|
Delaware
|
|
No. 45-0357838
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(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(IRS Employer
Identification No.)
|
|
|
||
|
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Page No.
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PART I.
|
FINANCIAL INFORMATION
|
|
ITEM 1.
|
FINANCIAL STATEMENTS
|
|
|
Consolidated Balance Sheets as of April 30, 2017 and January 31, 2017
|
|
|
Consolidated Statements of Operations for the three months ended April 30, 2017 and 2016
|
|
|
Consolidated Statements of Comprehensive Income (Loss) for the three months ended April 30, 2017 and 2016
|
|
|
Consolidated Statements of Cash Flows for the three months ended April 30, 2017 and 2016
|
|
|
Notes to Consolidated Financial Statements
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
|
PART II.
|
OTHER INFORMATION
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
|
ITEM 1A.
|
RISK FACTORS
|
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
|
ITEM 5.
|
OTHER INFORMATION
|
|
ITEM 6.
|
EXHIBITS
|
|
Signatures
|
|
|
Exhibit Index
|
|
|
April 30, 2017
|
|
January 31, 2017
|
||||
Assets
|
|
|
|
|
|||
Current Assets
|
|
|
|
||||
Cash
|
$
|
56,241
|
|
|
$
|
53,151
|
|
Receivables (net of allowance of $3,587 and $3,630 as of April 30, 2017 and January 31, 2017, respectively)
|
62,946
|
|
|
60,082
|
|
||
Inventories
|
484,090
|
|
|
478,266
|
|
||
Prepaid expenses and other
|
7,868
|
|
|
10,989
|
|
||
Income taxes receivable
|
5,371
|
|
|
5,380
|
|
||
Total current assets
|
616,516
|
|
|
607,868
|
|
||
Noncurrent Assets
|
|
|
|
||||
Intangible assets, net of accumulated amortization
|
4,980
|
|
|
5,001
|
|
||
Property and equipment, net of accumulated depreciation
|
159,753
|
|
|
156,647
|
|
||
Deferred income taxes
|
332
|
|
|
547
|
|
||
Other
|
1,347
|
|
|
1,359
|
|
||
Total noncurrent assets
|
166,412
|
|
|
163,554
|
|
||
Total Assets
|
$
|
782,928
|
|
|
$
|
771,422
|
|
|
|
|
|
||||
Liabilities and Stockholders' Equity
|
|
|
|
||||
Current Liabilities
|
|
|
|
||||
Accounts payable
|
$
|
20,123
|
|
|
$
|
17,326
|
|
Floorplan payable
|
259,634
|
|
|
233,228
|
|
||
Current maturities of long-term debt
|
1,371
|
|
|
1,373
|
|
||
Customer deposits
|
23,620
|
|
|
26,366
|
|
||
Accrued expenses and other
|
23,636
|
|
|
30,533
|
|
||
Total current liabilities
|
328,384
|
|
|
308,826
|
|
||
Long-Term Liabilities
|
|
|
|
||||
Senior convertible notes
|
70,361
|
|
|
88,501
|
|
||
Long-term debt, less current maturities
|
56,245
|
|
|
38,236
|
|
||
Deferred income taxes
|
4,948
|
|
|
9,500
|
|
||
Other long-term liabilities
|
5,694
|
|
|
5,180
|
|
||
Total long-term liabilities
|
137,248
|
|
|
141,417
|
|
||
Commitments and Contingencies
|
|
|
|
|
|
||
Stockholders' Equity
|
|
|
|
||||
Common stock, par value $.00001 per share, 45,000 shares authorized; 21,834 shares issued and outstanding at April 30, 2017; 21,836 shares issued and outstanding at January 31, 2017
|
—
|
|
|
—
|
|
||
Additional paid-in-capital
|
242,938
|
|
|
240,615
|
|
||
Retained earnings
|
78,163
|
|
|
85,347
|
|
||
Accumulated other comprehensive loss
|
(3,805
|
)
|
|
(4,783
|
)
|
||
Total stockholders' equity
|
317,296
|
|
|
321,179
|
|
||
Total Liabilities and Stockholders' Equity
|
$
|
782,928
|
|
|
$
|
771,422
|
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
Revenue
|
|
|
|
||||
Equipment
|
$
|
167,915
|
|
|
$
|
184,874
|
|
Parts
|
56,583
|
|
|
57,509
|
|
||
Service
|
28,766
|
|
|
30,992
|
|
||
Rental and other
|
10,854
|
|
|
11,485
|
|
||
Total Revenue
|
264,118
|
|
|
284,860
|
|
||
Cost of Revenue
|
|
|
|
||||
Equipment
|
155,517
|
|
|
170,324
|
|
||
Parts
|
40,357
|
|
|
40,501
|
|
||
Service
|
10,794
|
|
|
11,600
|
|
||
Rental and other
|
8,531
|
|
|
8,887
|
|
||
Total Cost of Revenue
|
215,199
|
|
|
231,312
|
|
||
Gross Profit
|
48,919
|
|
|
53,548
|
|
||
Operating Expenses
|
51,987
|
|
|
54,502
|
|
||
Restructuring Costs
|
2,344
|
|
|
247
|
|
||
Loss from Operations
|
(5,412
|
)
|
|
(1,201
|
)
|
||
Other Income (Expense)
|
|
|
|
||||
Interest income and other income (expense)
|
778
|
|
|
137
|
|
||
Floorplan interest expense
|
(2,656
|
)
|
|
(3,743
|
)
|
||
Other interest expense
|
(2,120
|
)
|
|
(993
|
)
|
||
Loss Before Income Taxes
|
(9,410
|
)
|
|
(5,800
|
)
|
||
Benefit from Income Taxes
|
(3,478
|
)
|
|
(1,942
|
)
|
||
Net Loss Including Noncontrolling Interest
|
$
|
(5,932
|
)
|
|
$
|
(3,858
|
)
|
Less: Loss Attributable to Noncontrolling Interest
|
—
|
|
|
(174
|
)
|
||
Net Loss Attributable to Titan Machinery Inc.
|
$
|
(5,932
|
)
|
|
$
|
(3,684
|
)
|
Net Loss Allocated to Participating Securities - Note 1
|
114
|
|
|
68
|
|
||
Net Loss Attributable to Titan Machinery Inc. Common Stockholders
|
$
|
(5,818
|
)
|
|
$
|
(3,616
|
)
|
Earnings (Loss) per Share - Note 1
|
|
|
|
||||
Earnings (Loss) per Share - Basic
|
$
|
(0.27
|
)
|
|
$
|
(0.17
|
)
|
Earnings (Loss) per Share - Diluted
|
$
|
(0.27
|
)
|
|
$
|
(0.17
|
)
|
Weighted Average Common Shares - Basic
|
21,373
|
|
|
21,203
|
|
||
Weighted Average Common Shares - Diluted
|
21,373
|
|
|
21,203
|
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
Net Loss Including Noncontrolling Interest
|
$
|
(5,932
|
)
|
|
$
|
(3,858
|
)
|
Other Comprehensive Income (Loss)
|
|
|
|
||||
Foreign currency translation adjustments
|
461
|
|
|
754
|
|
||
Unrealized gain (loss) on interest rate swap cash flow hedge derivative instrument, net of tax expense (benefit) of $19 and ($57) for the three months ended April 30, 2017 and 2016
|
29
|
|
|
(87
|
)
|
||
Reclassification of loss on interest rate swap cash flow hedge derivative instrument included in net loss, net of tax benefit of $326 and $148 for the three months ended April 30, 2017 and 2016
|
488
|
|
|
223
|
|
||
Total Other Comprehensive Income (Loss)
|
978
|
|
|
890
|
|
||
Comprehensive Loss
|
(4,954
|
)
|
|
(2,968
|
)
|
||
Comprehensive Loss Attributable to Noncontrolling Interest
|
—
|
|
|
(186
|
)
|
||
Comprehensive Loss Attributable To Titan Machinery Inc.
|
$
|
(4,954
|
)
|
|
$
|
(2,782
|
)
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
Operating Activities
|
|
|
|
||||
Net loss including noncontrolling interest
|
$
|
(5,932
|
)
|
|
$
|
(3,858
|
)
|
Adjustments to reconcile net loss including noncontrolling interest to net cash provided by (used for) operating activities
|
|
|
|
||||
Depreciation and amortization
|
6,095
|
|
|
6,208
|
|
||
Deferred income taxes
|
(3,603
|
)
|
|
609
|
|
||
Stock-based compensation expense
|
789
|
|
|
627
|
|
||
Noncash interest expense
|
914
|
|
|
1,378
|
|
||
Unrealized foreign currency (gain) loss on loans to international subsidiaries
|
(84
|
)
|
|
(842
|
)
|
||
Gain on repurchase of senior convertible notes
|
(40
|
)
|
|
(2,102
|
)
|
||
Other, net
|
849
|
|
|
89
|
|
||
Changes in assets and liabilities
|
|
|
|
||||
Receivables, prepaid expenses and other assets
|
283
|
|
|
4,702
|
|
||
Inventories
|
(3,814
|
)
|
|
9,422
|
|
||
Manufacturer floorplan payable
|
51,139
|
|
|
(26,996
|
)
|
||
Accounts payable, customer deposits, accrued expenses and other and other long-term liabilities
|
(5,744
|
)
|
|
(14,892
|
)
|
||
Income taxes
|
80
|
|
|
781
|
|
||
Net Cash Provided by (Used for) Operating Activities
|
40,932
|
|
|
(24,874
|
)
|
||
Investing Activities
|
|
|
|
||||
Rental fleet purchases
|
(5,612
|
)
|
|
(561
|
)
|
||
Property and equipment purchases (excluding rental fleet)
|
(4,575
|
)
|
|
(1,051
|
)
|
||
Proceeds from sale of property and equipment
|
417
|
|
|
892
|
|
||
Other, net
|
21
|
|
|
48
|
|
||
Net Cash Used for Investing Activities
|
(9,749
|
)
|
|
(672
|
)
|
||
Financing Activities
|
|
|
|
||||
Net change in non-manufacturer floorplan payable
|
(25,484
|
)
|
|
25,117
|
|
||
Repurchase of senior convertible notes
|
(19,340
|
)
|
|
(24,983
|
)
|
||
Proceeds from long-term debt borrowings
|
20,115
|
|
|
—
|
|
||
Principal payments on long-term debt
|
(2,335
|
)
|
|
(526
|
)
|
||
Other, net
|
(1,123
|
)
|
|
(158
|
)
|
||
Net Cash Used for Financing Activities
|
(28,167
|
)
|
|
(550
|
)
|
||
Effect of Exchange Rate Changes on Cash
|
74
|
|
|
413
|
|
||
Net Change in Cash
|
3,090
|
|
|
(25,683
|
)
|
||
Cash at Beginning of Period
|
53,151
|
|
|
89,465
|
|
||
Cash at End of Period
|
$
|
56,241
|
|
|
$
|
63,782
|
|
Supplemental Disclosures of Cash Flow Information
|
|
|
|
||||
Cash paid (received) during the period
|
|
|
|
||||
Income taxes, net of refunds
|
$
|
—
|
|
|
$
|
(3,327
|
)
|
Interest
|
$
|
3,429
|
|
|
$
|
4,667
|
|
Supplemental Disclosures of Noncash Investing and Financing Activities
|
|
|
|
||||
Net property and equipment financed with long-term debt, accounts payable and accrued expenses and other
|
$
|
354
|
|
|
$
|
941
|
|
Net transfer of assets from property and equipment to inventories
|
$
|
(1,200
|
)
|
|
$
|
(1,882
|
)
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(in thousands, except per share data)
|
||||||
Basic Weighted-Average Common Shares Outstanding
|
21,373
|
|
|
21,203
|
|
||
Plus: Incremental Shares From Assumed Exercise of Stock Options
|
—
|
|
|
—
|
|
||
Diluted Weighted-Average Common Shares Outstanding
|
21,373
|
|
|
21,203
|
|
||
|
|
|
|
||||
Anti-Dilutive Shares Excluded From Diluted Weighted-Average Common Shares Outstanding:
|
|
|
|
||||
Stock Options
|
153
|
|
|
146
|
|
||
Shares Underlying Senior Convertible Notes (conversion price of $43.17)
|
1,748
|
|
|
2,777
|
|
||
|
|
|
|
||||
Earnings (Loss) per Share - Basic
|
$
|
(0.27
|
)
|
|
$
|
(0.17
|
)
|
Earnings (Loss) per Share - Diluted
|
$
|
(0.27
|
)
|
|
$
|
(0.17
|
)
|
|
As of February 1, 2017
|
||||||||||
|
Balance Sheet Classification
|
||||||||||
|
Additional paid-in capital
|
|
Deferred income tax liability
|
|
Retained earnings
|
||||||
|
(in thousands)
|
||||||||||
|
Increase (Decrease)
|
||||||||||
Impact of cumulative-effect adjustment from adoption of ASU 2016-09
|
$
|
2,087
|
|
|
$
|
(835
|
)
|
|
$
|
(1,252
|
)
|
|
April 30, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
New equipment
|
$
|
257,863
|
|
|
$
|
235,161
|
|
Used equipment
|
144,893
|
|
|
160,503
|
|
||
Parts and attachments
|
79,706
|
|
|
81,734
|
|
||
Work in process
|
1,628
|
|
|
868
|
|
||
|
$
|
484,090
|
|
|
$
|
478,266
|
|
|
April 30, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Rental fleet equipment
|
$
|
126,298
|
|
|
$
|
124,417
|
|
Machinery and equipment
|
22,523
|
|
|
22,255
|
|
||
Vehicles
|
36,281
|
|
|
36,384
|
|
||
Furniture and fixtures
|
41,070
|
|
|
39,875
|
|
||
Land, buildings, and leasehold improvements
|
62,188
|
|
|
59,481
|
|
||
|
288,360
|
|
|
282,412
|
|
||
Less accumulated depreciation
|
(128,607
|
)
|
|
(125,765
|
)
|
||
|
$
|
159,753
|
|
|
$
|
156,647
|
|
|
April 30, 2017
|
|
January 31, 2017
|
||||
|
(in thousands except conversion
rate and conversion price)
|
||||||
Principal value
|
$
|
75,470
|
|
|
$
|
95,725
|
|
Unamortized debt discount
|
(4,507
|
)
|
|
(6,368
|
)
|
||
Unamortized debt issuance costs
|
(602
|
)
|
|
(856
|
)
|
||
Carrying value of senior convertible notes
|
$
|
70,361
|
|
|
$
|
88,501
|
|
|
|
|
|
||||
Carrying value of equity component, net of deferred taxes
|
$
|
15,192
|
|
|
$
|
15,546
|
|
|
|
|
|
||||
Conversion rate (shares of common stock per $1,000 principal amount of notes)
|
23.1626
|
|
|
|
|||
Conversion price (per share of common stock)
|
$
|
43.17
|
|
|
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(in thousands)
|
||||||
Cash Interest Expense
|
|
|
|
||||
Coupon interest expense
|
$
|
783
|
|
|
$
|
1,337
|
|
Noncash Interest Expense
|
|
|
|
||||
Amortization of debt discount
|
571
|
|
|
910
|
|
||
Amortization of transaction costs
|
80
|
|
|
133
|
|
||
|
$
|
1,434
|
|
|
$
|
2,380
|
|
|
Notional Amount as of:
|
||||||
|
April 30, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Cash flow hedges:
|
|
|
|
||||
Interest rate swap
|
$
|
—
|
|
|
$
|
100,000
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Foreign currency contracts
|
13,300
|
|
|
18,021
|
|
|
Fair Value as of:
|
||||||
|
April 30, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Liability Derivatives:
|
|
|
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
||||
Cash flow hedges:
|
|
|
|
||||
Interest rate swap
|
$
|
—
|
|
|
$
|
1,155
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
||||
Foreign currency contracts
|
28
|
|
|
200
|
|
||
Total Liability Derivatives
|
$
|
28
|
|
|
$
|
1,355
|
|
|
Three Months Ended April 30,
|
||||||||||||||
|
2017
|
|
2016
|
||||||||||||
|
OCI
|
|
Income (Loss)
|
|
OCI
|
|
Income (Loss)
|
||||||||
|
(in thousands)
|
||||||||||||||
Dervatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
||||||||
Cash flow hedges:
|
|
|
|
|
|
|
|
||||||||
Interest rate swap
(a)
|
48
|
|
|
(814
|
)
|
|
(144
|
)
|
|
(371
|
)
|
||||
Dervatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
||||||||
Foreign currency contracts
(b)
|
—
|
|
|
(68
|
)
|
|
—
|
|
|
(640
|
)
|
||||
Total Derivatives
|
$
|
48
|
|
|
$
|
(882
|
)
|
|
$
|
(144
|
)
|
|
$
|
(1,011
|
)
|
|
|
April 30, 2017
|
|
January 31, 2017
|
||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||||||||||
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest rate swap
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,155
|
|
|
$
|
—
|
|
|
$
|
1,155
|
|
Foreign currency contracts
|
—
|
|
|
28
|
|
|
—
|
|
|
28
|
|
|
—
|
|
|
200
|
|
|
—
|
|
|
200
|
|
||||||||
Total Financial Liabilities
|
$
|
—
|
|
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
1,355
|
|
|
$
|
—
|
|
|
$
|
1,355
|
|
|
April 30, 2017
|
|
January 31, 2017
|
||||||||||||||||||||
|
Estimated Fair Value
|
|
Carrying Value
|
|
Face Value
|
|
Estimated Fair Value
|
|
Carrying Value
|
|
Face Value
|
||||||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||||||||||
Senior convertible notes
|
$
|
73,000
|
|
|
$
|
70,361
|
|
|
$
|
75,470
|
|
|
$
|
87,000
|
|
|
$
|
88,501
|
|
|
$
|
95,725
|
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(in thousands)
|
||||||
Revenue
|
|
|
|
||||
Agriculture
|
$
|
163,625
|
|
|
$
|
178,807
|
|
Construction
|
63,420
|
|
|
78,001
|
|
||
International
|
37,073
|
|
|
28,052
|
|
||
Total
|
$
|
264,118
|
|
|
$
|
284,860
|
|
|
|
|
|
||||
Income (Loss) Before Income Taxes
|
|
|
|
||||
Agriculture
|
$
|
(3,897
|
)
|
|
$
|
(3,758
|
)
|
Construction
|
(2,633
|
)
|
|
(2,044
|
)
|
||
International
|
595
|
|
|
(517
|
)
|
||
Segment income (loss) before income taxes
|
(5,935
|
)
|
|
(6,319
|
)
|
||
Shared Resources
|
(3,475
|
)
|
|
519
|
|
||
Total
|
$
|
(9,410
|
)
|
|
$
|
(5,800
|
)
|
|
April 30, 2017
|
|
January 31, 2017
|
||||
|
(in thousands)
|
||||||
Total Assets
|
|
|
|
||||
Agriculture
|
$
|
395,274
|
|
|
$
|
411,726
|
|
Construction
|
226,379
|
|
|
221,092
|
|
||
International
|
115,338
|
|
|
106,899
|
|
||
Segment assets
|
736,991
|
|
|
739,717
|
|
||
Shared Resources
|
45,937
|
|
|
31,705
|
|
||
Total
|
$
|
782,928
|
|
|
$
|
771,422
|
|
|
Three Months Ended
April 30, 2017
|
|
Cumulative Amount
|
||||
|
(in thousands)
|
||||||
Lease accrual and termination costs
|
$
|
253
|
|
|
$
|
253
|
|
Termination benefits
|
1,818
|
|
|
1,818
|
|
||
Impairment of fixed assets, net of gains on asset disposition
|
—
|
|
|
2,957
|
|
||
Asset relocation and other costs
|
273
|
|
|
321
|
|
||
|
$
|
2,344
|
|
|
$
|
5,349
|
|
|
Three Months Ended
April 30, 2017
|
|
Cumulative Amount
|
||||
|
(in thousands)
|
||||||
Segment
|
|
|
|
||||
Agriculture
|
$
|
1,478
|
|
|
$
|
2,581
|
|
Construction
|
86
|
|
|
1,988
|
|
||
Shared Resources
|
780
|
|
|
780
|
|
||
Total
|
$
|
2,344
|
|
|
$
|
5,349
|
|
|
Lease Accrual & Termination Costs
|
|
Termination Benefits
|
|
Asset Relocation & Other Costs
|
|
Total
|
||||||||
|
(in thousands)
|
|
|
||||||||||||
Balance, January 31, 2017
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Exit costs incurred and charged to expense
|
253
|
|
|
1,688
|
|
|
273
|
|
|
2,214
|
|
||||
Exit costs paid
|
—
|
|
|
(1,551
|
)
|
|
(273
|
)
|
|
(1,824
|
)
|
||||
Balance, April 30, 2017
|
$
|
253
|
|
|
$
|
137
|
|
|
$
|
—
|
|
|
$
|
390
|
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(in thousands)
|
||||||
U.S.
|
$
|
(10,005
|
)
|
|
$
|
(5,283
|
)
|
Foreign
|
595
|
|
|
(517
|
)
|
||
Total
|
$
|
(9,410
|
)
|
|
$
|
(5,800
|
)
|
|
Three Months Ended April 30,
|
||||
|
2017
|
|
2016
|
||
U.S. statutory rate
|
(35.0
|
)%
|
|
(35.0
|
)%
|
Foreign statutory rates
|
0.6
|
%
|
|
2.1
|
%
|
State taxes on income net of federal tax benefit
|
(5.0
|
)%
|
|
(4.1
|
)%
|
Change in valuation allowance
|
3.9
|
%
|
|
6.6
|
%
|
Tax effect of Ukrainian hryvnia devaluation
(a)
|
1.7
|
%
|
|
(6.0
|
)%
|
All other, net
|
(3.2
|
)%
|
|
2.9
|
%
|
|
(37.0
|
)%
|
|
(33.5
|
)%
|
|
•
|
Revenue
decreased
7.3%
for the
first
quarter of fiscal
2018
, as compared to the
first
quarter last year, driven by a decrease in same-store sales in both our Agriculture and Construction segments and as a result of our store closings associated with our Fiscal 2018 Restructuring Plan.
|
•
|
Total gross profit margin decreased to
18.5%
for the
first
quarter of fiscal
2018
, as compared to
18.8%
for the
first
quarter of fiscal
2017
. The decrease in gross profit margin was primarily the result of lower gross profit margins on equipment revenues.
