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EXHIBIT 10.2.13
(MAZDA LOGO)
STANDARD PROVISIONS
12. ACQUISITION, DELIVERY, AND INVENTORY OF MAZDA PRODUCTS.
A. ACQUISITION OF MAZDA PRODUCTS. Dealer has the right to order and
purchase Mazda Products, as specified in the Product Addendum, from
Mazda or other Mazda Dealers in accordance with the terms of the
Agreement and such other requirements as may be established by Mazda
from time to time. Dealer agrees to purchase such new Mazda Products
meeting all applicable state and federal specifications and
requirements, only from Mazda or other Mazda Dealers licensed in the
United States.
Except as Dealer may indicate to the contrary, Dealer warrants that
all Mazda Products purchased from Mazda or other Mazda Dealers, except
those used in Dealer's Business, or by Dealer personally, shall be
purchased only for retail sale or lease in the regular course of
Dealer's Business. Dealer has furnished and agrees to furnish to
Mazda all applicable retail certificates relating to retail
transactions, in the form required by law.
B. AVAILABILITY AND ALLOCATION OF PRODUCT. Mazda agrees to use its best
efforts to provide such Mazda Products as stated above to Dealer in
such quantities and types as Dealer may require in order to fulfill
Dealer's obligations for the sale and servicing of Mazda Products
under this Agreement. However, Dealer and Mazda acknowledge that
Mazda's supply of Mazda Products can vary from time to time for many
reasons and that to maintain an effective distribution system, it may
be necessary for Mazda to allocate its supply of Mazda Products among
Mazda Dealers. Mazda shall endeavor to allocate Mazda Products among
its dealers in a fair and equitable manner, utilizing uniform methods
of allocation which take into consideration such factors as are
reasonably relevant. Mazda agrees to provide Dealer with an
explanation of the method used to distribute such products upon
written request, and will advise Dealer of Mazda's total wholesale
sales of Mazda Vehicles, by series, in Dealer's market area and to
Dealer individually, for a reasonable time frame.
C. PRICES AND TERMS OF SALE. Dealer agrees to purchase such Mazda
Products according to the prices, charges (including destination,
shipping and other applicable charges) and terms Mazda may establish
and revise from time to time. Revised prices, charges and terms shall
apply to any Mazda Products not already invoiced to Dealer by Mazda as
follows:
(i) At the time the notice of any such change is given to Dealer (in
the case of Mazda Vehicles);
(ii) Upon issuance of a new or modified parts price list or through
change notices, letters, bulletins, or revision sheets (in the
case of parts, options and accessories); or
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(iii) At such other times as may be designated by Mazda in writing.
Dealer shall pay for all Mazda Products when billed, unless other
terms are established by Mazda in writing. Ownership of and title to
Mazda Products sold by Mazda to Dealer shall pass to Dealer upon
Mazda's receipt of full payment for such Mazda Products.
D. METHOD, PLACE AND CHARGES ASSOCIATED WITH PRODUCT DELIVERY.
(i) METHOD AND PLACE OF DELIVERY. Mazda shall deliver Mazda Products
to Dealer as soon as is practicable after acceptance of Dealer's
order. Mazda shall designate the distribution points, and shall
select the mode of transportation and carrier for transportation
of Mazda Products to Dealer. Mazda Products may be delivered to
Dealer at Dealer's Authorized Location or to the nearest
practicable unloading point from Dealer's Authorized Location.
(ii) CHARGES ASSOCIATED WITH PRODUCT DELIVERY. Dealer shall pay Mazda
such charges as Mazda establishes in its reasonable discretion
establishes for the above transportation services, under such
terms and conditions as established in Mazda's Policies and
Procedures.
E. INVENTORY DAMAGE CLAIMS & LIABILITY. Mazda shall have the risk of loss
until Mazda Products are delivered to Dealer and signed for or
accepted by Dealer in accordance with Dealer's arrangements with the
carrier, and thereafter the risk of loss shall pass to Dealer. Dealer
shall promptly notify Mazda of any damage occurring during transit and
shall, if instructed by Mazda, file damage claims on Mazda's behalf
against the transportation carrier. Dealer agrees to assist Mazda in
obtaining recovery against any transportation carrier or insurer for
loss or damage to Mazda Products delivered to Dealer.
To the extent required by law, Dealer shall notify the customer prior
to the sale of a Mazda Product of any damage known or made known to
Dealer which was sustained by that Mazda Product. Dealer shall defend,
indemnify and hold Mazda harmless from any liability and/or loss
resulting from Dealer's failure to so notify the purchaser.
F. DELAYS/FAILURES IN DELIVERY. Mazda shall not be liable for delays or
failures in delivery of Mazda Products resulting from any event beyond
Mazda's reasonable control, including, without limitation: fires,
floods, storms or other acts of God, any law or regulation of any
governmental entity, foreign or civil wars, riots, terrorist acts,
interruptions of navigation, shipwrecks, strikes, lockouts or other
labor troubles, embargoes, or blockades. Dealer agrees to make claims
promptly, in writing, to Mazda for shortages in any shipments of Mazda
Products within the time and in the manner required by Mazda.
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G. CHARGES FOR NON-ACCEPTANCE OR NON-PAYMENT BY DEALER. If after
delivery, Dealer fails or refuses to accept or pay for Mazda Vehicles
that it has agreed to purchase, Dealer shall pay all resulting charges
incurred by Mazda. These charges shall not exceed the total of the
charge of returning any such product to the point of original shipment
by Mazda plus all charges for demurrage, storage or other charges
relating to such failure or refusal, as well as any and all reasonable
charges for demurrage, storage or other charges accruing after return
of the shipment to the point of original shipment. Mazda agrees to pay
all expenses incurred by Dealer to reship to Mazda any Mazda Vehicle
not ordered by Dealer; provided, that Dealer notifies Mazda of the
incorrect shipment, and reships the Mazda Vehicles promptly and as
directed by Mazda.
H. PRODUCT CHANGES BY MAZDA. Mazda may change the design or
specifications of, or the options for, any Mazda Product, or make any
similar changes in any Mazda Product previously purchased by or
delivered to Dealer, without notice to Dealer. No change shall be
considered a model year change unless solely specified by Mazda.
I. DISCONTINUANCE OF MANUFACTURE, IMPORTATION OR DISTRIBUTION. Mazda may
discontinue the manufacture, importation or distribution of all or
part of any Mazda Product, including motor vehicles, parts, options,
or accessories, and including any model, series, or body style of any
Mazda Vehicle, at any time without any obligation or liability to
Dealer.
J. VEHICLE INVENTORY OBLIGATIONS. Subject to Mazda's ability to supply
Mazda Vehicles to Dealer, Dealer shall, at all times, maintain for
purposes of display, demonstration and sale the appropriate number and
representative mix, as may be established by Mazda from time to time,
of the most current models of Mazda Vehicles set forth in the Product
Addendum. Dealer shall, at all times, maintain such Mazda Vehicles in
showroom ready condition.
K. RESTRICTIONS ON PRODUCT MODIFICATIONS BY DEALER. Mazda may request
that Dealer make modifications to Mazda Products from time to time.
Other than those modifications approved in writing by Mazda, Dealer
shall not make, or cause to be made, any modifications to any Mazda
Products which may tend to impair or adversely affect a Mazda
Product's safety, emissions, durability, or structural integrity, or
which are not in compliance with applicable law.
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13. DEALER MARKETING OF COMPANY PRODUCTS.
A. CUSTOMER SERVICE PHILOSOPHY. Dealer and Mazda agree that the success
and future growth of Dealer and Mazda are substantially dependent upon
maintaining the highest levels of customer satisfaction possible.
Accordingly, Dealer agrees to:
(i) Ensure that Dealer's sales personnel and administrative staff
receive professional and ongoing training in customer
satisfaction techniques and considerations;
(ii) Employ a sufficient number of qualified and trained personnel for
Dealer's sale of Mazda Products; and
(iii) Ensure that Dealer's sales personnel at all times treat
customers in a prompt, courteous, fair and professional manner
in accordance with Mazda's Policies and Standards.
B. DEALER'S SALES RESPONSIBILITIES. Dealer recognizes that customer
satisfaction and the successful promotion and sale of Mazda Products
are significantly dependent on Dealer's advertising and sales
promotion activities. Accordingly, Dealer shall at all times
honestly, energetically, professionally and effectively promote the
purchase of Mazda Products by:
(i) Advertising, merchandising, promoting and selling such Mazda
Products in an active and effective manner through Dealer's own
advertising and sales promotion activities;
(ii) Maintaining high standards of ethics in advertising, promoting
and selling such Mazda Products, and not engaging in any
misrepresentations, unlawful, unfair or deceptive practices; and
(iii) Accurately representing to customers the total sale or lease
price of such Mazda Products. Dealer agrees to explain to
customers of such Mazda Products the items that make up the
total sale or lease price and to give customers itemized
statements and all other information required by law. Dealer
understands and hereby acknowledges that it may sell or lease
such Mazda Products at whatever lawful price Dealer desires.
C. DEALER'S EXPORT SALES PROHIBITION. Dealer is authorized to sell Mazda
Products only to customers located in the United States. Dealer agrees
that it shall not knowingly sell Mazda Products for resale or use
outside of the United States. Dealer shall not be responsible for any
Mazda Vehicles registered in the United States, but subsequently
exported by the purchaser without Dealer's knowledge of the
purchaser's intent to export the Mazda Vehicles.
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D. USED VEHICLES. Dealer agrees to display, promote and sell used
vehicles at the Authorized Location(s). Dealer shall maintain for
retail sales an adequate inventory of used vehicles.
Mazda may from time to time develop used vehicle programs to enhance
Dealer's ability to promote sales and customer satisfaction. Such
programs shall be made available to all Mazda Dealers that meet
certain Policies and Standards. If Dealer meets such Policies and
Standards, Dealer is eligible to participate in such programs.
E. ASSISTANCE PROVIDED BY MAZDA.
(i) SALES TRAINING. To assist Dealer in the fulfillment of its sales
and customer satisfaction responsibilities under this Agreement,
Mazda agrees to offer general and specialized sales management
and sales training programs for the benefit and use of Dealer's
sales organization. Mazda may reasonably deem participation by
Mazda Dealers in certain programs to be essential for maintaining
an effective and efficient sales distribution system for Mazda
Products ("Essential Programs"). Attendance at all training
programs, whether or not an Essential Program, shall be at
Dealer's expense.
(ii) SALES PROMOTION ASSISTANCE. In order that authorized Mazda
Dealers may be assured of the benefits of comprehensive
advertising and promotion of Mazda Products, Mazda agrees to
establish and maintain general advertising and promotion programs
and shall from time to time make sales promotion and campaign
materials available to Dealer to promote the sales of Mazda
Products, at a reasonable charge if applicable.
