EXHIBIT 10.4.2
HONDA
CIVIC
AUTOMOBILE DEALER'S STANDARD AGREEMENT
AMERICAN HONDA MOTOR CO., INC.
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TABLE OF CONTENTS
HONDA AUTOMOBILE DEALER'S STANDARD AGREEMENT
ARTICLE I: DEFINITIONS
1. "HONDA MOTOR" . . . . . . . . . . . . . . . . . . . . . . . . . . .1
2. "DISTRIBUTOR" . . . . . . . . . . . . . . . . . . . . . . . . . . .1
3. "DEALER". . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
4. "HONDA AUTOMOBILES" . . . . . . . . . . . . . . . . . . . . . . . .1
5. "HONDA AUTOMOBILE PARTS". . . . . . . . . . . . . . . . . . . . . .1
6. "HONDA TRADEMARK" . . . . . . . . . . . . . . . . . . . . . . . . .1
7. "HONDA SIGN". . . . . . . . . . . . . . . . . . . . . . . . . . . .1
ARTICLE II: BASIC OBLIGATION
1. SALE AND RESALE OF HONDA AUTOMOBILES AND HONDA AUTOMOBILE PARTS . .1
2. DEALER'S RESPONSIBILITY FOR SALE AND PROMOTION. . . . . . . . . . .2
3. APPOINTMENT OF DEALERS. . . . . . . . . . . . . . . . . . . . . . .2
4. CONDUCT OF DEALER . . . . . . . . . . . . . . . . . . . . . . . . .2
5. DIRECTIVES AND POLICIES OF DISTRIBUTOR. . . . . . . . . . . . . . .2
6. DEALER AS INDEPENDENT BUSINESS. . . . . . . . . . . . . . . . . . .2
7. DEALER'S POWER AND AUTHORITY LIMITATION . . . . . . . . . . . . . .3
8. DISTRIBUTOR'S NON-LIABILITY . . . . . . . . . . . . . . . . . . . .3
ARTICLE III: DEALER'S GENERAL BUSINESS REQUIREMENTS
1. DEALER'S BUSINESS PREMISES. . . . . . . . . . . . . . . . . . . . .3
2. DESCRIPTION AND PLANS OF DEALER'S PREMISES. . . . . . . . . . . . .3
3. EXPANSIONS AND IMPROVEMENTS OF DEALER'S PREMISES. . . . . . . . . .4
4. RELOCATION AND NEW DEALER'S PREMISES. . . . . . . . . . . . . . . .4
5. DEALER'S PERSONNEL. . . . . . . . . . . . . . . . . . . . . . . . .4
6. HOURS OF BUSINESS . . . . . . . . . . . . . . . . . . . . . . . . .4
7. CAPITAL REQUIREMENTS. . . . . . . . . . . . . . . . . . . . . . . .4
8. ACCOUNTING SYSTEM . . . . . . . . . . . . . . . . . . . . . . . . .5
9. RECORD SUPPORTING CLAIMS. . . . . . . . . . . . . . . . . . . . . .5
10. EXAMINATION OF ACCOUNTS AND RECORDS . . . . . . . . . . . . . . . .6
ARTICLE IV: SALES OF HONDA AUTOMOBILES AND HONDA AUTOMOBILE PARTS
1. DEALER'S RESPONSIBILITY FOR SALES . . . . . . . . . . . . . . . . .6
2. SALES AND MECHANICAL STAFF. . . . . . . . . . . . . . . . . . . . .6
3. SALES AND SERVICE RECORDS . . . . . . . . . . . . . . . . . . . . .7
4. CUSTOMER'S COMPLAINTS . . . . . . . . . . . . . . . . . . . . . . .7
5. TREATMENT OF PURCHASERS . . . . . . . . . . . . . . . . . . . . . .7
A. DELIVERED PRICES AND ITEMIZED INVOICES . . . . . . . . . . . .7
B. TRUE STATEMENT AS TO SELLING PRICES. . . . . . . . . . . . . .7
C. SUGGESTED RETAIL PRICES. . . . . . . . . . . . . . . . . . . .7
D. SALE WITHOUT OPTIONAL EQUIPMENT OR ACCESSORIES . . . . . . . .7
E. PRE-DELIVERY INSPECTION. . . . . . . . . . . . . . . . . . . .8
ARTICLE V: DEALER'S HONDA AUTOMOBILE PARTS AND SUPPLIES
1. PROMOTION OF HONDA AUTOMOBILE PARTS . . . . . . . . . . . . . . . .8
2. DEALER'S PARTS DEPARTMENT REQUIREMENTS. . . . . . . . . . . . . . .8
3. SALE OF HONDA AUTOMOBILE PARTS. . . . . . . . . . . . . . . . . . .8
4. MINIMUM INVENTORY OF HONDA AUTOMOBILE PARTS . . . . . . . . . . . .9
ARTICLE VI: CUSTOMER'S SERVICE
1. SERVICE TO BE PROVIDED BY DEALER. . . . . . . . . . . . . . . . . .9
2. SERVICE DEPARTMENT. . . . . . . . . . . . . . . . . . . . . . . . .9
3. REPRESENTATION OF HONDA AUTOMOBILE PARTS. . . . . . . . . . . . . .9
4. CONTACT WITH PURCHASERS . . . . . . . . . . . . . . . . . . . . . .9
5. WARRANTY DIRECTIVES AND PROCEDURES. . . . . . . . . . . . . . . . 10
ARTICLE VII: DEALER'S PURCHASES AND INVENTORY
1. PRICES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
2. ORDER AND ACCEPTANCE. . . . . . . . . . . . . . . . . . . . . . . 10
3. LOCAL TAXES . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
4. PAYMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5. RESERVATION OF TITLE FOR SECURITY . . . . . . . . . . . . . . . . 11
6. PASSING OF TITLE AND RISK . . . . . . . . . . . . . . . . . . . . 12
7. EXTENT OF DISTRIBUTOR'S RESPONSIBILITY FOR DEFECTS AND DAMAGE . . 12
8. CLAIMS FOR INCOMPLETE DELIVERY. . . . . . . . . . . . . . . . . . 12
9. CHANGES OF SPECIFICATIONS . . . . . . . . . . . . . . . . . . . . 12
10. FAILURE OF OR DELAY IN DELIVERY . . . . . . . . . . . . . . . . . 13
11. RETURN OR DIVERSION ON FAILURE TO ACCEPT. . . . . . . . . . . . . 13
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12. INVENTORIES . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE VIII: WARRANTY TO CUSTOMERS
1. MANUFACTURER'S WARRANTY . . . . . . . . . . . . . . . . . . . . . 14
2. WARRANTY TO CUSTOMERS . . . . . . . . . . . . . . . . . . . . . . 14
3. WARRANTY CLAIM PROCEDURE. . . . . . . . . . . . . . . . . . . . . 14
4. WARRANTY REGISTRATION PROCEDURE . . . . . . . . . . . . . . . . . 15
ARTICLE IX: ESTIMATES AND REPORTS
1. ESTIMATES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2. SALES AND INVENTORY REPORTS . . . . . . . . . . . . . . . . . . . 15
ARTICLE X: SIGNS, TRADEMARKS AND TRADENAMES
1. SIGNS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
A. PRODUCT SIGN . . . . . . . . . . . . . . . . . . . . . . . . 16
B. CUSTOMER SERVICE SIGN. . . . . . . . . . . . . . . . . . . . 16
C. OTHER NECESSARY SIGNS. . . . . . . . . . . . . . . . . . . . 16
2. TRADEMARKS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
A. EXCLUSIVE OWNERSHIP. . . . . . . . . . . . . . . . . . . . . 16
B. USE BY DEALER. . . . . . . . . . . . . . . . . . . . . . . . 16
C. DISCONTINUANCE OF USE UPON TERMINATION . . . . . . . . . . . 16
D. DEALER'S LIABILITY FOR FAILURE TO DISCONTINUE USE. . . . . . 17
ARTICLE XI: ADVERTISING PROMOTIONAL PROGRAM . . . . . . . . . . . . . . . 17
ARTICLE XII: COMPLIANCE WITH LAWS . . . . . . . . . . . . . . . . . . . . 17
ARTICLE XIII: TERMINATION OF SALES AGREEMENT
1. TERMINATION BY DEALER . . . . . . . . . . . . . . . . . . . . . . 18
2. TERMINATION FOR CAUSE . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE XIV: SIGNS, LITERATURE, BUSINESS NAME, ETC. UPON TERMINATION
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1. REMOVAL OF SIGNS. . . . . . . . . . . . . . . . . . . . . . . . . 20
2. LITERATURE, MANUALS, PROMOTIONAL MATERIAL, ETC. . . . . . . . . . 20
3. BUSINESS NAME . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE XV: TERMINATION DELIVERIES
1. CANCELLATION OF ORDERS. . . . . . . . . . . . . . . . . . . . . . 21
2. TERMINATION DELIVERIES. . . . . . . . . . . . . . . . . . . . . . 21
3. EFFECT OF TRANSACTIONS AFTER TERMINATION. . . . . . . . . . . . . 22
ARTICLE XVI: REPURCHASE OF HONDA AUTOMOBILES, HONDA
AUTOMOBILE PARTS, SPECIAL TOOLS AND
EQUIPMENT AFTER TERMINATION
1. HONDA AUTOMOBILES . . . . . . . . . . . . . . . . . . . . . . . . 23
2. HONDA AUTOMOBILE PARTS. . . . . . . . . . . . . . . . . . . . . . 23