|
•
|
Floorplan interest expense
decreased
29%
in the
first
quarter of fiscal
2018
, as compared to the
first
quarter last year, primarily due to a decrease in our average interest-bearing inventory in the
first
quarter of fiscal
2018
; other interest expense was
$2.1 million
in the
first
quarter of fiscal
2018
, as compared to
$1.0 million
in the
first
quarter last year. Other interest expense in the first quarter of fiscal 2017 included a $2.1 million gain recognized as the result of repurchasing $30.1 million of face value of our senior convertible notes. Interest expense associated with our senior convertible notes decreased $0.9 million in the first quarter of fiscal 2018 compared to the first quarter of fiscal 2017.
|
•
|
Restructuring costs amounted to
$2.3 million
in the
first
quarter of fiscal
2018
, as compared to
$0.2 million
in the first quarter last year. See the Fiscal 2018 Restructuring Plan section below for further details.
|
|
Three Months Ended April 30,
|
||||
|
2017
|
|
2016
|
||
Revenue
|
|
|
|
|
|
Equipment
|
63.6
|
%
|
|
64.9
|
%
|
Parts
|
21.4
|
%
|
|
20.2
|
%
|
Service
|
10.9
|
%
|
|
10.9
|
%
|
Rental and other
|
4.1
|
%
|
|
4.0
|
%
|
Total Revenue
|
100.0
|
%
|
|
100.0
|
%
|
Total Cost of Revenue
|
81.5
|
%
|
|
81.2
|
%
|
Gross Profit Margin
|
18.5
|
%
|
|
18.8
|
%
|
Operating Expenses
|
19.6
|
%
|
|
19.1
|
%
|
Impairment and Realignment Costs
|
0.9
|
%
|
|
0.1
|
%
|
Income from Operations
|
(2.0
|
)%
|
|
(0.4
|
)%
|
Other Income (Expense)
|
(1.6
|
)%
|
|
(1.6
|
)%
|
Income (Loss) Before Income Taxes
|
(3.6
|
)%
|
|
(2.0
|
)%
|
Provision for (Benefit from) Income Taxes
|
(1.4
|
)%
|
|
(0.6
|
)%
|
Net Income (Loss) Including Noncontrolling Interest
|
(2.2
|
)%
|
|
(1.4
|
)%
|
Less: Net Income (Loss) Attributable to Noncontrolling Interest
|
—
|
%
|
|
(0.1
|
)%
|
Net Income (Loss) Attributable to Titan Machinery Inc.
|
(2.2
|
)%
|
|
(1.3
|
)%
|
|
Three Months Ended April 30,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Equipment
|
$
|
167,915
|
|
|
$
|
184,874
|
|
|
$
|
(16,959
|
)
|
|
(9.2
|
)%
|
Parts
|
56,583
|
|
|
57,509
|
|
|
(926
|
)
|
|
(1.6
|
)%
|
|||
Service
|
28,766
|
|
|
30,992
|
|
|
(2,226
|
)
|
|
(7.2
|
)%
|
|||
Rental and other
|
10,854
|
|
|
11,485
|
|
|
(631
|
)
|
|
(5.5
|
)%
|
|||
Total Revenue
|
$
|
264,118
|
|
|
$
|
284,860
|
|
|
$
|
(20,742
|
)
|
|
(7.3
|
)%
|
|
Three Months Ended April 30,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|
||||||||||
Gross Profit
|
|
|
|
|
|
|
|
|||||||
Equipment
|
$
|
12,398
|
|
|
$
|
14,550
|
|
|
$
|
(2,152
|
)
|
|
(14.8
|
)%
|
Parts
|
16,226
|
|
|
17,008
|
|
|
(782
|
)
|
|
(4.6
|
)%
|
|||
Service
|
17,972
|
|
|
19,392
|
|
|
(1,420
|
)
|
|
(7.3
|
)%
|
|||
Rental and other
|
2,323
|
|
|
2,598
|
|
|
(275
|
)
|
|
(10.6
|
)%
|
|||
Total Gross Profit
|
$
|
48,919
|
|
|
$
|
53,548
|
|
|
$
|
(4,629
|
)
|
|
(8.6
|
)%
|
Gross Profit Margin
|
|
|
|
|
|
|
|
|||||||
Equipment
|
7.4
|
%
|
|
7.9
|
%
|
|
(0.5
|
)%
|
|
(6.3
|
)%
|
|||
Parts
|
28.7
|
%
|
|
29.6
|
%
|
|
(0.9
|
)%
|
|
(3.0
|
)%
|
|||
Service
|
62.5
|
%
|
|
62.6
|
%
|
|
(0.1
|
)%
|
|
(0.2
|
)%
|
|||
Rental and other
|
21.4
|
%
|
|
22.6
|
%
|
|
(1.2
|
)%
|
|
(5.3
|
)%
|
|||
Total Gross Profit Margin
|
18.5
|
%
|
|
18.8
|
%
|
|
(0.3
|
)%
|
|
(1.6
|
)%
|
|||
Gross Profit Mix
|
|
|
|
|
|
|
|
|||||||
Equipment
|
25.3
|
%
|
|
27.2
|
%
|
|
(1.9
|
)%
|
|
(7.0
|
)%
|
|||
Parts
|
33.3
|
%
|
|
31.7
|
%
|
|
1.6
|
%
|
|
5.0
|
%
|
|||
Service
|
36.7
|
%
|
|
36.2
|
%
|
|
0.5
|
%
|
|
1.4
|
%
|
|||
Rental and other
|
4.7
|
%
|
|
4.9
|
%
|
|
(0.2
|
)%
|
|
(4.1
|
)%
|
|||
Total Gross Profit Mix
|
100.0
|
%
|
|
100.0
|
%
|
|
|
|
|
|
|
|
Three Months Ended April 30,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Operating Expenses
|
$
|
51,987
|
|
|
$
|
54,502
|
|
|
$
|
(2,515
|
)
|
|
(4.6
|
)%
|
Operating Expenses as a Percentage of Revenue
|
19.6
|
%
|
|
19.1
|
%
|
|
0.5
|
%
|
|
2.6
|
%
|
|
Three Months Ended April 30,
|
|
|
|
Percent
|
||||||||
|
2017
|
|
2016
|
|
Increase
|
|
Change
|
||||||
|
(dollars in thousands)
|
|
|
||||||||||
Restructuring Costs
|
$
|
2,344
|
|
|
$
|
247
|
|
|
$
|
2,097
|
|
|
849.0%
|
|
Three Months Ended April 30,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Interest income and other income (expense)
|
$
|
778
|
|
|
$
|
137
|
|
|
$
|
641
|
|
|
467.9
|
%
|
Floorplan interest expense
|
(2,656
|
)
|
|
(3,743
|
)
|
|
(1,087
|
)
|
|
(29.0
|
)%
|
|||
Other interest expense
|
(2,120
|
)
|
|
(993
|
)
|
|
1,127
|
|
|
113.5
|
%
|
|
Three Months Ended April 30,
|
|
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
Increase
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Benefit from Income Taxes
|
$
|
(3,478
|
)
|
|
$
|
(1,942
|
)
|
|
$
|
1,536
|
|
|
79.1
|
%
|
|
Three Months Ended April 30,
|
|
Increase/
|
|
Percent
|
|||||||||
|
2017
|
|
2016
|
|
(Decrease)
|
|
Change
|
|||||||
|
(dollars in thousands)
|
|
|
|||||||||||
Revenue
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
163,625
|
|
|
$
|
178,807
|
|
|
$
|
(15,182
|
)
|
|
(8.5
|
)%
|
Construction
|
63,420
|
|
|
78,001
|
|
|
(14,581
|
)
|
|
(18.7
|
)%
|
|||
International
|
37,073
|
|
|
28,052
|
|
|
9,021
|
|
|
32.2
|
%
|
|||
Total
|
$
|
264,118
|
|
|
$
|
284,860
|
|
|
$
|
(20,742
|
)
|
|
(7.3
|
)%
|
|
|
|
|
|
|
|
|
|||||||
Income (Loss) Before Income Taxes
|
|
|
|
|
|
|
|
|||||||
Agriculture
|
$
|
(3,897
|
)
|
|
$
|
(3,758
|
)
|
|
$
|
(139
|
)
|
|
(3.7
|
)%
|
Construction
|
(2,633
|
)
|
|
(2,044
|
)
|
|
(589
|
)
|
|
(28.8
|
)%
|
|||
International
|
595
|
|
|
(517
|
)
|
|
1,112
|
|
|
215.1
|
%
|
|||
Segment income (loss) before income taxes
|
(5,935
|
)
|
|
(6,319
|
)
|
|
384
|
|
|
6.1
|
%
|
|||
Shared Resources
|
(3,475
|
)
|
|
519
|
|
|
(3,994
|
)
|
|
(769.6
|
)%
|
|||
Total
|
$
|
(9,410
|
)
|
|
$
|
(5,800
|
)
|
|
$
|
(3,610
|
)
|
|
(62.2
|
)%
|
|
Three Months Ended April 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(dollars in thousands, except per share data)
|
||||||
Net Loss Including Noncontrolling Interest
|
|
|
|
||||
Net Loss Including Noncontrolling Interest
|
$
|
(5,932
|
)
|
|
$
|
(3,858
|
)
|
Adjustments
|
|
|
|
||||
Gain on Repurchase of Senior Convertible Notes
|
(40
|
)
|
|
(2,102
|
)
|
||
Restructuring
|
2,344
|
|
|
247
|
|
||
Ukraine Remeasurement (1)
|
—
|
|
|
195
|
|
||
Interest Rate Swap Termination & Reclassification
|
631
|
|
|
—
|
|
||
Total Pre-Tax Adjustments
|
2,935
|
|
|
(1,660
|
)
|
||
Less: Tax Effect of Adjustments (2)
|
1,174
|
|
|
(742
|
)
|
||
Total Adjustments
|
1,761
|
|
|
(918
|
)
|
||
Adjusted Net Loss Including Noncontrolling Interest
|
$
|
(4,171
|
)
|
|
$
|
(4,776
|
)
|
|
|
|
|
||||
Earnings (Loss) per Share - Diluted
|
|
|
|
||||
Loss per Share - Diluted
|
$
|
(0.27
|
)
|
|
$
|
(0.17
|
)
|
Adjustments (3)
|
|
|
|
||||
Gain on Repurchase of Senior Convertible Notes
|
—
|
|
|
(0.10
|
)
|
||
Restructuring Costs
|
0.11
|
|
|
0.01
|
|
||
Ukraine Remeasurement (1)
|
—
|
|
|
0.01
|
|
||
Interest Rate Swap Termination & Reclassification
|
0.03
|
|
|
|
|||
Total Pre-Tax Adjustments
|
0.14
|
|
|
(0.08
|
)
|
||
Less: Tax Effect of Adjustments (2)
|
0.06
|
|
|
(0.04
|
)
|
||
Total Adjustments
|
0.08
|
|
|
(0.04
|
)
|
||
Adjusted Loss per Share - Diluted
|
$
|
(0.19
|
)
|
|
$
|
(0.21
|
)
|
|
Net Cash Provided by (Used for) Operating Activities
|
|
Net Cash Used for Financing Activities
|
||||||||||||
|
Three Months Ended April 30, 2017
|
|
Three Months Ended April 30, 2016
|
|
Three Months Ended April 30, 2017
|
|
Three Months Ended April 30, 2016
|
||||||||
|
(in thousands)
|
|
(in thousands)
|
||||||||||||
Cash Flow, As Reported
|
$
|
40,932
|
|
|
$
|
(24,874
|
)
|
|
$
|
(28,167
|
)
|
|
$
|
(550
|
)
|
Adjustment for Non-Manufacturer Floorplan Net Payments
|
(25,484
|
)
|
|
25,117
|
|
|
25,484
|
|
|
(25,117
|
)
|
||||
Adjustment for Constant Equity in Equipment Inventory
|
(22,226
|
)
|
|
(6,004
|
)
|
|
—
|
|
|
—
|
|
||||
Adjusted Cash Flow
|
$
|
(6,778
|
)
|
|
$
|
(5,761
|
)
|
|
$
|
(2,683
|
)
|
|
$
|
(25,667
|
)
|
Dated:
|
June 2, 2017
|
|
|
|
|
TITAN MACHINERY INC.
|
|
|
|
|
|
|
|
|
|
|
|
By
|
/s/ Mark Kalvoda
|
|
|
|
Mark Kalvoda
|
|
|
|
Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
No.
|
|
Description
|
|
|
|
10.1
|
|
Case Construction Equipment Sales and Service Agreement, dated May 30, 2017, between CNH Industrial America LLC and Titan Machinery Inc.
|
10.2
|
|
Amendment dated May 30, 2017 to Case Construction Equipment Sales and Service Agreement between CNH Industrial America LLC and Titan Machinery Inc.
|
10.3
|
|
Case IH Agricultural Equipment Sales and Service Agreement, dated May 30, 2017, between CNH Industrial America LLC and Titan Machinery Inc.
|
10.4
|
|
Amendment dated May 30, 2017 to Case IH Agricultural Equipment Sales and Service Agreement between CNH Industrial America LLC and Titan Machinery Inc.
|
10.5
|
|
New Holland Equipment Sales and Service Agreement, dated May 30, 2017, between CNH Industrial America LLC and Titan Machinery Inc.
|
10.6
|
|
Amendment dated May 30, 2017 to New Holland Equipment Sales and Service Agreement between CNH Industrial America LLC and Titan Machinery Inc.
|
31.1
|
|
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
31.2
|
|
Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
|
|
32.1
|
|
Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
32.2
|
|
Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
|
|
101
|
|
Financial statements from the Quarterly Report on Form 10-Q of the Company for the quarter ended April 30, 2017, formatted in XBRL: (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Stockholders’ Equity, (iv) the Consolidated Statements of Cash Flows, and (v) the Notes to the Consolidated Financial Statements.
|
|
2.1
|
Affiliate
: as to Case, any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with Case. The term “control” means the power to direct the management and policies of an entity through the ownership of more than 50% of the voting securities, rights or other similar interests of that entity.
|
2.2
|
Branch Location(s)
: Dealer’s additional place(s) of business listed in Schedule D for the sale, rental, lease and service of Products, separate from Dealer’s Primary Location.
|
2.3
|
Case IP
: any and all intellectual property including but not limited to patents, Trademarks (including the Licensed Trademarks), designs, copyrights, trade secrets, computer software (whether imbedded in Products or otherwise) and other proprietary technology and information, whether technical or business related, including registrations for and applications to register any of the foregoing, which are incorporated or used in or with Products or which are owned or licensed by Case for use with Products.
|
2.4
|
Case National Dealer Market Share
: a percentage figure calculated by taking the number of units of new Case brand equipment for a given Product Line or Product Line grouping, sold by Case dealers in the United States during a designated time period determined by Case, divided by the total industry volume of all comparable new units of equipment (including Case and competitive units) sold in the United States during that same time period. Total industry volume of new equipment sales shall be as reported by the Association of Equipment Manufacturers (or other replacement organization selected by Case, hereinafter “AEM”).
|
2.5
|
Case Regional Market Share
: a percentage figure calculated by taking the number of units of new Case brand equipment for a given Product Line or Product Line grouping, sold by Case dealers in a regional sales area (a multi-state area determined by Case in its sole discretion) during a designated time period determined by Case, divided by the total industry volume of all comparable new units of equipment (including Case and competitive units) sold in that same regional sales area during that same time period. Total industry volume of new equipment sales shall be as reported by AEM.
|
2.6
|
Customer(s)
: an end-user that purchases, leases or rents Products from an authorized dealer or Case for its own use and not for resale.
|
2.7
|
Dealer Claims
: Dealer’s claims to Case for Warranty Service, Other Required Service, or any retail promotional or sales incentive, including but not limited to refunds, credits, rebates, incentives, allowances, discounts, or payments under any Case program.
|
2.8
|
Dealer Location(s)
: Dealer’s Primary Location and Branch Locations, if any, authorized by Case for the sale, rental, lease and service of Equipment and/or Parts.
|
2.9
|
Dealer Market Share
: a percentage figure for measuring Dealer’s sales performance calculated by taking the number of units of new Equipment, by Product Line or Product Line grouping, sold by Dealer to Customers located within Dealer’s Sales and Service Market (“SSM”) during a given time period as determined by Case, divided by the total industry volume of all new units of equipment of that same Product Line or Product Line grouping (including Case and competitive units) sold within Dealer's SSM during that same period, as determined and reported by AEM. For market share purposes, Dealer will only be measured against the industry sales in a given county of Dealer’s SSM to the extent of the percentage of that county assigned to Dealer.
|
2.10
|
DOG
: refers to both the Dealer Operating Guide and Parts Policy Manual or any equivalent or successor documents and amendments thereto issued by Case setting forth for all dealers the various policies, procedures and operating standards for doing business with Case.
|
2.11
|
Domestic
: within the 50 states of the United States of America.
|
2.12
|
Equipment
: whole good machinery and any related attachments designated on Schedule B by Product Line and Licensed Trademark.
|
2.13
|
Licensed Trademarks
: the Trademarks listed in Schedule B that Case authorizes Dealer to use for the sole purpose of performing its obligations hereunder with respect to Products.
|
2.14
|
Limited Warranty
: the Warranty and Limitation of Liability agreement furnished by Case with respect to any Product sold to Customers.
|
2.15
|
Other Required Service
: service that Case, in its sole discretion, has deemed necessary or desirable and in the best interests of Customers and the goodwill associated with the Licensed Trademarks, including but not limited to, policy service, campaign service, or field improvement program service.
|
2.16
|
Parts
: proprietary replacement parts sold by Case for Equipment listed on Schedule B (specifically not including replacement parts for Case equipment not listed on Schedule B), together with all other common service or maintenance items (for example, including but not limited to filters, hoses, lubricants, etc.) and accessories which are offered for sale by Case to Dealer (either directly from Case or from an authorized source of supply), which Case has authorized to be identified with the Licensed Trademarks. Parts do not include ‘merchandise’ items such as clothing, toys, binders, gloves, etc.
|
2.17
|
Primary Location
: the primary Dealer facility location specified in Schedule D.
|
2.18
|
Product(s)
: Equipment and Parts that Dealer is authorized to represent under this Agreement.
|
2.19
|
Product Line
: the categories of Products set forth in Schedule B.
|
2.21
|
Strategic Accounts
: customer accounts typically referred to as “national accounts,” “corporate accounts,” national or regional equipment rental companies, or any customer designated by Case as such an account.
|
2.22
|
Trademarks
: all words, slogans, designs, pictures, logotypes or other symbols, including trademarks, service marks, trade dress, and trade names, regardless of whether registration has been sought or obtained therefor, used to (a) identify, distinguish or advertise the Products and services of Case or its Affiliates, (b) identify Case as the source or licensor of Products and services, or (c) identify the business of Case and its authorized dealers.
|
2.23
|
Warranty Service
: service that is required for any Product (a) to ensure that Case is in compliance with Case’s Limited Warranty obligations for such Product and (b) to comply with any extended service or maintenance plan purchased for that Product.
|
2.24
|
Will Call
: a program whereby Case, in its sole discretion, may permit Dealer to take delivery and possession of Products directly from a Will Call Provider or Case, in lieu of such Products being transported to Dealer at Dealer Location(s). The procedures for the Will Call program will be as set forth in the DOG.
|
2.25
|
Will Call Provider
: a third-party engaged by Case to facilitate Dealer's pick-up of Products at Case plant locations or port facilities under the terms of the Will Call program.
|
3.1
|
Scope of Appointment
. Pursuant to the provisions of this Agreement, Case hereby authorizes Dealer to market, promote, sell, lease or rent new Products and to provide Warranty Service for Products to Customers solely from the authorized Dealer Location(s) listed in Schedule D. The foregoing appointment is limited to Products identified with the Licensed Trademarks on Schedule B. Dealer accepts this appointment and agrees that the relationship between Dealer and Case shall be governed by the terms and conditions of this Agreement as well as the policies outlined in the DOG.
|
3.2
|
Incorporation of DOG
. The DOG includes the standards of quality and performance that Case seeks to have associated with its Trademarks and is hereby incorporated by reference into this Agreement. It is expressly understood and agreed that Case reserves the right to modify the DOG unilaterally to reflect reasonable standards of quality and performance so long as such standards do not conflict with the terms of this Agreement.
|
3.3
|
Material Inducement
. Section 3.2 is a material inducement upon which Case relied in entering into this Agreement with Dealer, the breach or unenforceability of which represents a failure of consideration entitling Case to void this Agreement in its entirety.
|
4.1
|
Dealer Representations and Warranties
. The appointment of Dealer is made in reliance on Dealer’s representation and warranty that the information set forth in any dealer application provided to Case as well as in Schedule A regarding Dealer’s legal name, ownership (if corporation, as listed in a Stock Ownership Certificate), management personnel, business structure, and state of residence or organization is accurate and complete. Dealer also represents and warrants that entering into this Agreement does not violate any other contract or agreement to which Dealer is a party and that any person signing this Agreement on behalf of Dealer has the authority to do so. Any breach of any of the foregoing representations and warranties represents a failure of consideration entitling Case to void this Agreement in its entirety.
|
4.2
|
Personal Services Nature of Agreement
. Dealer ownership and management are important to the successful working relationship between the Parties. Case has chosen to contract with the present ownership and management of Dealer, and the Parties acknowledge that this Agreement represents a personal services relationship, and that any change to the ownership, management or business structure of Dealer could seriously and adversely impact such relationship. As such, Case may refuse to appoint as an authorized dealer any purchaser or prospective purchaser of any of the shares or assets of Dealer.
|
4.3
|
Changes in Dealer Form and Control
. Except as otherwise stated in Section 4.4, Dealer shall provide Case with sixty (60) days’ prior written notice of Dealer’s intention to change it: (a) legal form or entity; or (b) control, ownership or management. Prior to consummating any such change, Dealer must obtain Case’s written consent, which shall be in Case’s sole discretion. A “change in control, ownership or management” shall mean one or more of the following events: (i) if Dealer is an individual proprietor, withdrawal of that individual proprietor from the operation or control of Dealer; (ii) if Dealer is a partnership or limited liability company, any addition to or subtraction from the partners or members involved; (iii) if Dealer is a corporation, any change in the beneficial ownership of any of Dealer’s shares or the voting rights associated therewith; (iv) any sale of all or substantially all of Dealer’s assets; (v) any change in the composition of Dealer’s management as set forth on Schedule A; or (vi) any event, including entering into an agreement, that substantially affects, directly or indirectly, the operation or control of Dealer’s business.