(iii) FIELD SALES PERSONNEL ASSISTANCE. To assist Dealer in handling
its sales responsibilities under this Agreement, Mazda agrees to
provide qualified and trained field sales personnel to contact
Dealer on a periodic basis to: (a) advise and counsel Dealer on
sales-related subjects, including merchandising, sales, training
and general management matters; and (b) review and discuss
customer satisfaction matters.
F. INNOVATIVE MARKETING OPPORTUNITIES. In order to maintain an effective
and efficient sales distribution system for Mazda Products, it may be
necessary for Mazda to develop and implement new and innovative
marketing strategies, techniques and opportunities. Dealer agrees to
support Mazda's efforts by either participating in programs developed
by Mazda or by developing Dealer's own complementary marketing
strategies, techniques and opportunities.
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14. DEALER SERVICE OBLIGATIONS.
A. CUSTOMER SERVICE PHILOSOPHY. Dealer and Mazda agree that the success
and future growth of Dealer and Mazda are substantially dependent upon
the customer's ability to obtain high-quality vehicle service and
maintenance. Therefore, in striving for and maintaining the highest
levels of customer satisfaction possible, Dealer agrees to:
(i) Take all reasonable steps to provide the highest quality of
service for all Mazda Vehicles, regardless of where purchased and
whether or not covered under warranty;
(ii) Employ a sufficient number of qualified and trained personnel for
the service of Mazda Products;
(iii) Ensure that the customer is advised of the nature and cost of
any necessary repairs, and that his or her consent is obtained
prior to the initiation of any repairs;
(iv) Ensure that customer concerns with Mazda Vehicles are accurately
diagnosed and any necessary and approved repairs are promptly and
professionally performed;
(v) Ensure that Dealer's service and parts personnel receive
professional training in the servicing of Mazda Products and in
customer satisfaction techniques and considerations; and
(vi) Ensure that customers are at all times treated in a prompt,
courteous, fair and professional manner.
B. NEW VEHICLE PRE-DELIVERY OBLIGATIONS. Prior to delivery of each new
Mazda Vehicle to a customer. Dealer shall perform a pre-delivery
inspection and service on the vehicle in accordance with standards
and procedures established by Mazda. Mazda shall pay Dealer for such
pre-delivery service according to the applicable provisions of the
Mazda Warranty Policies and Procedures Manual.
Mazda shall prepare and affix appropriate stickers, tags and other
labels and notices to the customer ("CONSUMER NOTICE(S)") to all Mazda
Vehicles it delivers to Dealer. Dealer shall inspect and ensure that
all such Consumer Notices remain affixed to all Mazda Vehicles until
delivered to the customer.
C. WARRANTY AND POLICY SERVICE. Dealer acknowledges that the only
warranties applicable to Mazda Products shall be such written
warranty or warranties furnished by Mazda and Mazda's suppliers, as
revised from time to time. Except for its limited express liability
under such
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written warranty or warranties, Mazda does not assume any other
warranty obligation or liability. Dealer is not authorized to assume
or create any additional warranty obligations or liabilities on behalf
of Mazda. Any additional obligations assumed by Dealer shall be
Dealer's sole responsibility. Any extended service contract offered by
Mazda or others and sold by Dealer to a customer shall be governed by
its own terms.
Dealer agrees to abide by and implement Mazda's warranty procedures,
as amended from time to time, in all respects and shall comply with
all warranty requirements imposed by law.
Unless otherwise approved in writing in advance by Mazda, Dealer shall
perform all warranty repairs on Mazda Products using genuine Mazda
Parts and Accessories and shall make such other repairs or inspections
of Mazda Products as may be required or authorized by Mazda, in
accordance with Mazda's Policies and Procedures, regardless of where
the Mazda Product was purchased. Mazda agrees to compensate Dealer for
all warranty work, including labor, diagnosis and genuine Mazda Parts
and Accessories, in accordance with Mazda's Policies and Procedures
and at the rates established from time to time by Mazda. Warranty
service is provided for the benefit of customers, and Dealer agrees
that a customer shall not be obligated to pay any charges for warranty
work or any other services for which Dealer is reimbursed or paid by
Mazda.
D. USE OF PARTS AND ACCESSORIES IN NON-WARRANTY SERVICING. Subject to the
provisions set forth below, Dealer has the right to sell, install or
use, for making non-warranty repairs, products that are not genuine
Mazda Parts or Accessories. Dealer acknowledges, however, that its
customers expect that any parts or accessories that Dealer sells,
installs or uses in the sale, repair or servicing of Mazda Vehicles
are, or meet the high quality standards of, genuine Mazda Parts or
Accessories. Dealer agrees that in sales, repairs or servicing where
Dealer does not use genuine Mazda Parts or Accessories, Dealer shall
only utilize such other parts or accessories that shall not adversely
affect the operation or characteristics of the Mazda Vehicle being
sold, repaired or serviced and that are equivalent in quality and
design to genuine Mazda Parts or Accessories.
E. NON-GENUINE PARTS AND ACCESSORIES WARRANTY DISCLOSURES. In order to
minimize confusion and potential customer dissatisfaction, in any
instance where Dealer sells, installs or uses other than genuine Mazda
Parts or Accessories, Dealer shall disclose such fact to the customer
and shall advise the customer that these items are not included in
warranties furnished by Mazda. Such disclosure shall be written,
conspicuous and stated on the customer's copy of the service or repair
order or sale document. In addition, Dealer shall clearly explain to
the customer the extent of any warranty covering the parts or
accessories involved and shall deliver a copy of the warranty to the
customer.
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F. SERVICE CAMPAIGN INSPECTIONS AND CORRECTIONS. Dealer agrees to perform
service campaign inspections and/or corrections for owners or users of
all Mazda Products that qualify for such inspections and/or
corrections. Dealer further agrees to comply with all of Mazda's
directives and with the applicable procedures established by Mazda
from time to time relating to those inspections and/or corrections.
Mazda agrees to reimburse Dealer for all replacement parts and other
materials required and used in such work and for labor according to
Mazda's directives and the applicable procedures established by Mazda.
G. COMPLIANCE WITH SAFETY AND EMISSIONS CONTROL REQUIREMENTS. Dealer
agrees to comply and operate consistently with all applicable
provisions of federal, state and local laws, ordinances, rules,
regulations, consent decrees, and orders affecting Mazda Products and
Dealership Operations, including without limitation, those relating to
safety, emissions control, noise control and customer service. Dealer
and Mazda agree to provide to one another such information and
assistance as reasonably requested by the other in connection
therewith.
In the event that the laws of the state in which Dealer is located
require motor vehicle dealers or distributors to install in new or
used motor vehicles, prior to their retail sale, any safety devices or
other equipment not installed or supplied as standard equipment by
Mazda, then Dealer, prior to the sale of any Mazda Vehicle on which
such installations are required, shall properly install such devices
or equipment on such vehicle. Mazda agrees to reimburse Dealer for all
parts and other materials required and used for such work and for
labor according to the applicable procedures established by Mazda from
time to time. Dealer shall comply with state and local laws pertaining
to the installation and reporting of such equipment.
H. COMPLIANCE WITH CONSUMER PROTECTION STATUTES, RULES AND REGULATIONS.
Dealer shall promptly investigate and handle all matters brought to
its attention by Mazda, customers or users of Mazda Products, or any
public or private agency, relating to the sale or servicing of Mazda
Products so as to develop and maintain customer confidence in Dealer,
Mazda and Mazda Products. Because certain customer complaints may
impose liability upon Mazda under various repair or replacement laws
or other consumer protection laws, rules and regulations, Dealer
agrees to provide immediate notice to Mazda of such complaints and
take such other steps as Mazda may reasonably require. Dealer shall do
nothing to affect adversely Mazda's rights under such laws, rules and
regulations. Subject to any law, rule or regulation to the contrary,
where Mazda reasonably establishes that Dealer failed to carry out
vehicle repairs in accordance with written and published Mazda
Policies and Procedures or Mazda's express oral instructions
subsequently confirmed in writing, Dealer shall be liable to Mazda for
any refunds or vehicle replacements provided to customer. Dealer also
agrees to provide applicable customer notifications and disclosures
prescribed by repair or replacement laws or other consumer laws or
regulations.
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15. SERVICE AND PARTS OPERATIONS.
A. ORGANIZATION AND STANDARDS. Dealer agrees to organize and maintain a
trained service and parts organization of the highest quality,
including a qualified service manager and a qualified parts manager,
and a number of competent customer relations, service and parts
personnel sufficient to meet the needs of the marketplace, in Mazda's
reasonable opinion. Dealer's personnel shall meet the educational,
management and technical training standards established by Mazda and
Dealer.
B. SERVICE EQUIPMENT AND SPECIAL TOOLS. Dealer agrees to acquire and
properly maintain adequate service equipment and such special tools
and instruments as Mazda specifies.
C. PARTS INVENTORY OBLIGATIONS. Dealer and Mazda recognize that owners
and users of Mazda Vehicles may reasonably expect that Dealer shall
have genuine Mazda Parts or Accessories immediately available for
purchase or installation. Dealer, therefore, agrees to carry in stock
at all times during the term of this Agreement an adequate inventory
of genuine Mazda Parts or Accessories, as listed in Mazda's current
inventory guide, to enable Dealer to meet the current and reasonably
anticipated requirements of its customers and to fulfill its service
responsibilities under this Agreement.
Mazda shall prepare and affix appropriate Consumer Notices to all
Mazda Parts or Accessories it delivers to Dealer. Dealer shall ensure
that all such Consumer Notices remain affixed to all Mazda Parts or
Accessories, or on or in the original packaging for Mazda Parts or
Accessories, until delivered to the customer.
D. MANUALS AND MATERIALS. Dealer agrees to acquire, at Dealer's expense,
and properly maintain and use adequate copies of such dealer manuals,
catalogs, bulletins, publications and technical data as Mazda deems
necessary for the needs of Dealer's service and parts organization.
Dealer shall be responsible for keeping such manuals, publications and
data current and available for consultation by its employees.
E. ASSISTANCE PROVIDED BY MAZDA.
(i) SERVICE AND PARTS TRAINING. To assist Dealer in fulfilling its
service and parts responsibilities under this Agreement, Mazda
agrees to offer general and specialized service and parts
training programs for the benefit and use of Dealer's service and
parts organizations. When requested by Mazda, Dealer's personnel
shall participate in such programs at Dealer's expense.
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(ii) MANUALS AND MATERIALS. Mazda agrees to make available to Dealer,
at Dealer's expense, copies of such dealer manuals, catalogs,
bulletins, publications and technical data as Mazda deems
necessary for the needs of Dealer's service and parts
organization.
(iii) SPECIAL TOOLS AND EQUIPMENT. Mazda agrees to make available to
Dealer, at Dealer's expense, special tools and equipment as
Mazda deems reasonably necessary for use by Dealer's service and
parts organization.