3. SPECIAL TOOLS AND EQUIPMENT . . . . . . . . . . . . . . . . . . . 24
4. DELIVERY TO DISTRIBUTOR . . . . . . . . . . . . . . . . . . . . . 24
5. INSPECTION OF PROPERTY AT DEALER'S PREMISES . . . . . . . . . . . 24
6. RIGHT OF REJECTION. . . . . . . . . . . . . . . . . . . . . . . . 24
7. LIENS AND ENCUMBRANCES. . . . . . . . . . . . . . . . . . . . . . 25
8. PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
9. FREIGHT AND INSURANCE CHARGES . . . . . . . . . . . . . . . . . . 25
ARTICLE XVII: OBLIGATIONS OF DISTRIBUTOR IN CASE OF DEATH . . . . . . . . 25
1. DEATH OF DEALER . . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE XVIII: DISTRIBUTOR'S ASSISTANCE
1. ASSISTANCE IN SALE OF DEALER'S BUSINESS . . . . . . . . . . . . . 26
ARTICLE XIX: GENERAL PROVISIONS
1. AUTHORITY TO SIGN FOR DISTRIBUTOR . . . . . . . . . . . . . . . . 27
2. ENTIRE AGREEMENT. . . . . . . . . . . . . . . . . . . . . . . . . 27
3. RELEASE OF CLAIMS . . . . . . . . . . . . . . . . . . . . . . . . 27
4. VARIATIONS, MODIFICATIONS, AMENDMENTS . . . . . . . . . . . . . . 27
5. NO TRANSFER . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
6. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
7. WAIVERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
8. DIVISIBILITY. . . . . . . . . . . . . . . . . . . . . . . . . . . 28
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HONDA AUTOMOBILE DEALER'S STANDARD AGREEMENT
ARTICLE I
DEFINITIONS
As used herein:
1. "HONDA MOTOR" means Honda Motor Co., Ltd., a Japan corporation.
2. "DISTRIBUTOR" means American Honda Motor Co., Inc., a California
corporation.
3. "DEALER" means the authorized Honda Automobile Dealer.
4. "HONDA AUTOMOBILES" means automobiles of any model and type manufactured in
whole or in part by Honda Motor and supplied to Dealer by Distributor.
5. "HONDA AUTOMOBILE PARTS" means parts, accessories and optional equipment
for Honda Automobiles which are manufactured by or for Honda Motor or
Distributor and title to which passes through Distributor.
6. "HONDA TRADEMARK" means any trademark, service ▇▇▇▇, or other identifying
word, emblem, insignia, symbol, slogan, design or indicia now or during
the term of this Agreement claimed or adopted by Honda Motor or Distributor
to distinguish Honda Automobiles, Honda Automobile Parts, or services
related thereto, including but not limited to "HONDA," "H," "HM," "AHM,"
and the wing design.
7. "HONDA SIGN" means any sign displaying any Honda Trademark, including but
not limited to, the standard Customer's Service Sign.
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ARTICLE II
BASIC OBLIGATION
1. SALE AND RESALE OF HONDA AUTOMOBILES AND HONDA AUTOMOBILE PARTS:
Subject to the provisions of this Agreement, Distributor shall sell
and deliver Honda Automobiles and Honda Automobile Parts to Dealer for
resale and assist the Dealer and its operation relating to the resale of
and customers' service for Honda Automobiles and Honda Automobile Parts.
2. DEALER'S RESPONSIBILITY FOR SALE AND PROMOTION:
Dealer assumes the responsibility for the promotion and sale of Honda
Automobiles, Honda Automobile Parts, and rendering customers' service for
Honda Automobiles within an area in which the Dealer's premises are
located, which is herein referred to as "AREA OF RESPONSIBILITY" and agrees
to devote his principal efforts to such area.
3. APPOINTMENT OF DEALERS:
Distributor reserves the right to appoint one or more authorized Honda
Automobile Dealers in the above mentioned "Area of Responsibility" as
Distributor may, from time to time, determine necessary.
4. CONDUCT OF DEALER:
In the operation of its business, Dealer shall protect the reputation
and goodwill of Honda Automobiles, Honda Automobile Parts and other Honda
products, of Honda Motor and Distributor and shall refrain from all conduct
and activities which might be detrimental and reflect adversely upon the
reputation of Honda Automobiles, Honda Automobile Parts and other Honda
products or Honda Motor or Distributor or are contrary to good business
practices or to any laws, statutes, rules and regulations affecting the
operation of a retail automobile business and shall not engage in any
discourteous, deceptive, misleading or unethical practices or activities,
but shall give prompt, efficient and courteous service to its customers and
actively and honestly promote the sale of Honda Automobiles and Honda
Automobile Parts.
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5. DIRECTIVES AND POLICIES OF DISTRIBUTOR:
In the operation of Dealer's business and in the sale and promotion of
Honda Automobiles and Honda Automobile Parts and in rendering customers'
service and in all other activities pursuant to any provisions of this
Agreement, Dealer shall abide by all reasonable directives and policies of
Distributor. Distributor shall periodically evaluate Dealer's business
operation and may require Dealer to make any reasonable adjustments
necessary to uphold and protect the reputation and goodwill of Honda
Automobiles including Honda Automobile Parts.
6. DEALER AS INDEPENDENT BUSINESS:
Dealer represents and shall transact and operate his business in
accordance with the provisions of this Agreement as an independent business
on its own behalf and its own account.
7. DEALER'S POWER AND AUTHORITY LIMITATION:
Dealer has no power or authority or right to act as an agent or
otherwise for the account or on behalf of Honda Motor or Distributor or to
assume or create any obligation or responsibility, expressed or implied,
for or in behalf of Honda Motor or Distributor or to bind Honda Motor or
Distributor in any manner whatsoever.
8. DISTRIBUTOR'S NON-LIABILITY:
Distributor shall not be liable or responsible whatsoever for any
expenditures made or obligations, indebtedness or liability incurred by
Dealer in connection with Dealer's performance of its obligations under
this Agreement.
ARTICLE III
DEALER'S GENERAL BUSINESS REQUIREMENTS
1. DEALER'S BUSINESS PREMISES:
To provide proper Honda Automobile and Honda Automobile Parts
representation commensurate with the reputation and goodwill attached to
the name "Honda" and to facilitate the proper sales and servicing of Honda
Automobiles and Honda Automobile Parts, Dealer will maintain business
premises satisfactory to Distributor with respect to appearance, location,
size of buildings, space allotments and adequate layout as well as
equipment, showroom, office, storage space, used car
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lot, body repair and paint shop, if any, parking facilities, workshop and
service operation; each of which shall comply with the standards, policies
and directives of Distributor as developed in proportion to the number of
Honda Automobiles and Honda Automobile Parts that may reasonably be
expected to be sold and serviced by Dealer.