|
4.4
|
Death or Incapacity of Dealer Principals
. In the event of the death or incapacity of any person listed in Schedule A or in the Stock Ownership Certificate (“Dealer Principal(s)”), Dealer shall provide Case: (a) notice of such occurrence within thirty (30) days; and (b) within ninety (90) days of such occurrence, an ownership or management succession plan for the replacement of such deceased or incapacitated Dealer Principal(s), if Dealer proposes to continue operation under this Agreement. Case retains sole discretion whether to approve Dealer’s proposed succession plan or terminate the Agreement.
|
4.5
|
Ancillary Documents
. Dealer will execute such agreements or other documents as Case in its sole discretion may deem necessary to preserve Case's rights under this Agreement in response to (a) any change or
|
5.1
|
Authorized Products
.
|
(b)
|
Upon sixty (60) days’ written notice to Dealer, Case in its sole discretion may amend Schedule B to
|
5.2
|
Dealer Obligation to Support New Equipment Models
. Case may introduce new models of Equipment for Product Lines that Dealer is authorized to sell on Schedule B. In order to provide service to Customers for such Equipment, Dealer shall support such new models by complying with Case-designated requirements for:
|
5.3
|
Product Packaging and Labels
. Dealer shall not modify or remove any warning labels affixed to Products. Further, without Case’s prior written consent, Dealer shall not modify any packaging or other labeling for Products.
|
5.4
|
Installation of Non-Standard Attachments or Accessories
. Without prior written approval from Case , Dealer shall not install or attach non-standard, “self-designed,” or “one-off” attachments or accessories to Equipment. Such non-standard, “self-designed,” or “one-off” attachments or accessories are those that are not manufactured and sold by established equipment manufacturers for the application and purpose for which they are being used. Dealers that install standard attachments or accessories from established equipment manufacturers shall ensure that the Equipment can properly and safely operate with such attachment or accessory.
|
5.5
|
Prohibited Modifications to Product
. Dealer shall not perform any of the following actions: (a) modify Equipment without Case’s prior written consent; (b) install upon Equipment any attachment, accessory or equipment that is beyond the rated capacity of that Equipment as stated in the Operator’s Manual furnished with the Equipment or as otherwise instructed by Case; or (c) perform any adjustment or assembly procedures to Equipment not recommended by or in contravention of the Operator’s Manual, Service Manual or other Case instruction.
|
6.1
|
Assignment of SSM
. The SSM assigned to Dealer is set forth in Schedule C. The Dealer’s SSM may vary by Equipment or Product Line. Case’s assignment to Dealer of an SSM is for the purpose of: (a) focusing Dealer’s sales, marketing, and product support efforts; (b) measuring Dealer Market Share performance; and
|
6.2
|
No Obligation to Support Sales Outside SSM
. To the extent Case decides to offer marketing programs, retail sales incentives, or other promotions, it shall have no obligation to do so for Dealer’s sales or marketing activities outside of Dealer’s SSM.
|
6.3
|
Sales & Service Fee
. Case may assess Dealer a sales and service fee for sales of new Equipment by Dealer that are registered in a county outside of Dealer’s SSM. The amount of such fee, the operative regulations and policies, and the Equipment to which it applies are published in the DOG, and may be amended by Case in its sole discretion. Case reserves the right not to assess a sales and service fee against other dealers for their sales to Customers within Dealer’s SSM, if Dealer is failing to meet the market share obligations contained in Section 9.1(a).
|
6.4
|
SSM Non-Exclusive
. Dealer’s SSM is non-exclusive. Without incurring any liability to Dealer, Case may determine the number and locations of authorized dealers necessary for adequate sales and service representation of Products within any geographic area, or within the designated SSM. Nothing in this Agreement shall be construed as requiring Dealer's consent to the establishment of new or additional dealer representation for Products in Dealer’s SSM or elsewhere.
|
7.1
|
Wholesale Line of Credit
. Dealer shall establish and at all times maintain an unrestricted wholesale line of credit for the purchase and stocking of new Products in an amount acceptable to Case in order to meet Dealer’s inventory and sales obligations hereunder. If within any six (6)-month period, Dealer’s primary wholesale line of credit is cumulatively reduced by twenty percent (20%) or more and such reduction is not for valid business reasons, said line of credit shall be deemed unacceptable to Case.
|
7.2
|
Adjusted Debt to Tangible Net Worth Ratio
. Dealer hereby covenants and agrees that it will maintain an Adjusted Debt to Tangible Net Worth Ratio of not more than four to one (4.0:1.0). Unless specifically approved in advance in writing by Case, Dealer will not make any acquisitions or initiate new business activities if Dealer’s Adjusted Debt to Tangible Net Worth Ratio exceeds four to one (4.0:1.0) or if such ratio would increase beyond four to one (4.0:1.0) as a result of such actions. This ratio shall be calculated using the consolidated balance sheets and income statements of Dealer (and of Dealer’s related entities and affiliates, if Case so elects). All such balance sheets and income statements must be prepared in accordance with Generally Accepted Accounting Principles (“GAAP”). For purposes of calculating this ratio, the following definitions will apply:
|
7.3
|
Working Capital Requirements
. Dealer shall maintain net working capital in amounts necessary for Dealer to comply with its obligations under this Agreement.
|
8.1
|
Equipment Stocking Requirements
. Dealer shall order, maintain in inventory and prominently display, at all Dealer Locations unless otherwise excepted in writing by Case, representative models of each type of new Equipment Dealer is authorized to sell as set forth in Schedule B, at the level deemed necessary by Case to meet Dealer’s Equipment sales obligations in accordance with Dealer’s Business Plan provided pursuant to Section 13 of this Agreement.
|
8.2
|
Parts Stocking Requirements
. For the purpose of providing prompt Customer support, Dealer agrees to order and maintain in inventory all Parts at the level deemed necessary by Case to meet Dealer’s Parts sales obligations in accordance with Dealer’s Business Plan provided pursuant to Section 13 of this Agreement. Dealer must provide a retail display area for Parts acceptable to Case.
|
8.3
|
Licensed Trademark Use
. At any Dealer Location and in all advertising for such Dealer Locations, Dealer shall not use or display the Licensed Trademarks in any way that might cause confusion with, or dilute the distinctive quality of, the Licensed Trademarks, or in any way that violates any Case trademark guidelines. In furtherance of this provision, if Dealer represents non-Case products, Dealer shall at any such location: (a) maintain internal and external display areas for new Products separate from non-Case products; (b) display new Products in the most visible and desirable position and in an area of greater size or space than the area used to display non-Case products.
|
9.1
|
Sales Responsibilities
. Dealer is solely responsible for developing its own plan for marketing and selling Products, and shall fulfill its sales obligations in several ways, including but not limited to the following:
|
(a)
|
Equipment Market Share
. Dealer shall aggressively promote and sell new Equipment to attain within Dealer’s SSM for all Equipment designated on Schedule B, a Dealer Market Share that is equal to at least 90% of either, in Case’s sole discretion, the Case National Dealer Market Share or the Case Regional Market Share. In evaluating Dealer’s market share performance, Case, in its sole discretion, may (i) group Product Lines and/or (ii) evaluate Dealer’s performance on a per Dealer Location basis.
|
(b)
|
Parts Sales Objectives
. Dealer shall aggressively promote and sell all Parts offered by Case.
|
(c)
|
Advertising and Promotion
. Dealer shall conduct aggressive advertising and sales promotion activities, including but not limited to open houses, field days, product demonstrations, radio and/or television advertising, print advertising, trade shows and community events. Dealer shall appropriately display and distribute current Product sales literature, brochures and advertisements at its Dealer Locations, and shall also maintain a dealer website that prominently displays new Products. Dealer’s use of Licensed Trademarks and its display of Products on Dealer’s website shall be subject to Case’s approval. Upon Case’s request, Dealer shall participate in national or regional sales promotion and advertising programs as Case may periodically conduct.
|
(d)
|
Sales Staff
. Dealer shall employ a sufficient number of properly trained Product-dedicated sales personnel based on the industry potential in Dealer’s SSM and as required by Case to call on all potential customers within the SSM. Such sales personnel shall attend Case’s sales training sessions as required in the DOG.
|
(e)
|
Extended Service Plans
. Dealer shall promote and sell extended service and maintenance plans.
|
(f)
|
Customer Surveys
. Case from time to time may conduct surveys (by use of questionnaires or otherwise) of Dealer’s Customers to determine the satisfaction of those Customers with the sales, leasing, rental and service efforts of Dealer. Case may use the results of these surveys in assessing Dealer's performance under this Agreement.
|
(g)
|
Other Performance Standards
. Dealer shall meet such other sales performance standards or best business practices as may be established by Case in the DOG.
|
9.2
|
Dealer Resource Commitment and Exclusivity
. The Parties mutually recognize that one of the purposes of this Agreement is to assure that Dealer focuses its resources and efforts on the sale of new Products and the performance of its obligations under this Agreement. Therefore, Dealer agrees that:
|
(a)
|
If Dealer undertakes or engages in another business activity at a Dealer Location(s) separate from its representation of new Products pursuant to this Agreement, which activity involves a considerable commitment of Dealer’s effort and resources, Dealer agrees to make such separation of the personnel, facilities, capital (including, but not limited to, appropriate wholesale credit lines, sufficient working capital, sufficient equity) and other resources devoted to that business as is satisfactory to Case, provided that Case specifies in writing the separation of personnel, facilities and capital resources that are required. Case shall provide Dealer with twenty-four (24) months’ prior written notice for Dealer to complete any required separation of facilities.
|
(b)
|
Dealer shall refrain from marketing, selling (at retail or wholesale) or entering into any agreement to do same, at any Dealer Location, any product competitive with Products, including without limitation product which may not compete with Case Products as of the date of this Agreement but which become competitive in the future, due to the offering of new products by Case (whether as a result of new product development, acquisition, or otherwise). Within twenty-four (24) months of signing this Agreement, Dealer shall terminate any existing agreement to represent any competitive line of product. Unless otherwise mutually agreed to by Dealer and Case, Dealer shall have eighteen (18) months within which to phase out its representation of competitive products after Case’s development or acquisition of new product offerings that would compete with those existing competitive lines.
|
9.3
|
Sales Reporting
. Dealer shall report all new Equipment retail sales to Case, and shall provide true and accurate information on such sales as required by Case, including but not limited to registering the location of such Equipment sales and the end-use designation in compliance with Case guidelines.
|
10.1
|
Warranty Service and Other Required Service
. Dealer shall provide Warranty Service for any Product, regardless of whether Dealer sold that specific Product; provided, however, Dealer may not provide Warranty Service for any Case (or other CNH Industrial America LLC) products not listed on Schedule B. Dealer also shall provide Other Required Service as directed by Case in its sole discretion. Dealer shall provide Warranty Service and Other Required Service in a prompt, professional and courteous manner, and shall fulfill these responsibilities in several ways, including but not limited to the following:
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(a)
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Service Technicians
. Dealer shall employ at all times a sufficient number of trained and fully certified service technicians based on industry sales in Dealer’s SSM. Dealer must have service technicians at each Dealer Location who are trained and fully certified to service each type of Equipment listed on Schedule B, and Dealer’s service technicians must attend Case service training sessions as required by Case in the DOG.
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(b)
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Service Tools and Manuals
. Dealer shall maintain, or have access to, at each Dealer Location all special service tools, electronic diagnostic tools or websites, electronic parts catalogs, service manuals, parts manuals and operator’s manuals required by Case to service the Equipment listed in Schedule B. Dealer may comply with the service tool requirements by subscribing to any Case tool rental program.
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(c)
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Service Standards
. Dealer shall perform Warranty Service and/or Other Required Service in a timely manner and in strict compliance with the DOG and any service bulletins or other instructions issued by Case. Dealer shall give priority to performing such Warranty Service or Other Required Service before general maintenance if a Customer’s Product is not operable.
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(d)
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Use of Case-Sourced Parts
. Except as otherwise instructed by Case in writing, Dealer shall use only Parts obtained from Case or Case’s authorized sources of supply in performing Warranty Service or Other Required Service.
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(e)
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Certification Standards
. Dealer shall meet or exceed Case’s service certification standards including pre-delivery, delivery and after-delivery requirements for all Products, as defined by Case in the DOG.
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(f)
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Compliance with Service Policies
. Dealer shall abide by all Case policies and procedures contained in the DOG when performing Warranty Service and Other Required Service or when submitting Dealer Claims, including creating and retaining all supporting documentation for such claims.
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10.2
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Strategic Account Service
. Dealer shall provide Warranty Service and/or Other Required Service for any Product sold by Case to Strategic Accounts, as well as for any Product sold or donated to charitable, educational or governmental entities.
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11.1
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Product Setup
. To ensure the proper operation of Products, before delivery of Products to a Customer Dealer shall perform the inspections, adjustments, conditioning, installations or servicing of such Products in accordance with instructions and procedures provided by Case.
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11.2
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Product Literature
. Dealer shall deliver to each Customer of a Product the appropriate current publications and forms for owners covering operation, maintenance, warranty and other matters as determined by Case.
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11.3
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Customer Instruction
. At the time of delivery, Dealer shall instruct each Customer of a Product in the safe use, proper operation and required maintenance of that Product. Such instruction shall include, at a minimum:
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11.4
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Accident Reporting
. Dealer shall promptly notify Case, pursuant to guidelines contained in the DOG, of any reports of accidents or injuries involving Products of which Dealer becomes aware, as well as any information concerning the existence of any significant Product failure or malfunction.
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11.5
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Post-Delivery Services
. Dealer shall perform all required post-delivery inspections and adjustments to Products as prescribed by instructions and procedures provided by Case from time to time or as stated in the DOG.
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12.1
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Facility Requirements
. Dealer shall establish and maintain at each authorized Dealer Location listed on Schedule D a facility to sell, service, display and store Products in accordance with facility standards contained in the DOG.
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12.2
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Unauthorized Locations
. Without Case’s prior written consent, Dealer shall not at any location other than those listed in Schedule D, directly or indirectly: (a) advertise or represent itself as an authorized dealer of Case Products; (b) use the Licensed Trademarks or any other Trademarks; (c) store, stock or display Products; (d) sell, advertise or market any Products; or (e) provide Warranty Service and/or Other Required Service.
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12.3
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Closure and Relocation
. Without Case’s prior written consent, Dealer may not close or relocate any Dealer Location listed on Schedule D. Dealer shall seek Case’s consent for the closure or relocation of a Dealer Location at least sixty (60) days prior to the proposed closure or relocation. Should Case give its consent, Case, in its sole discretion, may modify or reassign the SSM associated with the relocated or closed Dealer Location. Dealer acknowledges and agrees that any consent granted by Case for the closure of a Dealer Location shall not initiate the inventory repurchase obligations set forth in Section 29.
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12.4
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Brand Identification
. Dealer shall: (a) display a primary identification sign (flag mast or monument) and comply with dealer identity standards as specified in the DOG for each Dealer Location listed on Schedule D; and (b) comply with Case’s vehicle identity standards as set forth in the DOG.
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12.5
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Trademark Display
. Dealer’s use of Trademarks or Licensed Trademarks at any Dealer Location, including but not limited to signs, banners or displays, shall be subject to Case approval. Any such use not approved by Case must be removed immediately by Dealer.
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13.1
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Business Plan Requirements
. Annually, or as otherwise requested by Case, Dealer shall complete and make available for review by Case a written plan for the subsequent fiscal year (or additional years if requested by Case) that shall contain the information and objectives required by Case for a business plan (“Business Plan”), which may include but not be limited to the following:
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(a)
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Equipment inventory stocking and sales objectives to maximize Dealer’s Equipment sales in its SSM, but at a minimum to obtain Dealer Market Share requirements stated in Section 9.1(a), including action plans for obtaining such objectives;
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(b)
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Parts inventory stocking plan and sales objectives to maximize Dealer’s Parts sales;
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(c)
|
training plans for Dealer sales and service personnel, including Case provided training;
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(d)
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advertising, promotional and marketing plans and budgets;
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(e)
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action plans for Dealer’s possible expansion or upgrading of its current facilities, or for the proposed addition of new facilities; and
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(f)
|
any additional information required by Case as set forth in the DOG.
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13.2
|
Business Plan Acceptance
. Dealer agrees that providing a Business Plan reasonably acceptable to Case is a requirement for Dealer to effectively promote and sell Products under this Agreement. Case may conduct periodic reviews of Dealer’s performance against its approved Business Plan, and during such reviews Dealer agrees to make available all Dealer’s records and employees which would contribute to the overall value of these reviews.
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14.1
|
Insurance Coverage
. Dealer shall maintain an occurrence-based policy of Comprehensive General Liability insurance (including Products and Property Damage Liability) with a maximum per occurrence deductible of
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14.2
|
Payment of Taxes
. Dealer shall pay all license fees, sales, use, personal property, and excise taxes, duties, and any other fees, assessments or taxes which may be assessed or levied by any governmental authority against any Products which are shipped to, or are in the possession of, Dealer.
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14.3
|
Dealer Tax Representations
. By submitting an order to Case for the purchase of any Product, Dealer represents and warrants that (a) such Products are being purchased for resale, lease or rent to Customers in the ordinary course of Dealer's business, and (b) Dealer has complied and will comply with all requirements for collection and payment of applicable sales, use and similar taxes. Upon request, Dealer shall provide evidence satisfactory to Case of Dealer’s compliance with the foregoing representations and warranties.
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15.1
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Warranty Obligations
. Case’s warranties covering Products are as set forth in the Limited Warranty furnished by Case with respect to such Products. The performance and administration of the warranties so extended, and the reimbursement to Dealer for Warranty Service performed on Products, are as set forth herein and in the DOG in effect at the time warranty work is performed. The Parties shall promptly fulfill their respective warranty obligations as set forth in the Limited Warranty and DOG.
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15.2
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Dealer Obligations Upon Sale
. At the time of any retail sale of Products pursuant to this Agreement, Dealer shall (a) deliver to and review with the Customer Case’s Limited Warranty for such Products in force at the time of such sale, (b) have the Customer complete the operator’s manual/warranty receipt verification section of the Limited Warranty, (c) obtain the Customer’s signature on the Limited Warranty and (d) submit the signed Limited Warranty to Case within ten (10) days of the sales transaction. Case reserves the right not to
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15.3
|
No Other Warranty Provisions
. Dealer is not authorized to assume or purport to assume for Case any additional obligations or liabilities in connection with the sale, lease, rental or service of Products covered by this Agreement, and Dealer shall not do so. Case shall not be liable nor shall it defend, indemnify or in any way be obligated to assist Dealer in defense of any notice, claim, or lawsuit alleging the existence of a warranty beyond the terms and conditions of Case’s Limited Warranty for any Product.
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15.4
|
Disclaimer of Other Warranties
. Dealer agrees and acknowledges that, except for the warranty extended to Customers under Case’s Limited Warranty, and to the extent allowed by law, Case makes no other representations or warranties, express or implied (including implied warranties of merchantability and fitness for a particular purpose) to Dealer or any Customer with respect to Products.
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15.5
|
Non-Case Equipment and Service
. If Dealer installs on or attaches to a Product any non-Case equipment, attachment, accessory or part, Dealer shall advise Customer in writing that the non-Case equipment, attachment, accessory or part is not covered by the Limited Warranty. If Dealer sells any service contract not provided by Case or its Affiliates in conjunction with the sale of Equipment, Dealer will disclose to Customer the identity of the service contract provider and will further advise that Case has no responsibility to fulfill the obligations of such service contract.
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15.6
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Actions Voiding Limited Warranty
. Dealer acknowledges and agrees that any breach of Sections 5.4 or 5.5 may result in Case voiding the Limited Warranty for Products in its sole discretion, and Dealer must so advise its Customer in writing to whom such Product has been sold. In such a case where Case elects to void the Limited Warranty, as between Dealer and Case, Dealer shall be solely responsible for any Warranty Service claims relating to such Product.
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15.7
|
Use of Unauthorized Parts
. In the event Dealer breaches Section 10.1(d), Case in its sole discretion may (a) refuse to reimburse Dealer for such Warranty Service and/or Other Required Service, (b) void Case’s Limited Warranty for such Products, and/or (c) hold Dealer solely responsible for all Warranty Service relating to such Products.
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16.1
|
Financial Statements
. Dealer shall submit to Case, within ninety (90) days after the end of Dealer’s fiscal year, audited (or where audited are not available then certified) balance sheets and financial statements for that year.
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16.2
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Supplemental Financial Records
. Dealer shall submit monthly financial statements to Case in the manner directed by Case. Case reserves the right to request at any time personal financial statements from the Dealer Principal(s) or guarantor(s) of Dealer and Dealer shall supply such statements within thirty (30) days.
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16.3
|
Sales Reports
. Dealer shall maintain and provide to Case upon request current reports of Equipment or Parts sales, owner registration, inventory, service and warranty reports, as well as such other reports as may be requested by Case.
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16.4
|
Inspections
. Dealer shall permit Case or its authorized representatives during normal business hours to (a) enter and inspect all Dealer Locations, (b) examine Dealer’s Product inventory, (c) test Equipment in Dealer’s possession, custody or control, (d) examine and audit Dealer’s books and records and all supporting data of Dealer’s business, and (e) make copies of any such records or accounts.
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16.5
|
Records Retention
. Dealer shall maintain for at least two (2) years all original records and documents relating to Dealer Claims submitted to or paid by Case.
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16.6
|
Chargeback for Improper or Unsubstantiated Claims
. Dealer’s submission of unsubstantiated Dealer Claims or Dealer Claims not in compliance with the requirements of the DOG will result in a chargeback to Dealer for such claims, including interest at the then current prime rate. If Dealer refuses to permit an audit, fails to maintain a substantial amount of the required records, or intentionally submits false or fraudulent Dealer Claims, the chargeback will include all amounts paid on Dealer Claims for the prior two (2) years, including any dealer settlement allowances, plus interest at the then current prime rate. This remedy is in addition to those available to Case for breach of this Agreement, including but not limited to termination of this Agreement.