(iv) FIELD PERSONNEL ASSISTANCE. To assist Dealer in handling its
service and parts responsibilities under this Agreement, Mazda
agrees to make available qualified field service and parts
personnel who shall, from time to time, advise and counsel Dealer
on service and parts-related subjects, including service and
parts policies, product quality, technical adjustments, repair
and replacement of product components, recall, product
improvement or product update campaigns conducted by Mazda,
customer relations, warranty administration, service and parts
merchandising, and personnel/management training.
16. CUSTOMER SATISFACTION RESPONSIBILITIES. One of Mazda's and Dealer's goals
is to be recognized as marketing the finest products and providing the best
service in the automobile industry. The Mazda name should therefore be
synonymous with the highest level of customer satisfaction.
A. RESPONSIBILITIES OF DEALER. Dealer shall take all reasonable steps to
ensure that each customer is completely satisfied with his or her
Mazda Products and Dealer's services and practices. Accordingly,
Dealer shall:
(i) Designate an employee principally responsible for customer
satisfaction who has the authority to handle and resolve most
customer satisfaction matters;
(ii) Ensure customer satisfaction by:
(a) Emphasizing customer satisfaction to all Dealer's employees,
ensuring that customers are at all times treated in a
prompt, courteous, fair and professional manner, and
cooperating fully with Mazda in customer satisfaction
matters involving Dealer;
(b) Ensuring that Dealer's employees, including Dealer's General
Manager, attend Mazda's customer satisfaction training
sessions, at Dealer's expense;
(c) Responding immediately to, and using its best efforts to
positively resolve, requests for customer assistance, and
conveying to customers that Dealer is committed to the
highest possible level of customer satisfaction; and
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(d) Avoiding any and all deceptive, misleading, illegal, unethical
and discourteous practices;
And,
(iii) Advise Mazda promptly and fully, and maintain written records, of
customer claims or problems in accordance with guidelines or
instructions established by Mazda from time to time.
B. RESPONSIBILITIES OF MAZDA. Mazda acknowledges that Mazda has an
obligation to support Dealer's efforts to achieve a high level of customer
satisfaction. Accordingly, Mazda shall:
(i) Ensure that qualified Mazda personnel contact Dealer on a periodic
basis to discuss customer satisfaction matters;
(ii) Designate persons having principal responsibility and authority on
behalf of Mazda to handle and resolve customer satisfaction matters
with customers and Dealer;
(iii) Prepare and offer to Dealer consumer materials about Mazda Products
and services;
(iv) Establish effective consumer communications programs;
(v) Provide Dealer with the support needed to identify and make
improvements in Dealership Operations through customer satisfaction
programs as may be implemented by Mazda from time to time;
(vi) Promptly and fully advise Dealer with respect to customer matters
involving Dealer, and respond in a timely fashion to notices from
Dealer in situations involving claims of defects in Mazda Products;
and
(vii) Provide appropriate information to enable Dealer to respond to
customers, consumer organizations and government agencies in a timely
and courteous fashion regarding customer satisfaction matters
involving Dealer.
C. MEASUREMENT OF CUSTOMER SATISFACTION PERFORMANCE. Mazda's and Dealer's
respective performance in promoting customer satisfaction and maintaining
their customer service philosophy shall be evaluated on a regular basis
through systems established by Mazda from time to time, together with
survey results and unsolicited customer comments. Mazda shall establish
reasonable, uniform criteria with which to evaluate Dealer. Mazda and
Dealer agree to work together toward the goal of ever-improving customer
satisfaction in accordance with the goals of their customer service
philosophy.
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17. DEALER FACILITIES AND IDENTIFICATION.
A. FACILITIES. In order for Mazda to establish an effective network of
authorized Mazda Dealers, Dealer shall provide, and at all times
maintain, attractive Dealer Facilities at the Authorized Location(s)
which satisfy the image, size, layout, interior design, color,
equipment, identification and other factors established by Mazda.
Dealer shall meet the minimum facility Policies and Standards
established by Mazda from time to time.
To assist Dealer in planning, building, remodeling and maintaining
Dealer Facilities, upon Dealer's request Mazda shall:
(i) Provide to Dealer, or assist Dealer in identifying, sources from
which Dealer may purchase architectural materials and furnishings
which meet Mazda's standards and guidelines; and
(ii) Provide the services of Mazda representatives to counsel and
advise Dealer from time to time in connection with Dealer's
maintaining and equipping the Dealer Facilities.
B. OPERATION HOURS BY DEALER. Dealer agrees to keep all aspects of
Dealer's Business open for business during all days and hours that are
customary and lawful for such operations in the community or locality
in which Dealer is located and in accordance with industry standards.
The dealership shall not be considered open unless: (i) Dealer has for
sale the appropriate number and mix of available Mazda Vehicles of the
current models set forth in the Product Addendum; (ii) sales, service
and parts operations are open to the public during Dealer's regular
business hours; and (iii) an appropriate staff of dealership personnel
are present to assist customers.
C. AUTHORIZED SIGNS. Subject to applicable governmental statutes,
ordinances, rules and regulations, Dealer agrees to comply with Mazda's
signage program and to display only standard authorized signs (from a
Mazda approved vendor) in accordance with the Signs Addendum and which
conform to Mazda's corporate identification program, guidelines and
specifications as established by Mazda from time to time.
D. USE OF MAZDA MARKS.
(i) USE BY DEALER. Mazda grants to Dealer the non-exclusive privilege,
during the term of this Agreement, of displaying or otherwise
using Mazda Marks at the Authorized Location(s) in connection with
the selling or servicing of Mazda Products. Dealer may use the
Mazda Marks as specified by Mazda only at Authorized Location(s)
and for the purposes specified in this Agreement. Dealer agrees
that such Mazda Marks may be used as part of the assumed business
name ("dba") under which Dealer's Business is conducted,
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only with the prior written approval of Mazda and upon such terms
and conditions as Mazda may specify from time to time.
Dealer further agrees to promptly discontinue the display and use
of any mazda marks, or to change the manner in which any Mazda
Marks are displayed and used, when, for any reason, Mazda
requests. Dealer shall also discontinue any advertising Mazda
finds to be harmful to the business or reputation of Mazda, Mazda
Marks, or any other Mazda Dealer.
(ii) DISCONTINUANCE OF USE. Upon termination, non-renewal or expiration
of this Agreement, Dealer agrees that it shall at its own expense
(except as otherwise specified below) immediately:
(a) Discontinue the use of all Mazda Marks, or any semblance of
Mazda Marks, including without limitation: on all stationery;
on signs, posters, and advertising matter; in any legal name
or assumed business name; in telephone directory listings,
and in other printed material; or in any other form or
medium;
(b) Discontinue the use of all Mazda Marks, or any semblance of
same, as part of its assumed business name or legal entity
name, and file a change or discontinuance of such name with
appropriate authorities;
(c) Promptly, and at Dealer's expense, remove and consult with
Mazda regarding the proper disposal of all signs bearing
Mazda Marks and all items that are an integral part of
Mazda's image;
(d) Cease representing itself as an authorized Mazda Dealer; and
(e) Refrain from any action, including without limitation, any
advertisement, statement or implication that Dealer is
authorized by Mazda to sell, distribute or service Mazda
Products.
(iii) SIGNAGE AND IDENTIFICATION REMOVAL OBLIGATIONS. In the event
Dealer fails to comply promptly with the terms and conditions of
Section 17(C) (Authorized Signs) or 17(D) (Use of Mazda Marks),
Mazda shall have the right to enter upon Dealer's premises and
remove, without notice or liability, all such signs and
identifications bearing Mazda Marks. If applicable, Dealer shall
obtain, in writing, the right for Mazda to enter upon any real
property leased for Dealer's Business in order for Mazda to take
the actions set forth in this paragraph. Dealer agrees to hold
Mazda harmless from any damage to property or injury to persons
reasonably incurred in connection with such removal. Dealer agrees
that it shall reimburse Mazda for any costs and expenses incurred
in such removal, including reasonable attorneys' fees and costs.
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18. CAPITAL, CREDIT, RECORDS AND UNIFORM SYSTEMS.
A. NET WORKING CAPITAL STANDARDS. The amount and structure of the net
working capital required to properly conduct Dealer's Business depends
upon many factors, including the nature, size and volume of Dealer's
vehicle sales, service and parts operations. Dealer agrees to
establish and maintain actual net working capital in an amount not
less than the minimum net working capital specified in the Financial
and Capital Addendum. The amount so specified is not a warranty by
Mazda of the adequacy of such financial resources for the successful
conduct of Dealer's Business.
Mazda has the right, due either to changed conditions or Mazda's
adoption of a new net working capital formula or standards, to require
Dealer to establish and maintain a new minimum net working capital
amount for Dealer's Business. If revised, Mazda shall issue and
deliver to Dealer an amended Financial and Capital Addendum, and
Dealer agrees to meet the new minimum net working capital requirements
within a reasonable period of time.
B. VEHICLE WHOLESALE LINE OF CREDIT. Dealer recognizes that the ability
to fulfill its obligations under this Agreement depends upon
maintaining a wholesale line of credit or other financial arrangements
acceptable to Mazda ("FLOORING") sufficient to sustain Dealer's
required new vehicle and demonstrator vehicle inventory. Dealer agrees
to obtain and maintain at all times open, unencumbered, unrestricted,
confirmed and adequate Flooring with a bank or financial institution,
in a form and in an amount, which shall enable Dealer to perform its
obligations under this Agreement, all of which must be acceptable to
Mazda. Subject to the foregoing, Dealer is free to choose the bank or
financial institution that will undertake its financing business
(wholesale, retail or both) and the extent of such undertaking.
All Mazda Vehicles that Dealer purchases from Mazda shall be charged
to such Flooring. Mazda shall, as of the date such vehicles are
reasonably expected to be delivered to Dealer, electronically draft or
otherwise draw on Dealer's wholesale bank or financial institution for
payment.
C. PAYMENT TERMS AND SETTLEMENT OF ACCOUNTS. All monies or accounts due
to Dealer from Mazda will be net of Dealer's obligations to Mazda on
Dealer's parts/open account. Mazda may deduct or offset any amounts
due, or to become due, from Dealer to Mazda. Under no circumstances
will Mazda enter into a new Dealer Agreement with a transferee
proposed by Dealer, unless Dealer first makes arrangements acceptable
to Mazda to satisfy any outstanding obligations owed to Mazda on
Dealer's parts/open account. In addition, under Dealer's buy/sell
agreement with a transferee approved by Mazda, the transferee shall
assume all rights and responsibilities on Dealer's open account with
Mazda.
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D. UNIFORM ACCOUNTING SYSTEM. The accuracy and timely submission of
financial information is crucial to Mazda's business decisions.
