHRYSLER agrees to approve the sale of Valley Dodge to FAA
notwithstanding the poor CSI performance at SERRAMONTE DODGE. CHRYSLER further
agrees to award DUBLIN DODGE a Dodge Sales and Service Agreement, a copy of
which is attached hereto as Exhibit "A", which will give FAA the right to
conduct business operations as a Dodge dealer, in Dublin, California.
2. In consideration for CHRYSLER'S approval of FAA'S purchase of Valley
Dodge and for CHRYSLER awarding DUBLIN DODGE the Sales and Service Agreement,
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SERRAMONTE DODGE, POWAY DODGE and DUBLIN DODGE, FAA and PRICE agree to the
following:
(a) FAA shall achieve a twelve (12) month CSI score at each of its
CHRYSLER dealerships - SERRAMONTE DODGE, POWAY DODGE and DUBLIN
DODGE - which is equal to or greater than the average rating for the
Zone Group Levels in which each dealership is included within its
dealership's sales zone.
(b) FAA and any of its companies, subsidiaries, affiliated companies,
successor companies, or companies in which any of its current officers
and directors have a controlling interest shall (1) not seek to
purchase a new CHRYSLER dealership or to purchase stock or a
partnership interest of an existing CHRYSLER dealership or seek to
become an authorized dealer of any of CHRYSLER vehicle tines until FAA
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meets the CSI requirement in Paragraph (a) above, at each of its
dealerships, and (2) at the time it seeks to purchase, the twelve (12)
month CSI score at each of its CHRYSLER dealerships must be equal to
or greater than the average rating for the Zone Group Levels in which
each dealership is included within its dealership's sales zones.
3. This Agreement cannot be altered, modified, waived or amended, in
whole or in part, except in writing signed by a duly authorized officer or agent
of SERRAMONTE DOD GE, POWAY DODGE, DUBLIN DODGE and, FAA, PRICE and an officer
or the National Dealer Placement Manager of CHRYSLER
4. The failure of any party hereto to enforce any rights arising under
this Agreement on one or more occasion shall not operate as a waiver of that or
any other right on that or any other occasion.
5. This Agreement sets forth the entire agreement and understanding
between the parties hereto pertaining to the matters referred to herein except
and to the extent that other documents specifically referred to in this
Agreement might also contain additional agreements and understandings
between the panties hereto. To the extent that there is any conflict between
this Agreement and any other such document, the terms of this Agreement will
prevail. It is specifically understood and agreed by all parties that this
Agreement is totally separate, distinct and apart from all such other agreements
and understandings. Furthermore, there are no other promises, representations or
inducements pertaining to the subject matter of this agreement except as
expressed herein. The terms of this Agreement are contractual and not mere
recitals.
6. This Agreement has been fully and completely negotiated and shall not
be construed more strictly against any parry hereto.
7. The meaning, performance, operation, construction and legal effect of
this Agreement shall be construed according to the laws of the State of Michigan
applicable to
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agreements made and wholly performed therein.
8. Should SERRAMONTE DODGE, POWAY DODGE, DUBLIN DODGE, FAA, or PRICE
breach any provision of this Agreement, CHRYSLER may pursue any and all remedies
at law or equity including, but not limited to, specific performance of this
Agreement and FAA and PRICE shall be liable for any and all attorneys fees and
court costs incurred by CHRYSLER in the pursuit of those remedies.
9. SERRAMONTE DODGE, POWAY DODGE, DUBLIN DODGE, FAA and PRICE shall each
do and perform or cause to be done and performed all such further acts and
things and shall execute and deliver all such other agreements, certificates,
instruments and documents as CHRYSLER may reasonably request in order to carry
out the intent and accomplish the purposes of this Agreement and the
consummation of the transactions contemplated hereby.
10. This Agreement will be fully binding on the heirs, successors and
assigns of the parties hereto.
11. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, and all of which together shall constitute
one and the same document.
12. This Agreement is deemed to have been signed by the parties hereto,
coincidental with the effective date of the CHRYSLER Sales and Service Agreement
for DUBLIN DODGE and this Agreement will not be canceled or superseded by this
Sales and Service Agreement
13. The parties hereby agree that they have read and they understand the
terms of this Agreement and have had the advice of legal counsel.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by a duly authorized corporate officer or agent and, upon signature by
all parties, this Agreement shall be binding upon them all.
FAA SERRAMONTE, INC. FAA POWAY D, INC.
D/B/A DODGE OF SERRAMONTE D/B/A POWAY DODGE
By: /s/ Thomas A. Price By: /s/ Thomas A. Price
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Thomas A. Price Thomas A. Price
Its: President Its: President
Dated: 6/25/97 Dated: 6/25/97
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FAA DUBLIN VWD, INC. FIRST AMERICA AUTOMOTIVE, INC.
D/B/A DUBLIN DODGE
By: /s/ Thomas A. Price By: Thomas A. Price
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Thomas A. Price Thomas A. Price
Its: President Its: President
Dated: 6/25/97 Dated: 6/25/97
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THOMAS A. PRICE CHRYSLER CORPORATION
By: /s/ Thomas A. Price By: /s/ Van W. Gray
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Thomas A. Price Van W. Gray
Individually Its: Dealer Placement Manager
Dated: 6/25/97 Dated: 7/1/97
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