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17.1
|
Dealer Management System Requirements
. Dealer shall install and maintain in good working order at each Dealer Location: (a) a computerized dealer management system (“DMS”) satisfactory to Case that maintains the current Case-to-DMS interfaces and functions to communicate and conduct business with Case’s computer applications and systems (the “System”); (b) a Dealer-to-Case network connection that meets or exceeds Case specified Dealer-to-Case connectivity requirements; and (c) all necessary hardware and software to maintain compatibility with the System.
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17.2
|
Case Applications
. Dealer shall subscribe to, install and maintain required software applications as communicated to Dealer by Case or as set forth in the DOG, including (but not limited to) the Electronic Parts Catalog applications.
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17.3
|
Operating Costs
. Dealer shall pay all costs, including taxes, for the DMS, the Dealer-to-Case network connection, and any monthly access charges for use of the System.
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17.4
|
Confidentiality
. Dealer shall keep confidential any information and data contained in the System, and shall not use the System or any information or data derived from the System for purposes unrelated to Dealer’s performance of its obligations under this Agreement.
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17.5
|
Disclaimer of Liability
. Case shall not be responsible or liable for any defects, problems or resulting damages incurred by Dealer from the operation and use of the DMS, the Dealer-to-Case network connection, or the System.
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18.1
|
Marketing Assistance
. To assist Dealer in its marketing and promotional efforts, Case will develop the following marketing and promotional materials: (a) training and videos of Product features, operations, demonstrations and competitive comparisons; (b) Product sales literature and brochures; (c) Product and promotional posters, banners and point of sale materials; (d) print and media copy for advertisements in newspapers, magazines, and trade publications; and (e) radio and television advertising scripts. Case may also make cooperative advertising funds available to Dealers, in its sole discretion.
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18.2
|
Communications to Dealer
. Dealer expressly consents to the receipt of unsolicited commercial faxes, emails, text messages, instant messages or other form of electronic communication, from Case, its Affiliates, or other Case-designated sender.
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18.3
|
Products and Services Provided by Case
. From time to time, Case will provide Dealer with certain products and services necessary for Dealer to market, sell and service Products. Dealer agrees that Case, in its discretion, may charge Dealer for any such products or services so provided.
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18.4
|
Dealer Knowledge of SSM
. Case expects Dealer to know and understand its market area and the promotional activities that would best be used to market Products within Dealer’s SSM. As such, it is Dealer’s responsibility to determine which marketing and promotional materials to use in its marketing efforts to meet its sales responsibilities under this Agreement.
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19.1
|
Purchase Orders
. Dealer may seek to purchase Products from Case under this Agreement by submitting purchase orders through Case’s System in accordance with instructions provided by Case. Case may specify in writing the minimum quantity of a given Product that Dealer shall be obligated to order at one time as a condition for filling such order, provided that such minimum quantity requirements will be consistently imposed on Dealers.
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19.2
|
Offer and Acceptance
. Dealer’s transmission of an order for Products through Case’s System will be a binding offer by Dealer to purchase the Products ordered, unless Case rejects the order. Purchase orders submitted by Dealer shall not be binding upon Case unless and until accepted in writing or electronically by Case. All orders for Products may not be canceled by Dealer, and shall be subject to Case’s then applicable conditions of sale.
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19.3
|
Delivery Dates
. Case shall endeavor to meet the delivery date specified in the System, but shall have no liability for failing to timely fill or deliver any order.
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19.4
|
Product Allocation
. Case shall have the right to allocate delivery of Dealer’s Product orders based on their relative order or sales status as compared to other pending orders.
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19.5
|
Product Shipment
. Case shall arrange delivery of Products to Dealer and Case reserves the right to determine the method and routing for such delivery. Case shall not be responsible for guaranteeing shipping rates or for delays in shipment. Case, in its discretion, may permit Dealer to designate orders for Will Call delivery pursuant to the terms of the DOG.
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19.6
|
Risk of Loss / Passage of Title
. Case’s release of Products to any carrier for transportation to Dealer shall constitute delivery to Dealer for purposes of passage of title, and Dealer shall bear all risk of loss or damage to Products thereafter. For Will Call orders, risk of loss and passage of title shall be as set forth in the DOG.
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19.7
|
Equipment Transfer
. The transfer of Equipment from Dealer to other authorized dealers of Products shall be in accordance with Case’s transfer program described in the DOG. Case shall have no liability as a result of any such transfer.
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19.8
|
Product Return Authorization
. Dealer agrees that no Products delivered to it hereunder are to be returned to Case without prior written authorization. Dealer shall pay all transportation charges on any returned Products authorized by Case, and Dealer is responsible for payment of all restocking charges stated in the DOG.
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20.1
|
Prices
. Unless otherwise authorized by Case, the price charged to Dealer for any Product shall be the price in effect at the time the Product is invoiced to Dealer.
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20.2
|
Price Changes
. Case reserves the right at any time to change its prices, terms, discounts and any other pricing provision for Products.
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20.3
|
Payment
. Dealer shall pay Case for all Products immediately upon invoicing of Products to Dealer. The terms and conditions of sale and payments for all Products invoiced to Dealer shall be subject to Case’s applicable conditions of sale and prices as published and modified from time to time by Case. Failure to make payment in accordance with this provision may, in Case’s sole discretion, result in Case revoking the sale and repossessing the Product without notice or formality. Case reserves the right, without liability, to refuse to sell or deliver Products to Dealer when in Case’s opinion Dealer’s financial condition does not warrant or support further sales or deliveries.
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20.4
|
Equipment Relocation
. Case may request Dealer to transfer new Equipment to another authorized dealer to accommodate such dealer’s sale to another Customer. If Dealer refuses, Case, in its sole discretion, may decline to pay, on Dealer’s behalf, the wholesale finance interest charges associated with that specific Equipment, and may decline to make available to Dealer any retail sales programs for such Equipment.
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20.5
|
Application of Money and Credits
. Any money or credits due and payable or becoming due and payable from Case to Dealer may be applied in any order Case may determine for the satisfaction, in full or in part, of any debts, liabilities or obligations due and payable or becoming due and payable or owing from Dealer to Case or its Affiliates.
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21.1
|
Domestic Sales Only
. Without Case’s prior written approval, Dealer shall not sell, lease or rent Products outside of the Domestic United States.
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21.2
|
Retail Sales Only
. Dealer shall sell Products only to retail Customers or to other authorized dealers of Products. As such, except for sales to authorized Case dealers, Dealer may not sell any Products at wholesale, including but not limited to sales to jobbers, jockeys, or other unauthorized dealers.
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21.3
|
No Deceptive or Unethical Practices
. Dealer shall conduct business in a manner that will reflect favorably at all times on Dealer, Case, Products, Licensed Trademarks and other authorized dealers of Products. Dealer shall refrain from business practices, advertisements, promotions and conduct that are unethical, deceptive, misleading, fraudulent, confusing or would likely contravene any voluntary or involuntary advertising standard or any law. Dealer shall not make, directly or indirectly, any false or misleading statement or representation concerning any Product, its source, condition, capabilities, price, or charges for the Product’s distribution, delivery, taxes or other items.
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21.4
|
No Internet Sales
. Dealer may not consummate sales of new Products on or through an Internet website, including but not limited to an auction-type website, except as otherwise authorized by Case.
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21.5
|
Announcements
. Dealer shall not publish public relation announcements that in any way involve or mention Case without Case’s prior written consent.
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21.6
|
Compliance with Federal, State and Local Laws
. Dealer shall comply with all applicable federal, state, and local laws and regulations governing Dealer’s operations and its ordering, sales and service of Products, including without limitation those laws or regulations concerning safety, emissions control and customer service. Dealer shall obtain all governmental approvals, permits or licenses required to do business in its SSM.
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21.7
|
Compliance With Export Laws
. Certain Products purchased by Dealer from Case may be subject to United States export control laws. Dealer agrees that it is responsible for knowing and complying with such laws. Diversion contrary to United States law is prohibited.
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21.8
|
Compliance with Fraud and Anti-Corruption Laws
.
|
(a)
|
Dealer and its Dealer Principals represent that they have not been convicted of, or pleaded guilty to, an offense involving fraud or corruption and that they are not now listed by any government agency as debarred, suspended, or proposed for suspension or debarment, or otherwise ineligible for any government bid or procurement programs. Dealer agrees to promptly inform Case of any change in this representation.
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(b)
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Dealer shall become familiar with and strictly comply with all applicable laws, statutes, regulations and codes relating to anti-bribery and anti-corruption, including but not limited to the United States Foreign Corrupt Practices Act and similar anti-corruption or anti-bribery laws. Dealer shall promptly report to Case any request or demand for any undue financial or other advantage of any kind received by Dealer in connection with the performance of this Agreement. Dealer warrants that it has no foreign public officials as direct or indirect owners, officers or employees at the date of this Agreement, and shall immediately notify Case in writing if a foreign public official becomes an officer or employee of Dealer or acquires a direct or indirect interest in Dealer.
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22.1
|
Product Changes and Improvements
. Case may make changes or improvements at any time in the specifications, construction, color and design of Products without incurring any obligation to Dealer or Dealer’s Customers.
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22.2
|
Product Discontinuation
. Case reserves the right at any time, without liability to Dealer, to discontinue the manufacture of any and all model(s), Equipment, or Product Line(s) under the Licensed Trademarks covered by this Agreement. Products shall be considered discontinued notwithstanding the fact that similar or identical products continue to be manufactured or sold by CNH Industrial America LLC or its Affiliates under Trademarks other than the Licensed Trademarks or brands for which this Agreement grants Dealer certain Product distribution rights. For any models, Equipment or Product Line(s) so discontinued, Case shall not be required to offer Dealer the right to represent a similar model, Equipment or Product Line(s), if any, marketed, manufactured or sold by CNH Industrial America LLC or its Affiliates under Trademarks other than the Licensed Trademarks or brand(s) listed on Schedule B.
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24.1
|
Trademark License
. Subject to and only in accordance with the terms and conditions of this Agreement, Case grants Dealer the right and Dealer accepts the obligation to make only Permitted Uses of the Licensed Trademarks set forth in Section 24.2 and to refrain from engaging in Prohibited Uses of the Licensed Trademarks set forth in Section 24.3. Dealer’s right to use the Licensed Trademarks is limited to the Permitted Uses during the term of this Agreement. Any unauthorized use of the Licensed Trademarks (including any of the Prohibited Uses) shall constitute an infringement of Case’s rights to the Licensed Trademarks in addition to a breach of this Agreement. In the event Dealer’s use of Licensed Trademarks (even though a Permitted Use) is unacceptable to Case in its sole discretion, Dealer must immediately cease such use of the Licensed Trademark upon notice from Case.
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24.2
|
Permitted Uses
. Dealer shall and is permitted to: (a) use the Licensed Trademarks to identify and advertise its business at Dealer Locations in connection with the marketing, sale, distribution and service of Products under the Licensed Trademarks; (b) use the Licensed Trademarks only in connection with the marketing, sale, distribution and service of the Products for which Case has authorized them to be used; (c) identify itself (and not Case) as the owner of Dealer’s business in conjunction with any use of the Licensed Trademarks, including the use thereof on leases, invoices, order forms, receipts, and business stationery, as well as at such other locations and in the manner as Case may designate in the DOG; and (d) use the Licensed Trademarks to identify itself as an authorized dealer of Products.
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24.3
|
Prohibited Uses
. Dealer shall not: (a) use the Licensed Trademarks (or any other Trademarks owned or licensed by Case or its Affiliates) as part of its corporate or other legal name without the prior written consent of Case; (b) sublicense or assign its right to use the Licensed Trademarks to any other person or entity; (c) use the Licensed Trademarks to incur any obligation or indebtedness on behalf of Case; (d) manufacture or purchase objects bearing Licensed Trademarks or Trademarks from unlicensed sources or apply, or have applied, Licensed Trademarks or Trademarks to objects that will be offered for sale or provided as promotional items by Dealer or any third party, specifically including but not limited to any clothing item (such as shirts, hats or other apparel), giftware, toys or other sundry items; and (e) register, attempt to register, obtain any ownership in, or otherwise use any Internet Registration (defined as any website, domain name, URL, internet/World Wide Web presence or feature, social media account designations, or other electronic communications portal) whose domain name, URL or other electronic communications portal contains, incorporates, or consists of the Licensed Trademarks or Trademarks without Case’s express written consent, which may be withheld for any or no reason.
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24.4
|
Unauthorized Internet Registrations
. In the event that Dealer registers, attempts to register, obtains any ownership in, or otherwise uses any Internet Registration in violation of this Agreement, in addition to any rights Case may have under this Agreement, Dealer hereby acknowledges and agrees that any such Internet Registration, including any copyrights therein, shall be deemed to be the property of Case. Dealer will assign, transfer or assist in the perfection of any rights necessary to transfer said registration to Case with no compensation to Dealer and at no additional cost to Case. In the event that a court of competent jurisdiction determines that any ownership rights to any Internet Registration are not automatically transferred to Case pursuant to this Agreement, Dealer agrees to execute any documents deemed necessary by Case to give effect to this provision. Case may condition approval of Dealer’s use of any such Internet Registration on the transfer to Case of any and all ownership rights therein, including any copyrights. In the event that this Agreement expires or is terminated, Dealer shall not use or register a domain name that includes, or in Case's sole discretion is confusingly similar to, a Licensed Trademark or any other Trademark.
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24.5
|
Notice of Trademark Claims
. Dealer shall promptly notify Case of any suspected unauthorized or infringing use of the Licensed Trademarks, any challenge to the validity of the Licensed Trademarks, any challenge to Case’s ownership of the Licensed Trademarks, any challenge to Case’s right to use and license others to use such Licensed Trademarks, or any challenge to Dealer’s right to use the Licensed Trademarks.
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24.6
|
Validity of Licensed Trademarks
. Dealer expressly understands and acknowledges that the Licensed Trademarks are valid and serve to identify Products and those authorized by Case to market, sell, distribute, and service Products. Dealer shall not directly or indirectly contest, attack, oppose, attempt to cancel or
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24.7
|
Ownership of Licensed Trademarks and Goodwill
. Dealer acknowledges the Licensed Trademarks are exclusively owned by Case. Dealer’s use of the Licensed Trademarks pursuant to this Agreement does not give Dealer any ownership interest or other interest in or to the Licensed Trademarks. Dealer shall execute any documents deemed necessary or useful by Case to obtain protection for the Licensed Trademarks or to maintain their validity and enforceability. Any and all goodwill arising from Dealer’s use of the Licensed Trademarks shall inure solely and exclusively to the benefit of Case. Upon expiration or termination of this Agreement, no monetary amount shall be attributable to any goodwill associated with Dealer’s use of the Licensed Trademarks or the sale and service of Products.
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24.8
|
Nonexclusive License
. This Agreement grants Dealer only a nonexclusive right and license to use the Licensed Trademarks. Case has and retains the rights to use the Licensed Trademarks itself in connection with selling Products and services and to grant other licenses for the Licensed Trademarks and for Trademarks.
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24.9
|
Discontinuation and Substitution of Licensed Trademarks
. Case reserves the right in its sole discretion to discontinue any Licensed Trademark and to substitute or add different Licensed Trademarks for use in identifying Products or the dealers authorized to sell or service Products. Dealer shall implement promptly any such substitution or addition of new Licensed Trademarks.
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24.10
|
Copyrights
. Dealer shall not copy any aspect or portion of Case's website or other electronically stored information or printed documents or publications without the express prior written consent of Case.
|
25.1
|
Software License
. Dealer acknowledges that certain Products contain imbedded computer software and related technology (collectively, “Authorized Software”) in which Case owns or licenses copyrights and/or other intellectual property rights. During the term of this Agreement, Case grants Dealer a non-transferable, royalty-free license to use Authorized Software in object code form only (“Software License”). The Software License is limited to the sale and service of any Product containing Authorized Software only in the manner authorized by Case in writing. Except as expressly authorized by this Agreement, Dealer may not sublicense Authorized Software to any other entity nor assign its Software License. This Agreement does not grant Dealer any right, title, or interest in Authorized Software anywhere in the world except the Software License granted herein. Dealer acknowledges that the use of any Product containing Authorized Software may require a Software License from Case. Case reserves the right to require all users of Products containing Authorized Software to possess a valid license in the form prescribed by Case, and in such case Dealer shall not transfer or permit the transfer or use of any Product containing Authorized Software unless the transferee or user is subject to such valid license. This Software License shall continue until it is terminated in accordance with this Agreement, or for the useful life of the Product in which Authorized Software is imbedded or of which Authorized Software is an integral part, or for the useful life of Authorized Software, whichever is shorter.
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25.2
|
Automatic Termination
. The Software License shall automatically terminate upon the occurrence of any of the following: (a) removal of Authorized Software from the Product for which it was obtained or authorized,
|
26.1
|
Company Information
. Periodically, Case will provide Dealer with proprietary, confidential information, technical knowledge and/or assistance, and other materials that derive value from not being generally known in the industry (“Company Information”) that are reasonably necessary for the distribution, sale, promotion and service of Products. Case has sole discretion to determine what information it provides to Dealer is Company Information. Dealer agrees that Company Information remains the property of Case. Dealer must take commercially reasonable measures, but in any event no less strict than the measures Dealer uses with
|
26.2
|
Return of Company Information
. Dealer acknowledges that Case provides Company Information to Dealer for use by Dealer pursuant to this Agreement. Therefore, upon expiration or termination of this Agreement for any reason, Dealer shall immediately return to Case all Company Information in any form.
|
26.3
|
No Reverse Engineering
. Dealer shall not engage in, cause to be engaged in, or permit any reverse engineering of Authorized Software, Products, or component parts thereof. “Reverse engineering” is defined as attempting through analysis of Products or component parts thereof to determine their functionality and thereby gain the ability to alter or reproduce that functionality.
|
26.4
|
Right to Use Case IP
. Dealer shall use Case IP only in accordance with the provisions of and for the purposes contemplated by this Agreement and in accordance with any procedures that Case may establish for use of Case IP.
|
27.1
|
Term of Agreement and Renewal
. This Agreement shall commence on the Effective Date and continue to the Expiration Date (“Term”). The Expiration Date of this Agreement shall be extended for additional successive five (5) year periods unless, at least ninety (90) days prior to the Expiration Date or the expiration date of any subsequent extension period, either party notifies the other of its intention not to extend. Upon such notification not to extend, this Agreement shall expire on the Expiration Date or at the expiration date of any extension period.
|
27.2
|
Replacement Agreement
. In the event Case offers to all authorized dealers in the state of Dealer’s Primary Location a new dealer agreement or an amendment to this Agreement (“Replacement Agreement”), Case may terminate this Agreement at any time by providing Dealer with at least one hundred eighty (180) days’ prior written notice and shall furnish Dealer a copy of the Replacement Agreement with such notice. Dealer’s return to Case of an executed Replacement Agreement shall not give rise to any repurchase rights and obligations provided for in Section 29.
|
27.3
|
Breach
.
|
(a)
|
Except where termination of the Agreement due to Dealer’s breach is allowed immediately pursuant to Section 27.4, and except as stated in Sections 27.3(b) and (c), in the event that either Dealer or Case fails to fulfill any of their responsibilities under this Agreement, the other party may terminate this Agreement by providing ninety (90) days’ written notice listing the reasons for termination.
|
(b)
|
If Dealer breaches Section 7.2, Case may, in its sole discretion, terminate the Agreement or remove authorized Dealer Locations from the Agreement upon ninety (90) days’ advance written notice to Dealer. However, during this ninety (90)-day period, Dealer may cure its breach of Section 7.2 by providing Case, within sixty (60) days of Case’s notice to Dealer, a written plan to return to compliance with Section 7.2 within twelve (12) months from the date of Case’s notice. Thereafter, if Dealer fails to perform such submitted plan, Case may terminate the Agreement with thirty (30) days’ written notice.
|
(c)
|
If Dealer is in breach of Section 9.1(a) Case may terminate Dealer for such default only after providing Dealer with written notice and a twelve (12)-month period within which Dealer may cure such default to Case’s sole satisfaction.
|
(d)
|
A breach by Dealer of any other written agreements between Dealer and Case or its Affiliates, shall also be considered a breach under this Agreement permitting termination of this Agreement. Termination for such breach shall be pursuant to Section 27.3(a) unless the breach is of the type of conduct enumerated in subsections 27.4(f), (h), (j), (k), (l), (n) or (o), in which case Case may terminate this Agreement immediately.
|
(e)
|
As an additional or alternative remedy for any breach by Dealer of the Agreement, Case, in its sole discretion and after providing Dealer with an opportunity to cure said breach as provided in Sections 27.3(a), (b) or (c), may amend Schedule D to remove authorization for the Dealer Location at which such breach occurred. In such event, Dealer shall cease all activities related to the display, stocking, sales and service of Products at such Dealer Location, including the use of Licensed Trademarks, and Case will repurchase new Parts and Signs located only at such Dealer Location as provided in Sections 29.1(b) and (c).