Accordingly, Dealer agrees to maintain its financial books and records
in accordance with requirements established by Mazda from time to
time. Dealer shall furnish to Mazda complete and accurate financial
and operating information by no later than the tenth (10th) calendar
day of each month in the format and by the means prescribed by Mazda.
This information shall include, without limitation, a complete and
accurate financial and operating statement covering the preceding
month and calendar year-to-date operations, and any adjusted year-end
statements, showing the true condition of Dealer's Business. All such
information shall be furnished by Dealer to Mazda via Mazda's
electronic communications network or in hard copy, and/or in any other
manner Mazda designates.
E. RECORDS MAINTENANCE. Dealer agrees to keep and maintain complete,
accurate and current records, in accordance with Mazda's Policies and
Standards regarding Dealer's Business, including without limitation,
its sale, lease and servicing of Mazda Products. Such records shall be
retained by Dealer for the period of time as may be required by Mazda
or for such longer period required by applicable law, rule or
regulation. Dealer shall prepare, keep current and retain records in
support of requests for reimbursement for warranty and repair work
performed by Dealer in accordance with the Mazda Warranty Policies
and Procedures Manual. All records shall be kept and maintained in
either hard copy or electronic format. Mazda reserves the right to
convert or require Dealer to convert such records to a format
compatible with Mazda's systems.
F. EXAMINATION OF DEALERSHIP ACCOUNTS AND RECORDS. Mazda, in its sole
discretion, has the right during regular business hours to inspect
Dealer Facilities and to examine, audit and to copy (in accordance
with applicable law) all records, accounts and supporting data
relating to Dealership Operations, including without limitation,
sales, sales reporting, service and repair (including warranty repair)
of Mazda Products by Dealer for any reason and upon notice to Dealer
as appropriate under the circumstances. Dealer agrees to cooperate
fully with Mazda, and its agents or representatives, in any such
examination or audit. Upon Dealer's request, Mazda shall provide a
copy to and review with Dealer any such written report made on the
examination or audit performed on Dealer.
G. TAXES. Dealer shall be responsible for, timely collect and duly pay
all taxes, including, without limitation, sales, use and excise taxes
and other governmental charges imposed, levied or based upon the
purchase, sale or use of Mazda Products by Dealer, and maintain
accurate records of the above. Dealer shall hold Mazda harmless from
any claims for sales, use, excise, and all other kinds of taxes and
other governmental charges owed by Dealer.
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H. CONFIDENTIALITY. Except as provided in Sections 18(D) (Uniform
Accounting System) above and 20(A) (Rights Granted) below, Mazda
agrees that it will not provide any financial information, documents
or other information submitted to it by Dealer to any third party,
except to Mazda's Affiliated or Related Companies, unless authorized
by Dealer, required by legal process, judicial or governmental order,
required to carry out the terms and conditions of this Agreement, or
required to generate composite or comparative data for analytical
purposes. Dealer agrees to keep confidential and not to disclose,
directly or indirectly, any information that Mazda designates as
confidential, unless authorized by Mazda, required by any legal
process, judicial or governmental order.
Should Mazda or Dealer be required to disclose confidential
information regarding the other party pursuant to any legal process,
judicial or government order, the party from whom such disclosure is
sought will promptly notify the other party, with sufficient advance
notice (if possible), to allow the party whose confidential
information is being sought to take all appropriate legal action and
intervention in response. A decision by Mazda or Dealer at any time
not to challenge the disclosure of certain confidential information
will not be deemed a waiver of this provision, even if the same
information or similar types of information, either by the same or a
different party, is sought at a later time.
I. INFORMATION COMMUNICATION SYSTEM. To facilitate the accurate and
prompt reporting of such relevant dealership operational, consumer and
financial information as Mazda may require, Dealer agrees to install,
maintain and update electronic communication processing facilities
(both hardware and software) which are compatible with and which will
facilitate the transmission and reception of such information on the
electronic communications network Mazda uses. Dealer shall utilize
such information systems in accordance with Mazda's Policies and
Procedures.
J. SALES REPORTING OBLIGATIONS BY DEALER. Dealer agrees to report
accurately to Mazda, together with such information as Mazda may
reasonably require, the delivery of each new Mazda Vehicle to a
purchaser by no later than the second (2nd) business day following the
day that the vehicle is registered or reported as sold to the
appropriate state agency, whichever is earlier. Dealer also agrees to
furnish Mazda with such other reports, in such form as Mazda may
reasonably require, from time to time.
19. EVALUATION OF DEALER PERFORMANCE. Dealer acknowledges the importance of its
overall performance in order to achieve the purposes and objectives of this
Agreement. Mazda shall periodically and continually evaluate Dealer's
performance, as provided in Mazda's Policies and Procedures, in the areas
of sales, service and parts, facilities and location, financial resources
and capitalization and customer satisfaction, based upon such reasonable
criteria as Mazda may establish from time to time. Mazda agrees to review
such periodic evaluations with Dealer and to provide Dealer with a copy of
such periodic evaluations.
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20. RIGHT OF FIRST REFUSAL OR OPTION TO PURCHASE BY MAZDA.
A. RIGHTS GRANTED. If a proposal to sell the Dealer's assets or transfer
or assign a majority or controlling interest in Dealer is submitted by
Dealer to Mazda, subject to applicable law, Mazda has a right of first
refusal or option to purchase the dealership assets or interests,
including any leasehold interests or realty (if included in the
proposed transfer agreement), on the same or substantially the same
terms as those offered in such bona fide ownership transfer proposal
and as agreed upon between the parties thereto. Mazda's exercise of
its right or option under this Section supersedes (i) any right or
attempt by Dealer to transfer or assign dealership assets, and (ii)
any right or attempt to transfer or assign a majority or controlling
interest in Dealer, except as provided in Section 21 (Succession
Rights).
In the case of a proposed transfer by a living majority or Controlling
Owner to an Heir, Mazda shall notify Dealer in writing, within a
reasonable time frame, or such time frame as required by law, if the
proposed transfer will not be approved and whether Mazda is exercising
its right of first refusal or option. Within fifteen (15) days after
Mazda has notified Dealer of Mazda's exercise of its right of first
refusal or option, Dealer may notify Mazda in writing that Dealer has
decided not to transfer ownership and that Dealer withdraws the
submission of the buy/sell agreement to Mazda. Upon such written
notice, Mazda's right of first refusal or option shall terminate on
that particular proposal.
In the event of the death or Incapacity of the majority or Controlling
Owner of Dealer, subject to applicable law and the terms of Section 21
(Succession Rights), Dealer's Heirs, at their discretion, may request
that Mazda purchase the dealership assets or stock, including any
leasehold interests or realty, at fair market value. If Mazda chooses
to exercise this option, the terms and conditions of Mazda's purchase
of the dealership assets or stock shall be determined in good faith
negotiations between the parties. If an agreement cannot be reached,
those terms shall be exclusively determined by arbitration in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association. The site of the arbitration shall be the
office of the American Arbitration Association in the locality of
Mazda's principal place of business.
Mazda's right or option may be assigned by it to any third party, and
Mazda hereby guarantees the full payment to Dealer of the purchase
price as agreed upon by Dealer and Mazda and to be paid by such
assignee. Mazda may disclose the terms of any pending buy/sell
agreement and any other relevant dealership performance information to
any potential assignee; provided, that the potential assignee agrees
to maintain the confidentiality of the information to be disclosed.
Mazda's rights under this Section shall be binding on and enforceable
against any successor in interest to Dealer or purchaser of Dealer's
assets or stock.
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B. EXERCISE OF MAZDA'S RIGHTS. Subject to applicable law, Mazda shall
have thirty (30) days from each of the following events within which
to give notice of its decision to exercise its right of first refusal
or option to purchase:
(i) Mazda's receipt of all data and documentation customarily
required by it to evaluate a proposed transfer or assignment of
a majority or controlling interest in Dealer;
(ii) Mazda's receipt of written notice, or its independent
determination, of the death or Incapacity of the majority or
Controlling Owner of Dealer; or
(iii) Mazda's disapproval of any application submitted by an Owner's
Heir(s) pursuant to Section 21 (Succession Rights).
If under Section 20(B)(ii) above, Mazda independently determines that
the death or Incapacity of the majority or Controlling Owner of Dealer
has occurred, Mazda shall contact Dealer's Heir in writing, by first
class registered mail, to confirm that the death or Incapacity has in
fact occurred. Dealer's Heir shall have thirty (30) days from the date
of Mazda's notice to respond to Mazda. If Dealer's Heir fails to
respond timely to Mazda's notice, then Mazda may exercise its option
to purchase as set forth above.
Subject to applicable law, Mazda's exercise of its right of first
refusal or option under this Section is not dependent upon, and does
not require, prior consideration by Mazda of the proposed buyer or
transferee, or refusal by Mazda to approve the proposed buyer or
transferee.
C. RIGHT OF FIRST REFUSAL. If Dealer has entered into a bona fide written
agreement to sell its dealership assets or stock, subject to
applicable law, Mazda's right under this Section is a right of first
refusal, enabling Mazda to assume the buyer's rights and obligations
under such agreement, and to terminate this Agreement and all rights
granted to Dealer. Mazda may take reasonable steps to determine
whether the buy/sell agreement is bona fide. Upon Mazda's request,
Dealer agrees to provide documents relating to the proposed sale or
transfer and any other information which Mazda deems appropriate,
including, without limitation, those reflecting other agreements or
understandings between the parties to the buy/sell agreement. Refusal
to provide such documentation or to state in writing that no such
documents exist shall create the presumption that the buy/sell
agreement is not a bona fide agreement.
D. OPTION TO PURCHASE. In the event of the death or Incapacity of the
majority or Controlling Owner of Dealer or if Dealer submits a
proposal which Mazda reasonably believes is not bona fide on Dealer's
part, Mazda has the option to purchase the principal assets of Dealer
utilized in Dealer's Business, including real estate and leasehold
interests, and to terminate this Agreement and the rights granted to
Dealer. The terms and conditions of the purchase of the
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dealership assets shall be determined in good faith negotiations
between the parties. If an agreement cannot be reached, those terms
shall be exclusively determined by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association.
The site of the arbitration shall be the office of the American
Arbitration Association in the locality of Mazda's principal place of
business.
E. DEALER'S OBLIGATIONS. Upon Mazda's exercise of its right or option,
and tender of performance, Dealer shall, as soon as possible, transfer
the affected real property, including any easements, by warranty deed
or its equivalent, conveying marketable title free and clear of all
liens, claims, mortgages, encumbrances, interests and occupancies. The
warranty deed or its equivalent shall be in proper form for recording,
and Dealer shall deliver the original, executed deed, and complete
possession of the property at the time of closing. Dealer shall also
furnish to Mazda all copies of any permits, licenses, or other
documents affecting the property or Dealership Operations, and shall
assign or transfer to Mazda any permits, licenses, or other rights
that are necessary or desirable for the use of the property or the
conduct of such Dealership Operations. Dealer shall also immediately
execute and deliver to Mazda instruments satisfactory to Mazda
conveying title to all affected personal property and leasehold
interests involved in the transfer or sale to Mazda. If any personal
property is subject to any lien or charge of any kind, Dealer agrees
to procure the discharge, release and satisfaction of such lien or
charge prior to the closing of the transfer or sale of such property
to Mazda.
