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EXHIBIT 10.45
SATURN DISTRIBUTION CORPORATION RETAILER AGREEMENT
This Agreement, effective the 15th day of March, 1997, is entered into by
Saturn Distribution Corporation (the Franchisor), a wholly owned subsidiary of
Saturn Corporation (Saturn), and Jay Automotive Group II, Inc. d/b/a,
Saturn of Columbus
( ) a proprietorship;
( ) a partnership;
( ) a limited liability company;
( X ) a corporation, incorporated in the State of Georgia, on 4-3-91,
located in Columbus, Georgia (the Retailer).
PURPOSES OF THE AGREEMENT
The principal purposes of this Agreement are to:
A. affirm the commitment of the Retailer and the Franchisor to adhere to
the Saturn Philosophy and Values, and achieve the Saturn Mission;
B. identify the framework within which the Retailer and the Franchisor
will jointly act to fulfill their commitments to each other;
C. authorize the Retailer to sell and service Saturn Products and to
represent itself as a Saturn Retailer; and
D. identify other commitments, rights and responsibilities of the
Retailer and the Franchisor.
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1. RETAILER COMMITMENT TO THE SATURN MISSION, PHILOSOPHY AND VALUES
Retailers represent Saturn's products and brand to the public.
Therefore, it is essential to the success of Saturn, the Franchisor and the
Retailers that each Retailer understand, embrace and promote both the letter
and the spirit of the Saturn Mission, Philosophy and Values as set forth below.
The Retailer and the Franchisor can conduct their relationship with
trust and respect only if both the Retailer and the Franchisor work in an open,
fair and cooperative manner. Both the Retailer and the Franchisor are dependent
upon each other for maintaining this unique working relationship.
The Retailer therefore agrees to adhere to the Saturn Philosophy and
Values in conducting its franchised business, and to work jointly with the
Franchiser and Saturn, within the framework identified in this Agreement, to
accomplish the Saturn Mission. The Retailer acknowledges that the success of
the Saturn, the Franchisor, other Retailers and its suppliers is dependent on
the Retailer fulfilling this commitment. Consistent with the Saturn Philosophy,
the Retailer pledges to maintain the highest ethical standards in all
activities.
2. SATURN MISSION
Saturn's Mission is to market vehicles developed and manufactured in
the United States that are world leaders in quality, cost and customer
enthusiasm through the integration of people, technology and business systems
and to exchange knowledge, technology and experience throughout General Motors.
Achieving this Mission is dependent in part upon the development and
maintenance of a network of authorized Retailers working together with the
Franchisor to build and maintain customer confidence in the Retailer and Saturn.
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3. SATURN PHILOSOPHY
We, the Saturn team, in concert with the UAW and General Motors,
believe that meeting the needs of customers, Saturn members, suppliers,
Retailers and neighbors is fundamental to fulfilling our Mission. To meet the
needs of Retailers, the Franchisor will conduct business in an open and fair
manner, and will share responsibility and decision making with Retailers in the
manner specified in this Agreement to further the spirit of trust and respect
that is critical to the relationship.
4. SATURN VALUES
The Saturn Values direct the way the Retailer and the Franchisor can
reach their shared goals. The Saturn Values, as set forth below, focus on
exceeding customer expectations and on establishing a positive work environment
for Saturn team members.
A. Commitment to Customer Enthusiasm
We continually exceed the expectations of internal and external
customers for products and services that are world leaders in cost, quality
and customer enthusiasm. Our customers know that we really care about them.
B. Commitment to Excel
There is no place for mediocrity and halfhearted efforts at Saturn. We
accept responsibility, accountability and authority for overcoming
obstacles and reaching beyond the best. We choose to excel in every aspect
of our business, including return on investment.
C. Teamwork
We are dedicated to singleness of purpose through the effective
involvement of team members, suppliers, Retailers, neighbors and other
stakeholders. A fundamental tenet of our philosophy is the belief that
effective teams engage the talents of individual members while encouraging
team growth.
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D. Trust and Respect for the Individual
We have nothing of greater value than our people. We believe that
demonstrating respect for the uniqueness of every individual builds a team of
confident, creative members possessing a high degree of initiative,
self-respect and self-discipline.
E. Continuous Improvement
We know that sustained success depends on our ability to continually
improve the quality, cost and timeliness of our products and services. We are
providing opportunity for personal, professional, and organizational growth and
innovation for all Saturn stakeholders.
5. SHARED RESPONSIBILITY
In consideration of the Retailers' commitments, and to ensure that the
relationship between the Retailers and the Franchisor remains mutually
satisfactory, the Franchisor has put into place mechanisms that allow Retailers
to contribute collectively to decisions that significantly affect Retailers'
business. Retailer involvement is provided through two principal mechanisms:
the Franchise Operations Team and the Franchise Task Forces.
A. Franchise Operations Team
The Franchise Operations Team (FOT) is made up of an equal number of
Saturn Retailer Operators and Franchisor representatives. The FOT shall exercise
the responsibilities specified in this Agreement. The selection of FOT members,
their terms of service and the manner in which the FOT carries out its
responsibilities are pursuant to procedures adopted by the FOT.
The FOT uses a consensus decision-making process, described in the
FOT New Member Training Manual. The Retailer Operators serving on the FOT will
be trained in this process.
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B. FRANCHISE TASK FORCES
The FOT may establish Franchise Task Forces to assist in the performance
of its responsibilities if it concludes the input of additional Retailer
Operators, Retail team members and Saturn representatives would be helpful.
Franchise Task Forces make recommendations to the FOT unless the Franchise
Task Force is empowered by the FOT to make a decision. FOT shall retain
authority to modify or change Franchise Task Force decisions. The FOT will
determine the membership of each Franchise Task Force, as well as the scope and
duration of its assignment. A representative from the FOT will serve as a
cochampion of each Franchise Task Force.
6. DISPUTE RESOLUTION PROCESS
A. Exclusive Remedy
The Retailer and the Franchisor believe their mutual commitments to the
Saturn Mission, Philosophy and Values, together with the mechanisms for sharing
responsibility described in Article 5, should minimize the potential for
disputes. Nonetheless, some disputes may occur that cannot be resolved in the
normal course of business.
The Retailer and the Franchisor acknowledge that, at the state and federal
levels, various courts and agencies would, in the absence of this Article 6, be
available to them to resolve claims or controversies that might arise between
them. The Retailer and the Franchisor agree that it is inconsistent with the
Saturn Mission and Philosophy for either the Retailer or the Franchisor to use
courts or governmental agencies to resolve such claims or controversies.
THEREFORE, CONSISTENT WITH THE PROVISIONS OF THE UNITED STATES ARBITRATION
ACT (9 U.S.C. Section 1 et seq.), THE RETAILER AND THE FRANCHISOR AGREE THAT
THE DISPUTE RESOLUTION PROCESS OUTLINED IN THIS ARTICLE, WHICH INCLUDES BINDING
ARBITRATION, SHALL BE THE EXCLUSIVE MECHANISM FOR RESOLVING ANY CONTROVERSY OR
CLAIM BETWEEN THEM ARISING OUT OF OR RELATING TO THIS AGREEMENT, ITS CREATION
OR TERMINATION.