2. DESCRIPTION AND PLANS OF DEALER'S PREMISES:
For the purpose of identifying the business premises and providing
satisfactory evidence that said business premises are in compliance with
Distributor's standards, policies and directives as specified in
Paragraph 1 of Article III, Dealer will submit to Distributor as Exhibit A
of this Agreement, a complete and full description and plans of the
location, land, building and all other requirements as contained in
Paragraph 1 of Article Ill herein. Such description and/or plans shall be
submitted on a "Description and Plan of Dealer's Premises" form to be
furnished by Distributor and must be approved in writing by Distributor.
3. EXPANSIONS AND IMPROVEMENTS OF DEALER'S PREMISES:
If during the term of this Agreement, expansion of Dealer's premises
is necessary to properly sell and service customers, it is agreed that
Dealer and Distributor will enter into a bona fide and good faith
negotiation to determine the extent of improvements necessary to fulfill
the requirements of such expansion of business. Upon agreement by
Distributor and Dealer of any change of said description and/or plans, a
new "Description and Plans of Dealer's Premises" shall be prepared, signed
by Dealer, and approved by Distributor in writing.
4. RELOCATION AND NEW DEALER'S PREMISES:
Once a Dealer has established its business facilities at a location
mutually satisfactory to Dealer and Distributor, Dealer will not move to or
establish a new or different location, branch sales office, branch service
establishment or any place or business including any used automobiles or
truck lots or location without first obtaining a written approval of
Distributor.
5. DEALER'S PERSONNEL:
Dealer shall at all times employ for its business qualified and
competent personnel for sale of Honda Automobiles and sale of used
automobiles and for sale of Honda Automobile Parts and for servicing Honda
Automobiles in such numbers and in such capacities as required according
to Distributor's standards, policies and directives for Dealer's
satisfactory operation. Dealer, at its cost, shall cause such of
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its qualified personnel, who may come within the scope of any training
courses conducted by Distributor, to attend such training whenever
Distributor specifies that attendance is required and will use such
material and information as may be specified from time to time by
Distributor.
6. HOURS OF BUSINESS:
During the term of this Agreement the Dealer shall operate its
business at its premises during and for not less than the customary
business days and hours of the trade in Dealer's area.
7. CAPITAL REQUIREMENTS:
Dealer and Distributor fully understand that a successful operation of
Dealer's business will to a great extent depend on the amount of net
working capital, owner's equity and line of credit with which Dealer
maintains its business operations, and, therefore, Dealer agrees that it
will at all times maintain as its minimum net working capital, owner's
equity and lines of credit in accordance with the amount set forth in a
separate minimum net working capital agreement to be executed by Dealer
and Distributor at the time of the execution of this Agreement. If due
to changed conditions, Distributor shall deem it necessary to materially
increase or decrease the amount of minimum net working capital, owner's
equity or line or lines of credit for Dealer to properly operate its
business, Dealer agrees to maintain the revised amount of minimum net
working capital, owner's equity, or line or lines of credit, as the case
may be deemed necessary by Distributor, to meet such changed conditions
for the proper operation of Dealer's business and Dealer and Distributor
agree to execute a new Sales Agreement, thereof setting forth such
revised amounts. If the amounts thereof are increased or decreased,
Dealer will meet the new minimum net working requirements within the time
agreed upon by Dealer and Distributor.
8. ACCOUNTING SYSTEM:
In order that Distributor may obtain satisfactory and adequate
financial operation data and information concerning Dealer's business
operation to enable Distributor to formulate policies beneficial to
Dealer's interest and for the promotion and sales of Honda Automobiles
and Honda Automobile Parts, it is agreed Dealer will use and keep
up-to-date an accounting system of the type which will meet the accepted
accounting practices of the accounting profession and satisfactory to
Distributor, and upon request by Distributor, Dealer will furnish to
Distributor by the fifteenth (15th) day of each month, a complete and
accurate financial and operation statement on forms furnished or approved
by Distributor with such supporting data as Distributor might request
covering the period of operation so designated, and showing
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a true and actual account of Dealer's business. In addition, if the
Dealer is, at the time of the execution of this Agreement or thereafter,
engaged in the sale of any other product or service, Dealer shall
maintain and keep separate records and books relating to the sales of
Honda Automobiles and Honda Automobile Parts and servicing of Honda
Automobiles so that Distributor shall be fully advised of all matters
relating to transactions of Dealer pursuant to the terms of this
Agreement; and Dealer shall furnish Distributor with one (1) copy of a
certified profit and loss statement and balance sheet of Honda products
and services consolidated statement for all products and services monthly.
9. RECORD SUPPORTING CLAIMS:
Dealer will prepare, keep up-to-date and retain records in support of
application for reimbursement of warranty policy work performed by Dealer,
and application for discounts, allowances, refunds or credits, in
accordance with the policies, procedures and directions formulated by
Distributor.
10. EXAMINATION OF ACCOUNTS AND RECORDS:
Dealer will permit, at any reasonable business hours, an examination
of its accounts and records to be made by person or persons in the employ
of or acceptable to Distributor.
ARTICLE IV
SALES OF HONDA AUTOMOBILES AND HONDA AUTOMOBILE PARTS
1. DEALER'S RESPONSIBILITY FOR SALES:
Dealer will use its best and principal efforts in promoting sales
performance of Honda Automobiles and Honda Automobile Parts and rendering
service to owners of Honda Automobiles satisfactory to Distributor in
Dealer's Area of Responsibility, and agrees to meet Sales Quotas as may
be determined by Distributor as hereinafter provided. Dealer's sales
performance shall be evaluated, based an such reasonable criteria as
Distributor may determine from time to time, which may include but not be
limited to the relative sales of New Honda Automobiles by Dealer in
comparison with sales of other makes of automobiles in such area, with
the nationwide, statewide or local sales of New Honda Automobiles, with
sales of New Honda Automobiles in comparative trade areas, development of
Dealer's sales performance over reasonable sales time, the availability
and the delivery of Honda Automobiles to Dealer, and local conditions,
including but not limited to geographic location, climate, population,
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transportation facilities and general shopping habits of the buying
public directly affecting such sales performance, and reasonable Sales
Quotas likewise determined by Distributor from time to time. When two or
more Honda Automobile Dealers are located within Dealer's Area of
Responsibility, evaluations of the sales performance of Dealer shall be
based upon Dealer's contribution to the combined sales performance of all
New Honda Automobiles in such area, Dealer's sales participation
experience within such area, and consideration of all the other sales
performance factors hereinabove set forth.
2. SALES AND MECHANICAL STAFF:
Dealer shall at all times maintain a staff of competent salesmen and a
selling and customer relations organization adequate to take care of its
sales potential. Dealer shall employ Distributor-trained and certified
service technicians in such manners and capacities as specified according
to Distributor's standards, policies and directives to service the owners
of Honda Automobiles in Dealer's Area of Responsibility.
3. SALES AND SERVICE RECORDS:
Dealer will keep separate, complete and current records pertaining
to sales and servicing of Honda Automobiles and Honda Automobile Parts
and will permit Distributor or its designee or designees at any
reasonable business hours to inspect such records.
4. CUSTOMER'S COMPLAINTS:
Dealer will receive, investigate and handle all complaints made by
owners of Honda Automobiles promptly, courteously and efficiently in
order to secure and maintain the goodwill of the public toward Dealer,
Distributor and Honda Automobiles, and any complaint received by Dealer
which cannot be readily remedied by Dealer shall be promptly reported in
detail to Distributor.
5. TREATMENT OF PURCHASERS:
A. DELIVERED PRICES AND ITEMIZED INVOICES:
Dealer will inform purchasers of Honda Automobiles and any Parts of
purchasers' delivered prices and give them an itemized invoice covering
the details of their purchases.
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B. TRUE STATEMENT AS TO SELLING PRICES:
Dealer will not make any misleading statements or misrepresentations
as to the items making up the total selling price of a New Honda
Automobile, Honda Automobile Parts, or as to the prices related to
such items.
C. SUGGESTED RETAIL PRICES:
Dealer hereby fully understands that any suggested retail price
which may be issued by Distributor pursuant to applicable laws is
merely a suggested price and no Dealer is required to sell any Honda
Automobiles or Honda Automobile Parts at such suggested retail prices.