F. NO APPLICABILITY TO NOMINEE SUCCESSOR. This Section 20 (Right of First
Refusal or Option to Purchase by Mazda) is not applicable to the
proposed transfer of assets or ownership to a candidate who has been
and continues to be approved by Mazda to be Dealer's Nominee Successor
pursuant to Section 21(C) (Nomination of Successor Prior to Death or
Incapacity of Owner).
21. SUCCESSION RIGHTS.
A. SUCCESSOR TO OWNERSHIP AFTER DEATH OF OWNER. In the event that an
Owner dies and his or her interest in the dealership passes directly
to any Heir(s) who wish to succeed to Owner's interest, then within
sixty (60) days of the death of the Owner, Owner's legal
representative must: (i) notify Mazda of such Heir's or Heirs' intent
to succeed Owner, and (ii) designate a proposed General Manager for
Mazda's approval. The effect of such notice from Owner's legal
representative shall be to suspend any notice by Mazda of its intent
to exercise its right of first refusal or option to purchase under
Section 20 (Right of First Refusal or Option to Purchase by Mazda).
Upon delivery of such notice to Mazda, Owner's legal representative
shall immediately request: (i) any person(s) it has identified to
Mazda as intending to succeed Owner, and (ii) the designated candidate
for General Manager (if any change in General Manager is proposed),
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to submit application(s) to Mazda and to provide Mazda with all
personal and financial (if applicable) information that Mazda may
reasonably and customarily require in its review of such applications.
All requested information must be provided promptly to Mazda and in no
case later than thirty (30) days after receipt by each of the proposed
successor(s) or candidate of the request for information from Owner's
legal representative. Upon the submission of all requested
information, Mazda agrees to review such application(s) pursuant to
the then-current criteria generally applied by Mazda in qualifying
dealer Owners and/or General Managers. Mazda shall either approve or
disapprove the application(s) within ninety (90) days of full
compliance with all Mazda's requests for information. If Mazda
approves the application(s), it shall offer to enter into a new Mazda
Dealer Agreement with Owner's Heir(s) in the form then currently in
use, for a one (1) year term and subject to such additional conditions
as Mazda deems reasonably appropriate.
Mazda may reinstate or issue a notice of termination, notice of intent
to exercise its right of first refusal, or option to purchase in the
event that:
(i) Mazda does not approve the designated Heir(s) or candidate for
General Manager; or
(ii) The Owner's legal representative withdraws his or her notice of
the Heir'(s) intent to succeed as Owner(s); or
(iii) The legal representative or any proposed owners or General
Manager fails to timely provide the required information.
Nothing in this Section shall constitute a waiver of Mazda's right
under Section 20 (Right of First Refusal or Option to Purchase by
Mazda) to exercise its right of first refusal or option to purchase.
B. INCAPACITY OF OWNER. Mazda may terminate this Agreement when an
Incapacitated Owner also is the General Manager identified in
accordance with this Agreement.
Prior to the effective date of any notice of termination, an
Incapacitated Owner who is also the General Manager, or his or her
legal representative, may propose a new candidate for the position of
General Manager. Such proposal shall be in writing and shall suspend
any pending notice of termination and/or notice of Mazda's intent to
exercise its right of first refusal or option to purchase until Mazda
advises Dealer of its approval or disapproval of the new candidate.
Upon Mazda's receipt of the notice of the proposed new General
Manager, Mazda and Dealer shall follow the qualification procedures
set forth above in subsection 21(A) (Successor to Ownership After
Death of Owner).
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C. NOMINATION OF SUCCESSOR PRIOR TO DEATH OR INCAPACITY OF OWNER. An
Owner owning a majority interest in Dealer may nominate a candidate
("NOMINEE SUCCESSOR") to assume such ownership and/or the position of
General Manager of the dealership upon his or her death or Incapacity.
The form for such nomination is attached as the Nominee Successor
Addendum.
As soon as is practicable after such nomination, Mazda shall request
such personal and financial and other information from the Nominee
Successor as Mazda reasonably and customarily may require in
evaluating a Nominee Successor. Mazda shall apply criteria that Mazda
then currently uses in qualifying Owners and/or General Managers of
authorized dealers. Upon receipt of all requested information, Mazda
shall either approve or disapprove such Nominee Successor. Approval by
Mazda shall not be unreasonably withheld. In the event of the death or
Incapacity of the nominating Owner, Mazda shall enter into a new Mazda
Dealer Agreement with the approved Nominee Successor for a term of one
(1) year.
If Mazda does not initially qualify the proposed Nominee Successor,
Mazda agrees, upon Dealer's written request, to review the reason(s)
for its decision with Owner. Owner is free at any time to renew or
withdraw a nomination, prior to his/her death or Incapacity even if
Mazda has previously qualified said Nominee Successor. However, as is
always the case, any new or renominated Nominee Successor must qualify
pursuant to the then current criteria.
During periodic evaluations of Dealer, the Nominee Successor shall be
re-evaluated by Mazda. Mazda shall evaluate the Nominee Successor
using standard methods and Policies and Procedures, which may change
from time to time.
Mazda agrees that Dealer may re-nominate the previously approved
Nominee Successor after the expiration of this Agreement, and Mazda
shall re-approve such nomination provided: (i) Mazda and Dealer have
entered into a new Mazda Dealer Agreement; and (ii) the proposed
Nominee Successor complies with the criteria that Mazda then currently
uses in qualifying such Nominee Successors.
22. TERMINATION.
A. VOLUNTARY TERMINATION BY DEALER. Dealer may voluntarily terminate
this Agreement at any time by delivery of written notice to Mazda.
Termination shall be effective thirty (30) days after receipt by Mazda
of Dealer's notice, unless the parties agree otherwise in writing.
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B. TERMINATION FOR CAUSE BY MAZDA.
(i) IMMEDIATE TERMINATION. Dealer and Mazda agree that any instance of the
following conduct is so contrary to the goals, purposes and objectives
of this Agreement as to warrant its immediate termination upon written
notice by Mazda to Dealer:
(a) Dealer fails to conduct any of its customary Dealership
Operations for seven (7) consecutive business days during
Dealer's customary business hours, except if caused by an event
beyond Dealer's control, such as fires, floods, earthquakes, or
other acts of God, or government action;
(b) Dealer becomes insolvent or is unable or unwilling to pay debts
as they become due; a voluntary or involuntary petition is filed
by or on behalf of Dealer under federal or state bankruptcy laws
which seeks (or is converted to seek) the liquidation of the
Dealership which is not vacated within thirty (30) days from its
institution (or conversion); Dealer executes an assignment for
the benefit of creditors; a receiver, trustee or another officer
having similar powers is appointed for Dealer and is not removed
within thirty (30) days from such appointment; or there is any
levy under attachment, foreclosure, execution or similar process
which is not vacated or removed within ten (10) days from the
date of such levy;
(e) Dealer, or any Owner, shareholder, member, partner, director,
officer (collectively, "DEALER PARTY"), or parent company of
Dealer, is convicted of a felony or enters a plea of guilty to a
felony charge, which potentially results in a significant adverse
effect either on Dealer's Business or on the reputation of
Dealer, Mazda or Mazda Dealers generally. Provided, however, that
if the subject Dealer Party owns a minority interest, or no
interest, in Dealer, upon written notice from Mazda, Dealer shall
have a reasonable period of time as set forth in such notice, to
disassociate from the Dealer Party in question through means and
in a manner acceptable to Mazda.
(d) Any Dealer Party makes any material misrepresentation to Mazda,
or omits to state a material fact, including, but not limited to,
any misrepresentations or omissions made by any Dealer Party to
Mazda in applying for this Agreement or for approval as Owner or
General Manager of Dealer;
(e) Dealer fails to obtain, maintain and keep current and in full
force and effect those essential licenses, permits or
authorizations necessary for the conduct of Dealer's Business; or
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(f) Dealer makes any attempted or actual sale, transfer or assignment
of this Agreement, of any of Dealer's rights under this
Agreement, or of the principal assets necessary for the
performance of Dealer's responsibilities under this Agreement,
whether by operation of law or otherwise, without the prior
written approval of Mazda.
(ii) TERMINATION FOR FAILURE TO CURE. Dealer and Mazda agree that any of
the following conduct violates the terms and conditions of this
Agreement, and if Dealer engages in such conduct and such conduct is
not cured within a reasonable period of time, as stated by Mazda in
writing, or such other notice period as may be required by law, Mazda
shall have the right to terminate this Agreement immediately upon
written notice to Dealer.
(a) Appointing a General Manager without Mazda's prior written
approval;
(b) Failing to make any undisputed substantial payments to Mazda when
due;
(c) Any undertaking by Dealer to conduct, directly or indirectly, any
of the Dealership Business at a location or facility other than
the Authorized Location(s) specified in the then-current
Facilities Addendum;
(d) Failing to establish or maintain available and unencumbered
during the term of this Agreement the required Flooring line or
net working capital;
(e) Any dispute, disagreement or controversy between persons who
constitute Dealer Party that, in the reasonable opinion of Mazda,
adversely affects the ownership, operation, management, business,
reputation or interests of Dealer or Mazda such that Dealership
Operations can no longer be conducted in the normal course of
business or there is danger that Dealer's property or business
will be impaired or lost;
(f) Engaging in serious disreputable conduct resulting in a
significant adverse effect either on Dealer's Business or on the
reputation of Dealer, Mazda or Mazda Dealers generally;
(g) Impairment of the financial standing of Dealer or Dealer's parent
company significantly below Mazda's guidelines subsequent to the
execution of this Agreement;
(h) Refusing to permit Mazda to examine or audit Dealer's records, or
to provide Mazda with such records, as provided in this
Agreement;
(i) Failing to furnish in a timely manner to Mazda all required sales
or financial information and related supporting information in
the required format;
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(j) Knowing submission by any Dealer Party to Mazda of any false or
fraudulent: (i) report or statement; (ii) claim for payment,
reimbursement or any other financial benefit; (iii) financial
information; or (iv) sales reporting data; or
(k) Any Dealer Party: (i) willfully fails to comply with laws or
final judicial orders relating to the essence of Dealer's
Business provided, however, that if the subject Dealer Party
owns a minority interest, or no interest, in Dealer, upon
written notice from Mazda, Dealer shall have a reasonable period
of time as set forth in such notice, to disassociate from the
Dealer Party in question through means and in a manner acceptable
to Mazda; or (ii) is in material breach or willfully violates any
term or provision of this Agreement.