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There are two steps in the Dispute Resolution Process: Mediation and
Binding Arbitration. All controversies or claims must first be submitted to
Mediation, unless that step is waived by written agreement of the parties. If
Mediation does not resolve the dispute to their mutual satisfaction, then the
Retailer or the Franchisor may submit the dispute to Binding Arbitration.
Mediation and Arbitration are each conducted by a panel consisting of two
Franchisor Representatives and two Retailer Operators selected from a pool of
volunteers approved by the FOT and trained to serve in the Dispute Resolution
Process. The Retailer and the Franchisor agree that the procedures contained in
the Retailer/Saturn Dispute Resolution Guide, as may be modified from time to
time by the FOT, shall govern Mediation and Arbitration under this Article.
B. Mediation
Either the Retailer or the Franchisor can submit to Mediation a claim or
controversy between them that arises out of or relates to the Retailer
Agreement. The Mediation Panel will evaluate each position and recommend a
solution. The recommended solution is not binding.
C. Binding Arbitration
If a claim or controversy arising out of or relating to this Agreement has
not been resolved after Mediation, or if the Retailer and the Franchisor have
agreed in writing to waive Mediation, then the claim or controversy will be
settled by Binding Arbitration in accordance with the procedures in the
Retailer/Saturn Dispute Resolution Guide. All awards of the arbitration are
binding and non-appealable except as otherwise provided in the United States
Arbitration Act. Judgment upon any award rendered by the arbitrators may be
entered and enforced in any court having jurisdiction.
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7. AUTHORIZED RETAILER
The Retailer has presented the Franchisor with information regarding its
qualifications to be appointed a Saturn Retailer. The Retailer, its Retailer
Operator and Investors have been evaluated and found to satisfy the Franchisor's
standards.
The Retailer has also presented to the Franchisor a Marketing Area Plan
("MAP"), stating the Retailer's proposal to develop and operate facilities in a
specified Marketing Area to promote, sell and service Saturn Products. The
Franchisor has accepted this MAP.
In reliance upon the Retailer's representations, and on its expressed
commitment to the Mission, Philosophy and Values, the Franchisor grants the
Retailer a nonexclusive right to:
a) buy new Motor Vehicles distributed for resale by Saturn and identified
in any Saturn Motor Vehicle Addendum and related Parts and
Accessories; and
b) identify itself as an authorized Saturn Retailer in the manner and at
the location(s) approved by the Franchisor.
The Retailer accepts the rights granted and agrees to fulfill its
obligations under this Agreement.
8. RETAILER OPERATOR
A. Personal Qualifications
The Franchisor is entering into this Agreement in reliance on the
qualifications and capabilities of the person identified in Article 25 as
"Retailer Operator," on that person's commitment to the Mission, Philosophy
and Values, and on the Retailer's assurance that the personal services of the
Retailer Operator will be provided in the overall management of the
franchised business.
B. Management Responsibility
Both the Retailer and the Franchisor agree that the Retailer Operator must
have the sole authority to exercise management control of the Retailer.
The Retailer's MAP describes the ownership of the Retailer and any
arrangements necessary to comply with this Article.
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C. Ownership Requirement
The Retailer Operator will have and maintain an unencumbered ownership
interest in the Retailer of at least 10 percent at all times.
9. RETAILER INVESTOR
The Franchisor is entering into this Agreement in reliance on the
qualifications of the person(s) identified in Article 25 as "Retailer
Investor(s)." Retailer investor candidates with previous retail automotive
operating or management experience must participate in a selection process to
demonstrate qualification under the Franchisor's Retailer Selection Criteria.
Retailer investor candidates without previous automotive or management
experience must complete an investor questionnaire for review and approval by
the Franchisor.
10. TERM
If the Retailer continues to meet all conditions and fulfill its
obligations and responsibilities under this Agreement, this Agreement will not
expire until the first to occur of the following:
a) a superseding form of Retailer Agreement, recommended by FOT
pursuant to Article 24L is executed;
b) 90 days after such superseding form of Retailer Agreement is
presented to the Retailer for execution; or
c) 90 days following the death or incapacity of the Retailer
Operator; whichever comes first.
If this Agreement is to expire because of the death or incapacity of the
Retailer Operator, the Retailer may request a deferral of the effective date of
expiration to assist in winding up its franchised business or to provide for a
transfer of assets or ownership previously approved under Article 20.
This request must be made at least 30 days prior to the effective date of
expiration, and the Franchisor will not unreasonably refuse to grant any
necessary extension.
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11. AUTHORIZED LOCATIONS AND MARKETING AREA RIGHTS
A. Retailer's Marketing Area
The Retailer has been furnished with a "Notice of Retailer's Marketing
Area." The Retailer is responsible for effectively selling, servicing and
otherwise representing Saturn Products in its Marketing Area. The Retailer
agrees to conduct Saturn Retail Facility Operations only from approved
locations within its Marketing Area. The Retailer's Marketing Area Plan as
described in Article 15 specifies Retailer's approved location(s) and
facility(ies). Where applicable, the Retailer will establish additional
facilities in the time and manner agreed to by the Retailer and the Franchisor
in the MAP.
1) Facility Design and Appearance
Saturn's Mission to exceed customers' expectations can be
furthered if Retailers' facilities are instantly identifiable and
share a consistent architectural design and environment. Accordingly,
the Retailer agrees to purchase Franchisor's Retail Environmental
Design Package and to provide retail facilities consistent with that
Package. The Retailer also agrees to review all proposed facility
plans with the Franchisor and to obtain the Franchisor's approval
before committing to any construction or purchase.
Additionally, the Retailer pledges to properly maintain its
facilities so that they promote and reinforce the unique Saturn image.
The Retailer agrees to make any facility modifications approved by the
FOT. The Retailer agrees not to make any facility modifications that
affect the appearance or function of its facilities without the
Franchisor's prior written authorization.
2) Exclusive Use
The Retailer agrees to use all Saturn facilities (including the
individual sites approved by Saturn) exclusively for conducting Saturn
Retail Facility Operations. The Retailer agrees to conduct from each
location only those Retail Facility Operations authorized in the MAP
for such location.
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B. Marketing Area Rights
The Retailer will devote its full efforts to developing its Marketing
Area. Consequently, the Retailer agrees not to engage, either directly or
indirectly, in any of the activities contemplated by the Agreement from any
locations outside of its Marketing Area.
If the Retailer meets its obligations under the MAP and this Agreement,
then the Franchisor will not authorize any other Retailer to establish a Saturn
retail facility in the Retailer's Marketing Area. If the Retailer fails to
develop its Marketing Area according to its MAP, then the Franchisor may
terminate this Agreement for failure of performance under Article 21 or
restructure the Retailer's Marketing Area and reassign any areas necessary to
achieve maximum potential development of the Marketing Area.