D. SALE WITHOUT OPTIONAL EQUIPMENT OR ACCESSORIES:
Dealer recognizes that a retail customer has the right to purchase
New Honda Automobile without being required to purchase any optional
equipment or accessories, which the purchaser does not want unless
such equipment or accessories are required under applicable law or
regulations. Dealer shall remove such optional equipment or accessories
not desired by customer or will immediately order a New Honda
Automobile without such optional equipment or accessories.
E. PRE-DELIVERY INSPECTION:
Dealer will inspect, test and condition each New Honda Automobile
before delivering it to customer in accordance with Distributor's
Pre-Delivery and Inspection Schedule, except wholesale sales to other
authorized Honda Automobile Dealers. Dealer agrees to promptly submit
verification to Distributor, on the forms provided by Distributor, that
the Pre-Deliver Inspection has been properly performed by a
Distributor-trained and certified service technician.
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ARTICLE V
DEALER'S HONDA AUTOMOBILE PARTS SUPPLIES
1. PROMOTION OF HONDA AUTOMOBILE PARTS:
Dealer will use its best efforts to promote the sales of Honda
Automobile Parts in the Dealer's Area of Responsibility including use of
such means as may be specified from time to time by Distributor's
directives and suggestions.
2. DEALER'S PARTS DEPARTMENT REQUIREMENTS:
In the operation of Dealer's Parts Department, Dealer shall comply
with such reasonable standards or requirements as Distributor shall from
time to time define, and Dealer shall at all times employ qualified and
competent parts manager, parts clerk and parts employee and in such
number as may be required to satisfactorily manage and operate such Parts
Department, and use forms prescribed by Distributor, and at all times
give prompt and careful attention to owners of Honda Automobiles.
3. SALE OF HONDA AUTOMOBILE PARTS:
Dealer shall not sell or offer for sale as Honda Automobile Parts,
or as parts approved by Honda Motor or Distributor, any parts which are
not in fact, respectively, Honda Automobile Parts, or parts expressly
approved by Honda Motor or Distributor, and in no event shall Dealer sell
or offer for sale or use in connection with Honda Automobiles any parts
or accessories which are not permitted to be sold under the standard set
forth pursuant to the National Traffic and Motor Vehicle Safety Act of
1966 as amended.
4. MINIMUM INVENTORY OF HONDA AUTOMOBILE PARTS:
Dealer will carry in stock at all times during the term of this
Agreement reasonable inventory of Honda Automobile Parts to render proper
service to owners of Honda Automobiles in Dealer's Area of Responsibility.
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ARTICLE VI
CUSTOMER'S SERVICE
1. SERVICE TO BE PROVIDED BY DEALER:
Dealer shall provide the best possible service to any Honda
Automobile owner who may request such service from Dealer, including
performance of warranty repairs, and shall use its best efforts and
endeavor to promote customer's service.
2. SERVICE DEPARTMENT:
In the operation of Dealer's Service Department, Dealer agrees to
comply with such standards as Distributor may from time to time define;
Dealer shall at all times indicate the location of the Service Department
through a customer service sign in accordance with the directives of
Distributor; shall purchase and maintain all general tools, special tools
and equipment required by Distributor to property service Honda
Automobiles; shall provide Distributor with verification per Exhibit B of
this Agreement, that all required tools and equipment are available on
Dealer's premises and in good operating condition for use on Honda
Automobiles; shall employ qualified and competent service manager,
service writer, shop ▇▇▇▇▇▇▇, experienced, competent and
Distributor-trained technician and other service employee and in such
numbers as may be required by Distributor; shall use Honda service
promotional material and workshop forms prescribed by Distributor; shall
properly execute all service and repair work with respect to Honda
Automobiles; and shall provide prompt and careful service for owners of
Honda Automobiles.
3. REPRESENTATION OF HONDA AUTOMOBILE PARTS:
Dealer shall not represent as New Honda Automobile Parts or as new
parts approved by Honda Motor or Distributor other than New Honda
Automobile Parts or new parts expressly approved by Honda Motor or
Distributor.
4. CONTACT WITH PURCHASERS:
Dealer will furnish owners of Honda Automobiles prompt, courteous and
efficient service and will establish regular contact by correspondence,
or otherwise, with all persons who purchased Honda Automobiles from Dealer.
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5. WARRANTY DIRECTIVES AND PROCEDURES:
Distributor shall from time to time issue directives or policies on
Dealer's warranty procedures and adjustments which will be reviewed
periodically by Distributor to assure the handling of adjustments and
warranty problems properly and efficiently, to maintain maximum benefits
to Dealer and Distributor and to ▇▇▇▇▇▇ goodwill of owners of Honda
Automobiles and good relationship toward Dealer, Distributor and Honda
Automobiles. Any change or modification of such directives or policies
shall become effective three (3) days after mailing of such notice to
Dealer.
ARTICLE VII
DEALER'S PURCHASES AND INVENTORY
1. PRICES:
Distributor shall sell Honda Automobiles and Honda Automobile Parts
to Dealer at such prices and upon such terms as may be established from
time to time by Distributor. Dealer shall pay any and all sales taxes,
use taxes, State excise taxes and other governmental or municipal charges
imposed or levied or based upon the sale of Honda Automobiles or Honda
Automobile Parts by Distributor to Dealer. In the event of any increase
or decrease of the prices established by Distributor, Dealer shall have
the right to cancel all orders for Honda Automobiles affected by such
increase or decrease which are pending and unfilled at the time Dealer
obtains written notice of the increase or decrease from Distributor,
provided that Distributor be notified in writing of such cancellation
within ten (10) days from the time Dealer receives such notice, and
provided that such order or orders have not been shipped by Distributor
to Dealer.
2. ORDER AND ACCEPTANCE:
Dealer shall furnish its orders for Honda Automobiles and Honda
Automobile Parts to Distributor on forms supplied by Distributor at such
time or times and for such period or periods as Distributor reasonably
may require from time to time, and all such orders may be accepted by
Distributor in whole or as to any part thereof. All orders of Dealer
shall be binding upon it unless and until they are rejected in writing by
Distributor, provided, however, that in the event of a partial acceptance
by Distributor, Dealer shall no longer be bound with respect to the parts
of the order not accepted. In the event of shortage or restricted supply,
Dealer gives Distributor the
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right to allocate such supply in any reasonable manner Distributor deems
fit in any geographical market area.
3. LOCAL TAXES:
With each order furnished by Dealer to Distributor, Dealer
represents and warrants, as of the date of the purchase of the Honda
Automobiles or Honda Automobile Parts ordered, that all Honda Automobiles,
Honda Automobile Parts and similar items purchased from Distributor are
purchased by Dealer for resale in the ordinary course of Dealer's
business and that Dealer has complied with all the pertinent provisions
of local law prerequisite to the collection and payment by Dealer of all
sales taxes, use taxes, State excise taxes and other governmental or
municipal charges applicable to all such purchases or resale transactions
and will furnish evidence thereof to Distributor upon request. In the
event that any Honda Automobiles, Honda Automobile Parts or other
tangible property purchased from Distributor are put to a taxable use by
Dealer, or are in fact purchased by Dealer for purposes other than resale
in the ordinary course of Dealer's business, Dealer shall make timely
return and payment to the appropriate taxing authorities, of all
applicable sales taxes, use taxes, State excise taxes and other
governmental or municipal charges imposed or levied or based upon the
sale of such Honda Automobiles or Honda Automobile Parts or other
tangible property by Distributor to Dealer, and shall hold Distributor
free and harmless from any and all claims and demands which may be made
by such taxing authorities with respect thereto.
4. PAYMENTS:
Dealer shall make payment at the time and upon the conditions
specified in Distributor's established terms of payment. Delivery of any
checks or instruments of payment, other than actual cash, shall not
constitute payment until Distributor shall have collected actual cash in
the full amount thereof. Dealer shall pay all collection charges and
costs of exchange, if any, incurred in connection with its payments.
5. RESERVATION OF TITLE FOR SECURITY:
Except where the invoice may show a sale on credit, title to the
Honda Automobiles or Honda Automobile Parts sold by Distributor to Dealer
shall remain with Distributor to secure the payment therefor, and
Distributor shall have the right to stop such shipment in transit and to
repossess, retake and resell said Honda Automobiles or Honda Automobile
Parts and give credit therefor, and Dealer shall bear the cost of
transportation and sale thereof, if any, if Distributor shall elect to sell.