|
27.4
|
Immediate Termination
. Case may terminate this Agreement immediately upon the occurrence of any of the following events:
|
(a)
|
Dealer Financial Defaults
: (i) Dealer’s default in the payment when due of any obligations to Case or any of its Affiliates, including but not limited to CNH Industrial Capital America LLC (“CNH Capital”); (ii) Dealer’s default under any chattel mortgage or other security agreement between Dealer and Case, any of its Affiliates or any other lender or financing entity; or (iii) the refusal or failure of Dealer upon demand to account to Case or any of its Affiliates for the proceeds of the sale of Products for which Dealer is indebted to Case or such Affiliates;
|
(b)
|
Loss of Wholesale Credit Line
: (i) the termination (or suspension where such suspension continues for more than sixty (60) calendar days), of any of Dealer’s significant wholesale lines of credit for the purchase of new Products;
|
(c)
|
Insolvency
: (i) the filing of a voluntary or involuntary petition in bankruptcy by or against Dealer; (ii) the making of an assignment by Dealer for the benefit of creditors; (iii) a closeout or sale of a substantial part of Dealer’s assets related to the business; (iv) the commencement of dissolution, receivership or liquidation proceedings by or against Dealer; (v) the insolvency of Dealer; or (vi) the levy of a writ of attachment or execution against Dealer;
|
(d)
|
Change in Dealer Entity, Control, Ownership or Management
: without the prior written consent of Case: (i) any change in Dealer’s legal form or entity; (ii) any change in Dealer’s control, ownership or management (as defined in Section 4.3) listed in Schedule A; or (iii) any assignment or attempted assignment by Dealer of this Agreement;
|
(e)
|
Death or Incapacity
: if Dealer fails to provide Case with an acceptable ownership or management succession plan as set forth in Section 4.4 upon the death or incapacity of any Dealer Principal;
|
(f)
|
Misrepresented or False Information
: Dealer or anyone acting on its behalf has: (i) submitted false records, contracts, statements, reports or documents to Case or any of its Affiliates, including CNH Capital; (ii) submitted any false or fraudulent documents for Dealer Claims or in support thereof; (iii) knowingly accepted any payment from Case for any work not performed by Dealer in accordance with the provisions of this Agreement or the DOG; or (iv) submitted false information in applying for appointment as an authorized dealer of Products;
|
(g)
|
Failure to Operate
: failure to operate any Dealer Location in the normal course of business for seven
|
(h)
|
Criminal and/or Tortious Conduct
: Dealer or any Dealer Principal has pleaded guilty to or been convicted of a felony or any other violation of law that in Case’s opinion affects adversely the operation or business of Dealer, or the good name, goodwill or reputation of Case, Products, Licensed Trademarks, Dealer, or other authorized dealers of Products;
|
(i)
|
Dealer Closure/Loss of License
: (i) a permanent closure of any Dealer Location without the prior written consent of Case; or (ii) the revocation, suspension or other invalidation of any Dealer license, permit or authorization necessary to conduct business pursuant to this Agreement;
|
(j)
|
Inspection/Audit Refusal
: any failure by Dealer to permit Case to inspect or audit Dealer’s inventory or business and financial records pursuant to Section 16.4;
|
(k)
|
Detrimental Conduct
: any conduct by Dealer or any Dealer Principal which in the sole discretion of Case: (i) is injurious or detrimental to Dealer’s Customers, the public welfare, other authorized dealers of Products, or the reputation of Case, Products and the Licensed Trademarks; (ii) is unbecoming of a reputable business person; (iii) is abusive or threatening to any Case employee; or
|
(l)
|
Breach of Confidentiality
: any misuse or unauthorized disclosure of Case IP, Company Information or Authorized Software;
|
(m)
|
Revocation of Guaranty
: the withdrawal or revocation of a guaranty of Dealer’s indebtedness to Case or its Affiliates by one or more personal or corporate guarantors;
|
(n)
|
Incurable Breach
: any breach of the Agreement that is incapable of being remedied by an affirmative present action by the Dealer;
|
(o)
|
Repetitive Breach
: breach of the Agreement by Dealer for which it has received notice by Case of that same type of breach on at least two (2) prior separate and distinct occasions;
|
(p)
|
Unauthorized Location
: any breach of Section 12.2 of the Agreement.
|
27.5
|
Case’s Exercise of Termination Rights
. Case may exercise its termination rights under Sections 27.3 and
|
27.6
|
Termination At Will
. This Agreement may be terminated at any time at will, without cause, upon sixty (60) days’ written notice by Dealer to Case, or upon one hundred twenty (120) days’ written notice by Case to Dealer, or as mutually agreed upon in writing by both Parties.
|
28.1
|
Dealer’s Obligations
. Upon the termination or expiration of this Agreement, Dealer shall cease to operate or represent itself as an authorized dealer of Products under the Licensed Trademarks, and shall promptly: (a) cease using the Licensed Trademarks and remove from Dealer Locations and vehicles all signs or advertising displays that bear the Licensed Trademarks; (b) remove and discontinue the use of, and cause any third party to remove, any identification and any promotion or advertising that associates Dealer with Products, the Licensed Trademarks, or Case; and (c) at Case’s request, provide to Case all sales records, mailing lists, customer lists, service history records, microfiche, catalogs, registrations and any other material of any kind relating to the promotion, marketing, sale, operation or servicing of Products covered by this Agreement. If Dealer fails to promptly comply with any of its obligations upon the termination or expiration of this Agreement, including but not limited to Dealer’s obligations under this section, Case may take steps, as it deems necessary in its sole discretion, to effect Dealer’s compliance with such obligations or the same result as would be realized by Dealer’s compliance, and Dealer shall reimburse Case for all costs and expenses, including attorney's fees, incurred by Case in effecting or enforcing such compliance.
|
28.2
|
Pending Orders
. Termination or expiration of this Agreement shall relieve Case of any obligation to make any further shipments of Products, and Case may without liability cancel any of Dealer’s unshipped orders for Products. For any Products which Case may ship after termination or notice thereof, Case may require payment prior to shipment.
|
28.3
|
Financial Obligations
. Upon the termination or expiration of this Agreement, all indebtedness of Dealer shall become immediately due and payable to Case, and Dealer shall promptly pay Case all sums owed by Dealer. Final settlement of Dealer’s account with Case shall not be made until Dealer complies with all requirements of this Agreement.
|
28.4
|
Continued Market Presence
. In advance of the effective date of termination, the scheduled Expiration Date or the expiration of any extension period of this Agreement, Case may consummate arrangements to appoint a replacement authorized dealer for Dealer’s SSM.
|
28.5
|
Post-Termination Transactions
. Any business relations or transactions between the Parties after expiration or termination of this Agreement shall not constitute a waiver of the expiration or termination of this Agreement or in any manner reinstate the Parties’ contractual relationship, or establish any new contractual relationship, and all such relations shall be governed by terms and conditions identical to the relevant provisions of this Agreement unless the Parties execute a new agreement superseding this Agreement.
|
28.6
|
Pre-Termination Warranty Service
. Case will reimburse Dealer for all Warranty Service claims performed prior to the expiration or termination of this Agreement that meet the requirements of the DOG.
|
29.1
|
Items Subject to Repurchase
. Within thirty (30) days after the termination or expiration of this Agreement, either Case or Dealer may request in writing the return for repurchase of all of the following items originally purchased from Case by Dealer, on the terms specified herein, and Dealer shall return such items to Case as follows:
|
(a)
|
Equipment
.
|
(i)
|
Equipment Eligible for Repurchase
. New, undamaged, salable, current, complete and unused Equipment, including attachments, purchased from Case and delivered to Dealer within twenty-four (24) months of the date this Agreement terminates or expires (“Repurchasable Equipment”). For purposes of this Section, “current” means the model or series of Equipment listed in Case’s price book or price list at the date of termination or expiration of the Agreement. Case will only repurchase separate attachments that were not previously installed on Equipment and which were invoiced separately to Dealer.
|
(ii)
|
Equipment Repurchase Price
. Repurchasable Equipment shall be repurchased at the price paid by Dealer (A) not including transportation costs actually paid or incurred by Dealer for initial delivery, (B) less any discounts which may have been allowed or paid thereon by Case, (C) adjusted where appropriate to account for any damage or weathering. Case shall not be obligated to reimburse Dealer’s initial costs for unloading, set up, or preparation of Repurchasable Equipment.
|
(b)
|
Parts
.
|
(i)
|
Parts Eligible for Repurchase
. New, undamaged, salable, complete and unused Parts purchased from Case by Dealer, that are listed as of the date of termination or expiration of the Agreement in Case’s then current Price List and not identified as discontinued in such Price List (“Repurchasable Parts”). Repurchasable Parts must be in original Case packaging with their original authorized Case identification label and must be properly identified prior to shipment to Case for repurchase. Case specifically excludes from repurchase Parts that: (A) have a limited shelf life or contain flammable or hazardous materials; (B) are direct shipped from a supplier other than Case; (C) have an altered or counterfeited identification label; (D) are in broken packaging; (E) are not in correct order multiples; (F) are coded non-returnable in the current parts Price List; or (G) are common service or ‘maintenance’ items, rather than repair parts, such as oil, filters, fluids, lubricants, tires, batteries, tracks, bucket edges and teeth.
|
(ii)
|
Parts Repurchase Price
. Repurchasable Parts shall be repurchased at the then current dealer price (less discounts and freight), less a restocking charge as set forth in the Parts Return Policy.
|
(iii)
|
Merchandise Items
. ‘Merchandise’ items such as clothing, toys, binders, gloves, etc., are not eligible for repurchase.
|
(c)
|
Signs
.
|
(i)
|
Signs Eligible for Repurchase
. External flag mast, pole or monument sign purchased from a vendor authorized by Case that displays the Licensed Trademarks or any other Trademarks, excluding any building fascia (“Repurchasable Signs”).
|
(ii)
|
Sign Repurchase Price
. Repurchasable Signs shall be repurchased at the amount paid by Dealer, less an annual depreciation of twenty-five percent (25%).
|
29.2
|
Return Procedures
. Within sixty (60) days after the date of the written request made pursuant to Section 29.1, Dealer shall return to Case all items subject to repurchase or required to be returned pursuant to this Agreement. All items returned to Case shall be identified as required by Case, packed, boxed, crated and loaded by Dealer and shipped at Dealer’s expense and risk of loss to the destination or destinations specified by Case. The procedure for the repurchase of Repurchasable Parts shall be further subject to the Parts Return Policy issued by Case and in effect on the date of termination or expiration of the Agreement. Upon receipt of returned items, Case shall inspect them and issue credit to Dealer for all such items returned that
|
29.3
|
Conditions Precedent to Payment
. Any costs incurred by Case in discharging all or any part of Dealer’s obligations under this Agreement, including but not limited to Dealer’s obligations to cease all use of the Licensed Trademarks or to pack, load and ship Parts to Case, shall be deducted from any amount owed by Case to Dealer. Dealer shall not be entitled to payment or credit for returned items until Dealer has complied with all applicable laws, rules, regulations and other legal requirements governing the bulk transfer of inventory or similar protection of creditors. Case shall have the right to withhold from the price of any items repurchased pursuant to this section a sum sufficient to discharge any liens or encumbrances against such items and to discharge such liens or encumbrances. Dealer shall execute such documents and take any additional action requested by Case to transfer ownership of returned items, free and clear of any claims, liens or encumbrances.
|
29.4
|
Other Return Items
. Upon expiration or termination of this Agreement, Dealer shall return to Case any materials (such as sales promotion, advertising and training materials, tools and signs) provided without charge to Dealer by Case or any predecessor. In addition, Dealer shall return for repurchase special service tools currently offered by Case. Case will repurchase such service tools at 50% of the price paid by Dealer, except service tools that are new, unused and in original packaging shall be repurchased at 100% of the price paid by Dealer.
|
30.1
|
Dealer Responsibility for Operating Capital
. This Agreement contemplates that Dealer, as an independent business, shall obtain on its own the capital investment necessary to operate its business. Nothing in this Agreement shall impose any liability on Case in connection with Dealer's operations under this Agreement or otherwise, or for any expenditure made or incurred by Dealer in preparation for performance or in performance of Dealer's responsibilities under this Agreement.
|
30.2
|
Disclaimer of Consequential Damages
. The Parties both understand and agree that this Agreement is of a limited duration, and therefore, except as provided herein, neither party shall be liable to the other for any damages caused by the termination or expiration of this Agreement, whether based upon loss of anticipated sales or prospective profits, expenditures, investments, leases, property improvements or other matters related to the business of the Parties. The damages to which either party may be entitled for breach of this Agreement are limited to actual out-of-pocket expenses incurred as a direct result of the breach.
|
30.3
|
Waiver of Punitive Damages
. The Parties hereby waive, to the fullest extent permitted by law, any right or claim for any punitive or exemplary damages against the other and agree that if there is a dispute with the other that each party shall be limited to the recovery of actual damages sustained by it.
|
30.4
|
No Group Litigation
. The Parties agree that any and all dispute resolution proceedings between them, including litigation, arising from or related to this Agreement shall be conducted on an individual basis only. Neither Party shall commence any dispute resolution with a third-party against the other, or join with any third party in any dispute resolution involving Case and Dealer. Neither of the Parties shall attempt to consolidate or otherwise combine in any manner a dispute resolution proceeding involving Case or Dealer with another dispute resolution proceeding of any kind.
|
30.5
|
Limitations Period
. All claims for any breach of this Agreement, and all claims arising out of the relationship between the Parties established by this Agreement, shall be made within two (2) years from the date such claim accrued.
|
31.1
|
Indemnification By Case
.
|
(a)
|
Licensed Trademarks
. If Case reasonably determines that Dealer has used the Licensed Trademarks in accordance with this Agreement, Case shall defend, indemnify, and hold harmless
|
(b)
|
Authorized Software
. Case shall defend, indemnify, and hold Dealer harmless from all loss, cost, liability, and expense arising out of any claim that Authorized Software used in accordance with its documentation infringes any valid patent, copyright, trade secret, or other enforceable proprietary right of any third party. Should any Authorized Software become (or in Case’s opinion be likely to become) subject to such a claim, Dealer will permit Case, at Case’s option and expense to
|
(c)
|
Case IP
. Except as otherwise provided in this Section with respect to Authorized Software and Licensed Trademarks, Case will indemnify, defend and hold harmless Dealer from all loss, cost, liability, and expense arising out of any claim based on an allegation that any Product infringes a valid patent, copyright, or trademark or misappropriates any protectable and enforceable trade secret. Case shall have no obligations under this provision for any Product that has been the subject of unauthorized modifications by Dealer or any third party or for infringement that results from the use of intellectual property other than Case IP in conjunction with Case IP that would otherwise not be infringing. If any Product becomes, or in Case’s opinion is likely to become, subject to such a claim of infringement, Case will, at its expense and at its option, either procure the right for Dealer and Dealer’s Customers to continue using the infringing Product(s) or replace or modify the Case Product(s) so that they are no longer infringing. Upon failure of the foregoing provisions, Case may, at its option, refund the purchase price for the infringing Product(s) less a reasonable allowance for use. This section states the entire liability of Case for infringement by any Product.
|
(d)
|
Dealer Cooperation
. In the event of any litigation relating to Dealer’s use of the Licensed Trademarks, Authorized Software, or Case IP, Dealer shall promptly notify Case of such litigation and shall execute any and all documents and undertake such acts as may, in the opinion of Case, be necessary or useful to carry out such defense or prosecution, including becoming a nominal party to any legal action. Except to the extent that such litigation is the result of Dealer’s use of the Licensed Trademarks, Authorized Software, or Case IP in a manner inconsistent with the terms and conditions of this Agreement, Case agrees to reimburse Dealer for its out-of-pocket costs in undertaking such acts.
|
(e)
|
Control of Litigation
. Dealer acknowledges that Case has the right to direct and control any administrative proceeding or litigation involving the Licensed Trademarks, Authorized Software, or Case IP, including any settlement thereof. Case agrees to consult with Dealer regarding any settlement in which Dealer would be required to financially participate and to obtain Dealer’s consent to any such settlement, which consent will not be unreasonably withheld. Case has the right, but not the obligation, to take action against uses by others that may constitute infringement of the Licensed Trademarks, Authorized Software or Case IP. If Dealer fails to notify Case promptly of any litigation or refuses to give Case sole control of the defense and/or prosecution of such litigation and all settlement negotiations, Case will be relieved of its obligations under this Section.
|
31.2
|
Indemnification by Dealer
. Dealer agrees to defend, hold harmless and indemnify Case, its Affiliates and their respective shareholders, directors, officers, agents, employees, successors and assigns from and against any and all claims, damages, demands, settlements, judgments, legal actions, liabilities, costs and expenses of any nature, including without limitation, attorney's fees and court costs, resulting from the acts and/or omissions of Dealer, including but not limited to: (i) Dealer’s defrauding of or misrepresentations to customers; (ii) Dealer’s actions in violation of Sections 5.3, 5.4, 5.5, 10.1(d), 11.1, 11.2, 11.3, 11.5, 14.2, 15.2, 15.3, 15.4, 15.5, 15.6, 21.3, 21.6, 21.7 and 21.8; or (iii) Dealer’s negligent or improper, or alleged negligent or improper, repair or servicing of Products, whether such actions occur during or after the Term of this Agreement.
|
32.1
|
Governing Law
. This Agreement shall be governed by and interpreted according to the laws of the state of Dealer’s Primary Location, without regard to such state’s conflicts of laws rules and except to the extent governed by the United States Trademark Act of 1946 (Lanham Act), the Copyright Act, and the Patent Act.
|
32.2
|
Consent to Jurisdiction and Venue
. Dealer irrevocably submits itself to the exclusive jurisdiction of the federal court of the Milwaukee Division of the Eastern District of Wisconsin for the purpose of any suit, action, or other proceeding arising out of or relating to this Agreement, or of any of the transactions contemplated thereby, and irrevocably agrees that all claims in respect of such suit, action or proceeding may be heard and determined in such federal court, provided that Case may apply to any court of competent jurisdiction for interim protection or equitable relief such as an interlocutory or interim injunction. If the federal court of the Eastern District of Wisconsin lacks jurisdiction for any reason to hear such claims, Dealer irrevocably submits itself to the exclusive jurisdiction of the Circuit Court of Racine County, Wisconsin. By execution and delivery of this Agreement, Dealer irrevocably waives, to the fullest extent it may effectively do so, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action, or proceeding, any claim that it is not personally subject to the jurisdiction of the above-named courts for any reason whatsoever. The Parties agree that a final judgment (as to which all appeals have been exhausted or the time within which such appeals may be made has expired) in any such suit, action or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment or in any other manner provided by law.
|
32.3
|
Compliance With Local Laws
. The rights and obligations of the Parties to this Agreement may be subject to certain laws, orders, regulations, directions, restrictions, and limitations of governments and governmental agencies having jurisdiction over the Parties. If a change in any such law, order, regulation, direction, or restriction (including any limitation, appropriation, seizure, or interpretation thereof) shall, in the judgment of either party, substantially alter the relationship between the Parties, this Agreement, or the advantages derived from the Parties’ relationship, either party may request the other party to modify this Agreement. If, within thirty (30) days after such a request has been made, the Parties are unable to agree upon a mutually satisfactory modification of this Agreement, then the adversely affected party may terminate this Agreement on fifteen (15) days’ notice given to the other party.
|
32.4
|
Information Sharing
. Case shall be allowed to share information regarding Dealer, including but not limited to Dealer’s financial and ownership information, with any of Case’s Affiliates.
|
32.5
|
Dealer Relationship to Case
. The Parties are independent businesses and neither has any fiduciary obligation to the other, and Dealer is an independent retailer which purchases Products for resale for Dealer’s principal benefit. Nothing in this Agreement shall be construed as constituting Dealer to be an employee, franchisee, agent or legal representative of Case for any purpose whatsoever. Dealer has no right or authority, express or implied, to assume or create any obligation or responsibility on behalf of or in the name of Case, or to bind Case in any manner.
|
32.6
|
Entire Agreement
. This Agreement, together with the DOG and any changes thereto issued by Case from time to time, is and shall be deemed to be the complete and final expression of the agreement between the Parties as to the matters herein contained and provided for and supersedes all previous agreements between the Parties pertaining to such matters. IT IS CLEARLY UNDERSTOOD THAT NO PROMISE OR REPRESENTATION NOT CONTAINED HEREIN WAS AN INDUCEMENT TO EITHER PARTY OR WAS RELIED UPON BY EITHER PARTY IN ENTERING INTO THIS AGREEMENT.
|
32.7
|
Execution and Modification
. Except as expressly provided for herein, this Agreement may not be executed, amended or altered, or any of its provisions waived on behalf of Case, except in writing, signed by Case’s Director of Network Development or other authorized director in a similar capacity.
|
32.8
|
Severability
. In the event any part of this Agreement is held to be invalid or unenforceable under the law, this Agreement shall be enforceable to the maximum extent permitted by such law, without invalidating the remainder of this Agreement, or invalidating the effect of such portion of this Agreement elsewhere.
|
32.9
|
Assignment
.
|
(a)
|
By Dealer
. In view of the personal nature of this Agreement, the rights, privileges and obligations conferred on Dealer under this Agreement are not transferable, assignable or salable by Dealer
|
(b)
|
By Case
. Upon written notice to Dealer, Case may assign this Agreement and any rights and obligations thereunder to any Affiliate of Case or to any entity that succeeds to the interests of Case.
|
32.10
|
Waiver of Default
. The waiver by Case of any default, or the failure of Case to exercise any of its rights, under this Agreement or otherwise shall not act as a waiver of any subsequent default or a waiver of such default or any of Case’s rights hereunder.
|
32.11
|
Headings
. The headings of sections and subsections in this Agreement are inserted for convenience of reference only and shall not in any way affect the construction, meaning or interpretation of any provision of this Agreement, and shall not be deemed or construed in any way to limit the meaning of such sections.
|
32.12
|
Interpretation
. This Agreement is being entered into by and among competent and sophisticated parties who are experienced in business matters. Therefore, any language in this Agreement deemed to be ambiguous by a court of law will not be construed against any particular party as the drafter of the language.
|
32.13
|
Notice, Approval and Consent
. Any notice, approval or consent required or allowed under this Agreement shall be given in writing and, without prejudice to other forms of actual service, shall be considered as served upon being mailed in a properly sealed envelope with first class, certified or registered postage prepaid. Notices to Case shall be addressed to the Case Director of Distribution and shall be delivered or mailed to CNH Industrial America LLC, 621 State Street, Racine, Wisconsin 53402. Notices to Dealer shall be delivered or mailed to any person designated in Schedule A or to Dealer at Dealer’s Primary Location.
|
32.14
|
Survival
. The Parties’ obligations in the following sections shall survive the expiration or termination of this Agreement: 5.5, 10.1(f), 16.6, 17.4, 24.4, 26.1, 26.2, 28.1, 28.3, 28.6, 29.1, 29.2, 29.3, 29.4, 30.2, 30.3, 30.4, 30.5, 31.1, 31.2, 32.1, 32.2, and 32.3.
|
32.15
|
Review by Counsel
. Dealer acknowledges that it has had an adequate opportunity to review this Agreement and consult with legal counsel of its own choosing regarding the content and meaning of this Agreement.IN WITNESS WHEREOF the Parties have duly executed this Agreement on the dates written below:
|
Dealer
|
|
Dealer Name
|
|
By
|
|
Title (authorized owner, officer, partner, president)
|
|
Date
|
|
Signature of Other Partner(s) or Owner(s)
|
|
Case
|
CNH Industrial America LLC
|
By
|
|
Vice President, Case Construction, North America
|
|
Title
|
|
Date
|
|
Heavy Products
|
Light Products
|
Skid Steer
Products
|
||||||
CE
|
CX
|
CM
|
GR
|
UT
|
MW
|
MX
|
SL
|
||
Dealer City
|
Dealer State
|
CE Crawler Dozer and CE Wheel Loader
|
Excavator 10+ MT and Midi Excavator 7-10 MT
|
Compaction
|
Grader
|
Tractor Loader, Tractor
Loader Backhoe, Forklift and Light Crawler Dozer
|
Compact Wheel Loader
|
Compact Excavator 0-6 MT
|
Skid Steer and Compact Track Loaders
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Product Lines and County SSM Assignment
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Dealer Code
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Dealer City, State
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County Assignment
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ST
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Heavy Products
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Light Products
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Skid Steer Products
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Type
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Street Address
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City
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ST
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Zip Code
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Equipment, Parts & Service
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Parts Only
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Parts & Service Only
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Corp Office
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Dual Location
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Primary
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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2.