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12. RETAILER'S RESPONSIBILITY TO PROMOTE, SELL AND SERVICE SATURN PRODUCTS AND
ADHERE TO BRAND CRITICAL STANDARDS
A. Responsibility to Promote and Sell
1) The Retailer agrees to effectively promote and sell both the purchase
and the use (including rental and leasing) of Saturn Products to
customers located in its Marketing Area. The Franchisor will review
annually the Retailer's performance of this obligation, in conjunction
with the Marketing Area Plan as described in Article 15.
2) The Retailer is authorized to sell new and unused Motor Vehicles only
to:
a) customers who purchase for personal use or for a primary business
use other than resale,
b) other Saturn Retailers, and
c) Saturn.
3) The Retailer agrees to offer for sale Saturn Service Plan Products to
all customers who purchase or lease new Saturn vehicles, and used
Saturn vehicles if they are eligible for a Saturn Service Plan. The
Retailer may, in addition, offer customers the option of choosing a
non-Saturn service contract (or insurance coverage) provided:
a) the non-Saturn service contract or insurance meets or exceeds
quality standards adopted by FOT, and
b) the Retailer discloses to the customer in writing that the
non-Saturn service contract (or insurance) is not marketed or
warranted by Saturn, and the coverage is not provided by Saturn or
an affiliate and may not be honored by other Saturn Retailers. The
form of the disclosure will be approved by FOT.
4) The Retailer is authorized to sell Saturn Products only to customers
located in the United States. The Retailer agrees not to sell Saturn
Products for resale or use outside the continental United States,
Alaska and Hawaii.
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B. Responsiblity to Service
The manner in which Retailers service Saturn Motor Vehicles is important to
maintaining the Saturn brand image, and to securing and growing a loyal customer
base.
Therefore, the Retailer agrees to provide quality, courteous, convenient,
prompt, efficient, respectful and professional service to owners of Motor
Vehicles, regardless of where the vehicles were purchased.
All service will be performed in accordance with this Agreement and the
Saturn Service Policies and Procedures Manual, as modified from time to time,
which is incorporated into this Agreement by reference.
C. Responsibility to Adhere to Brand Critical Standards
Saturn's brand image has been achieved through a consistent, outstanding
customer experience. Protecting the Saturn brand and achieving Saturn's goal to
be the industry leader in customer enthusiasm requires that all Retailers adhere
to consistent standards in conducting their operations.
FOT may designate a particular standard as a Brand Critical Standard when
it pertains to matters deemed by FOT to be particularly vital to the strength of
the Saturn brand, or protecting the reputation and goodwill of the Franchisor,
Saturn and other Saturn Retailers.
The Retailer agrees to adhere to Brand Critical Standards approved by FOT.
The Retailer Standards Manual, which is incorporated into this Agreement by
reference, defines these Brand Critical Standards and will be reviewed annually,
or more often if deemed necessary by FOT, for potential modifications.
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13. SALE OF PRODUCTS TO RETAILER
A. Sale of Saturn Motor Vehicles to Retailers
The Franchisor has provided the Retailer with a Saturn Motor Vehicle
Addendum specifying the current model types or series of new Motor Vehicles
that the Retailer may purchase. The Franchisor may change the Saturn Motor
Vehicle Addendum at any time by furnishing the Retailer with a superseding
Saturn Motor Vehicle Addendum.
The Franchisor will make every effort to allocate new Motor Vehicles among
Retailers in a fair and equitable manner. The allocation method used will be
reviewed by the FOT and will provide the Franchisor discretion in exercising
business judgment to achieve fairness and equity.
B. Sale of Parts and Accessories to Retailers
Parts and Accessories are any new or remanufactured automotive parts and
accessories that are marketed by Saturn and listed either in the current
"Retailer Parts and Accessories Price Schedules" or in supplements furnished to
the Retailer.
Parts and Accessories will be sold to Retailers by the Franchisor, Saturn
or other suppliers designated by the Franchisor. All orders for Saturn Parts
and Accessories will be submitted and processed according to the written
procedures established by the Franchisor, Saturn or other designated suppliers.
To support the focus of marketing Parts and Accessories primarily within a
Retailer's Marketing Area, Saturn reserves the right to exercise its best
business judgment in allocating Parts and Accessories to Retailers.
C. Prices and Other Terms of Sale
1) For Motor Vehicles
a) Prices, destination charges and other terms of sale applicable to
purchase of new Motor Vehicles will be those established
according to the "Vehicle Terms of Sale Bulletin" furnished to
the Retailer.
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b) Prices, destination charges and other terms of sale may be changed at
any time. Changes will apply only to Motor Vehicles not shipped at the
time changes are effective.
c) If there is an increase in the price charged to the Retailer for a
Motor Vehicle or for any optional equipment or transportation charge
during a model year, such increase will not apply to bona fide sold
orders that were submitted before the Franchisor notifies the Retailer
of the price increase.
d) The Retailer will receive written notice of any price increase before
any Motor Vehicle to which such increase applies is shipped except for
initial prices for a new model year or for any new model or body type.
2) For Saturn Parts and Accessories:
a) Prices and other terms of sale applicable to Parts and Accessories
will be those established according to the "Parts and Accessories
Terms of Sale Bulletin" furnished to the Retailer.
b) These prices and other terms of sale may be changed at any time. Sales
to Retailers will be made at the Retailer price in effect at the order
commitment date.
c) Such changes apply to Parts and Accessories not shipped at the time
the changes are effective.
D. Inventory
1) Motor Vehicle Inventory:
The Retailer recognizes that customers expect to have a reasonable
quantity and variety of current model Motor Vehicles in inventory.
Accordingly, the Retailer agrees to stock and sell, subject to any supply
restrictions, all models and series of current Motor Vehicles identified
in the Motor Vehicle Addendum.
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2) Parts and Accessories:
The Retailer also agrees to stock sufficient Parts and Accessories to:
a) perform warranty repairs and policy adjustments,
b) meet the demands of its customers primarily within its Marketing
Area, and
c) meet the "same day" availability standards approved by the FOT.
E. Warranties on Products
Saturn warrants the new Motor Vehicles and Parts and Accessories
(Products) that it produces. The warranties are explained in documents provided
with these Products and in the Saturn Service Policies and Procedures Manual.
Franchisor (Saturn Distribution Corporation) does not warrant products.
EXCEPT AS OTHERWISE PROVIDED BY LAW, THE WRITTEN SATURN WARRANTIES ARE THE
ONLY WARRANTIES APPLICABLE TO NEW PRODUCTS. WITH RESPECT TO RETAILERS, SUCH
WARRANTIES ARE IN LIEU OF ALL OTHER WARRANTIES OR LIABILITIES, EXPRESS OR
IMPLIED, INCLUDING ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR
A PARTICULAR PURPOSE OR ANY LIABILITY FOR COMMERCIAL LOSSES BASED UPON
NEGLIGENCE OR MANUFACTURER'S STRICT LIABILITY. EXCEPT AS MAY BE PROVIDED UNDER
AN ESTABLISHED SATURN PROGRAM OR PROCEDURE, SATURN NEITHER ASSUMES NOR
AUTHORIZES ANYONE TO ASSUME FOR IT ANY OTHER OBLIGATION OR LIABILITY IN
CONNECTION WITH PRODUCTS, AND SATURN'S MAXIMUM LIABILITY IS TO REPAIR OR
REPLACE THE PRODUCT.