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6. PASSING OF TITLE AND RISK:
Except for reservation of title in Distributor as provided in
Article VII, Paragraph 5 supra, the title to Honda Automobiles and Honda
Automobile Parts sold by Distributor to Dealer, and all risks and peril
thereto shall pass to Dealer at the time of their delivery to Dealer,
Dealer's agent or carrier at the place of delivery specified in
accordance with the Distributor's established terms of delivery and
during all subsequent transportation; and it shall be up to Dealer to
insure such risks for its benefit and at its expense.
7. EXTENT OF DISTRIBUTOR'S RESPONSIBILITY FOR DEFECTS AND DAMAGE:
As between Distributor and Dealer only, Distributor assumes
responsibility for damage of Honda Automobiles and Honda Automobile Parts
caused during storage by Distributor or prior to delivery to Dealer,
Dealer's agent or carrier at the place of delivery specified in
Distributor's terms of delivery, provided Dealer notes nature and extent
of damage on carrier's delivery receipt and notifies Distributor not more
than five (5) days after delivery. Distributor assumes responsibility
for concealed damage provided that carrier and Distributor are properly
notified of the nature and extent of such damage not more than
forty-eight (48) hours after delivery in accordance with the directives
and policies of Distributor.
Dealer shall cause all such defects or damage to be repaired fully in
accordance with the standards, directives and policies of Distributor to a
level not less than the original condition before such damage was incurred.
8. CLAIMS FOR INCOMPLETE DELIVERY:
All claims for incomplete delivery of Honda Automobiles or Honda
Automobile Parts ordered by Dealer must be properly submitted to
Distributor not more than five (5) days after Dealer receives shipment,
provided that, in the case of automobile shipments, all shortages are
noted on the carrier's delivery receipt.
9. CHANGES OF SPECIFICATIONS:
Distributor reserves the right, at any time, to change or modify,
without notice, any specifications, design or model of Honda Automobiles
and Honda Automobile Parts. In the event of any change or modification
with respect to any Honda Automobiles or Honda Automobile Parts, Dealer
shall not be entitled to have such or similar change or modification with
respect to any Honda Automobiles or
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Honda Automobile Parts already ordered or purchased by Dealer and shipped
to Dealer or in Dealer's possession, except as may be required by
applicable law.
10. FAILURE OF OR DELAY IN DELIVERY:
Neither Distributor nor Honda Motor shall be under any liability
whatsoever to Dealer or to its customer for failure to deliver, or for
delay in making delivery pursuant to orders of Dealer accepted by
Distributor if such failure or delay is due, in whole or in part, to the
fact that delivery or timely delivery was rendered impossible or more
burdensome than it would have been in the normal course of business by
any event, whether foreseen or foreseeable or not, including any event in
the nature of acts of God, acts of providence, foreign or civil wars,
riots, interruptions of navigation or transportation, shipwrecks, strikes,
lockout, other labor troubles in place of business of Distributor or its
supplies, embargoes, blockades, fires, explosions, any labor, material,
transportation or utility shortage, failures of Honda Motor or of any
other supplier of Distributor to deliver, or delay of Honda Motor or of
any other supplier in making delivery and any cause beyond control of
Distributor, the foregoing specific events having listed herein only by
way of illustration and not by way of limitation.
11. RETURN OR DIVERSION ON FAILURE TO ACCEPT:
If without fault on part of Distributor, Dealer should fail or
refuse to accept delivery of any Honda Automobiles or Honda Automobile
Parts ordered by Dealer, Dealer shall pay Distributor the amount of all
expenses incurred by Distributor in shipping such Honda Automobiles or
Honda Automobile Parts to Dealer and expenses of returning them to the
original place of shipment or in directing them to another destination,
as determined by Distributor; but in no event shall the cost to Dealer
for returning such non-accepted items be in an amount in excess of the
expenses of returning such Honda Automobiles or Honda Automobile Parts to
their original place of shipment. In the event, such Honda Automobile
Parts be returned to a warehouse of Distributor, Dealer shall pay, in
addition to said expenses, restocking charges of such Honda Automobile
Parts according to terms established by Distributor.
12. INVENTORIES:
Dealer shall acquire and at all times maintain at least such minimum
inventory of Honda Automobiles and Honda Automobile Parts as may be
reasonably determined from time to time by Distributor, but this
obligation shall be subject to the ability of Distributor to supply the
products ordered by Dealer. Dealer also shall have available at all
times for purposes of demonstration the number of Honda Automobiles of
the most current models and types, as reasonably requested by Distributor
in accordance
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with the volume of Dealer's business, and shall keep the same at all
times in first class operating condition. Dealer shall increase from
time to time, as may be reasonably requested by Distributor, its minimum
inventory of Honda Automobiles and Honda Automobile Parts and the number
of Honda Automobiles held by it for the purpose of demonstration.
ARTICLE VIII
WARRANTY TO CUSTOMERS
1. MANUFACTURER'S WARRANTY:
New Honda Automobiles and New Honda Automobile Parts supplied to
Dealer by Distributor will be warranted by Distributor only in accordance
with the manufacturer's or Distributor's written warranty to customers as
may be furnished to Dealer from time to time by Distributor be
distributed to its retail consumers, which warranty may be amended or
modified at any time by Distributor. OTHER THAN THE WARRANTY CONTAINED
IN SAID MANUFACTURER'S OR DISTRIBUTOR'S WRITTEN WARRANTY, NEITHER
DISTRIBUTOR NOR HONDA MOTOR MAKES ANY WARRANTY WHATSOEVER, EXPRESSED OR
IMPLIED, AS TO THE QUALITY OR CONDITION OF HONDA AUTOMOBILES OR HONDA
AUTOMOBILE PARTS TO BE SUPPLIED BY IT TO DEALER, INCLUDING, BUT NOT BY
WAY OF LIMITATION, THE MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR
PURPOSES OF SUCH HONDA AUTOMOBILES OR HONDA AUTOMOBILE PARTS AND ASSUMES
NO LIABILITY WHATSOEVER, WHETHER FOR DIRECT, INDIRECT OR CONSEQUENTIAL
DAMAGES, OR IN ANY OTHER WAY, IN CONNECTION WITH SUCH CONDITION.
2. WARRANTY TO CUSTOMERS:
Dealer shall make all sales of Honda Automobiles and Honda
Automobile Parts in such manner that the customers shall acquire all
rights accorded thereto by the Manufacturer's or Distributor's written
warranty as amended from time to time by Distributor, to the exclusion of
any other, further or different warranty from or on behalf of Honda Motor
or Distributor.
3. WARRANTY CLAIM PROCEDURE:
Procedures for the processing and disposition of warranty claims and
for the return and disposition of Honda Automobile Parts claimed to be
defective, and
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payment and credit therefor shall be established from time to time by
Distributor. Dealer shall comply with all the requests of Distributor
for the performance of services pursuant to warranty claims.
4. WARRANTY REGISTRATION PROCEDURE:
Dealer agrees to notify Distributor of the sale of each New Honda
Automobile, or used Honda Automobile, if still under warranty, on such
forms as prescribed by Distributor in accordance with policies and
procedures established from time to time by Distributor.
ARTICLE IX
ESTIMATES AND REPORTS
1. ESTIMATES:
To enable Distributor to estimate requirements for future delivery,
Dealer will furnish Distributor every month by the time specified by
Distributor with a monthly estimate of Dealer's requirements of New Honda
Automobiles on a form provided by Distributor for a period of time as may
be designated by Distributor.
2. SALES AND INVENTORY REPORTS:
To assist Distributor in the evaluation of current market trends and
adjustments of established current and future shipment schedule, Dealer
will furnish Distributor every month by the time specified by Distributor
with monthly sales and inventory reports of Honda Automobiles, on forms
furnished by Distributor. Such reports shall show separately detail sales
of both new and used Honda Automobiles and new and used automobiles other
than Honda Automobiles made during such period, separate detailed
inventory of both new and used Honda Automobiles and unfilled orders for
Honda Automobiles on hand at the end of each month. Dealer shall also
furnish Distributor with such daily interim sales and inventory reports,
on forms furnished by Distributor, as Distributor may reasonably require
in evaluating Dealer's current sales and inventory. Such daily interim
sales and inventory reports shall be furnished to Distributor within the
time as may be requested by Distributor.