(iii) TERMINATION FOR FAILURE OF PERFORMANCE. If Mazda concludes that
Dealer has failed to perform adequately as to its facilities,
location, sales, service, parts or customer satisfaction
responsibilities, Mazda shall notify Dealer in writing of such
failure(s). Mazda shall endeavor to review promptly with Dealer the
nature and extent of such failure(s), and shall grant Dealer a
reasonable opportunity, or such period as may be required by law, to
correct such failure(s). If Dealer fails or refuses to correct all
such failure(s) prior to the expiration of such notice period, Mazda
may terminate this Agreement immediately or after such notice period
as may be required by law. The provisions of this Section 22(B)(iii)
shall not be applicable where Dealer has committed any act or
omission giving rise to a notice of termination under any other
section of this Agreement.
C. MANNER OF NOTICE OF TERMINATION. Any notice of termination must be in
writing and must be delivered by overnight mail or certified mail,
return receipt requested, or delivered in person as set forth below.
Any notice by Mazda to Dealer shall be delivered to Dealer or its
General Manager at Dealer's Authorized Location, or delivered in
person to the dealership. In the event that the Dealer's Business is
not open at its Authorized Location during normal business hours, or
it is otherwise not reasonable to deliver such notice to Dealer at
the Authorized Location, Mazda may cause such notice, or a copy
thereof, to be delivered to the residential address last listed in
Mazda's records for the majority or Controlling Owner of Dealer or
Dealer's General Manager. Any notice by Dealer to Mazda must be
delivered to Mazda at the regional office having responsibility for
Dealer's Authorized Location. Notice of termination shall be
effective as stated in the notice or as required under applicable
law.
D. FURTHER TRANSACTIONS AFTER NOTICE OF TERMINATION. Upon receipt of any
notice of termination or non-renewal, Dealer and each Dealer Party
agree to conduct themselves and Dealership Operations until the
effective date of termination or non-renewal in a manner that will
not injure the reputation or goodwill of the Mazda Marks or Mazda.
Dealer agrees to cooperate with Mazda to unwind the Dealership
Business in a timely manner. If Mazda accepts any orders from Dealer
or otherwise transacts business with Dealer after the expiration or
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termination of this Agreement, all such transactions shall be governed
by terms identical to those in this Agreement. Further, the acceptance
of orders by Mazda or transaction of other business between Mazda and
Dealer shall not waive the expiration or termination, or constitute an
extension or renewal of this Agreement.
E. REPURCHASE PROVISIONS.
(i) DEALER'S OBLIGATIONS. Mazda's obligations to repurchase the items
set forth below are contingent upon Dealer fulfilling the
following obligations:
(a) Within thirty (30) days after the expiration or the effective
date of termination of this Agreement, Dealer must deliver to
Mazda a detailed inventory of all items it requests Mazda to
repurchase in accordance with this Section 22(E) and shall
certify that such lists are true and accurate.
(b) Dealer shall be entitled to request repurchase of only those
items which were originally purchased directly from Mazda,
unless Mazda agrees otherwise.
(c) Dealer shall remove, at its own expense, all signs bearing
Mazda Marks from Dealer's Authorized Location(s) or from the
dealership before it is eligible for payment for any
repurchased items pursuant to this Section 22(E).
(d) Except as otherwise provided in Section 22(D) (Further
Transactions After Notice of Termination), Dealer shall
immediately, upon expiration or termination of this Agreement,
cease to be, act as, or represent itself to be an authorized
dealer of Mazda Products.
(ii) MAZDA'S OBLIGATIONS. Upon the expiration or termination of this
Agreement (other than pursuant to an approved agreement to sell
the Dealer's Business or assets or to otherwise transfer the
ownership of Dealer), Mazda shall repurchase the following from
Dealer:
(a) New, unused, never titled, unmodified, undamaged, current
model year Mazda Vehicles with less than 100 miles, or
otherwise specified by Mazda, then unsold in Dealer's
inventory. The repurchase prices of such Mazda Vehicles shall
be the same as the prices at which the Mazda Vehicles were
originally purchased by Dealer, less freight and all prior
refunds or other allowances made by Mazda to Dealer for such
Mazda Vehicles.
(b) New, unused and undamaged Mazda Parts and Accessories,
contained in the original packaging, then unsold in Dealer's
inventory which are in good and saleable condition. The
repurchase prices for such parts and accessories shall be at a
price equal to
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the then-current price established by Mazda for the sale to
Mazda Dealers of identical Mazda Parts and Accessories, less
Mazda's then-current charge for the cost of handling and
restocking.
(c) Special service tools owned by Dealer which are especially
designed for servicing Mazda Vehicles and specifically
recommended by Mazda, and signs that Mazda has recommended for
identification of Dealer which are owned by Dealer. The
repurchase prices for such special service tools and signs
shall be the price paid by Dealer, less appropriate
depreciation as stated in the then current Mazda Policies and
Procedures, or such other prices as the parties may agree upon.
(iii) DELIVERY. Mazda shall furnish Dealer with shipping instructions,
and Dealer shall make delivery of the items to be repurchased,
transportation charges prepaid, to destinations within the United
States as designated by Mazda. Dealer agrees to take any action and
execute and deliver such instruments as may be required by Mazda to
convey to Mazda or its nominee good and marketable title to the
property upon delivery to Mazda or the shipper, to comply with
applicable state law relating to bulk sales or transfers, and to
satisfy and discharge any liens or encumbrances on the property
prior to delivery and Mazda's repurchase of such items.
(iv) PAYMENT BY MAZDA. Mazda shall pay Dealer for such items as Dealer
may request be repurchased and that qualify under this Section
22(E) as soon as practicable after Dealer's compliance with all
relevant obligations set forth in this Agreement and upon
computation of any outstanding indebtedness of Dealer to Mazda.
Mazda shall have the right to offset any amounts due under this
Agreement to Dealer, or to any financial institution or any other
person which has legal rights thereto, against the total sum of
Dealer's outstanding indebtedness to Mazda. All or part of the
repurchase payment may be made by Mazda, at its option, to any
financial institution or other person which has legal rights
thereto, to discharge any lien or encumbrance on the property. If
Dealer disagrees with Mazda's valuation of any item to be
repurchased, and Dealer and Mazda have not resolved their
disagreement within sixty (60) days after the effective date of
termination or expiration of this Agreement, Dealer's exclusive
remedy to recover any additional sums that it believes are due
under this Section 22(E) shall be by resort to any existing
Alternative Dispute Resolution program. If no Alternative Dispute
Resolution program then exists, Dealer's exclusive remedy shall be
by resort to arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association ("AAA").
The site of the arbitration shall be at the office of the AAA in
the locality of Mazda's principal place of business.
(v) CUSTOMER RECORDS. Immediately upon expiration or termination of
this Agreement, Dealer shall provide Mazda with a copy of its
customer records and inform Mazda of all unfilled
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orders for sale of Mazda Products by Dealer. Mazda reserves the
right to have such orders filled by other Mazda Dealers.
23. MANAGEMENT OF DISPUTES.
A. ALTERNATIVE DISPUTE RESOLUTION PROGRAMS. Mazda and Dealer acknowledge
that disputes concerning this Agreement may arise which the parties
cannot resolve. To minimize the effects of such disputes on their
business relationship, the parties agree to participate in Alternative
Dispute Resolution ("ADR") programs, including mediation, which Mazda
may establish, in its sole discretion, from time to time.
It is expressly understood that, unless otherwise specified in this
Agreement, the final decision of any ADR program shall be binding upon
Mazda, but will not be binding upon Dealer. The parties' commitment
to support and participate in ADR programs specifically is not a
waiver of Dealer's right to later resort to litigation before any
judicial or administrative forum. A written agreement between the
parties to submit a particular dispute to an ADR program shall suspend
the running of any applicable statute of limitations as to that
dispute for the duration of the parties' participation in the program.
B. MUTUAL RELEASES. Each party hereby releases the other from any and all
claims (including attorneys' fees and costs) and causes of action that
it may have against the other for money damages (except for accounts
payable by one party to the other as a result of the purchase of any
Mazda Products, audit adjustments or reimbursement for any services
and except for any claims either may have under Section 24 (Defenses
and Indemnification) under this Agreement) arising from any event
occurring (i) prior to the date of execution of this Agreement, or
(ii) prior to the effective date of any agreement, which has been
approved by Mazda and in which Dealer transfers the assets or stock of
Dealer to a third party. This release does not extend to claims which
either party does not know or reasonably suspect to exist in its favor
at the time of the execution of this Agreement.
24. DEFENSE AND INDEMNIFICATION.
A. BY DEALER. Subject to Section 24(C) below (Conditional Defenses and/or
Indemnification) and upon Mazda's written request:
(i) Dealer shall defend Mazda against any and all claims that may
arise, commence or be asserted against Mazda in any action
concerning or alleging:
(a) Dealer's failure to comply, in whole or in part, with any of
Dealer's obligations under this Agreement;
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(b) Any negligence, error, omission or act of Dealer in
connection with the preparation, repair or service
(including warranty service, goodwill adjustments, and
campaign inspections and corrections) by Dealer of Mazda
Products, contrary to the express written or verbal
instructions of Mazda, or any loss related to other motor
vehicles or equipment (other than Mazda Vehicles or
Products) as may be sold, serviced, repaired or installed by
Dealer;
(c) Any modification, conversion or alteration made by, or on
behalf of, Dealer to a Mazda Product, except those made
pursuant to the express written instruction or with the
express written approval of Mazda;
(d) Dealer's breach of any agreement between Dealer and Dealer's
customer or other third party;
(e) Misleading, libelous or tortious statements,
misrepresentations or deceptive or unfair practices by
Dealer, directly or indirectly, to Mazda, a customer or
other third party;
(f) Dealer's breach of any contract or warranty other than a
contract with, or warranty of, Mazda or the manufacturer of
a Mazda Product; or
(g) Any change in the employment status, or in the terms of
employment, of any officer, employee or agent of Dealer or
any Owner, or General Manager, including, but not limited
to, any and all claims arising out of or in any way
connected to the hiring, retention or termination of any
person by Dealer, claims of unlawful discrimination,
harassment, wrongful discharge or termination, breach of the
covenant of good faith and fair dealing, breach of contract,
interference with contractual relations or economic
advantage, intentional and/or negligent infliction of
emotional distress, defamation, negligent hiring, and any
violations of laws, rules or regulations involving
environmental or work place practices or conditions.
(ii) Dealer shall indemnify and hold Mazda harmless from any and all
settlements made and final judgments rendered with respect to any
claims described above in Section 24(A)(i).