Any Parts and Accessories sold directly to the Retailer by a designated
supplier are not warranted by Saturn or the Franchisor and are warranted only
as specified by the supplier.
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14. SERVICE OF PRODUCTS
A. Service for Which Franchisor Pays
1) New Saturn Vehicle Predelivery Inspections and Adjustments
The delivery condition of a new vehicle is important to
customer enthusiasm. Therefore, the Retailer agrees to perform
all predelivery inspections and adjustments on each new Motor
Vehicle and to verify the completion of these inspections and
adjustments according to the procedures established in the
Saturn Service Policies and Procedures Manual.
2) Warranty Repairs and Special Policy Adjustments
The Retailer agrees to:
a) perform all required warranty repairs on each qualified
Motor Vehicle both at the time of predelivery service and
when requested by owner;
b) perform any special policy adjustments approved by
Franchisor, and
c) give the owner a copy and explanation of the repair document
reflecting all services performed and an explanation of those
services when the vehicle is returned to the owner.
3) Campaign Inspections and Corrections
The Retailer agrees to find and correct suspected
unsatisfactory conditions on Products that the Franchisor has
identified. The Retailer will also ensure that, prior to sale,
all campaign inspections and corrections have been made on all
new and used Saturn Motor Vehicles in its inventory, and will
follow up on Products on which campaigns are outstanding.
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4) Payment for Predelivery Adjustments, Warranty and Campaign Work
For the Retailer's performance of services, predelivery adjustments,
warranty repairs, special policy adjustments, and campaign inspections
and corrections, the Franchisor will provide or pay the Retailer for the
Parts and other materials required and will pay the Retailer a fair
amount for labor. Payment will be made according to policies in the
Saturn Service Policies and Procedures Manual. The Retailer will not
impose any charge for such service on owners or users except where a
deductible or pro rata charge applies.
B. Parts, Accessories and Body Repairs
1) Warranty Repairs and Policy Adjustments
The Retailer agrees to use only genuine Saturn or Franchisor-
approved parts in performing all warranty repairs and policy
adjustments, including special policies.
2) Representations and Disclosures as to Modifications, Parts and
Accessories
Both the Retailer and the Franchisor recognize and appreciate that
people who drive and own Motor Vehicles reasonably expect that vehicles
sold by Retailers as well as parts and accessories sold or used by
Retailers in servicing vehicles are marketed by Saturn or the
Franchisor.
If the Retailer sells or uses parts or accessories that are not
marketed by Saturn or the Franchisor in lieu of Saturn Parts and
Accessories, the Retailer is required to give customers written notice
on the purchase order or bill of sale that such parts or accessories are
not marketed or warranted by Saturn or the Franchisor.
If the Retailer adds non-Saturn aftermarket items to customers'
vehicles, the Retailer agrees not to represent that these vehicle
modifications are warranted or approved by Saturn or the Franchisor.
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Furthermore, the Retailer agrees not to represent that any vehicle
modifications performed by the retail facility or authorized sublet shop
that are not specifically authorized by Saturn are warranted or
approved by Saturn or the Franchisor.
3) Body Repairs
The Retailer must provide body repair service for all Saturn
vehicles. The Retailer can provide this service through its own body
shop, or in cases where the Franchisor agrees, by arrangement with an
independent repair establishment that is acceptable to the Franchisor.
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15. BUSINESS PLANNING
A. Marketing Area Plan
The Retailer and the Franchisor have executed a Marketing Area Plan
(MAP), which is an essential part of this Agreement and which may be updated
annually. The MAP describes how the Retailer will develop its Marketing Area
and fulfill its sales and service commitments.
1) Initial Marketing Area Plan
The Retailer agrees to develop its assigned Marketing Area
according to the MAP. Its commitments for such development include:
a) a detailed description of the number, location, type, size and
opening date of the Saturn facilities to be provided,
b) a detailed implementation schedule for each facility, and
c) a statement of the Retailer's legal and financial structure,
including capitalization, line of credit and equity ownership. The
Retailer agrees to update this statement whenever necessary to
ensure it is accurate.
2) Annual Marketing Area Plan
The Retailer also agrees to fulfill the sales and service commitments
described in the MAP as updated annually. These operational commitments
include but are not limited to:
a) Customer enthusiasm
b) Team member enthusiasm
c) Training
d) Financial performance
e) Market development
f) Retail image
g) Partnership
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B. Annual Plan Review
In order to maintain an effective working relationship, the Retailer
agrees to update its MAP annually, or more often if requested by either party,
and submit it to the Franchisor for joint review. Updated MAPs will include a
performance evaluation and any proposed modifications to the prior year's MAP.
If the Retailer and the Franchisor agree that changes to the proposed MAP are
necessary, then the Retailer will make these changes and then resubmit the MAP.
The Retailer's performance of its obligations is essential to
effectively and consistently representing Saturn Products and to building and
maintaining the reputation of Saturn, the Franchisor and other Retailers.
Therefore, the Retailer agrees to review with the Franchisor its
performance against the prior year's MAP in its updated MAP. The Retailer's
performance will be evaluated based on a number of factors including its
attainment of applicable Performance Benchmarks in areas which may include but
are not limited to the following Critical Success Factors: Customer Enthusiasm,
Team Member Enthusiasm, Training, Financial Performance, Market Development,
Retail Image and Partnership. The Retainer and the Franchisor will use this
evaluation to identify areas in which improvements are necessary so that
Retailer can take prompt action to achieve acceptable performance, and to set
goals for continuous improvement. Performance Benchmarks are approved by FOT
and may be modified from time to time with FOT approval. Periodic facility
evaluations will also be conducted, including an evaluation of the Retailer's
compliance with current requirements and standards for the retail facility
under the Marketing Area Plan.
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16. SATURN SYSTEMS AND PROCESSES
A major element of the Saturn Mission is to lead the industry in
customer enthusiasm. Maintaining this level of enthusiasm requires consistent
application by all Retailers of all designated sales, service, marketing,
facilities and other systems. The Retailer agrees to purchase, implement and
maintain the required systems that are identified in this Agreement, set forth
in the Retail Facilities Guide, the Architects Guide, other Franchise Systems
Manuals, or approved by the Franchise Operations Team. Additionally, the
Retailer agrees to fully utilize Saturn processes in order to ensure that
customers experience the Saturn difference.
A. Systems for Which Retailer Pays
1) Sales and Service Systems
The Retailer agrees to pay Saturn, the Franchisor or approved
sources for the systems necessary to develop and implement Saturn
sales and service in the Retailer's Marketing Area. These systems
include materials and initiatives designed to promote the
consistent display, sales and service of Saturn Products.