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ARTICLE X
SIGNS, TRADEMARKS AND TRADENAMES
1. SIGNS:
Dealer will purchase, erect and maintain at Dealer's expense the
following signs, except those prohibited by applicable law, statute or
ordinance.
A. PRODUCT SIGN:
A standard Honda electric sign authorized by Distributor in a
conspicuous place outside Dealer's showroom.
B. CUSTOMER SERVICE SIGN:
The standard service sign authorized by Distributor in a suitable
location on the outside of Dealer's place of business. Other service
signs shall be placed in conspicuous locations to direct customers
requiring use of Dealer's servicing facilities.
C. OTHER NECESSARY SIGNS:
Such other signs as Distributor approves in writing and is deemed
necessary to advertise Dealer's business property. All Honda Signs,
other than above described, must be first approved in writing by
Distributor before installation.
2. TRADEMARKS:
A. EXCLUSIVE OWNERSHIP:
Dealer agrees that Honda Motor and/or Distributor are the owners of
and are entitled to the exclusive use of the various Honda Trademarks.
B. USE BY DEALER:
Dealer is granted during the term of this Agreement the non-exclusive
privilege of displaying the Honda Trademarks in connection with the sale,
offering for sale and servicing of Honda Automobiles and Honda
Automobile Parts, of using such trademarks in the business name of Dealer
under which Dealer's Honda Automobile business is conducted, and upon
prior and separate written approval of Distributor, provided, however,
that Dealer shall discontinue the display or use of any Honda Trademark
or change the manner in which any such trademark is displayed or used
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when requested to do so by Distributor. Dealer agrees that any use or
display of the Honda Trademarks inures solely to the benefit of Honda
Motor and/or Distributor, including all goodwill. Dealer agrees that it
shall not use such trademarks in its corporate name.
C. DISCONTINUANCE OF USE UPON TERMINATION:
Dealer agrees that the above granted privilege is automatically
revoked upon termination or expiration without renewal of this Agreement
and that there is no continuing or other right or license to use or
display the Honda Trademarks. Dealer agrees that if any such trademark
is used in Dealer's business name or in signs, advertising or in any
other manner by Dealer, Dealer will, upon termination or expiration
without renewal of this Agreement, immediately discontinue, at is own
expense, all such use and display thereof. See Article XIV, infra.
D. DEALER'S LIABILITY FOR FAILURE TO DISCONTINUE USE:
If dealer shall refuse or neglect to keep and perform the provisions
of Section 2, subsections A, B or C, of this Article X or Sections 1, 2
or 3 of Article XIV, Dealer shall reimburse Honda Motor and/or
Distributor for all costs, attorney's fees and other expenses incurred by
Honda Motor and/or Distributor in connection with legal action to require
Dealer to comply therewith.
ARTICLE XI
ADVERTISING PROMOTIONAL PROGRAM
Dealer agrees to actively advertise Honda Automobiles and Honda
Automobile Parts and to display appropriate signs required by Distributor
and to cooperate to the greatest reasonable extent with all promotional
programs of Distributor and to protect Dealer's customers and the public
and to maintain the goodwill and reputation of Honda Automobiles and
Honda Automobile Parts. Dealer will not advertise or trade in
Distributor's products in such a way as to be injurious or detrimental to
such goodwill and reputation and will not publish, advertise or use any
form of advertising matter or media objectionable to Distributor, and
will discontinue immediately any advertising objected to by Distributor.
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ARTICLE XII
COMPLIANCE WITH LAWS
Dealer shall at all times hereunder operate and conduct its business
in full compliance with all Federal, State, County, or City statutes, laws,
rules, regulations and ordinances, particularly the applicable State
Motor Vehicle Code, the National Traffic and Motor Vehicle Safety Act of
1966 and all amendments thereto, and all federal or state trade
regulation laws. Dealer agrees to fully cooperate and comply immediately
with any directives or instructions of Distributor pertaining to matters
concerning compliance with said National Traffic and Motor Vehicle Act of
1966, or with rules, regulations and standards promulgated by the
Secretary of Transportation or the Traffic Safety Administrator.
ARTICLE XIII
TERMINATION OF SALES AGREEMENT
1. TERMINATION BY DEALER:
Dealer may terminate this Agreement by serving upon Distributor
written notice of termination, by certified or registered mail addressed
to Distributor at its home office. Such termination to be effective
thirty (30) days after actual receipt by Distributor of such Notice.
2. TERMINATION FOR CAUSE:
A. If Dealer breaches, violates or defaults under any obligation of
Dealer set forth in this Agreement or in connection with any conduct or
any transaction between Distributor and Dealer within the scope of this
Agreement, Distributor may terminate this Agreement by giving Dealer
written notice of termination by certified or registered mail addressed
to Dealer at its place of business to be effective sixty (60) days after
receipt of such notice. This provision shall not in any way be construed
to limit or restrict Distributor's rights to cancel this Agreement as
otherwise herein provided.
B. Distributor may, at its option, forthwith terminate this
Agreement for cause by notifying Dealer by certified or registered mail
or telegraph. The following events shall be considered sufficient cause
for the forthwith termination of this Agreement; such causes are
enumerated in this Agreement only by way of illustration and not by way
of limitation.
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1. Failure by Dealer or Distributor to secure and maintain any
license necessary for the conduct of Dealer or Distributor of its business
pursuant to this Agreement or the expiration without renewal, or
suspension, or revocation of any such license.
2. Any transfer or attempted transfer by Dealer of the whole
or any part of this Agreement or any interest therein or any right or
obligation thereunder, without the prior written consent of Distributor
subject to laws of state in which Dealer is located.
3. Insolvency of Dealer or the voluntary commencement by
Dealer or the involuntary commencement against Dealer of any proceedings
under the Bankruptcy Act or under any State insolvency law, which is not
vacated within ten (10) days from the institution thereof; or the
appointment of a receiver or other officer having similar powers for
Dealer or Dealer's business who is not removed within ten (10) days from
appointment thereof; or any levy under attachment, garnishment or
execution or similar process which is not within ten (10) days vacated or
removed by payment or bonding.
4. Any change, whether voluntary or by operation of law, in
the legal or beneficial ownership of or in the executive power or
responsibility in Dealer without the prior written consent of Distributor.
5. Any disagreement or personal difficulty between or among
partners or stockholders of Dealer or in the management of Dealer which
in the Distributor's opinion may adversely affect the conduct of Dealer's
business, or the presence in the management of Dealer or any person who
in the Distributor's opinion does not have or no longer has requisite
qualifications for his position.
6. Impairment of reputation or the financial standings of
Dealer or of any partner, stockholder or officer of Dealer subsequent to
the execution of this Agreement, or the ascertainment by Distributor of
any facts existing at or prior to the time of execution of this Agreement
which tend to impair such reputation or financial standings, or if Dealer
is in default of any obligations or debts due to Distributor or if
Dealer's account with Distributor becomes delinquent.
7. Submission by Dealer of any false or fraudulent application,
report or statement, or false or fraudulent claim for reimbursement,
refund or payment, including, but not by way of limitation, false and
fraudulent warranty claims.
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8. Conviction in any court of competent jurisdiction of
Dealer or of any partner, stockholder, or officer of Dealer for any crime
or violation of law, if in the opinion of Distributor such conviction may
adversely affect the conduct of Dealer's business or tend to be harmful
to the goodwill of Honda Motor or Distributor to the reputation of Honda
Automobiles, Honda Automobile Parts or other Honda products.
9. Should Dealer enter into any agreement, understanding, or
contract, oral or written, with any other Dealer or Dealers with the
purpose of fixing prices of Honda Automobiles or Honda Automobile Parts.
10. Death or incapacity (for reasons of health) of Dealer, if an
individual, or of a partner of Dealer, if a partnership, or dissolution or
liquidation of Dealer, if a partnership or a corporation.
11. Failure of Dealer to maintain dealership operations as a
going business, open during customary business hours, for seven
consecutive business days except if such failure is due to causes beyond
Dealer's control and is without Dealer's fault or negligence.
