Oklahoma § 47-596.5 - Manufacturer termination of dealer agreement - Good

§ 47-596.5. Manufacturer termination of dealer agreement - Good

cause - Notice - Repurchase of inventory.

A. A manufacturer, directly or through any officer, agent, or

employee, may terminate or not renew a dealer agreement without good

cause. If the manufacturer terminates or does not renew the dealer

agreement without good cause, the manufacturer shall comply with the

provisions of subsections D and E of this section. If the

manufacturer terminates or does not renew the dealer agreement with

good cause, the provisions of subsections D and E of this section

shall not apply.

B. A manufacturer has the burden of showing good cause for

terminating or not renewing a dealer agreement. All of the

following factors shall be considered in determining whether there

is good cause for a proposed termination or nonrenewal of a dealer

agreement by a manufacturer:

1. The extent of the penetration of the dealer in the relevant

market area;

2. The extent and quality of the service of the dealer under

recreational vehicle warranties;

3. The nature and extent of the investment of the dealer in

business of the dealer;

4. The adequacy of the service facilities, equipment, parts,

supplies, and personnel of the dealer;

5. The effect of the proposed action on the community;

6. Whether the dealer fails to follow agreed-upon procedures or

standards related to the overall operation of the dealership; and

7. The performance by the dealer under the terms of dealer

agreement.

C. Except as otherwise provided in this section, a manufacturer

shall provide a dealer with written notice of a termination or

nonrenewal of a dealer agreement. All of the following conditions

apply to a notice described in this subsection:

1. Except as provided in paragraph 4 or 5 of this subsection,

the manufacturer shall provide written notice at least ninety (90)

days before the effective date of the termination or nonrenewal of

the dealer agreement;

2. The notice shall state all of the reasons for the

termination or nonrenewal of the dealer agreement;

3. The notice shall state that if the dealer provides to the

manufacturer a written notification of the intent of the dealer to

cure all claimed deficiencies within thirty (30) days after the

dealer receives the notice, the dealer shall have one hundred twenty

(120) days after the date of the notice to correct the claimed

deficiencies. If all of the deficiencies are corrected within the

one-hundred-twenty-day time period, the notice shall be deemed void

and the manufacturer shall not terminate or not renew the dealer

Oklahoma Statutes - Title 47. Motor Vehicles

agreement because of the claimed deficiencies stated in the notice.

If the dealer does not provide a notification of intent to cure

deficiencies within the thirty-day time period, the termination or

nonrenewal of the dealer agreement shall take effect sixty (60) days

after the dealer received the notice from the manufacturer;

4. A manufacturer may reduce the notice period described in

paragraph 1 of this subsection from ninety (90) days to thirty (30)

days and shall not be required to allow the dealer an opportunity to

correct the deficiencies if the grounds for termination or

nonrenewal of the dealer agreement by the manufacturer are any of

the specific categories of good cause described in subsection F of

this section; and

5. A manufacturer shall not be required to provide notice or an

opportunity to correct deficiencies under this subsection if the

grounds for termination or nonrenewal of the dealer agreement by the

manufacturer includes one of the following:

a.

the dealer becomes insolvent,

b.

the dealer is bankrupt, or

c.

the dealer makes an assignment for the benefit of

creditors.

D. If a manufacturer terminates or does not renew a dealer

agreement for good cause under this section, the dealer, at its

option, may require the manufacturer to repurchase any of the

following from the dealer:

1. All new, untitled recreational vehicles that were acquired

from the manufacturer within eighteen (18) months before the

effective date of the notice of termination of the dealer agreement

that have not been used, except for demonstration purposes and have

not been altered or damaged, may be repurchased at one hundred

percent (100%) of the net invoice cost of the recreational vehicles,

including transportation, less applicable rebates and discounts to

the dealer;

2. All current and undamaged accessories and proprietary parts

sold to the dealer for resale within the eighteen (18) months prior

to the effective date of the termination of the dealer agreement

that are accompanied by the original invoice may be repurchased at

one hundred five percent (105%) of the original net price paid to

the manufacturer to compensate the dealer for handling, packing, and

shipping the accessories and parts; and

3. Any properly functioning diagnostic equipment, special

tools, current signage, and other equipment and machinery, purchased

by the dealer within the five (5) years prior to the effective date

of the termination of the dealer agreement at the request of the

manufacturer, if the equipment or machinery cannot be used in the

normal course of the ongoing business of the dealer, may be

repurchased at one hundred percent (100%) of the net cost of the

Oklahoma Statutes - Title 47. Motor Vehicles

dealer, plus freight, destination, delivery, and distribution

charges and sales taxes.

E. The dealer shall promptly return or arrange for the return

of all of the items the manufacturer is required to repurchase under

subsection D of this section at the expense of the manufacturer.

F. As used in this section, “good cause” includes, but is not

limited to, any of the following:

1. A conviction of a felony or a plea of guilty or nolo

contendere to a felony by a dealer or an owner of a dealership of a

crime that was committed during the time frame of the current dealer

agreement; provided, there is full disclosure, in writing, of any

felony conviction or plea of guilty or nolo contendere to any such

felony crime that occurred within ten (10) years of entering into

the dealer agreement;

2. Abandonment or permanent closing of the business operations

of a dealer for twenty-one (21) consecutive business days without

contacting the manufacturer prior to the closing unless the closing

is due to an act of God, strike, labor difficulty, or other cause

over which the dealer has no control;

3. A material misrepresentation to a manufacturer by a dealer

that severely affects the business relationship between the dealer

and the manufacturer;

4. Suspension or revocation of the license of a dealer or

refusal to renew the license of the dealer by the Oklahoma New Motor

Vehicle Commission;

5. A material violation of any of the provisions of the

Recreational Vehicle Franchise Act by a dealer; or

6. The dealer becomes insolvent, is bankrupt, or makes an

assignment for the benefit of creditors.

Added by Laws 2011, c. 272, § 7, eff. Jan. 1, 2012. Amended by Laws

2023, c. 29, § 24, eff. Nov. 1, 2023.