Periodically, the FOT will determine that new or updated
information, materials or initiatives are necessary. The Retailer
agrees to accept and utilize such designated new or updated
information, materials or initiatives and pay any applicable
charges. Any such charges will be established by the FOT and will
be based on anticipated costs.
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2) Computer Systems
Saturn's Mission involves the integration of people, technology and
business systems. This integration is possible only if the Retailer has
computer systems that meet customers' needs and the retail facility's
internal business needs; permit direct communication between the Retailer,
the Franchisor and Saturn; and give the Franchisor and Saturn ready access
to the Retailer's accounts and records.
Accordingly, the Retailer agrees to purchase and use all FOT-approved
computer system hardware and software packages, and to diligently update
these hardware and software packages whenever changes are approved by the
Franchise Operations Team.
3) Signs
To promote a consistent image among Retailers, the Retailer agrees to
purchase, maintain and use only signs approved by the Franchisor as
designated in the Retail Facilities Guide and the Critical Image Element
Guide, and to make and pay for any changes in signage approved by the FOT.
4) Tools and Equipment
The Retailer also agrees to provide all the service tools and
equipment necessary to fulfill its service obligations, and to purchase
and maintain any specified special tools and equipment to service Saturn
Products.
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B. Other Systems
1) Accounts and Records
a) Uniform Accounting System
Both the Retailer and the Franchisor will benefit by using
Retailer operating information to develop composite operating
statistics, to analyze the Retailer's business management
practices, and to assess the impact of the Franchisor's policies
and practices.
To assure maximum benefit, the Retailer agrees to maintain
a uniform accounting system and to furnish reports and records
as provided in the GM Dealer's Standard Accounting Manual and the
FOT approved Saturn Retailer Systems business accounting
applications.
b) Examination of Accounts and Records
The Franchisor and Saturn will have access, through computer
systems, to the Retailer's accounts and records.
In addition, any designated representative of the Franchisor
is authorized to examine, audit, reproduce and take copies of
any of the accounts and records the Retailer maintains under this
Agreement. The Retailer agrees to make such accounts and records
readily available in an organized manner at its retail facilities
during business hours. The Franchisor agrees to furnish the
Retailer with a copy of any reproduced records.
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c) Confidentiality of Retailer Data
The Franchisor will not furnish to any
nonaffiliated entity any personal or financial data
submitted to it by the Retailer in a format that
permits identification of the Retailer, unless it is
either authorized by the Retailer, required by law,
pertinent to proceedings under the Dispute Resolution
Process or to court or administrative proceedings.
2) Additional Systems
The Retailer is free to use any additional systems to
help manage the business, so long as they are consistent
with all the required Saturn systems and with Saturn's
Mission, Philosophy and Values. The Retailer agrees to
discontinue use of any systems deemed inconsistent by the
Franchisor.
C. Consistent Processes
An integral part of the Franchisor's plan to develop industry
leading customer enthusiasm is to promote Saturn Retailers as the
unsurpassed leaders of convenient and consistent automotive sales and
service. The Retailer agrees it will conduct its Retail Facility
Operations to support this concept, including utilizing processes
approved by the FOT. These processes include but are not limited to
the Saturn Consultative Sales Process, the Saturn Consultative
Service Process, the Saturn Financial Services Consultative Process
and, if used vehicles are sold at any approved locations specified in
the Retailer's MAP, the Saturn Used Car Process.
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17. MARKETING ASSOCIATION
Both the Retailer and the Franchisor acknowledge the mutual benefits of
comprehensive joint Retailer advertising and merchandising to promote the sale
and service of Saturn Products.
Accordingly, the Regional Unincorporated Marketing Association
(Association) has been established through the joint effort of Retailers and
the Franchisor to produce such joint merchandising and advertising. The
Retailer agrees to participate in the Association. The Association is governed
by the Regional Marketing Council (RMC), which is self-governing according to
its bylaws. The Retailer and the Franchisor agree to support the merchandising
and advertising initiatives of the RMC.
The Association will, from time to time, assess a minimum amount for each
new Motor Vehicle purchased by Retailers to fund merchandising and advertising
initiatives. The FOT will review annually the minimum assessment, and may
recommend changes based on marketing conditions.
18. TRAINING
The training of all Retailer team members is critical to the success of
the Retailer and the Franchisor in conducting business based on the Saturn
Mission, Philosophy, Values and designated processes.
The Retailer therefore agrees that all team members will participate in
both the initial and ongoing training programs identified in the Saturn Retail
Training Catalogue of Programs and Services, and in any others approved by the
FOT, within the time frames specified. The MAP will measure the completion of
training required compared to FOT approved Performance Benchmarks. The Retailer
agrees to pay any specified training charges.
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19. CAPITALIZATION
To ensure that the Retailer is financially capable of fulfilling its
commitments, the Retailer will maintain the levels of capitalization mutually
agreed upon in the Marketing Area Plan. To avoid the erosion of Saturn's
goodwill, which could result if the Retailer is financially unable to fulfill
its commitments, the Retailer agrees to have and maintain a separate line of
credit from a financial institution available for the Retailer to draw upon to
finance the purchase of new vehicles. The amount of the line of credit and the
identity of the financial institution will be included in the Retailer's
Marketing Area Plan, which is reviewed annually.
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20. CHANGES IN OWNERSHIP
Both the Retailer and the Franchisor recognize it is essential to the
success of all associated with Saturn that each Saturn retail facility be owned
and operated by people who are committed to upholding and promoting the Saturn
Mission, Philosophy, Values and way of doing business.
It is equally important that the Retailer Operators are highly qualified
and consistently meet the same high personal standards as the original Retailer
Operators.
Because the Franchisor has entered into this Agreement based on the
personal qualifications of the Retailer Operator and the qualifications of any
Investor(s), the Retailer agrees that it cannot assign its rights under this
Agreement.
A. Succession Rights upon Death or Incapacity
1) Successor Addendum
The Retailer can apply for a Successor Addendum, which
designates a proposed retailer operator and/or investor(s) of a
successor retailer to be established if this Agreement expires
because of the death or incapacity of the Retailer Operator. The
Franchisor will execute the Successor Addendum if the proposed
retailer operator successfully completes the Retailer Selection
Process and if any proposed investors satisfy applicable Retailer
Selection Criteria.
However, the proposed retailer operator and investors will
not be required to meet the usual capital requirements, nor to
demonstrate an ability to implement the Retailer's Marketing Area
Plan until the Successor Addendum is implemented.
At the time of application, the Retailer will pay the
Franchisor a nonrefundable fee to defray costs associated with
review of the proposal.
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2) Rights of Remaining Investors
If this Agreement is due to expire because of the death or incapacity
of the Retailer Operator, and the Retailer and the Franchisor have not
executed a Successor Addendum, the remaining Investors may propose a
successor retailer to continue the operations identified in this Agreement.
The proposal must be made in writing to the Franchisor at least 30
days prior to the expiration of this Agreement, including any deferrals
granted under Article 10. At the time of application, the Retailer will
pay the Franchisor a nonrefundable fee to defray costs associated with
review of the proposal.