12. Termination of Distributor's Franchise as a Honda Automobile
Distributor.
13. Failure of Dealer to perform the required pre-delivery
inspection, testing and conditioning services and procedural requirements
relating thereto.
14. Failure of Dealer to make improvements, alterations, or
modifications of its business premises which Dealer has agreed or
represented to Distributor that Dealer shall make or do.
15. Discontinuance of the Automobile Series for which Dealer
holds this Sales Agreement.
C. Termination of this Agreement is subject to state laws and
procedures in which the Dealer is located.
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ARTICLE XIV
SIGNS, LITERATURE, BUSINESS NAME, ETC. UPON TERMINATION
1. REMOVAL OF SIGNS:
Upon termination or expiration without renewal of this Agreement,
Dealer shall forthwith remove, at its own expense, all authorized signs
which are displayed at the premises for which this dealership was granted,
and sell and deliver the same to Distributor at Dealer's place of
business or such other place as may be designated by Distributor,
labelled and packaged in suitable containers for transportation.
Distributor shall pay Dealer such price for such Honda signs as
reasonably shall be determined by Distributor, provided, however, that
such price shall in no event be less than Dealer's cost price for such
signs reduced by straight line depreciation on the basis of a useful life
of five years except Distributor shall not be required to pay for any
signs not purchased by Dealer for use or display at the premises for
which this dealership was granted. Dealer agrees to forthwith destroy
all unauthorized signs.
2. LITERATURE, MANUALS, PROMOTIONAL MATERIAL, ETC.:
Upon termination or expiration without renewal of this Agreement,
Dealer shall deliver to Distributor at Distributor's place of business,
or to a third person designated by Distributor, or destroy upon request
by Distributor, any and all technical or service literature, advertising
and other printed material, then in Dealer's possession or under its
control, which relates to Honda Automobiles or Honda Automobile Parts,
and which was obtained by Dealer from Distributor. Distributor shall pay
Dealer therefor a reasonable amount as determined by Distributor,
provided Dealer was charged therefor by Distributor. Dealer shall at its
own expense destroy all other printed material, including business
stationery, bearing any Honda Trademark or referring to Honda Automobiles
or Honda Automobile Parts in any way which might make it appear that
Dealer is still a Honda Automobile Dealer.
3. BUSINESS NAME:
Upon termination or expiration without renewal of this Agreement,
Dealer shall, at its sole expense, promptly remove all Honda Trademarks
from its business name and any registration thereof, and shall in all
respects cease to hold itself out to the public or trade as a Honda
Automobile Dealer. See also Section 2, subsections C and D of Article X,
supra, re discontinuance of use of Honda Trademarks.
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ARTICLE XV
TERMINATION DELIVERIES
1. CANCELLATION OF ORDERS:
Upon the mailing of the written termination or expiration without
renewal of this Agreement, Distributor shall have the right to cancel all
pending orders of Dealer for Honda Automobiles, Honda Automobile Parts,
and special tools and equipment, whether previously accepted by
Distributor or not, except as provided in Article XV, Paragraph 2, below.
2. TERMINATION DELIVERIES:
In the event of termination of this Agreement or expiration without
renewal thereof, and upon written request by Dealer, Distributor will use
its best efforts to furnish Dealer with Honda Automobiles to fill
Dealer's bona fide orders on hand on the date of termination or
expiration without renewal subject to the following conditions and
limitations:
A. Within ten (10) days following the date of service of the
notice of termination upon Dealer or expiration without renewal of this
Agreement, Dealer shall deliver to Distributor a written schedule of
Dealer's bona fide retail orders on hand on the date of termination
together with a photo-copy of each such order attached. Such schedule
shall show the name and address of each retail customer and the details
with respect to each Honda Automobile ordered, including model, body type,
color and accessories and shall specify each bona fide order against
which Dealer desires Distributor to make delivery and that Dealer does
not have in stock such Honda Automobiles to fill such orders. Such
unfilled retail orders for which delivery is thus specified by Dealer,
when approved by Distributor, shall constitute Dealer's Unfilled Order
Schedule. No change or substitution may be made by Dealer in such
Dealer's Unfilled Order Schedule and Distributor shall not be obligated
to make delivery of any Honda Automobile to Dealer except as specified
therein. In the event Dealer fails to deliver to Distributor the timely
detailed Schedule above required, Dealer shall have no further rights.
B. Honda Automobiles shall be delivered to Dealer by Distributor
hereunder substantially in accordance with the schedules and basis of
delivery in effect with respect to other dealers in the same zone area at
the time of Dealer's termination, and Dealer shall accept any such Honda
Automobiles required to be delivered by Distributor hereunder against
Dealer's Unfilled Order Schedule immediately upon notification by
Distributor of the availability to Dealer of such
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Honda Automobiles and in accordance with the terms and conditions of
sales established by Distributor and in effect at the time of shipment.
In the event of its failure to do so, Dealer shall have no further right
to receive such Honda Automobiles or any other Honda Automobile in lieu
of them.
C. Dealer shall give Distributor notice immediately of any
cancellation for any reason of any retail order set forth in Dealer's
Unfilled Order Schedule and in the event of cancellation of any order
contained in Dealer's Unfilled Order Schedule before delivery by
Distributor of such Honda Automobile against such order, Distributor
shall be released from any obligation to make delivery of such Honda
Automobile.
3. EFFECT OF TRANSACTIONS AFTER TERMINATION:
The acceptance of orders from Dealer or the continuance of sale of
Honda Automobiles and Honda Automobile Parts to Dealer or any other act
of Distributor after termination of this Agreement shall not be construed
as a renewal of this Agreement for any further term nor a waiver of the
termination.
ARTICLE XVI
REPURCHASE OF HONDA AUTOMOBILES, HONDA AUTOMOBILE PARTS, SPECIAL TOOLS AND
EQUIPMENT AFTER TERMINATION
Upon the termination or expiration without renewal of this Agreement,
Distributor shall have the option to purchase from Dealer all or any
part of the properties hereinafter set forth, and Dealer agrees to sell
and deliver the same to Distributor in accordance with the provisions
herein contained. Distributor shall have thirty (30) days after
effective date of termination or expiration without renewal to exercise
its option to repurchase the properties hereinafter described.
1. HONDA AUTOMOBILES:
All new, unused and undamaged Honda Automobiles unsold at the
effective date of termination or expiration of this Agreement in Dealer's
inventory, in its possession or under its control which are in first
class saleable condition and of the then current model and type, and
provided that they were purchased by Dealer from Distributor. The price
for such Honda Automobiles shall be the price at which they were
originally purchased by Dealer from Distributor or the price last
established by Distributor for the sale of identical Honda Automobiles,
whichever shall be lower, in either case less all prior refunds and
allowances made by Distributor with respect
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thereto, if any. Further Dealer agrees that within ten (10) days after
termination or expiration without renewal of this Agreement, Dealer
shall deliver to Distributor a written inventory, in such form as
Distributor may require, of all Honda Automobiles in its inventory,
possession or control.
2. HONDA AUTOMOBILE PARTS:
All new, unused and undamaged Honda Automobile Parts listed in
"Distributor's Current Parts Price Schedule," then unsold and in Dealer's
inventory, or in its possession or control, which are in first class
saleable condition, provided they were purchased by Dealer from
Distributor. The price for such Honda Automobile Parts shall be the
price then last established by Distributor for the sale of such identical
Honda Automobile Parts, less all prior refunds or allowances made by
Distributor in respect thereto and less restocking charges. Further
Dealer agrees that within thirty (30) days after termination or
expiration without renewal, it will deliver to Distributor a list, in
such form as Distributor may require, of all Honda Automobile Parts in
its inventory, possession or control.
3. SPECIAL TOOLS AND EQUIPMENT:
All special tools and equipment for Honda Automobiles owned by
Dealer and purchased from Distributor by Dealer or pursuant to request of
Distributor. The price for such special tools and equipment shall be a
reasonable price determined by Distributor, but such price shall in no
event be less than Dealer's cost price for such tools and equipment
reduced by a straight line depreciation on the basis of a useful life of
five years. Further Dealer agrees that within thirty (30) days after
termination or expiration without renewal, it will deliver to Distributor
a list of all special tools and equipment in its inventory, possession or
control.