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Section 4.2 of the Agreement is deleted.
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3.
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Section 4.3 of the Agreement is replaced in its entirety with the following:
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(ii)
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any sale of all or substantially all of Dealer’s assets;
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(iv)
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a change in the composition of the Board of Dealer over a period of eighteen
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4.
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Section 4.4 of the Agreement is replaced in its entirety with the following:
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4.4
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Death or Incapacity of Dealer Principals
. In the event of the death or incapacity of any person listed in Schedule A (“Dealer Principal(s)”), Dealer shall provide Case within ninety (90) days of such occurrence, an ownership or management succession plan for the replacement of such deceased or incapacitated Dealer Principal(s), if Dealer proposes to continue operation under this Agreement. Case may approve or deny Dealer’s proposed succession plan in its reasonable discretion.
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5.
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Section 4.5 of the Agreement is replaced in its entirety with the following:
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4.5
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Ancillary Documents
. Dealer will execute such agreements or other documents as Case in its reasonable discretion may deem necessary to preserve Case's rights under this Agreement in response to (a) any change or proposed change in Dealer's legal form or entity, (b) any Change of Control of Dealer as defined above, or (c) death or incapacity of any Dealer Principal.
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6.
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Section 9.1(a) of the Agreement is replaced in its entirety with the following:
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7.
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Section 9.2(a) of the Agreement is replaced in its entirety with the following:
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8.
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Section 13.1 of the Agreement is replaced in its entirety with the following:
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10.
|
Section 16.6 of the Agreement is replaced in its entirety with the following:
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11.
|
Section 20.4 of the Agreement is replaced in its entirety with the following:
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12.
|
Section 21.1 of the Agreement is replaced in its entirety with the following:
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13.
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Section 21.4 of the Agreement is replaced in its entirety with the following:
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21.4
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No Internet Sales
. Dealer may not consummate sales of new Products on or through an Internet website, including but not limited to an auction-type website, except as otherwise authorized by Case; provided, that Dealer may consummate sales of Parts over the Internet to customers located within its SSM.
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14.
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Section 21.5 of the Agreement is replaced in its entirety with the following:
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21.5
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Announcements
. Prior to the filing of any statement with the Securities and Exchange Commission that includes disclosure of any information regarding Case that Case has advised Dealer in writing is material nonpublic information regarding Case, Dealer agrees to provide advance notice thereof to Case and to not disclose the same if so requested by Case, provided, however, that the foregoing shall not limit Dealer's rights and obligations to comply with applicable law.
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16.
|
Section 27.3(b) of the Agreement is replaced in its entirety with the following:
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17.
|
Subparagraphs (a), (c), (g), (h), (k) and (o) of Section 27.4 of the Agreement are amended as follows:
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(a)
|
Dealer Financial Defaults
: (i) Dealer’s default in the payment when due of any obligations to Case or any of its Affiliates, including but not limited to CNH Industrial Capital America LLC (“CNH Capital”) after the expiration of any notice and cure periods in any applicable agreements with Case’s Affiliates or CNH Capital; (ii) Dealer’s default under any chattel mortgage or other security agreement between Dealer and Case, any of its Affiliates or any other lender or financing entity with whom Dealer has a material credit arrangement (i.e., a credit arrangement for which the relevant agreements must be publicly disclosed pursuant to federal securities laws), if such default results in an acceleration of the indebtedness owed under the credit facility; or (iii) the refusal or failure of Dealer, following written demand, to account to Case or any of its Affiliates for the proceeds of the sale of Products for which Dealer is indebted to Case or such Affiliates;
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c.
|
Subparagraph (d) of Section 27.4 is replaced in its entirety with the following:
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d.
|
Subparagraph (g) of Section 27.4 is replaced in its entirety with the following:
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(g)
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Failure to Operate
: failure to operate any Dealer Location in the normal course of business for seven (7) consecutive calendar days other than due to a force majeure event, provided that within three (3) months from the seventh day of closure due to the force majeure event, Dealer shall submit a plan to Case detailing how Dealer shall return to operation at the affected Dealer Location, which plan must be acceptable to Case in its reasonable discretion;
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e.
|
Subparagraph (h) is amended to delete “or any Dealer Principal” from such section.
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f.
|
Subparagraph (k) of Section 27.4 is replaced in its entirety with the following:
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(k)
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Detrimental Conduct
: any conduct by Dealer which in the sole discretion of Case:
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g.
|
Subparagraph (o) of Section 27.4 is replaced in its entirety with the following:
|
Titan Machinery Inc.
|
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(Dealer Name)
|
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CNH Industrial America LLC
|
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(Dealer Location)
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By:
|
By:
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Vice President, Case Construction, N. America
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David J. Meyer, CEO
|
Dated:
|
Dated:
|
1.1
|
The purpose of this Agreement is to describe the respective functions, obligations and responsibilities of the Parties, so that each fully understands the nature of their required commitments of time, effort and capital. This Agreement establishes Dealer as an independent contractor for the promotion, retail sale and after-sale service and support of Products to Customers in Dealer’s local market.
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2.1
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A
ffiliate: as to Case IH, any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with Case IH. For this definition, the term “control” means the power to direct the management and policies of an entity through the ownership of more than 50% of the voting securities, rights or other similar interests of that entity.
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2.2
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Branch Location(s
): Dealer’s additional place(s) of business listed in Schedule D for the sale, rental, lease and service of Products, separate from Dealer’s Primary Location.
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2.3
|
Case IH I
P: any and all intellectual property including but not limited to patents, Trademarks (including the Licensed Trademarks), designs, copyrights, trade secrets, computer software (whether imbedded in Products or otherwise) and other proprietary technology and information, whether technical or business related, including registrations for and applications to register any of the foregoing, which are incorporated or used in or with Products or which are owned or licensed by Case IH for use with Products.
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2.4
|
Case IH Regional Market S
hare: a percentage figure calculated by taking the number of units of new Case IH brand equipment for a given Product Line or Product Line grouping, sold by Case IH dealers in a regional sales area (a multi- state area determined by Case IH in its sole discretion) during a designated time period determined by Case IH, divided by the total industry volume of all comparable new units of equipment (including Case IH and competitive units) sold in that same regional sales area during that same time period. Total industry volume of new equipment sales shall be as reported by the Association of Equipment Manufacturers (or other replacement organization selected by Case IH, hereinafter “AEM”).
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2.5
|
Case IH State Market S
hare: a percentage figure calculated by taking the number of units of new Case IH brand equipment for a given Product Line or Product Line grouping, sold by Case IH dealers in a state during a designated time period determined by Case IH, divided by the total industry volume of all comparable new units of equipment (including Case IH and competitive units) sold in that same state during that same time period. Total industry volume of new equipment sales shall be as reported by AEM.
|
2.6
|
C
ustomer(s): an end-user that purchases, leases or rents Products from an authorized dealer or Case IH for its own use and not for resale.
|
2.7
|
Dealer C
laims: Dealer’s claims to Case IH for Warranty Service, Other Required Service, or any retail promotional or sales incentive, including but not limited to refunds, credits, rebates, incentives, allowances, discounts, or payments under any Case IH program.
|
2.8
|
Dealer L
ocation(s): Dealer’s Primary Location and Branch Locations, if any, authorized by Case IH for the sale, rental, lease and service of Equipment and/or Parts.
|
2.9
|
Dealer Market S
hare: a percentage figure for measuring Dealer’s sales performance calculated by taking the number of units of new Equipment, by Product Line or Product Line grouping, sold by Dealer to Customers located within Dealer’s
|
2.10
|
D
OG: refers to both the Dealer Operating Guide and Parts Policy Manual or any equivalent or successor documents and amendments thereto issued by Case IH setting forth for all dealers the various policies, procedures and operating standards for doing business with Case IH.
|
2.11
|
D
omestic: within the 50 states of the United States of America.
|
2.12
|
E
quipment: whole good machinery and any related attachments designated on Schedule B by Product Line and Licensed Trademark.
|
2.13
|
Licensed T
rademarks: the Trademarks listed in Schedule B that Case IH authorizes Dealer to use for the sole purpose of performing its obligations hereunder with respect to Products.
|
2.14
|
Limited W
arranty: the Warranty and Limitation of Liability agreement furnished by Case IH with respect to any Product sold to Customers.
|
2.15
|
Other Required S
ervice: service that Case IH, in its sole discretion, has deemed necessary or desirable and in the best interests of Customers and the goodwill associated with the Licensed Trademarks, including but not limited to, policy service, campaign service, or field improvement program service.
|
2.16
|
P
arts: proprietary replacement parts sold by Case IH for Equipment listed on Schedule B (specifically not including replacement parts for Case IH equipment not listed on Schedule B), together with all other common service or maintenance items (for example, including but not limited to filters, hoses, lubricants, etc.) and accessories which are offered for sale by Case IH to Dealer (either directly from Case IH or from an authorized source of supply), which Case IH has authorized to be identified with the Licensed Trademarks. Parts do not include ‘merchandise’ items such as clothing, toys, binders, gloves, etc.
|
2.17
|
Primary L
ocation: the primary Dealer facility location specified in Schedule D.
|
2.18
|
P
roduct(s): Equipment and related Parts that Dealer is authorized to represent under this Agreement.
|
2.19
|
Product L
ine: the categories of Products set forth in Schedule B.
|
2.20
|
Sales and Service Market (“SSM”
): a market comprised of the total industry sales of all new Equipment (as reported by AEM), including Case IH and competitive equipment, sold (including first rentals or leases) within the geographic area designated in Schedule C.
|
2.21
|
Strategic Account
s: customer accounts typically referred to as “national accounts,” “corporate accounts,” national or regional equipment rental companies, or any customer designated by Case IH as such an account.
|
2.22
|
Trademark
s: all words, slogans, designs, pictures, logotypes or other symbols, including trademarks, service marks, trade dress, and trade names, regardless of whether registration has been sought or obtained therefor, used to (a) identify, distinguish or advertise the Products and services of Case IH or its Affiliates, (b) identify Case IH as the source or licensor of Products and services, or (c) identify the business of Case IH and its authorized dealers.
|
2.23
|
Warranty S
ervice: service that is required for any Product (a) to ensure that Case IH is in compliance with Case IH’s Limited Warranty obligations for such Product and (b) to comply with any extended service or maintenance plan purchased for that Product.
|
2.24
|
Will Cal
l: a program whereby Case IH, in its sole discretion, may permit Dealer to take delivery and possession of Products directly from a Will Call Provider or Case IH, in lieu of such Products being transported to Dealer at Dealer Location(s). The procedures for the Will Call program will be as set forth in the DOG.
|
2.25
|
Will Call Provider
: a third-party engaged by Case IH to facilitate Dealer's pick-up of Products at Case IH plant locations or port facilities under the terms of the Will Call program.
|
3.1
|
Scope of A
ppointment. Pursuant to the provisions of this Agreement, Case IH hereby authorizes Dealer to market, promote, sell, lease or rent new Products and to provide Warranty Service for Products to Customers solely from the authorized Dealer Location(s) listed in Schedule D. The foregoing appointment is limited to Products identified with the Licensed Trademarks on Schedule B. Dealer accepts this appointment and agrees that the relationship between Dealer and Case IH shall be governed by the terms and conditions of this Agreement as well as the policies outlined in the DOG.
|
3.2
|
Incorporation of D
OG. The DOG includes the standards of quality and performance that Case IH seeks to have associated with its Trademarks and is hereby incorporated by reference into this Agreement. It is expressly understood
|
3.3
|
Material I
nducement. Section 3.2 is a material inducement upon which Case IH relied in entering into this Agreement with Dealer, the breach or unenforceability of which represents a failure of consideration entitling Case IH to void this Agreement in its entirety.
|
4.1
|
Dealer Representations and War
ranties. The appointment of Dealer is made in reliance on Dealer’s representation and warranty that the information set forth in any dealer application provided to Case IH as well as in Schedule A regarding Dealer’s legal name, ownership (if corporation, as listed in a Stock Ownership Certificate), management personnel, business structure, and state of residence or organization is accurate and complete. Dealer also represents and warrants that entering into this Agreement does not violate any other contract or agreement to which Dealer is a party and that any person signing this Agreement on behalf of Dealer has the authority to do so. Any breach of any of the foregoing representations and warranties represents a failure of consideration entitling Case IH to void this Agreement in its entirety.
|
4.2
|
Personal Services Nature of A
greement. Dealer ownership and management are important to the successful working relationship between the Parties. Case IH has chosen to contract with the present ownership and management of Dealer, and the Parties acknowledge that this Agreement represents a personal services relationship, and that any change to the ownership, management or business structure of Dealer could seriously and adversely impact such relationship. As such, Case IH may refuse to appoint as an authorized dealer any purchaser or prospective purchaser of any of the shares or assets of Dealer.
|
4.3
|
Changes in Dealer Form and Con
trol. Except as otherwise stated in Section 4.4, Dealer shall provide Case IH with sixty
|
4.4
|
Death or Incapacity of Dealer P
rincipals. In the event of the death or incapacity of any person listed in Schedule A or in the Stock Ownership Certificate (“Dealer Principal(s)”), Dealer shall provide Case IH: (a) notice of such occurrence within thirty (30) days; and (b) within ninety (90) days of such occurrence, an ownership or management succession plan for the replacement of such deceased or incapacitated Dealer Principal(s), if Dealer proposes to continue operation under this Agreement. Case IH retains sole discretion whether to approve Dealer’s proposed succession plan or terminate the Agreement.
|
4.5
|
Succession Plan
. Upon request, Dealer shall provide a succession plan to Case IH in the format approved by Case IH. The submission of such succession plan shall not imply that Case IH has automatically accepted such plan. Case IH retains sole discretion whether to approve Dealer’s proposed succession plan.
|
4.6
|
Ancillary Docume
nts. Dealer will execute such agreements or other documents as Case IH in its sole discretion may deem necessary to preserve Case IH's rights under this Agreement in response to (a) any change or proposed change in Dealer's legal form or entity, (b) any change in Dealer’s control, ownership, or management, or (c) death or incapacity of any Dealer Principal.
|
5.1
|
Authorized P
roducts.
|
5.2
|
Dealer Obligation to Support New Equipment M
odels. Case IH may introduce new models of Equipment for Product Lines that Dealer is authorized to sell on Schedule B. In order to provide service to Customers for such Equipment, Dealer shall support such new models by complying with Case IH-designated requirements for: (a) stocking all required Parts; (b) purchasing all required service tools; and (c) attending sales and service training for such new models. Case IH has no obligation to fill orders or ship such new models of Equipment to Dealer if Dealer fails to fulfill the foregoing Parts, tools and training requirements.
|
5.3
|
Product Packaging and L
abels. Dealer shall not modify or remove any warning labels affixed to Products. Further, without Case IH’s prior written consent, Dealer shall not modify any packaging or other labeling for Products.
|
5.4
|
Installation of Non-Standard Attachments or Acces
sories. Without prior written approval from Case IH, Dealer shall not install or attach non-standard, “self-designed,” or “one-off” attachments or accessories to Equipment. Such non- standard, “self-designed,” or “one-off” attachments or accessories are those that are not manufactured and sold by established equipment manufacturers for the application and purpose for which they are being used. Dealers that install standard attachments or accessories from established equipment manufacturers shall ensure that the Equipment can properly and safely operate with such attachment or accessory.
|
5.5
|
Prohibited Modifications to P
roduct. Dealer shall not perform any of the following actions: (a) modify Equipment without Case IH’s prior written consent; (b) install upon Equipment any attachment, accessory or equipment that is beyond the rated capacity of that Equipment as stated in the Operator’s Manual furnished with the Equipment or as otherwise instructed by Case IH; or (c) perform any adjustment or assembly procedures to Equipment not recommended by or in contravention of the Operator’s Manual, Service Manual or other Case IH instruction.
|
6.1
|
Assignment of S
SM. The SSM assigned to Dealer is set forth in Schedule C. The Dealer’s SSM may vary by Equipment or Product Line. Case IH’s assignment to Dealer of an SSM is for the purpose of: (a) focusing Dealer’s sales, marketing and product support efforts; (b) measuring Dealer Market Share performance; and (c) maximizing the goodwill associated with Products and Licensed Trademarks. Dealer Market Share shall be measured only within Dealer’s SSM. Upon sixty
|
6.2
|
No Obligation to Support Sales Outside S
SM. To the extent Case IH decides to offer marketing programs, retail sales incentives, or other promotions, it shall have no obligation to do so for Dealer’s sales or marketing activities outside of Dealer’s SSM.
|
6.3
|
Sales & Service F
ee. Case IH may assess Dealer a sales and service fee for sales of new Equipment by Dealer that are registered in a county outside of Dealer’s SSM. The amount of such fee, the operative regulations and policies, and the Equipment to which it applies are published in the DOG, and may be amended by Case IH in its sole discretion. Case IH reserves the right not to assess a sales and service fee against other dealers for their sales to Customers within Dealer’s SSM, if Dealer is failing to meet the market share obligations contained in Section 9.1(a).
|
6.4
|
SSM N
on-Exclusive. Dealer’s SSM is non-exclusive. Without incurring any liability to Dealer, Case IH may determine the number and locations of authorized dealers necessary for adequate sales and service representation of Products within any geographic area, or within the designated SSM. Nothing in this Agreement shall be construed as requiring Dealer's consent to the establishment of new or additional dealer representation for Products in Dealer’s SSM or elsewhere.
|
7.1
|
Wholesale Line of C
redit. Dealer shall establish and at all times maintain an unrestricted wholesale line of credit for the purchase and stocking of new Products in an amount acceptable to Case IH in order to meet Dealer’s inventory and sales obligations hereunder. If within any six (6)-month period, Dealer’s primary wholesale line of credit is cumulatively
|
7.2
|
Adjusted Debt to Tangible Net Worth R
atio. Dealer hereby covenants and agrees that it will maintain an Adjusted Debt to Tangible Net Worth Ratio of not more than four to one (4.0:1.0). Unless specifically approved in advance in writing by Case IH, Dealer will not make any acquisitions or initiate new business activities if Dealer’s Adjusted Debt to Tangible Net Worth Ratio exceeds four to one (4.0:1.0) or if such ratio would increase beyond four to one (4.0:1.0) as a result of such actions. This ratio shall be calculated using the consolidated balance sheets and income statements of Dealer (and of Dealer’s related entities and affiliates, if Case IH so elects). All such balance sheets and income statements must be prepared in accordance with Generally Accepted Accounting Principles (“GAAP”). For purposes of calculating this ratio, the following definitions will apply:
|
7.3
|
Working Capital R
equirements. Dealer shall maintain net working capital in amounts necessary for Dealer to comply with its obligations under this Agreement.
|
8.1
|
Equipment Stocking R
equirements. Dealer shall order, maintain in inventory and prominently display, at all Dealer Locations unless otherwise excepted in writing by Case IH, representative models of each type of new Equipment Dealer is authorized to sell as set forth in Schedule B, at the level deemed necessary by Case IH to meet Dealer’s Equipment sales obligations in accordance with Dealer’s Business Plan provided pursuant to Section 13 of this Agreement.
|
8.2
|
Parts Stocking R
equirements. For the purpose of providing prompt Customer support, Dealer agrees to order and maintain in inventory all Parts at the level deemed necessary by Case IH to meet Dealer’s Parts sales obligations in accordance with Dealer’s Business Plan provided pursuant to Section 13 of this Agreement. Dealer must provide a retail display area for Parts acceptable to Case IH.
|
8.3
|
Licensed Trademark U
se. At any Dealer Location and in all advertising for such Dealer Locations, Dealer shall not use or display the Licensed Trademarks in any way that might cause confusion with, or dilute the distinctive quality of, the Licensed Trademarks, or in any way that violates any Case IH trademark guidelines. In furtherance of this provision, if Dealer represents non-Case IH products, Dealer shall at any such location: (a) maintain internal and external display areas for new Products separate from non-Case IH products; (b) display new Products in the most visible and desirable position and in an area of greater size or space than the area used to display non-Case IH products.
|
9.1
|
Sales Responsibilities
. Dealer is solely responsible for developing its own plan for marketing and selling Products, and shall fulfill its sales obligations in several ways, including but not limited to the following:
|
(a)
|
Equipment Market S
hare. Dealer shall aggressively promote and sell new Equipment to attain within Dealer’s SSM for all Equipment designated on Schedule B, a Dealer Market Share that is equal to at least 90% of either, in Case IH’s sole discretion, the Case IH State Market Share or the Case IH Regional Market Share. In evaluating Dealer’s market share performance, Case IH, in its sole discretion, may (i) group Product Lines and/or (ii) evaluate Dealer’s performance on a per Dealer Location basis.
|
(b)
|
Parts Sales O
bjectives. Dealer shall aggressively promote and sell all Parts offered by Case IH.
|
(c)
|
Advertising and P
romotion. Dealer shall conduct aggressive advertising and sales promotion activities, including but not limited to open houses, field days, product demonstrations, radio and/or television advertising, print advertising, trade shows and community events. Dealer shall appropriately display and distribute current Product sales literature, brochures and advertisements at its Dealer Locations, and shall also maintain a dealer website that prominently displays new Products. Dealer’s use of Licensed Trademarks and its display of Products on Dealer’s website shall be subject to Case IH’s approval. Upon Case IH’s request, Dealer shall participate in national or regional sales promotion and advertising programs as Case IH may periodically conduct.
|
(d)
|
Sales S
taff. Dealer shall employ a sufficient number of properly trained Product-dedicated sales personnel based on the industry potential in Dealer’s SSM and as required by Case IH to call on all potential customers within the SSM. Such sales personnel shall attend Case IH’s sales training sessions as required in the DOG.
|
(e)
|
Extended Service P
lans. Dealer shall promote and sell extended service and maintenance plans.
|
(f)
|
Customer Survey
s. Case IH from time to time may conduct surveys (by use of questionnaires or otherwise) of Dealer’s Customers to determine the satisfaction of those Customers with the sales, leasing, rental and service efforts of Dealer. Case IH may use the results of these surveys in assessing Dealer's performance under this Agreement.
|
(g)
|
Other Performance S
tandards. Dealer shall meet such other sales performance standards or best business practices as may be established by Case IH in the DOG.
|
9.2
|
Dealer Resource C
ommitment. The Parties mutually recognize that one of the purposes of this Agreement is to assure that Dealer focuses its resources and efforts on the sale of new Products and the performance of its obligations under this Agreement. Therefore, Dealer agrees that if Dealer undertakes or engages in another business activity at a Dealer Location(s) separate from its representation of new Products pursuant to this Agreement, which activity involves a considerable commitment of Dealer’s effort and resources, Dealer agrees to make such separation of the personnel, facilities and other non-capital resources devoted to that business as is satisfactory to Case IH, provided that Case IH specifies in writing the separation of personnel, facilities and non-capital resources that are required. Case IH shall provide Dealer with two (2) years’ prior written notice for Dealer to complete any required separation of facilities.
|
9.3
|
Sales Reporting
. Dealer shall report all new Equipment retail sales to Case IH, and shall provide true and accurate information on such sales as required by Case IH, including but not limited to registering the location of such Equipment sales and the end-use designation in compliance with Case IH guidelines.