The proposal will be accepted if it meets the requirements of Article
20A(3), if the proposed retailer operator successfully completes the
Retailer Selection Process and if all proposed investors satisfy
applicable Retailer Selection Criteria.
If the proposed successor retailer includes a retailer operator
and/or investors who are not remaining Investors, and who will
collectively acquire a majority ownership or voting control in the
proposed retailer, then Franchisor's right of first refusal or option
to purchase under Article 20C shall apply.
3) Successor Retailer Requirements
The Franchisor will accept a proposal to establish a successor
retailer that is submitted by a proposed retailer operator under Article
20A if:
a) the proposed successor retailer and the proposed retailer operator
are ready, willing and able to comply with the requirements of a new
retailer agreement and agree to adhere to and implement the Marketing
Area Plan formally agreed to by the Retailer; and
b) all outstanding monetary obligations of the Retailer to Saturn and
the Franchisor have been paid.
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4) Limitation on Offers
The Retailer will be notified in writing of the Franchisor's
decision on a proposal under Article 20A(3) within 60 days after the
Retailer has submitted all applications and information reasonably
requested by the Franchisor and the proposed retailer operator has
successfully completed the Retailer Selection Process. The Franchisor's
offer of a new Retailer Agreement under Article 20A will automatically
expire if it is not accepted by the proposed successor retailer within
60 days after it receives the offer.
5) New Successor Addendum
The Retailer may cancel an executed Successor Addendum at any time
prior to the death or incapacity of the Retailer Operator. However, the
Franchisor may cancel an executed Successor Addendum only if the
proposed retailer operator or proposed inventor(s) no longer meet the
Retailer Selection Criteria applicable to each. The parties may execute
a superseding Successor Addendum by agreement.
B. Other Changes in Ownership or Management
If the Retailer proposes a change in Retailer Operator, a change in
ownership, or a transfer of its Saturn franchised business or principal assets
to any person, the Franchisor will consider the Retailer's proposal subject to
the following:
1) The Retailer agrees to give the Franchisor prior written notice of any
such proposed change or transfer. The Retailer understands that if any
such change is made prior to the Franchisor's approval of the proposal,
termination of this Agreement will be warranted and the Franchisor will
have no further obligation to consider the Retailer's proposal.
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2) To maintain the high standard and integrity of the Retailer network,
the Retailer agrees to give the Franchisor prior written notice of
any proposed disposition of its principal assets or of any proposed
change of ownership in which a party:
a) first acquires equity ownership or beneficial interest in the
franchised business, or
b) acquires a majority ownership or voting control in the franchised
business.
3) If the proposal involves a change of Retailer Operator, the Retailer
will pay the Franchisor a fee to defray the costs of reviewing the
proposal and completing the Retailer Selection Process. The
Franchisor has no obligation to consider the proposal until it has
received this nonrefundable payment.
4) The Retailer will be notified in writing of the decision on its
proposal within 60 days after the Retailer has furnished all
applications and information reasonably requested by the Franchisor
and after the proposed retailer operator has successfully completed
the Retailer Selection Process. If the Franchisor disagrees with the
proposal, it will specify its reasons.
5) Any material change in the Retailer's proposal, including a change in
price, proposed investors or proposed retailer operator, will be
considered a new proposal, and the time period for the Franchisor to
respond shall recommence. In the event a new proposal is submitted and
the proposal includes a new retailer operator or investor candidate,
an additional fee may be imposed.
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6) Prior written approval is not required where the
transfer of equity ownership or beneficial interest
to an individual in between existing Investors of the
Retailer previously approved by the Franchisor where
there is no change in majority ownership or voting
control. The Retailer agrees to notify the Franchisor
within 30 days of the date of the change and to
execute a new Form C Investor Summary to Retailer's
Marketing Area Plan.
7) The Franchisor is not obligated to execute a new
Retailer Agreement under this Article unless the
Retailer makes acceptable arrangements to the
Franchisor to satisfy any indebtedness to Saturn or
the Franchisor.
C. Right of First Refusal or Option to Purchase
1) Creation and Coverage
If a proposal is submitted by the Retailer under
Article 20B, then the Franchisor has a right of first
refusal or option to purchase as described under this
Article 20C.
If the Franchisor exercises its right or option,
it will do so in the written decision on the
Retailer's proposal. The Franchisor's right or option
may be assigned to any party and the Franchisor will
guarantee the full payment of the purchase price by
the assignee. The Franchisor has the right to
disclose the terms of the buy/sell agreement to any
potential assignee.
If the Retailer has entered into a bona fide
written buy/sell agreement for its franchised
business or principal assets, the Franchisor's right
under this Article 20 is a right of first refusal,
enabling the Franchisor to assume the buyer's rights
and obligations under such buy/sell agreement, and to
cancel this Agreement and all rights granted to the
Retailer.
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In the absence of a bona fide written buy/sell agreement, the
Franchisor has the option to purchase the Retail Facility Assets of the
Retailer and to cancel this Agreement and all rights granted to the
Retailer. Real property will be included only if the Retailer and the
Franchisor agree.
If the Franchisor exercises its right or option, the fee described in
Article 20B(3) will be refunded if the person proposed by the Retailer as a
replacement retailer operator or investor satisfies the Retailer Selection
Criteria.
The Franchisor's rights under Article 20C will be binding and
enforceable against any assignee or successor in interest of the Retailer
or purchaser of the Retailer's assets.
2) Purchase Price and Other Terms of Sale
a) Bona Fide Agreement
If the Retailer has entered into a bona fide written buy/sell
agreement, the purchase price and other terms of the sale will be
those set forth in such agreement and any related documents unless the
Retailer and the Franchisor agree to other terms.
Upon the Franchisor's request, the Retailer will provide all
other documents relating to the proposed transfer, including, but not
limited to, those reflecting any other agreements or understandings
between the parties to the buy/sell agreement. If the Retailer does
not provide such documentation or state in writing that such
documents do not exist, the agreement will be presumed not to be bona
fide.
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b) Absence of Bona Fide Agreement
In the absence of a bona fide written buy/sell agreement, the
purchase price of the Retail Facility Assets, excluding new and
undamaged Parts and Accessories, will be determined by good faith
negotiations between the parties.
If agreement cannot be reached, the purchase price will be
determined through the Dispute Resolution Process. Repurchase
prices for new and undamaged Parts and Accessories will be the
prices last indicated in the parts price listing established by
the Franchisor.
The Franchisor will not be responsible for the repurchase of
non-Saturn Parts or accessories in the Retailer's inventory, or
for Saturn Parts and Accessories that are not resaleable as new,
as specified in the Saturn Service Policies and Procedures Manual.
3) Consummation
The Retailer agrees to transfer the property by Warranty
Deed conveying marketable title free and clear. The Warranty Deed
will be in proper form for recording and the Retailer will
deliver complete possession of the property when the Deed is
delivered. The Retailer will also furnish the Franchisor with
copies of any easements, licenses or other documents affecting
the property, and will assign to the Franchisor any permits or
licenses necessary to conduct the franchised business.