4. DELIVERY TO DISTRIBUTOR:
Dealer agrees to retain such Honda Automobiles, Honda Automobile
Parts, special tools and equipment at Dealer's place of business,
labelled and packaged in suitable containers for transportation until
receipt of shipping instructions from Distributor, and upon receipt of
such shipping instructions, Dealer shall comply therewith.
5. INSPECTION OF PROPERTY AT DEALER'S PREMISES:
Distributor, or its designee or designees, at such reasonable time
and for such reasonable period of time as Distributor may determine,
shall have the right to enter Dealer's premises for the purpose of
checking the list submitted by Dealer or
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examining and inspecting of any and all items of property therein set
forth to determine the correctness of the list submitted and the
condition of such property.
6. RIGHT OF REJECTION:
Notwithstanding anything to the contrary contained and regardless of
whether the Distributor has exercised his right of inspection under
Paragraph 5, of this Article XVI or not, in the event Distributor
exercises his option to repurchase the properties described in Paragraphs
1, 2 and 3 of Article XVI, Distributor shall have the right, for a period
of thirty (30) days after delivery of such property to Distributor, to
reject any or all of the Honda Automobiles, Honda Automobile Parts or
special tools and equipment to be repurchased by Distributor, if any such
product or property does not meet any of the requirements set forth in
said Paragraphs 1, 2 or 3 of this Article XVI, or if any such products or
property so delivered to Distributor was purchased by Dealer for premises
operated under another and separate Honda Automobile Sales Agreement.
7. LIENS AND ENCUMBRANCES:
All Honda Automobiles, Honda Automobile Parts, Honda Signs, special
tools and equipment to be repurchased by Distributor pursuant to
provisions of Article XIV or Article XVI of this Agreement shall be free
and clear of all liens, encumbrances or attachments, and Distributor may
deduct from the purchase price of such property all indebtedness of
Dealer to Distributor, including any payments made by Distributor to
satisfy any lien, encumbrance or attachment.
8. PAYMENT:
All payment due from Distributor to Dealer pursuant to provisions of
Article XIV or Article XVI of this Agreement or in connection with the
termination of Dealer's Sales Agreement, shall be made by Distributor
within ten (10) days after all matters therein provided shall be finally
determined and all credits and offsets ascertained. In the event it be
found that a balance is due from Dealer to Distributor, Dealer shall pay
such sum to Distributor within ten (10) days of notice of such balance.
9. FREIGHT AND INSURANCE CHARGES:
If Dealer cancels this Agreement, Dealer shall pay all freight and
insurance charges from Dealer's premises to the place of delivery
designated by Distributor on all repurchases of Honda Automobiles, Honda
Automobile Parts, special tools and equipment, Honda Signs, manuals,
literature, promotional material, etc., which
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Distributor is obligated to, or elects to, repurchase under this Agreement,
provided that Dealer shall not be liable for any amount greater than the
freight and insurance charges from Dealer's premises to Distributor's
closest warehouse.
ARTICLE XVII
OBLIGATIONS OF DISTRIBUTOR IN CASE OF DEATH
1. DEATH OF DEALER:
Notwithstanding the right of Distributor to forthwith terminate this
Agreement pursuant to Paragraph 10 of Article XIII herein upon the death
or incapacitation (for reasons of health) of any person referred to
therein, Distributor shall not so terminate this Agreement pursuant to
said Paragraph 10 before the end of the calendar year during which such
death or incapacitation of any such person occurs, if upon such death or
incapacitation of such person his/her beneficial interest in Dealer's
business passes directly to his/her spouse or children, or any of them,
and if either (1) the person having executive powers and responsibility
in the management of the Dealer's business remains unchanged, or (2)
within sixty (60) days after said death or incapacitation arrangements
are completed for the assumption of executive power and responsibility in
Dealer's business during the remainder of the calendar year by persons
acknowledged by Distributor to be satisfactory to it. However, nothing
in this Article XVII shall affect or waive Distributor's right otherwise
to terminate this Agreement pursuant to any provision of this Agreement
other than said Paragraph 10 and subject to any laws relating thereto in
which the Dealer is located.
ARTICLE XVIII
DISTRIBUTOR'S ASSISTANCE
1. ASSISTANCE IN SALE OF DEALER'S BUSINESS:
To the end that the equities of the Dealer may be protected and its
loss, if any, be minimized, Distributor will assist Dealer in the orderly
disposition of Dealer's business assets in accordance with the following
provisions:
A. If Dealer desires the assistance of Distributor in the
disposition of Dealer's business assets, which at the time of Dealer's
first knowledge of termination of expiration of this Agreement were being
used solely for the performance of Dealer's obligations under this
Agreement and Dealer's Sales Agreement, Dealer may
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within thirty (30) days from effective date of termination of this
Agreement file with Distributor a written request for assistance in the
disposition of such business assets and shall therein set forth an
itemized statement of all assets and property to be included therein,
excluding therefrom all Honda Automobiles, Honda Automobile Parts,
special tools and equipment and Honda Signs, etc., as may be repurchased
by Distributor under the provisions of Article XIV and Article XVI of
this Agreement. If Dealer fails to make such timely request,
Distributor shall be released from any and all obligations to Dealer
under the section.
B. Upon receipt of such request from Dealer, Distributor shall
endeavor to locate a purchaser who will offer to purchase such business
assets of the Dealer's business used solely for the performance of
Dealer's obligations under this Agreement and Dealer's Sales Agreement at
the price set by Dealer or at a fair and reasonable price. In the event
Distributor is unable to locate a purchaser of such business assets at a
price acceptable to Dealer within thirty (30) days after receipt of such
request from Dealer, then Distributor shall be released from any and all
obligations to locate a purchaser for Dealer pursuant to such request.
ARTICLE XIX
GENERAL PROVISIONS
1. AUTHORITY TO SIGN FOR DISTRIBUTOR:
Dealer acknowledges that only a Vice-President, or Secretary or
Assistant Secretary is authorized on behalf of Distributor to execute
this Agreement or to agree to any variation, modification or amendment of
any of its provisions.
2. ENTIRE AGREEMENT:
This instrument contains the entire Agreement between the parties.
No representations or statements other than those expressly set forth
herein were made or relied upon in entering into this Agreement.
3. RELEASE OF CLAIMS:
This Agreement terminates and supersedes as of the beginning of its
term all prior agreements, if any, with respect to Honda Automobiles and
Honda Automobile Parts between the parties. The parties hereby waive,
abandon and relinquish any and all claims of any kind and nature
whatsoever arising from or out of or in connection with any such prior
agreement, provided, however, that nothing herein contained shall
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be deemed a waiver of any claims arising out of prior sales of Honda
Automobiles and Honda Automobile Parts by Distributor to Dealer.
4. VARIATIONS, MODIFICATIONS, AMENDMENTS:
This Agreement may not be varied, modified or amended except by an
instrument in writing duly signed by the parties.
5. NO TRANSFER:
Neither this Agreement, nor any part thereof or any interest therein,
may be transferred or assigned by Dealer without the prior written
consent of Distributor except states with law regulating transfers.
6. NOTICES:
All notices under or pursuant to the provisions of this Agreement
shall be directed to the other party at their respective address as
stated herein, or, if either of the parties shall have specified another
address by notice in writing to the other party, to the address thus last
specified. The parties shall advise each other forthwith in writing of
any change of address.
7. WAIVERS:
The waiver by either party of any breach or violation of or default
under any provision of this Agreement shall not be deemed to be a waiver
by such person of any subsequent breach or violation thereof or default
thereunder, or of any other provisions herein.
8. DIVISIBILITY:
This Agreement is to be governed by and construed according to the
laws of the State of California. If any provision of this Agreement
should be held invalid or unenforceable for any reason whatsoever or to
violate any law of the United States, the District of Columbia or any
state this Agreement shall be considered divisible as to such provision,
and such provision shall be deemed deleted from this Agreement in such
jurisdiction or, in the event that it should be held to violate only the
laws of the District of Columbia or of any state, such provision shall be
inapplicable only within the territory thereof, and the remainder of this
Agreement shall be valid and binding as if such provision was not
included herein or as if it were included herein only with respect to
territories outside of such District or state, as the case may be.
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