What Are You Signing? When your OEM rep presents you with a document to be signed, understand what it requires. Programs that cost you more and make you less will result as OEMs seek to make dealer income their own. Some OEM documents may violate your state law if they have waivers of state franchise act protections. Remember, your franchise agreement does not terminate. During renewal of the agreement, while you cannot change a manufacturer’s form agreement, the specific terms applicable to your dealership are negotiable. If the terms are unfavorable, raise the issues with the factory and negotiate more favorable terms as part of your renewal. If your factory representative labels you as a difficult dealer, point out that the factory is changing the relationship, not you. Know your state franchise laws when it comes to new forms, such as in Virginia. The new forms need to be presented and approved by the Commissioner before the manufacturer can request that you execute them. Succession and Dealer Ownership Succession planning has become a reality for many dealers. If you are one of those dealers redoing the ownership structure for estate planning purposes, make sure you have the approval of your franchisor before you finalize the sale of or gift of stock. Many dealers think that they only must notify franchisors of minority interest changes after they make them. That is not the case. Most dealer sales and service agreements require manufacturer approval before a new interest in the company is granted. Any small interest gifted or sold requires manufacturer approval. Failing to obtain approval beforehand can be considered a breach of the dealer sales and service agreement. Scan the QR code to download the Supplier Agreement Checklist. vada.com/wp-content/uploads/2020/05/ Supplier-Agreement-Checklist.pdf Backed by decades of experience, Brad D. Weiss, Barrett Charapp Beaty, Travis Salisbury, Elizabeth A. Dwyer, and Ben Sinder are dedicated to providing auto dealers with comprehensive legal support and strategic guidance. cwattorneys.com 571.346.7507 1818 Library Street, Suite 500, Reston, VA 20190 Barrett Charapp Beaty Travis Salisbury Elizabeth A. Dwyer Ben Sinder Brad D. Weiss Your Trusted Legal Partner for Auto Dealers: Charapp & Weiss, LLP. Contact Us For Further Inquiry vada.com 13
RkJQdWJsaXNoZXIy MTg3NDExNQ==