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4) Transfers Involving Family Members
When the proposed change of ownership involves a transfer
by a Retailer Investor to a member or members of his or her
immediate family, the Franchisor's right of first refusal
will not apply. An "immediate family member" shall be the
spouse, child, grandchild, spouse of a child or grandchild,
brother, sister, or parent of the Retailer Investor. All
other requirements of Article 20B shall apply.
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21. TERMINATION
A. Termination of Agreement
1) By Retailer
The Retailer may terminate this Agreement by giving
written notice to the Franchisor. The Termination will be
effective 30 days after the Franchisor receives the notice,
unless otherwise mutually agreed upon in writing.
2) By Agreement
This Agreement may be terminated at any time by written
agreement between the Retailer and the Franchisor.
Termination assistance will be applicable only as specified
in the written termination agreement.
3) Failure to Be Licensed
If the Retailer or the Franchisor fails to secure or
maintain any license that is required to perform their
obligations under this Agreement, or if such license is
suspended or revoked, then either party may immediately
terminate this Agreement by giving the other party written
notice.
4) Misrepresentation, Failure to Conduct Operations, or
Disqualification or Change of Retailer Operator or Investor
If any of the following occurs, the Franchisor will
notify the Retailer and provide 30 days for the Retailer to
respond. Thereafter, the Franchisor may notify the Retailer
that the Agreement will be terminated not less than 30 days
after receipt of notice.
a) If the Retailer submits any false information to Saturn
or to the Franchisor,
b) The Retailer fails to conduct customary Saturn Retail
Facility Operations for seven consecutive business days,
c) The Retailer Operator or Investor(s) fail to continue
to meet the Retailer Selection Criteria applicable to
each,
d) The Retailer Operator is changed or withdraws without
prior written approval of the Franchisor, or
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e) If, without the prior written notice to and approval of the Franchisor,
a person:
i. first acquires an equity ownership or beneficial interest in the
Retailer, or
ii. acquires majority ownership or voting control.
If the Retailer chooses to use the Dispute Resolution Process, the
Agreement will continue pending a final resolution of the dispute.
5) Failure of Performance
If the Retailer fails to perform any other obligations specified in this
Agreement, including those listed as part of the Marketing Area Plan, the
Franchisor will review the failure with the Retailer.
If the Franchisor determines that corrective action is not forthcoming,
then the Franchisor will notify the Retailer in writing and designate a
period of time during which the Retailer is expected to remedy the failure.
If the failure is not remedied within that period, the Franchisor may
invoke the Dispute Resolution Process immediately or at any time, or
terminate this Agreement by giving the Retailer three months' advance
written notice.
6) Convictions of a Felony
a) The Franchisor may terminate this Agreement by giving written notice to
the Retailer if it learns that the Retailer, or a predecessor of the
Retailer owned or controlled by the same person, or the Retailer Operator
is convicted in a court of original jurisdiction of any felony.
Termination will be effective on the date specified in the notice.
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b) If a Retailer Investor is convicted in a court of original jurisdiction
of any felony, the Retailer Investor must divest its ownership
interest in the Retailer within 60 days after the Franchisor notifies
the Retailer or the Retailer becomes aware of the conviction, whichever
occurs first. If the Retailer Investor fails to divest its interest in
the Retailer within that period, the Franchisor may terminate this
Agreement. Termination will be effective on the date specified in the
notice.
7) Reliance on Any Applicable Termination Provision
The terminating party may select the termination provision under which
it elects to terminate without reference in its notice of termination to
any other provision that may also be applicable. Subsequently, the
terminating party may also assert other grounds for termination.
8) Option to Purchase
If this Retailer Agreement is set to expire or to terminate for any
reason, the Franchisor has the option to purchase the Retail Facility
Assets, and to cancel this Agreement and all rights granted to the
Retailer. Real property will be included only if the Retailer and the
Franchisor agree. The purchase price of the Retail Facility Assets and
other terms will be determined under Article 20C(2)b. The Franchisor must
advise the Retailer of its intent to exercise this option within 60 days
after it notifies the Retailer that an event has occurred that would cause
expiration or warrant termination.
B. Transactions after Termination
1) Orders
If, when this Agreement expires or is terminated, the Retailer and
the Franchisor do not enter into a new Retailer Agreement, the Retailer's
designated supply of Products will automatically be canceled except as
provided in this Article.
The termination or expiration of this Agreement will not release the
Retailer or the Franchisor from the obligation to pay any amounts owing
to the other when such amounts become due.
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2) Deliveries
If this Agreement is voluntarily terminated by the Retailer
or if it expires because of the death or incapacity of a Retailer
Operator, the Franchisor will make its best efforts consistent
with distribution procedures to furnish the Retailer with Motor
Vehicles to fill the Retailer's bona fide retail orders on hand
on the effective date of termination or expiration. Franchisor's
obligation under this Article 21B(2) shall not exceed the total
number of Motor Vehicles invoiced to the Retailer for retail sale
during the average of any three-month period during the year
preceding the effective date of termination.
3) Effect of Transactions after Termination
Neither the sale of Products to the Retailer, nor any other
act by Saturn, the Retailer or the Franchisor after the
termination or expiration of this Agreement, will waive the
termination or expiration.
22. TERMINATION ASSISTANCE
If this Agreement expires or is terminated and the Franchisor does not
offer either the Retailer or a replacement retailer with substantially the same
ownership (more than 50%, including total family ownership) a new Retailer
Agreement, then the Franchisor will provide assistance as specified in the
Termination Assistance Manual. The Franchisor's obligations under this Article
22 are subject to the Retailer fulfilling its responsibilities relating to
termination assistance, which are described in the Termination Assistance
Manual.
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23. ACKNOWLEDGMENT OF FRANCHISE LAW COMPLIANCE
A. Retailer's Investigation
The Retailer acknowledges that it has conducted an independent
investigation of the business venture contemplated by this Agreement, and
recognizes that it involves business risks and that its success will be
largely dependent upon the ability of the Retailer.
The Franchisor expressly disclaims the making of, and the Retailer
acknowledges that it has not received, a warranty or guarantee, express or
implied, as to the potential volume, profits or success of the business
venture contemplated by this Agreement.
B. Disclosure
The Retailer also acknowledges having received a copy of this Agreement
(together with attachments and related documents) at least five business
days prior to the date on which this Agreement was executed.
The Retailer further acknowledges having received the disclosure
document, which is required by the Trade Regulation Rule of the Federal
Trade Commission entitled the "Franchise Offering Circular," which
contains a copy of this Agreement, at least 10 business days prior to the
date on which this Agreement was executed.
C. Review
The Retailer acknowledges that it has read and understands this
Agreement (and its attachments and related agreements) and that the
Franchisor has afforded the Retailer ample time and opportunity to consult
with advisors of the Retailer's own choosing, about the potential benefits
and risks of its entering into this Agreement.