(iii) Mazda shall promptly notify Dealer in writing of any claims for
which Mazda requests indemnification from Dealer. However, Mazda
shall pay all costs of its own defense incurred prior to Dealer's
prompt and timely assumption of Mazda's defense and thereafter to
the extent that Mazda employs attorneys in addition to those
selected by Dealer.
B. BY MAZDA. Subject to Section 24(C) below (Conditional Defenses and/or
Indemnification) and upon Dealer's written request:
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(i) Mazda shall defend Dealer against any and all claims that may
arise, commence or be asserted against Dealer in any action
concerning or alleging;
(a) Bodily injury or property damage arising out of any
occurrence caused solely by a manufacturing or design defect
or alleged manufacturing or design defect in a Mazda Product
supplied by Mazda (except for any manufacturing or design
defect in tires) which has not been altered, converted or
modified by or for Dealer, provided that the defect could
not have reasonably been discovered by Dealer during the
pre-delivery inspection or service or installation of the
Mazda Product;
(b) Any substantial damage occurring to a new Mazda Product and
repaired by Mazda prior to the time it was delivered to
Dealer's Authorized Location or to a carrier for
transportation to Dealer, whichever occurred first, provided
Mazda failed to notify Dealer of such damage and repair
prior to delivery of the Mazda Product to the first retail
customer; or
(c) Breach of Mazda's warranty of a Mazda Product which is not,
in whole or part, the result of Dealer's sales, service or
repair practices or conduct. Dealer has an affirmative
obligation to notify Mazda immediately of any instance where
there are multiple repairs to the same component or vehicle,
in accordance with guidelines or instructions issued by
Mazda to Mazda Dealers from time to time.
(d) Purported misrepresentations, misleading statements, unfair
or deceptive trade practices of Mazda.
(ii) Mazda shall indemnify and hold Dealer harmless from any and all
settlements made which are approved by Mazda and final judgments
rendered with respect to any claims described above in Section
24(B)(i).
(iii)Dealer shall promptly notify Mazda in writing of any claims for
which Dealer requests indemnification from Mazda. However, Dealer
shall pay all costs of its own defense incurred prior to Mazda's
prompt and timely assumption of Dealer's defense and thereafter
to the extent that Dealer employs attorneys in addition to those
selected by Mazda.
(iv) Mazda may offset: (a) amounts paid or incurred as a result of
Mazda's indemnification obligations under this Section against
(b) any recovery on Dealer's behalf, including, without
limitation, attorneys' fees and costs and the amount of any
settlement or judgment.
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C. CONDITIONAL DEFENSE AND/OR INDEMNIFICATION.
(i) If the allegations asserted in any action or if any facts
established during or with respect to any action would require
Dealer to defend and indemnify Mazda under Section 24(A) and
Mazda to defend and indemnify Dealer under Section 24(B), Mazda
and Dealer shall each be responsible for its own defense in such
an action, and there shall be no obligation or responsibility in
connection with any defense, judgment, settlement or expenses of
such action as between Mazda and Dealer.
(ii) The obligations of Dealer and Mazda to defend, indemnify and hold
harmless are expressly conditioned and subject to all of the
following terms:
(a) The party initially requesting defense and/or
indemnification ("INDEMNIFIED PARTY") shall make such
request in writing and deliver the request to the other
party ("INDEMNIFYING PARTY") within twenty (20) days of
service of any legal process or within twenty (20) days of
discovery of facts giving rise to indemnification, whichever
is sooner.
(b) The Indemnified Party covenants, represents and warrants
that it, its agents and employees have not permitted a
default judgment to be entered and have not made any direct
or indirect admissions of liability, and are not aware of
any credible evidence to support any independent claim of
liability or lack of unity of interest.
(c) The Indemnifying Party shall have sixty (60) days from
receipt of a request in writing to conduct an investigation
or otherwise determine whether or not, or under what
conditions, it shall agree to defend and/or indemnify.
(d) During the pendency of a request for defense and/or
indemnification, and thereafter, the Indemnified Party shall
have a continuing duty to avoid undue prejudice to the
Indemnifying Party and to mitigate damages. The Indemnified
Party shall protect its own interests until a decision has
been made to assume the defense and/or provide the
indemnification.
(e) The Indemnified Party must cooperate fully (including,
without limitation, in the determination of whether there is
a duty to defend and/or indemnify) in the defense and any
settlement of such action in such manner and to such extent
as the Indemnifying Party may reasonably require. This
cooperation shall include, without limitation, providing
such written, electronic or oral information as the
Indemnifying Party reasonably requires.
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(f) The Indemnified Party must withdraw any actions (including
cross-claims) arising out of the circumstances for which the
Indemnified Party seeks indemnity and filed by it against
the Indemnifying Party and/or any Affiliated or Related
Companies or other company having an interest in any of
these entities.
(g) The Indemnifying Party shall have the right to engage and
direct counsel of its own choosing. The Indemnified Party
consents to the employment of attorneys selected by the
Indemnifying Party, and agrees to waive any conflict of
interest then in existence or which may later arise, thereby
enabling the Indemnifying Party's selected attorneys to
represent the Indemnifying Party throughout the defense of
the claim. The Indemnified Party may engage counsel to
represent it in any matter, in addition to or instead of
counsel engaged by the Indemnifying Party, at the
Indemnified Party's own expense.
(h) If subsequent developments in a case, supported by credible
evidence, cause a party to reasonably conclude that the
allegations, which initially precluded a request or
acceptance of a request for defense and/or indemnification,
are meritless or no longer at issue, then the request may be
re-tendered.
(i) No party shall be required to agree to such a subsequent
request or re-tender of defense and/or indemnification where
that party would be unduly prejudiced by such delay. Initial
rejection by any party of defense and/or indemnification is
not a waiver of the right to re-tender timely,
(j) A party agreeing to defend and/or indemnify may make its
written agreement conditioned upon the continued existence
of the state of facts as then known as well as such other
reasonable conditions as may be dictated by the particular
allegations or claims.
(k) In the event that subsequent developments in a case make
clear that the allegations which initially justified
acceptance of a request for a defense and/or indemnification
are no longer at issue in such case or that the claims no
longer meet the description of those for which
indemnification is required under this Agreement, or that
false or misleading information was provided, or material
information was omitted previously which led to the
agreement to indemnify, or the Indemnified Party fails to
reasonably cooperate with the Indemnifying Party, any party
providing a defense and/or indemnification under this
Agreement may terminate such defense and/or indemnification
of the other party without further liability or obligation.
The Indemnifying Party withdrawing its defense and/or
indemnification shall give notice of its withdrawal to the
Indemnified Party, which shall be effective upon receipt.
The Indemnifying Party shall be responsible for all costs
and expenses of defense up
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to the date of the Indemnified Party's receipt of the notice
of withdrawal, except for those reasonable costs and
expenses, including reasonable attorneys' fees, incurred
solely for the benefit of the Indemnified Party.
D. SURVIVAL. The parties agree that the defense, indemnification and hold
harmless obligations of this Agreement shall survive the termination of
this Agreement.
25. GENERAL PROVISIONS.
A. NOTICES. Except as otherwise specifically provided in this Agreement,
any notice required to be given by either party to the other shall be
in writing and delivered personally or by certified mail, return
receipt requested, and shall be effective either as stated in the
notice, or if not stated, immediately on the date of receipt. Notices
to Dealer shall be directed to Dealer or its General Manager at
Dealer's Authorized Location, or to the residential address last
listed in Mazda's records for the majority or Controlling Owner of
Dealer or Dealer's General Manager. Notices to Mazda shall be directed
to the appropriate Regional Office of Mazda, to the attention of the
Regional Manager.
B. NO IMPLIED WAIVERS. The failure of either party at any time to require
performance by the other party of any provision in this Agreement
shall in no way affect the right of such party to require such
performance at any time thereafter, nor shall any waiver by any party
of a breach of any provision in this Agreement constitute a waiver of
any succeeding breach of the same or any other provision, nor
constitute a waiver of the provision itself.
Any continuation of business relations between the parties following
expiration of this Agreement shall not be deemed a waiver of the
expiration nor shall it imply that either party has committed to
continue to do business with the other at any time in the future.
Should this Agreement be renewed or any other form of agreement be
offered to Dealer, Mazda reserves the right to offer an agreement of a
length of term and upon such additional conditions as it deems
reasonable.
C. SOLE AGREEMENT OF THE PARTIES. There are no prior agreements or
understandings, either oral or written, between the parties affecting
this Agreement or relating to the sale or service of Mazda Products,
except as otherwise specifically provided for or referred to in this
Agreement. Mazda has relied upon Dealer's Representations in entering
into this Agreement. Dealer acknowledges that no representations or
statements, other than those expressly set forth in this Agreement,
were made by Mazda or any officer, employee, agent or representative
of Mazda, or were relied upon by Dealer in entering into this
Agreement. This Agreement cancels and supersedes all previous
agreements between the parties relating to the subject matters covered
in this Agreement. No change or addition to, or deletion of, any
portion of
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this Agreement shall be valid or binding upon the parties to this
Agreement unless the same is approved in writing by an officer of each
party.
D. NO AGENCY RELATIONSHIP. Dealer and Mazda are and operate as
independent businesses from each other. This Agreement is not a
property right and does not make Dealer, Owners, Mazda, or employees
of Dealer or Mazda, or other Mazda Dealers, the agent, partner, joint
venturer, or legal representative of each other for any purpose
whatsoever. None of the parties to this Agreement, or any of their
employees or any other persons acting on their behalf are granted any
express or implied right or authority to assume or create any
obligation on behalf of, or in the name of, the other party or to bind
the other party in any manner whatsoever.
E. ASSIGNMENT OF RIGHTS OR DELEGATION OF DUTIES. This is a personal
service agreement by Dealer, Owners and General Manager and may not be
assigned or sold in whole or in part, directly or indirectly,
voluntarily or by operation of law, by them without the prior written
approval of Mazda. Any attempted transfer, assignment or sale without
Mazda's prior written approval is a material breach of this Agreement
and will be void and not binding upon Mazda.
F. NO FRANCHISE FEE. Dealer and each Dealer Party warrants that it has
paid no fee, nor has it provided any goods or services in lieu of
same, to Mazda or any other party in consideration of entering into
this Agreement. The sole consideration for Mazda's entering into this
Agreement is Dealer's, Owners' and General Manager's ability,
integrity, assurance of personal services and expressed intention to
deal according to applicable laws, fairly and equitably with Mazda,
Mazda Dealers and the public.
G. SEVERABILITY. If any provision of this Agreement should be held
invalid or unenforceable for any reason whatsoever, or conflicts with
any applicable law, this Agreement will be considered divisible as to
such provision, and such provision will be deemed amended to comply
with such law, or if it cannot be so amended without materially
affecting the meaning, duties or rights of the parties to the
Agreement, then it will be deemed deleted from this Agreement in such
jurisdiction, and in either case, the remainder of the Agreement will
be valid and binding to the greatest extent permitted under the law.
