28-4459. Manufacturer or distributor right of
first refusal
If a change of all, or substantially all, ownership of a new motor vehicle
dealership or transfer of all, or substantially all, dealership assets is proposed, a
manufacturer or distributor may exercise a right of first refusal to acquire the
dealership if all of the following requirements are met:
1. The manufacturer or distributor notifies the dealer in writing within sixty days
after receipt of the completed application forms and related information generally used
by a manufacturer or distributor to conduct its review and a copy of all agreements
regarding the proposed transfer of its intent to exercise its right of first refusal or
its rejection of the proposed transfer. If the manufacturer or distributor fails to
notify the dealer of its exercise of its right of first refusal or its rejection of the
proposed transfer within the sixty day period, the proposed transfer is deemed to be
approved by the manufacturer or distributor.
2. The exercise of the right of first refusal results in the dealer receiving the
same or greater compensation than the dealer negotiated or contracted to receive in
connection with the proposed change of all, or substantially all, ownership of the
dealership or transfer of all, or substantially all, dealership assets.
3. The proposed change of all, or substantially all, dealership assets does not
involve the transfer of assets or the transfer or issuance of stock by the dealer or one
or more dealer owners to a designated family member or members or the spouse, child,
grandchild, spouse of a child or grandchild, brother, sister or parent of the dealer or
one or more dealer owners or to a qualified manager, a partnership or a corporation
controlled by any of those persons.
4. The manufacturer or distributor agrees to pay the reasonable expenses, including
reasonable attorney fees that do not exceed the usual, customary and reasonable fees
charged for similar work done for other clients, incurred by the proposed new owner and
transferee before the manufacturer's or distributor's exercise of its right of first
refusal in negotiating and implementing the contract for the proposed change of all, or
substantially all, ownership of the dealership or transfer of all, or substantially all,
dealership assets. Notwithstanding the provisions of this paragraph, a manufacturer or
distributor shall not pay those expenses and attorney fees if the dealer has not
submitted or caused to be submitted to the manufacturer or distributor an accounting of
those expenses within twenty days after the dealers' receipt of the manufacturer's or
distributor's written request for the accounting. This accounting may be requested by a
manufacturer or distributor before exercising its right of first refusal.
|