24. GENERAL PROVISIONS
A. No Agent or Legal Representative Status
This Agreement does not make either party or Saturn the agent or legal
representative of the others for any purpose, nor does it grant either
party or Saturn authority to assume or create any obligation on behalf of
or in the name of the others. No fiduciary obligations are created by this
Agreement.
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B. Retailer's Responsibility for Its Operations
Except as provided in this Agreement, the Retailer is solely responsible
for all expenditures, liabilities and obligations incurred or assumed by the
Retailer to establish and conduct its operations.
C. Taxes
The Retailer is responsible for all local, state, federal, or other
applicable taxes and tax returns related to its franchised business and agrees
to hold the Franchisor and Saturn harmless from any related claims or demands
made by any taxing authority.
D. Indemnification by Saturn
Saturn has agreed with the Franchisor that Saturn will assume the defense
of the Retailer and indemnify the Retailer against any judgment for monetary
damages or rescission of contract in any lawsuit that names the Retailer as a
defendant when the lawsuit concerns:
1) Breach of the Saturn warranty related to a product or bodily injury or
property damage that is claimed to be caused solely by a defect in the
design, manufacture or assembly of a Product by Saturn. Saturn may
withhold indemnification where a defect should have been detected
during the predelivery inspection of the Product;
2) Failure of a Product to conform to the description set forth in
advertisements or product brochures distributed by Saturn, because of
changes in either standard equipment or material component parts,
unless the Retailer received notice of the changes prior to retail
delivery of the affected Product by Retailer;
3) Any substantial damage to a Product purchased by Retailer from Saturn
that has been repaired by Saturn unless the Retailer accepted the
Product with knowledge of the repair. Saturn has no obligation under
its agreement with Franchisor if the product involved has been
altered. Any indemnification provided by Saturn will be net of any
offset recovered by the Retailer. Procedures for requesting
indemnification, administrative details and limitations are contained
in the Saturn Service Policies and Procedures Manual.
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E. Trademarks and Service Marks
Saturn, the Franchisor or affiliated companies are the exclusive owners of
the various trademarks, service marks, names and designs (Marks) used in
connection with any Products.
The Retailer is granted the nonexclusive right to display Marks in the
form and manner approved by the Franchisor in the conduct of its franchised
business. Marks may be used as part of the Retailer's name with the written
approval of the Franchisor. The Retailer agrees to change or discontinue the
use of any Marks upon the Franchisor's request.
The Retailer agrees that no company owned by or affiliated with the
Retailer or any of its Investors may use any Mark to identify a business
without the Franchisor's written permission.
Upon termination of this Agreement, the Retailer agrees to immediately
discontinue, at its expense, all use of Marks. Thereafter, the Retailer will
not use, either directly or indirectly, any Marks or any other confusingly
similar marks in a manner that the Franchisor determines is likely to cause
confusion or mistake or to deceive the public.
The Retailer will reimburse the Franchisor for all legal fees and other
expenses incurred in connection with any action that is taken to require the
Retailer to comply with this Article 24E.
F. Notices
Any notice that is required to be given by either party to the other in
connection with this Agreement will be in writing and delivered personally or
by mail. Notices to the Retailer will be directed to either the Retailer or its
representatives at the Retailer's principal place of business. Notices by the
Retailer will be directed to:
Retail Network Planning
Saturn Distribution Corporation
100 Saturn Parkway, P.O. Box 1500
Spring Hill, TN 37174-1500
Mailed notices will be deemed received on the date deposited in U.S. or express
mail.
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G. No Implied Waivers
The delay or failure of the Retailer or the Franchisor to require
performance by the other party or the waiver by Retailer or Franchisor of a
breach of any provision of this Agreement will not affect the right subsequently
to require such performance.
H. Assignment of Rights or Delegation of Duties
The Franchisor may assign this Agreement and any rights, or delegate any
obligations to any affiliated or successor company. The Franchisor will provide
the Retailer with written notice of such assignment or delegation. Such an
assignment or delegation will not relieve the Franchisor of liability for the
performance of its obligations.
I. Accounts Payable
All monies or accounts due to the Retailer will be considered net of the
Retailer's indebtedness to the Franchisor and Saturn. The Franchisor and Saturn
may deduct any amounts due, or to become due from the Retailer to the Franchisor
or Saturn, or any amounts held by the Franchisor or Saturn, from any sums or
accounts due, or to become due, from Saturn or the Franchisor to the Retailer.
J. Sole Agreement of Parties
Except as provided in this Agreement, the Franchisor has made no promises
to the Retailer, the Retailer Operator or the Retailer Investor(s). There are no
other agreements or understandings, either oral or written, between the parties
affecting this Agreement or relating to any of the subject matter covered by
this Agreement.
Except as otherwise provided in this Agreement, this Agreement cancels and
supersedes all previous agreements between the parties that relate to any
matters covered herein.
No agreement between the Retailer and the Franchisor that relates to
matters covered herein, and no change in, addition to (except the filling in of
blank lines) or erasure of any printed portion of this Agreement, will be
binding unless it is approved in a written agreement executed under Article 25.
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K. Severability
If any provision of this Agreement is determined to be unenforceable under
a valid and applicable law in effect as of the effective date of this
Agreement, then the Agreement will be modified to the minimum extent necessary
to comply with such law.
L. Review and Modification of Agreement Terms
To demonstrate its commitment to the Saturn Philosophy, Mission, Values
and way of doing business, the Franchisor has entered into this indefinite term
Agreement.
However, neither the Retailer nor the Franchisor want to prevent the
modification of their contractual relationship as necessary to respond to
changes in marketing conditions. Therefore, the Franchise Operations Team will
review this Agreement every five years or at such other time as the FOT decides
is appropriate.
In the event the FOT recommends a superseding form of Retailer Agreement,
the Retailer and the Franchisor agree to terminate this Agreement and execute
the new Agreement. Unless otherwise agreed in writing, the rights and
obligations of the Retailer that may otherwise become applicable upon
termination or expiration of this Agreement will not be applicable.
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25. EXECUTION ON BEHALF OF RETAILER AND FRANCHISOR
This Agreement and related agreements are valid only if signed:
A. On behalf of the Retailer by a duly authorized representative and, in
the case of this Agreement, by the Chief Executive Officer; Retailer
Operator and Retailer Investor(s); and
B. On behalf of the Franchisor by either its President or a Vice
President, Sales.
SATURN DISTRIBUTION
CORPORATION
Retailer Name: Jay Automotive Group IV, Inc.
d/b/a Saturn of Columbus
By /s/ James G. Stelzenmuller, III 3/17/97 By /s/ Joe Kennedy 2-19-97
---------------------------------------- ----------------------------
Retailer Operator Date President Date
James G. Stelzenmuller, III
By /s/ James G. Stelzenmuller, III 3/17/97 By /s/ ????????? 2-19-97
---------------------------------------- ----------------------------
Retailer Investor Date Vice President, Sales Date
By /s/ James G. Stelzenmuller, III
----------------------------------------
Retailer Investor Date
By:
----------------------------------------
Retailer Investor Date
By:
----------------------------------------
Retailer Investor Date
By:
----------------------------------------
Retailer Investor Date
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