H. NEW FORM OF DEALER AGREEMENT. If Mazda at any time offers a new form
of Mazda Dealer Agreement to Mazda Dealers generally, Mazda may
terminate this Agreement by written notice to Dealer which offers the
new form of Dealer Agreement to Dealer. The termination shall be
effective ninety (90) days after Dealer receives such notice or on the
date upon which the new Mazda Dealer Agreement between Mazda and
Dealer is executed, whichever is earlier.
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I. BENEFIT. This Agreement is entered into by and between Mazda and
Dealer for their sole and mutual benefit. Neither this Agreement nor
any specific provision contained in it is intended or shall be
construed to be for the benefit of any third party.
J. NO FIDUCIARY RELATIONSHIP. This Agreement shall not be construed to
create a fiduciary relationship between Dealer and Mazda.
K. NO JOINT EMPLOYMENT. Dealer acknowledges that it has assumed
obligations under this Agreement to use its best efforts to sell and
service Mazda Products, to increase the future growth in Mazda Product
sales and service through increased customer satisfaction and other
obligations related to the operation of the dealership and recognizes
the necessity to employ and train qualified personnel to satisfy these
commitments. To this end, Dealer agrees to employ only qualified
persons who will fulfill the commitments made by Dealer to Mazda in
this Agreement. Notwithstanding the foregoing, Dealer retains the sole
and exclusive right to determine whom to hire and their
qualifications, to direct, control and supervise Dealer's employees,
and to establish all terms and conditions of employment of Dealer's
employees. All supervision, control and direction of Dealer's
employees shall be the sole and exclusive responsibility of Dealer.
Dealer shall at all times remain the sole employer of persons employed
in Dealer's Business and, to this end, Dealer and Mazda agree that no
act or omission of Dealer or Mazda shall be construed to make or
render them a joint employer, co-employer or alter ego of each other.
L. CONSENT OF MAZDA. Any time that this Agreement provides that Dealer
must obtain Mazda's consent to any proposed conduct or change, Dealer
must provide all information requested by Mazda concerning the
proposal, and Mazda shall have a reasonable amount of time in which to
evaluate the proposal.
M. MAZDA'S POLICIES, PROCEDURES, STANDARDS AND TERMINOLOGY. This
Agreement, from time to time, refers to certain policies and
procedures or policies and standards. Dealer acknowledges that these
policies, procedures and standards are prepared by Mazda in its sole
discretion based upon Mazda's evaluation of the marketplace. Mazda may
reasonably amend its policies, procedures and standards as the
marketplace changes from time to time. Wherever the term "sell" or
"sale" is used in this Agreement, such term includes leases or
leasing, or other approved forms of retail delivery of Mazda Vehicles
to customers. For purposes of this Agreement, a fleet sale is
considered a retail sale.
N. INABILITY TO PERFORM. Neither Dealer nor Mazda shall be liable for
failure to perform any obligation under this Agreement due to fire,
flood, other Acts of God, accident, strike or other labor dispute,
riot, terrorist act, insurrection, war, governmental act or
regulation, or act or failure to act of a manufacturer or any other
company involved in the chain of distribution for Mazda Products.
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0. GOVERNING LAW. All questions concerning the validity, interpretation
or performance of any of the terms or provisions of this Agreement, or
of any rights or obligations of the parties hereof, shall be governed
by and resolved in accordance with the laws of the state of the
Dealer's Authorized Location(s).
P. TITLES. The titles appearing in the Agreement are for convenience
only, and shall not affect the construction or interpretation of any
provisions of this Agreement.
Q. GENDER AND NUMBER. As the context requires, as used in this Agreement,
the masculine, feminine and neuter genders, and the singular and
plural, include one another.
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26. DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings:
A. "AFFILIATED OR RELATED COMPANIES" means entities that are related as
parent or subsidiary or are characterized by identity of ownership; or
an entity that directly, or indirectly (through one or more
intermediaries) controls, is controlled by, or is under common control
with another entity.
B. "AGREEMENT" OR "DEALER AGREEMENT" means the Mazda Dealer Agreement,
the Standard Provisions and any addenda that are incorporated by
reference.
C. "AUTHORIZED LOCATION(S)" means each of the locations of the Dealer
Facilities authorized by Mazda in writing to be used in Dealer's
Business for Dealership Operations, as specifically set forth in
Section 7 (Authorized Location and Facilities) of the Agreement.
D. "CONSUMER NOTICES" means all stickers, tags, labels and other notices
to the consumer prepared and affixed by Mazda to Mazda Products prior
to their delivery to Dealer.
E. "CONTROLLING OWNER" means a person who individually has the power to
direct or cause the direction of the management and policies of
Dealer, whether through the ownership of voting securities or by
contract, or otherwise, and even if such person does not own a
majority ownership interest in Dealer.
F. "DEALER" means the business entity identified as Dealer in the
Agreement.
G. "DEALER'S BUSINESS" means all activities of Dealer relating to the
promotion, sale, and service of Mazda Products and all other
activities of Dealer under the Agreement.
H. "DEALER FACILITIES" means the buildings, improvements, fixtures, and
equipment situated at the Authorized Location(s).
I. "DEALERSHIP OPERATIONS" means the management and execution of Dealer's
Business in a manner consistent with the Agreement.
J. "DEALER OWNER" or "OWNER" means the individual owner(s) of Dealer
identified in Section 4 (Dealer Entity Ownership) of this Agreement or
the individual(s) who either directly or ultimately own the business
entity identified in Section 4 and upon whose personal service Mazda
relies in entering into this Agreement.
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K. "DEALER PARTY" means Dealer, or any Owner, shareholder, member,
partner, director or officer of Dealer.
L. "DEALER'S REPRESENTATIONS" means the application, related documents
and information submitted, and oral or written representations, made
by Dealer to Mazda for the purpose of its evaluation of Dealer and
determination of whether to enter into or renew the Agreement with
Dealer.
M. "ESSENTIAL PROGRAMS" means those general and specialized sales
management and sales, parts and service training programs offered by
Mazda to Dealer, in which Dealer's participation is deemed necessary
for maintaining an effective and efficient sales distribution system
for Mazda Products.
N. "EXPIRATION DATE" means the date the term of the Agreement shall
expire.
0. "FACILITIES ADDENDUM" shall mean the Facilities Addendum issued by
Mazda to Dealer as part of this Agreement, which sets forth the
specific requirements for the Dealer Facilities. Mazda reserves the
right to issue new superseding Facilities Addenda to Dealer from time
to time.
P. "FLOORING" means the wholesale line of credit with a recognized
financial institution or other financial arrangement maintained by
Dealer and deemed acceptable by Mazda as sufficient to sustain
Dealer's required new vehicle inventory.
Q. "GENERAL MANAGER" means the general manager of Dealer identified in
Section 6 (Changes in Management or Ownership) of the Agreement, who
may or may not be an Owner, and upon whose personal service Mazda
relies in entering into or continuing this Agreement.
R. "HEIR(S)" means an individual or those individuals that either: (i)
have been named to succeed a Dealer Party's ownership interest in
Dealer, or (ii) have a relationship with a deceased or Incapacitated
Dealer Party, such that Mazda is required, under applicable law, to
allow such individuals to succeed to such deceased or Incapacitated
Dealer Party's interest in Dealer for a stated period of time.
S. "INCAPACITY" or "INCAPACITATED" means an individual who is not able,
due to physical or mental impairment, to perform his/her normal duties
pursuant to this Agreement for an extended or indefinite period of
time.
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T. "INDEMNIFIED PARTY" means the party requesting defense and/or
indemnification pursuant to this Agreement.
U. "INDEMNIFYING PARTY" shall mean the party who has been requested to
defend and/or indemnify the Indemnified Party pursuant to this
Agreement.
V. "MANUALS AND INSTRUCTIONS" shall mean those bulletins, manuals or
instructions issued by Mazda to all Mazda Dealers advising them of
Mazda's Policies or Procedures under this Agreement.
W. "MARKET REPRESENTATION PLAN" means a plan prepared and updated from
time to time by Mazda, pursuant to which Mazda has defined the SOA,
determined Dealer's Approved Location and established objectives for
Dealer's sales and levels of market penetration for Mazda Products
based on relevant factors including, without limitation, the location
of potential owners expected for Mazda Products and competitive
activities in such SOA.
X. "MAZDA" means Mazda Motor of America, Inc., a California corporation,
dba Mazda North American Operations.
Y. "MAZDA DEALER(S)" means a dealer or dealers authorized by Mazda to
promote, sell and service Mazda Products and serve Mazda customers in
the United States pursuant to an executed Mazda Dealer Agreement.
Z. "MAZDA MARKS" means the various trademarks, service marks, names,
logos, insignias, and designs (including, but not limited to the word
"Mazda"), and all registrations thereof, now or hereafter owned,
claimed, adopted, acquired or used by Mazda or any other authorized
company in the chain of distribution for Mazda Products.
AA. "MAZDA PARTS AND/OR ACCESSORIES" means new parts and/or accessories
designed for use on Mazda Vehicles and marketed by Mazda, or other
parts and/or accessories specifically designated by Mazda in writing
as Mazda Parts and/or Accessories.
BB. "MAZDA PRODUCTS" means Mazda Vehicles and Mazda Parts and Accessories,
and such other products including, but not limited to, extended
service contracts.
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CC. "MAZDA VEHICLES" means new cars and trucks authorized to bear Mazda
Marks and sold by Mazda to Mazda Dealers.
DD. "NOMINEE SUCCESSOR" means a candidate nominated by the Owner owning a
majority or controlling interest in Dealer. Once approved by Mazda in
writing, the Nominee Successor would assume such ownership and/or the
position of General Manager of the dealership upon the death or
Incapacity of the Owner.
EE. "POLICIES AND PROCEDURES" or "POLICIES AND STANDARDS" means the
policies and procedures/standards prepared by Mazda in its sole
discretion based upon Mazda's evaluation of Dealer's Business, Mazda's
business and dealer body, and the marketplace, which may be
established and/or amended by Mazda from time to time.
FF "PRODUCT ADDENDUM" shall mean the Product Addendum issued by Mazda to
Dealer which specifies those Mazda Products which shall be offered for
sale by Mazda to Dealer for resale. Mazda reserves the right to issue
new, superseding Product Addenda to Dealer from time to time.
GG. "SOA" means the geographic Statistical Observation Area, defined in
the Market Representation Plan in which Dealer is required to
effectively represent Mazda in advertising, sales, and service of
Mazda Products, and which may be revised by Mazda from time to time.
HH. "SOA ADDENDUM" shall mean the Statistical Observation Area Addendum
issued by Mazda to Dealer which specifies the SOA in which Dealer's
performance is principally measured. Mazda reserves the right to issue
new, superseding SOA Addenda to Dealer from time to time.
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