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10.1
|
Warranty Service and Other Required S
ervice. Dealer shall provide Warranty Service for any Product, regardless of whether Dealer sold that specific Product; provided, however, Dealer may not provide Warranty Service for any Case IH (or other CNH Industrial America LLC) products not listed on Schedule B. Dealer also shall provide Other Required Service as directed by Case IH in its sole discretion. Dealer shall provide Warranty Service and Other Required Service in a prompt, professional and courteous manner, and shall fulfill these responsibilities in several ways, including but not limited to the following:
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(a)
|
Service T
echnicians. Dealer shall employ at all times a sufficient number of trained and fully certified service technicians based on industry sales in Dealer’s SSM. Dealer must have service technicians at each Dealer Location who are trained and fully certified to service each type of Equipment listed on Schedule B, and Dealer’s service technicians must attend Case IH service training sessions as required by Case IH in the DOG.
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(b)
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Service Tools and M
anuals. Dealer shall maintain, or have access to, at each Dealer Location all special service tools, electronic diagnostic tools or websites, electronic parts catalogs, service manuals, parts manuals and operator’s manuals required by Case IH to service the Equipment listed in Schedule B. Dealer may comply with the service tool requirements by subscribing to any Case IH tool rental program.
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(c)
|
Service Standard
s. Dealer shall perform Warranty Service and/or Other Required Service in a timely manner and in strict compliance with the DOG and any service bulletins or other instructions issued by Case IH. Dealer shall give priority to performing such Warranty Service or Other Required Service before general maintenance if a Customer’s Product is not operable.
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(d)
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Use of Case IH-Sourced P
arts. Except as otherwise instructed by Case IH in writing, Dealer shall use only Parts obtained from Case IH or Case IH’s authorized sources of supply in performing Warranty Service or Other Required Service.
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(e)
|
Certification Stan
dards. Dealer shall meet or exceed Case IH’s service certification standards including pre- delivery, delivery and after-delivery requirements for all Products, as defined by Case IH in the DOG.
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(f)
|
Compliance with Service P
olicies. Dealer shall abide by all Case IH policies and procedures contained in the DOG when performing Warranty Service and Other Required Service or when submitting Dealer Claims, including creating and retaining all supporting documentation for such claims.
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10.2
|
Strategic Account S
ervice. Dealer shall provide Warranty Service and/or Other Required Service for any Product sold by Case IH to Strategic Accounts, as well as for any Product sold or donated to charitable, educational or governmental entities.
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11.1
|
Product S
etup. To ensure the proper operation of Products, before delivery of Products to a Customer Dealer shall perform the inspections, adjustments, conditioning, installations or servicing of such Products in accordance with instructions and procedures provided by Case IH.
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11.2
|
Product L
iterature. Dealer shall deliver to each Customer of a Product the appropriate current publications and forms for owners covering operation, maintenance, warranty and other matters as determined by Case IH.
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11.3
|
Customer Instruc
tion. At the time of delivery, Dealer shall instruct each Customer of a Product in the safe use, proper operation and required maintenance of that Product. Such instruction shall include, at a minimum: (a) reference to the operators manual and decals identifying hazards and how to avoid them, (b) identification of the safety features and functions of the Equipment, and (c) demonstration of such features and functions.
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11.4
|
Accident R
eporting. Dealer shall promptly notify Case IH, pursuant to guidelines contained in the DOG, of any reports of accidents or injuries involving Products of which Dealer becomes aware, as well as any information concerning the existence of any significant Product failure or malfunction.
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11.5
|
Post-Delivery S
ervices. Dealer shall perform all required post-delivery inspections and adjustments to Products as prescribed by instructions and procedures provided by Case IH from time to time or as stated in the DOG.
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12.1
|
Facility Requirem
ents. Dealer shall establish and maintain at each authorized Dealer Location listed on Schedule D a facility to sell, service, display and store Products in accordance with facility standards contained in the DOG.
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12.2
|
Unauthorized L
ocations. Without Case IH’s prior written consent, Dealer shall not at any location other than those listed in Schedule D, directly or indirectly: (a) advertise or represent itself as an authorized dealer of Case IH Products; (b) use the Licensed Trademarks or any other Trademarks; (c) store, stock or display Products; (d) sell, advertise or market any Products; or (e) provide Warranty Service and/or Other Required Service.
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12.3
|
Closure and R
elocation. Without Case IH’s prior written consent, Dealer may not close or relocate any Dealer Location listed on Schedule D. Dealer shall seek Case IH’s consent for the closure or relocation of a Dealer Location at least sixty (60) days prior to the proposed closure or relocation. Should Case IH give its consent, Case IH, in its sole discretion, may modify or reassign the SSM associated with the relocated or closed Dealer Location. Dealer acknowledges and agrees that any consent granted by Case IH for the closure of a Dealer Location shall not initiate the inventory repurchase obligations set forth in Section 29.
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12.4
|
Brand I
dentification. Dealer shall: (a) display a primary identification sign (flag mast or monument) and comply with dealer identity standards as specified in the DOG for each Dealer Location listed on Schedule D; and (b) comply with Case IH’s vehicle identity standards as set forth in the DOG.
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12.5
|
Trademark D
isplay. Dealer’s use of Trademarks or Licensed Trademarks at any Dealer Location, including but not limited to signs, banners or displays, shall be subject to Case IH approval. Any such use not approved by Case IH must be removed immediately by Dealer.
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13.1
|
Business Plan R
equirements. Annually, or as otherwise requested by Case IH, Dealer shall complete and make available for review by Case IH a written plan for the subsequent fiscal year (or additional years if requested by Case IH) that shall contain the information and objectives required by Case IH for a business plan (“Business Plan”), which may include but not be limited to the following:
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(a)
|
Equipment inventory stocking and sales objectives to maximize Dealer’s Equipment sales in its SSM, but at a minimum to obtain Dealer Market Share requirements stated in Section 9.1(a), including action plans for obtaining such objectives;
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(b)
|
Parts inventory stocking plan and sales objectives to maximize Dealer’s Parts sales;
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(c)
|
training plans for Dealer sales and service personnel, including Case IH provided training;
|
(d)
|
advertising, promotional and marketing plans and budgets;
|
(e)
|
action plans for Dealer’s possible expansion or upgrading of its current facilities, or for the proposed addition of new facilities; and
|
(f)
|
any additional information required by Case IH as set forth in the DOG.
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13.2
|
Business Plan A
cceptance. Dealer agrees that providing a Business Plan reasonably acceptable to Case IH is a requirement for Dealer to effectively promote and sell Products under this Agreement. Case IH may conduct periodic reviews of Dealer’s performance against its approved Business Plan, and during such reviews Dealer agrees to make available all Dealer’s records and employees which would contribute to the overall value of these reviews.
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14.1
|
Insurance C
overage. Dealer shall maintain an occurrence-based policy of Comprehensive General Liability insurance (including Products and Property Damage Liability) with a maximum per occurrence deductible of $50,000; a minimum liability limit of $5,000,000 per occurrence for personal injury claims; and a minimum liability limit of $500,000 per occurrence for property damage claims. If Dealer is self-insured, the per occurrence deductible maximum is not applicable. Case IH may modify the deductible and policy limit amounts as set forth in the DOG. Any annual aggregate liability limits under such policies shall not be less than $5,000,000. Upon request, Dealer shall furnish to Case IH certificates of such insurance, which shall provide for at least thirty (30) days’ prior written notice to Case IH of an increase in deductible amounts or the cancellation, lapse, or expiration of said policy.
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14.2
|
Payment of T
axes. Dealer shall pay all license fees, sales, use, personal property, and excise taxes, duties, and any other fees, assessments or taxes which may be assessed or levied by any governmental authority against any Products which are shipped to, or are in the possession of, Dealer.
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14.3
|
Dealer Tax Repre
sentations. By submitting an order to Case IH for the purchase of any Product, Dealer represents and warrants that (a) such Products are being purchased for resale, lease or rent to Customers in the ordinary course of Dealer's business, and (b) Dealer has complied and will comply with all requirements for collection and payment of applicable sales, use and similar taxes. Upon request, Dealer shall provide evidence satisfactory to Case IH of Dealer’s compliance with the foregoing representations and warranties.
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15.1
|
Warranty O
bligations. Case IH’s warranties covering Products are as set forth in the Limited Warranty furnished by Case IH with respect to such Products. The performance and administration of the warranties so extended, and the reimbursement to Dealer for Warranty Service performed on Products, are as set forth herein and in the DOG in effect at the time warranty work is performed. The Parties shall promptly fulfill their respective warranty obligations as set forth in the Limited Warranty and DOG.
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15.2
|
Dealer Obligations Upon S
ale. At the time of any retail sale of Products pursuant to this Agreement, Dealer shall (a) deliver to and review with the Customer Case IH’s Limited Warranty for such Products in force at the time of such sale,
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15.3
|
No Other Warranty P
rovisions. Dealer is not authorized to assume or purport to assume for Case IH any additional obligations or liabilities in connection with the sale, lease, rental or service of Products covered by this Agreement, and Dealer shall not do so. Case IH shall not be liable nor shall it defend, indemnify or in any way be obligated to assist Dealer in defense of any notice, claim, or lawsuit alleging the existence of a warranty beyond the terms and conditions of Case IH’s Limited Warranty for any Product.
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15.4
|
Disclaimer of Other W
arranties. Dealer agrees and acknowledges that, except for the warranty extended to Customers under Case IH’s Limited Warranty, and to the extent allowed by law, Case IH makes no other representations or warranties, express or implied (including implied warranties of merchantability and fitness for a particular purpose) to Dealer or any Customer with respect to Products.
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15.5
|
Non-Case IH Equipment and S
ervice. If Dealer installs on or attaches to a Product any non-Case IH equipment, attachment, accessory or part, Dealer shall advise Customer in writing that the non-Case IH equipment, attachment, accessory or part is not covered by the Limited Warranty. If Dealer sells any service contract not provided by Case IH
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15.6
|
Actions Voiding Limited Warranty
. Dealer acknowledges and agrees that any breach of Sections 5.4 or 5.5 may result in Case IH voiding the Limited Warranty for Products in its sole discretion, and Dealer must so advise its Customer in writing to whom such Product has been sold. In such a case where Case IH elects to void the Limited Warranty, as between Dealer and Case IH, Dealer shall be solely responsible for any warranty service claims relating to such Product.
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15.7
|
Use of Unauthorized P
arts. In the event Dealer breaches Section 10.1(d), Case IH in its sole discretion may (a) refuse to reimburse Dealer for such Warranty Service and/or Other Required Service, (b) void Case IH’s Limited Warranty for such Products, and/or (c) hold Dealer solely responsible for all Warranty Service relating to such Products.
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16.1
|
Financial Stateme
nts. Dealer shall submit to Case IH, within ninety (90) days after the end of Dealer’s fiscal year, audited (or where audited are not available then certified) balance sheets and financial statements for that year.
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16.2
|
Supplemental Financial R
ecords. Dealer shall submit monthly financial statements to Case IH in the manner directed by Case IH. Case IH reserves the right to request at any time personal financial statements from the Dealer Principal(s) or guarantor(s) of Dealer, and Dealer shall supply such statements within thirty (30) days.
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16.3
|
Sales R
eports. Dealer shall maintain and provide to Case IH upon request current reports of Equipment or Parts sales, owner registration, inventory, service and warranty reports, as well as such other reports as may be requested by Case IH.
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16.4
|
I
nspections. Dealer shall permit Case IH or its authorized representatives during normal business hours to (a) enter and inspect all Dealer Locations, (b) examine Dealer’s Product inventory, (c) test Equipment in Dealer’s possession, custody or control, (d) examine and audit Dealer’s books and records and all supporting data of Dealer’s business, and (e) make copies of any such records or accounts.
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16.5
|
Records R
etention. Dealer shall maintain for at least two (2) years all original records and documents relating to Dealer Claims submitted to or paid by Case IH.
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16.6
|
Chargeback for Improper or Unsubstantiated C
laims. Dealer’s submission of unsubstantiated Dealer Claims or Dealer Claims not in compliance with the requirements of the DOG will result in a chargeback to Dealer for such claims, including interest at the then current prime rate. If Dealer refuses to permit an audit, fails to maintain a substantial amount of the required records, or intentionally submits false or fraudulent Dealer Claims, the chargeback will include all amounts paid on Dealer Claims for the prior two (2) years, including any dealer settlement allowances, plus interest at the then current prime rate. This remedy is in addition to those available to Case IH for breach of this Agreement, including but not limited to termination of this Agreement.
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17.1
|
Dealer Management System R
equirements. Dealer shall install and maintain in good working order at each Dealer Location: (a) a computerized dealer management system (“DMS”) satisfactory to Case IH that maintains Case IH-to- DMS interfaces and functions to communicate and conduct business with Case IH’s computer applications and systems (the “System”); (b) a Dealer-to-Case IH network connection that meets or exceeds Case IH specified Dealer-to-Case IH connectivity requirements; and (c) all necessary hardware and software to maintain compatibility with the System.
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17.2
|
Case IH Applicati
ons. Dealer shall subscribe to, install and maintain required software applications as communicated to Dealer by Case IH or as set forth in the DOG, including (but not limited to) the Electronic Parts Catalog applications.
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17.3
|
Operating C
osts. Dealer shall pay all costs, including taxes, for the DMS, the Dealer-to-Case IH network connection, and any monthly access charges for use of the System.
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17.4
|
C
onfidentiality. Dealer shall keep confidential any information and data contained in the System, and shall not use the System or any information or data derived from the System for purposes unrelated to Dealer’s performance of its obligations under this Agreement.
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17.5
|
Disclaimer of Liabi
lity. Case IH shall not be responsible or liable for any defects, problems or resulting damages incurred by Dealer from the operation and use of the DMS, the Dealer-to-Case IH network connection, or the System.
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18.1
|
Marketing Assista
nce. To assist Dealer in its marketing and promotional efforts, Case IH will develop the following marketing and promotional materials: (a) training and videos of Product features, operations, demonstrations and competitive comparisons; (b) Product sales literature and brochures; (c) Product and promotional posters, banners and
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18.2
|
Communications to D
ealer. Dealer expressly consents to the receipt of unsolicited commercial faxes, emails, text messages, instant messages or other form of electronic communication, from Case IH, its Affiliates, or other Case IH- designated sender.
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18.3
|
Products and Services Provided by Case I
H. From time to time, Case IH will provide Dealer with certain products and services necessary for Dealer to market, sell and service Products. Dealer agrees that Case IH, in its discretion, may charge Dealer for any such products or services so provided.
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18.4
|
Dealer Knowledge of S
SM. Case IH expects Dealer to know and understand its market area and the promotional activities that would best be used to market Products within Dealer’s SSM. As such, it is Dealer’s responsibility to determine which marketing and promotional materials to use in its marketing efforts to meet its sales responsibilities under this Agreement.
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19.1
|
Purchase O
rders. Dealer may seek to purchase Products from Case IH under this Agreement by submitting purchase orders through Case IH’s System in accordance with instructions provided by Case IH. Case IH may specify in writing the minimum quantity of a given Product that Dealer shall be obligated to order at one time as a condition for filling such order, provided that such minimum quantity requirements will be consistently imposed on Dealers.
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19.2
|
Offer and A
cceptance. Dealer’s transmission of an order for Products through Case IH’s System will be a binding offer by Dealer to purchase the Products ordered, unless Case IH rejects the order. Purchase orders submitted by Dealer shall not be binding upon Case IH unless and until accepted in writing or electronically by Case IH. All orders for Products may not be canceled by Dealer, and shall be subject to Case IH’s then applicable conditions of sale.
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19.3
|
Delivery D
ates. Case IH shall endeavor to meet the delivery date specified in the System, but shall have no liability for failing to timely fill or deliver any order.
|
19.4
|
Product A
llocation. Case IH shall have the right to allocate delivery of Dealer’s Product orders based on their relative order or sales status as compared to other pending orders.
|
19.5
|
Product Shipmen
t. Case IH shall arrange delivery of Products to Dealer and reserves the right to determine the method and routing for such delivery. Case IH shall not be responsible for guaranteeing shipping rates or for delays in shipment. Case IH, in its discretion, may permit Dealer to designate orders for Will Call delivery pursuant to the terms of the DOG.
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19.6
|
Risk of Loss / Passage of T
itle. Case IH’s release of Products to any carrier for transportation to Dealer shall constitute delivery to Dealer for purposes of passage of title, and Dealer shall bear all risk of loss or damage to Products thereafter. For Will Call orders, risk of loss and passage of title shall be as set forth in the DOG.
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19.7
|
Equipment Trans
fer. The transfer of Equipment from Dealer to other authorized dealers of Products shall be in accordance with Case IH’s transfer program described in the DOG. Case IH shall have no liability as a result of any such transfer.
|
19.8
|
Product Return A
uthorization. Dealer agrees that no Products delivered to it hereunder are to be returned to Case IH without prior written authorization. Dealer shall pay all transportation charges on any returned Products authorized by Case IH, and Dealer is responsible for payment of all restocking charges stated in the DOG.
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20.1
|
P
rices. Unless otherwise authorized by Case IH, the price charged to Dealer for any Product shall be the price in effect at the time the Product is invoiced to Dealer.
|
20.2
|
Price C
hanges. Case IH reserves the right at any time to change its prices, terms, discounts and any other pricing provision for Products.
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20.3
|
P
ayment. Dealer shall pay Case IH for all Products immediately upon invoicing of Products to Dealer. The terms and conditions of sale and payments for all Products invoiced to Dealer shall be subject to Case IH’s applicable conditions of sale and prices as published and modified from time to time by Case IH. Failure to make payment in accordance with this provision may, in Case IH’s sole discretion, result in Case IH revoking the sale and repossessing the Product without notice or formality. Case IH reserves the right, without liability, to refuse to sell or deliver Products to Dealer when in Case IH’s opinion Dealer’s financial condition does not warrant or support further sales or deliveries.
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20.4
|
Equipment R
elocation. Case IH may request Dealer to transfer new Equipment to another authorized dealer to accommodate such dealer’s sale to another Customer. If Dealer refuses, Case IH, in its sole discretion, may decline to
|
20.5
|
Application of Money and C
redits. Any money or credits due and payable or becoming due and payable from Case IH to Dealer may be applied in any order Case IH may determine for the satisfaction, in full or in part, of any debts, liabilities or obligations due and payable or becoming due and payable or owing from Dealer to Case IH or its Affiliates.
|
21.1
|
Domestic Sales O
nly. Without Case IH’s prior written approval, Dealer shall not sell, lease or rent Products outside of the Domestic United States.
|
21.2
|
Retail Sales O
nly. Dealer shall sell Products only to retail Customers or to other authorized dealers of Products. As such, except for sales to authorized Case IH dealers, Dealer may not sell any Products at wholesale, including but not limited to sales to jobbers, jockeys, or other unauthorized dealers.
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21.3
|
No Deceptive or Unethical Practic
es. Dealer shall conduct business in a manner that will reflect favorably at all times on Dealer, Case IH, Products, Licensed Trademarks and other authorized dealers of Products. Dealer shall refrain from business practices, advertisements, promotions and conduct that are unethical, deceptive, misleading, fraudulent, confusing or would likely contravene any voluntary or involuntary advertising standard or any law. Dealer shall not make, directly or indirectly, any false or misleading statement or representation concerning any Product, its source, condition, capabilities, price, or charges for the Product’s distribution, delivery, taxes or other items.
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21.4
|
A
nnouncements. Dealer shall not publish public relation announcements that in any way involve or mention Case IH without Case IH’s prior written consent.
|
21.5
|
Compliance with Federal, State and Local L
aws. Dealer shall comply with all applicable federal, state, and local laws and regulations governing Dealer’s operations and its ordering, sales and service of Products, including without limitation those laws or regulations concerning safety, emissions control and customer service. Dealer shall obtain all governmental approvals, permits or licenses required to do business in its SSM.
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21.6
|
Compliance With Export L
aws. Certain Products purchased by Dealer from Case IH may be subject to United States export control laws. Dealer agrees that it is responsible for knowing and complying with such laws. Diversion contrary to United States law is prohibited.
|
21.7
|
Compliance with Fraud and Anti-Corruption Laws
.
|
(a)
|
Dealer and its Dealer Principals represent that they have not been convicted of, or pleaded guilty to, an offense involving fraud or corruption and that they are not now listed by any government agency as debarred, suspended, or proposed for suspension or debarment, or otherwise ineligible for any government bid or procurement programs. Dealer agrees to promptly inform Case IH of any change in this representation.
|
(b)
|
Dealer shall become familiar with and strictly comply with all applicable laws, statutes, regulations and codes relating to anti-bribery and anti-corruption, including but not limited to the United States Foreign Corrupt Practices Act and similar anti-corruption or anti-bribery laws. Dealer shall promptly report to Case IH any request or demand for any undue financial or other advantage of any kind received by Dealer in connection with the performance of this Agreement. Dealer warrants that it has no foreign public officials as direct or indirect owners, officers or employees at the date of this Agreement, and shall immediately notify Case IH in writing if a foreign public official becomes an officer or employee of Dealer or acquires a direct or indirect interest in Dealer.
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22.1
|
Product Changes and Improveme
nts. Case IH may make changes or improvements at any time in the specifications, construction, color and design of Products without incurring any obligation to Dealer or Dealer’s Customers.
|
22.2
|
Product D
iscontinuation. Case IH reserves the right at any time, without liability to Dealer, to discontinue the manufacture of any and all model(s), Equipment, or Product Line(s) under the Licensed Trademarks covered by this Agreement. Products shall be considered discontinued notwithstanding the fact that similar or identical products continue to be manufactured or sold by CNH Industrial America LLC or its Affiliates under Trademarks other than the Licensed Trademarks or brands for which this Agreement grants Dealer certain Product distribution rights. For any models, Equipment or Product Line(s) so discontinued, Case IH shall not be required to offer Dealer the right to represent a similar model, Equipment or Product Line(s), if any, marketed, manufactured or sold by CNH Industrial America LLC or its Affiliates under Trademarks other than the Licensed Trademarks or brand(s) listed on Schedule B.
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24.1
|
Trademark L
icense. Subject to and only in accordance with the terms and conditions of this Agreement, Case IH grants Dealer the right and Dealer accepts the obligation to make only Permitted Uses of the Licensed Trademarks set forth in Section 24.2 and to refrain from engaging in Prohibited Uses of the Licensed Trademarks set forth in Section 24.3. Dealer’s right to use the Licensed Trademarks is limited to the Permitted Uses during the term of this Agreement. Any unauthorized use of the Licensed Trademarks (including any of the Prohibited Uses) shall constitute an infringement of Case IH’s rights to the Licensed Trademarks in addition to a breach of this Agreement. In the event Dealer’s use of Licensed Trademarks (even though a Permitted Use) is unacceptable to Case IH in its sole discretion, Dealer must immediately cease such use of the Licensed Trademark upon notice from Case IH.
|
24.2
|
Permitted U
ses. Dealer shall and is permitted to: (a) use the Licensed Trademarks to identify and advertise its business at Dealer Locations in connection with the marketing, sale, distribution and service of Products under the Licensed Trademarks; (b) use the Licensed Trademarks only in connection with the marketing, sale, distribution and service of the Products for which Case IH has authorized them to be used; (c) identify itself (and not Case IH) as the owner of Dealer’s business in conjunction with any use of the Licensed Trademarks, including the use thereof on leases, invoices, order forms, receipts, and business stationery, as well as at such other locations and in the manner as Case IH may designate in the DOG; and (d) use the Licensed Trademarks to identify itself as an authorized dealer of Products.
|
24.3
|
Prohibited U
ses. Dealer shall not: (a) use the Licensed Trademarks (or any other Trademarks owned or licensed by Case IH or its Affiliates) as part of its corporate or other legal name without the prior written consent of Case IH; (b) sublicense or assign its right to use the Licensed Trademarks to any other person or entity; (c) use the Licensed Trademarks to incur any obligation or indebtedness on behalf of Case IH; (d) manufacture or purchase objects bearing Licensed Trademarks or Trademarks from unlicensed sources or apply, or have applied, Licensed Trademarks or Trademarks to objects that will be offered for sale or provided as promotional items by Dealer or any third party, specifically including but not limited to any clothing item (such as shirts, hats or other apparel), giftware, toys or other sundry items; and (e) register, attempt to register, obtain any ownership in, or otherwise use any Internet Registration (defined as any website, domain name, URL, internet/World Wide Web presence or feature, social media account designations, or other electronic communications portal) whose domain name, URL or other electronic communications portal contains, incorporates, or consists of the Licensed Trademarks or Trademarks without Case IH’s express written consent, which may be withheld for any or no reason.
|
24.4
|
Unauthorized Internet Registrations
. In the event that Dealer registers, attempts to register, obtains any ownership in, or otherwise uses any Internet Registration in violation of this Agreement, in addition to any rights Case IH may have under this Agreement, Dealer hereby acknowledges and agrees that any such Internet Registration, including any copyrights therein, shall be deemed to be the property of Case IH. Dealer will assign, transfer or assist in the perfection of any rights necessary to transfer said registration to Case IH with no compensation to Dealer and at no additional cost to Case IH. In the event that a court of competent jurisdiction determines that any ownership rights to any Internet Registration are not automatically transferred to Case IH pursuant to this Agreement, Dealer agrees to execute any documents deemed necessary by Case IH to give effect to this provision. Case IH may condition approval of Dealer’s use of any such Internet Registration on the transfer to Case IH of any and all ownership rights therein, including any copyrights. In the event that this Agreement expires or is terminated, Dealer shall not use or register a domain name that includes, or in Case IH's sole discretion is confusingly similar to, a Licensed Trademark or any other Trademark.
|
24.5
|
Notice of Trademark C
laims. Dealer shall promptly notify Case IH in writing of any suspected unauthorized or infringing use of the Licensed Trademarks, any challenge to the validity of the Licensed Trademarks, any challenge to Case IH’s ownership of the Licensed Trademarks, any challenge to Case IH’s right to use and license others to use such Licensed Trademarks, or any challenge to Dealer’s right to use the Licensed Trademarks.
|
24.6
|
Validity of Licensed Trademarks
. Dealer expressly understands and acknowledges that the Licensed Trademarks are valid and serve to identify Products and those authorized by Case IH to market, sell, distribute, and service Products. Dealer shall not directly or indirectly contest, attack, oppose, attempt to cancel or otherwise challenge in any manner or
|
24.7
|
Ownership of Licensed Trademarks and Goodw
ill. Dealer acknowledges the Licensed Trademarks are exclusively owned by Case IH. Dealer’s use of the Licensed Trademarks pursuant to this Agreement does not give Dealer any ownership interest or other interest in or to the Licensed Trademarks. Dealer shall execute any documents deemed necessary or useful by Case IH to obtain protection for the Licensed Trademarks or to maintain their validity and enforceability. Any and all goodwill arising from Dealer’s use of the Licensed Trademarks shall inure solely and exclusively to the benefit of Case IH. Upon expiration or termination of this Agreement, no monetary amount shall be attributable to any goodwill associated with Dealer’s use of the Licensed Trademarks or the sale and service of Products.
|
24.8
|
Nonexclusive L
icense. This Agreement grants Dealer only a nonexclusive right and license to use the Licensed Trademarks. Case IH has and retains the rights to use the Licensed Trademarks itself in connection with selling Products and services and to grant other licenses for the Licensed Trademarks and for Trademarks.
|
24.9
|
Discontinuation and Substitution of Licensed T
rademarks. Case IH reserves the right in its sole discretion to discontinue any Licensed Trademark and to substitute or add different Licensed Trademarks for use in identifying Products or the dealers authorized to sell or service Products. Dealer shall implement promptly any such substitution or addition of new Licensed Trademarks.
|
24.10
|
C
opyrights. Dealer shall not copy any aspect or portion of Case IH's website or other electronically stored information or printed documents or publications without the express prior written consent of Case IH.
|
25.1
|
Software L
icense. Dealer acknowledges that certain Products contain imbedded computer software and related technology (collectively, “Authorized Software”) in which Case IH owns or licenses copyrights and/or other intellectual property rights. During the term of this Agreement, Case IH grants Dealer a non-transferable, royalty-free license to use Authorized Software in object code form only (“Software License”). The Software License is limited to the sale and service of any Product containing Authorized Software only in the manner authorized by Case IH in writing. Except as expressly authorized by this Agreement, Dealer may not sublicense Authorized Software to any other entity nor assign its Software License. This Agreement does not grant Dealer any right, title, or interest in Authorized Software anywhere in the world except the Software License granted herein. Dealer acknowledges that the use of any Product containing Authorized Software may require a Software License from Case IH. Case IH reserves the right to require all users of Products containing Authorized Software to possess a valid license in the form prescribed by Case IH, and in such case Dealer shall not transfer or permit the transfer or use of any Product containing Authorized Software unless the transferee or user is subject to such valid license. This Software License shall continue until it is terminated in accordance with this Agreement, or for the useful life of the Product in which Authorized Software is imbedded or of which Authorized Software is an integral part, or for the useful life of Authorized Software, whichever is shorter.
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25.2
|
Automatic T
ermination. The Software License shall automatically terminate upon the occurrence of any of the following:
|
26.1
|
Company I
nformation. Periodically, Case IH will provide Dealer with proprietary, confidential information, technical knowledge and/or assistance, and other materials that derive value from not being generally known in the industry (“Company Information”) that are reasonably necessary for the distribution, sale, promotion and service of Products. Case IH has sole discretion to determine what information it provides to Dealer is Company Information. Dealer agrees that Company Information remains the property of Case IH. Dealer must take commercially reasonable measures, but in any event no less strict than the measures Dealer uses with its own confidential information, to maintain the confidentiality of Company Information and to ensure that all Company Information is used only to sell and service Products in accordance with this Agreement. Dealer may disclose Company Information only to those of its employees who will need it and must take all necessary measures to ensure that those persons do not reveal Company Information to any third parties without the prior written authorization of Case IH. Dealer shall be responsible and liable to Case IH for any breach of this provision by its employees, agents or representatives.
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26.2
|
Return of Company I
nformation. Dealer acknowledges that Case IH provides Company Information to Dealer for use by Dealer pursuant to this Agreement. Therefore, upon expiration or termination of this Agreement for any reason, Dealer shall immediately return to Case IH all Company Information in any form.
|
26.3
|
No Reverse Eng
ineering. Dealer shall not engage in, cause to be engaged in, or permit any reverse engineering of Authorized Software, Products, or component parts thereof. “Reverse engineering” is defined as attempting through analysis of Products or component parts thereof to determine their functionality and thereby gain the ability to alter or reproduce that functionality.
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26.4
|
Right to Use Case IH I
P. Dealer shall use Case IH IP only in accordance with the provisions of and for the purposes contemplated by this Agreement and in accordance with any procedures that Case IH may establish for use of Case IH IP.
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27.1
|
Term of Agreement and R
enewal. This Agreement shall commence on the Effective Date and continue to the Expiration Date (“Term”). The Expiration Date of this Agreement shall be extended for additional successive five (5) year periods unless, at least ninety (90) days prior to the Expiration Date or the expiration date of any subsequent extension period, either party notifies the other of its intention not to extend. Upon such notification not to extend, this Agreement shall expire on the Expiration Date or at the expiration date of any extension period.
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27.2
|
Replacement A
greement. In the event Case IH offers to all authorized dealers in the state of Dealer’s Primary Location a new dealer agreement or an amendment to this Agreement (“Replacement Agreement”), Case IH may terminate this Agreement at any time by providing Dealer with at least one hundred eighty (180) days’ prior written notice and shall furnish Dealer a copy of the Replacement Agreement with such notice. Dealer’s return to Case IH of an executed Replacement Agreement shall not give rise to any repurchase rights and obligations provided for in Section 29.
|
27.3
|
B
reach.
|
(a)
|
Except where termination of the Agreement due to Dealer’s breach is allowed immediately pursuant to Section 27.4, and except as stated in Sections 27.3(b) and (c), in the event that either Dealer or Case IH fails to fulfill any of their responsibilities under this Agreement, the other party may terminate this Agreement by providing ninety (90) days’ written notice listing the reasons for termination, within which period the other party will have sixty (60) days to rectify the identified breach and avoid termination.
|
(b)
|
If Dealer breaches Section 7.2, Case IH may, in its sole discretion, terminate the Agreement upon ninety (90) days’ advance written notice to Dealer. However, during this ninety (90)-day period, Dealer may cure its breach of Section 7.2 by providing Case IH, within sixty (60) days of Case IH’s notice to Dealer, a written plan to return to compliance with Section 7.2 within twelve (12) months from the date of Case IH’s notice. Thereafter, if Dealer fails to perform such submitted plan, Case IH may terminate the Agreement with thirty
|
(c)
|
If Dealer is in breach of Section 9.1(a), Case IH may terminate Dealer for such default only after providing Dealer with written notice and a twelve (12)-month period within which Dealer may cure such default to Case IH’s sole satisfaction.
|
(d)
|
A breach by Dealer of any other written agreements between Dealer and Case IH or its Affiliates that is due to fraud committed by Dealer, shall also be considered a breach under this Agreement allowing Case IH to immediately terminate the Agreement.
|
(e)
|
As an additional or alternative remedy for any breach by Dealer of the Agreement, Case IH, in its sole discretion and after providing Dealer with an opportunity to cure said breach as provided in Sections 27.3(a),
|
27.4
|
Immediate T
ermination. Case IH may terminate this Agreement immediately upon the occurrence of any of the following events:
|
(a)
|
Dealer Financial D
efaults: (i) Dealer’s default in the payment when due of any obligations to Case IH or any of its Affiliates, including but not limited to CNH Industrial Capital America LLC (“CNH Capital”); (ii) Dealer’s default under any chattel mortgage or other security agreement between Dealer and Case IH, any of its Affiliates or any other lender or financing entity; or (iii) the refusal or failure of Dealer upon demand to account to Case IH or any of its Affiliates for the proceeds of the sale of Products for which Dealer is indebted to Case IH or such Affiliates;
|
(b)
|
Loss of Wholesale Credit L
ine: the termination (or suspension where such suspension continues for more than sixty (60) calendar days), of any of Dealer’s significant wholesale lines of credit for the purchase of new Products;
|
(c)
|
I
nsolvency: (i) the filing of a voluntary or involuntary petition in bankruptcy by or against Dealer; (ii) the making of an assignment by Dealer for the benefit of creditors; (iii) a closeout or sale of a substantial part of Dealer’s assets related to the business; (iv) the commencement of dissolution, receivership or liquidation proceedings by or against Dealer; (v) the insolvency of Dealer; or (vi) the levy of a writ of attachment or execution against Dealer;
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(d)
|
Change in Dealer Entity, Control, Ownership or Management
: without the prior written consent of Case IH: (i) any change in Dealer’s legal form or entity; (ii) any change in Dealer’s control, ownership or management (as defined in Section 4.3) listed in Schedule A; or (iii) any assignment or attempted assignment by Dealer of this Agreement;
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(e)
|
Death or I
ncapacity: if Dealer fails to provide Case IH with an acceptable ownership or management succession plan as set forth in Section 4.4 upon the death or incapacity of any Dealer Principal;
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(f)
|
Misrepresented or False Informati
on: Dealer or anyone acting on its behalf has: (i) submitted false records, contracts, statements, reports or documents to Case IH or any of its Affiliates, including CNH Capital; (ii) submitted any false or fraudulent documents for Dealer Claims or in support thereof; (iii) knowingly accepted any payment from Case IH for any work not performed by Dealer in accordance with the provisions of this Agreement or the DOG; or (iv) submitted false information in applying for appointment as an authorized dealer of Products;
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(g)
|
Failure to Operate
: failure to operate any Dealer Location in the normal course of business for seven (7) consecutive calendar days;
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(h)
|
Criminal and/or Tortious C
onduct: Dealer or any Dealer Principal has pleaded guilty to or been convicted of a felony or any other violation of law that in Case IH’s opinion affects adversely the operation or business of Dealer, or the good name, goodwill or reputation of Case IH, Products, Licensed Trademarks, Dealer, or other authorized dealers of Products;
|
(i)
|
Dealer Closure/Loss of License
: (i) a permanent closure of any Dealer Location without the prior written consent of Case IH; or (ii) the revocation, suspension or other invalidation of any Dealer license, permit or authorization necessary to conduct business pursuant to this Agreement;
|
(j)
|
Inspection/Audit R
efusal: any failure by Dealer to permit Case IH to inspect or audit Dealer’s inventory or business and financial records pursuant to Section 16.4;
|
(k)
|
Detrimental Cond
uct: any conduct by Dealer or any Dealer Principal which in the sole discretion of Case IH:
|
(l)
|
Breach of Confid
entiality: any misuse or unauthorized disclosure of Case IH IP, Company Information or Authorized Software;
|
(m)
|
Revocation of Gu
aranty: the withdrawal or revocation of a guaranty of Dealer’s indebtedness to Case IH or its Affiliates by one or more personal or corporate guarantors;
|
(n)
|
Incurable B
reach: any breach of the Agreement that is incapable of being remedied by an affirmative present action by the Dealer;
|
(o)
|
Repetitive B
reach: breach of the Agreement by Dealer for which it has received notice by Case IH of that same type of breach on at least two (2) prior separate and distinct occasions;
|
(p)
|
Unauthorized L
ocation: any breach of Section 12.2 of the Agreement.
|
27.5
|
Case IH’s Exercise of Termination R
ights. Case IH may exercise its termination rights under Sections 27.3 and 27.4 without regard to the performance of other authorized dealers or to the circumstances under which Case IH has terminated or refrained from terminating the sales and service agreements of other authorized dealers.
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27.6
|
Termination At W
ill. This Agreement may be terminated at any time at will, without cause, upon sixty (60) days’ written notice by Dealer to Case IH, or as mutually agreed upon in writing by both Parties.
|
28.1
|
Dealer’s O
bligations. Upon the termination or expiration of this Agreement, Dealer shall cease to operate or represent itself as an authorized dealer of Products under the Licensed Trademarks, and shall promptly: (a) cease using the Licensed Trademarks and remove from Dealer Locations and vehicles all signs or advertising displays that bear the Licensed Trademarks; (b) remove and discontinue the use of, and cause any third party to remove, any identification
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28.2
|
Pending O
rders. Termination or expiration of this Agreement shall relieve Case IH of any obligation to make any further shipments of Products, and Case IH may without liability cancel any of Dealer’s unshipped orders for Products. For any Products which Case IH may ship after termination or notice thereof, Case IH may require payment prior to shipment.
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28.3
|
Financial Obligati
ons. Upon the termination or expiration of this Agreement, all indebtedness of Dealer shall become immediately due and payable to Case IH, and Dealer shall promptly pay Case IH all sums owed by Dealer. Final settlement of Dealer’s account with Case IH shall not be made until Dealer complies with all requirements of this Agreement.
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28.4
|
Continued Market P
resence. In advance of the effective date of termination, the scheduled Expiration Date or the expiration of any extension period of this Agreement, Case IH may consummate arrangements to appoint a replacement authorized dealer for Dealer’s SSM.
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28.5
|
Post-Termination T
ransactions. Any business relations or transactions between the Parties after expiration or termination of this Agreement shall not constitute a waiver of the expiration or termination of this Agreement or in any manner reinstate the Parties’ contractual relationship, or establish any new contractual relationship, and all such relations shall be governed by terms and conditions identical to the relevant provisions of this Agreement unless the Parties execute a new agreement superseding this Agreement.
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28.6
|
Pre-Termination Warranty S
ervice. Case IH will reimburse Dealer for all Warranty Service claims performed prior to the expiration or termination of this Agreement that meet the requirements of the DOG.
|
29.1
|
Items Subject to R
epurchase. Within thirty (30) days after the termination or expiration of this Agreement, either Case IH or Dealer may request in writing the return for repurchase of all of the following items originally purchased from Case IH by Dealer, on the terms specified herein, and Dealer shall return such items to Case IH as follows:
|
(a)
|
E
quipment.
|
(i)
|
Equipment Eligible for Repurcha
se. New, undamaged, salable, current, complete and unused Equipment, including attachments, purchased from Case IH and delivered to Dealer within twenty- four (24) months of the date this Agreement terminates or expires (“Repurchasable Equipment”). For purposes of this Section, “current” means the model or series of Equipment listed in Case IH’s price book or price list at the date of termination or expiration of the Agreement. Case IH will only repurchase separate attachments that were not previously installed on Equipment and which were invoiced separately to Dealer.
|
(ii)
|
Equipment Repurchase P
rice. Repurchasable Equipment shall be repurchased at the price paid by Dealer (A) not including transportation costs actually paid or incurred by Dealer for initial delivery,
|
(b)
|
Parts
.
|
(i)
|
Parts Eligible for R
epurchase. New, undamaged, salable, complete and unused Parts purchased from Case IH by Dealer, that are listed as of the date of termination or expiration of the Agreement in Case IH’s then current Price List and not identified as discontinued in such Price List (“Repurchasable Parts”). Repurchasable Parts must be in original Case IH packaging with their original authorized Case IH identification label and must be properly identified prior to shipment to Case IH for repurchase. Case IH specifically excludes from repurchase Parts that: (A) have a limited shelf life or contain flammable or hazardous materials; (B) are direct shipped from a supplier other than Case IH; (C) have an altered or counterfeited identification label; (D) are in broken packaging;
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(ii)
|
Parts Repurchase P
rice. Repurchasable Parts shall be repurchased at the then current dealer price (less discounts and freight), less a restocking charge as set forth in the Parts Return Policy.
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(iii)
|
Merchandise Item
s. ‘Merchandise’ items such as clothing, toys, binders, gloves, etc., are not eligible for repurchase.
|
(c)
|
S
igns.
|
(i)
|
Signs Eligible for R
epurchase. External flag mast, pole or monument sign purchased from a vendor authorized by Case IH that displays the Licensed Trademarks or any other Trademarks, excluding any building fascia (“Repurchasable Signs”).
|
(ii)
|
Sign Repurchase P
rice. Repurchasable Signs shall be repurchased at the amount paid by Dealer, less an annual depreciation of twenty-five percent (25%).
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29.2
|
Return P
rocedures. Within sixty (60) days after the date of the written request made pursuant to Section 29.1, Dealer shall return to Case IH all items subject to repurchase or required to be returned pursuant to this Agreement. All items returned to Case IH shall be identified as required by Case IH, packed, boxed, crated and loaded by Dealer and shipped at Dealer’s expense and risk of loss to the destination or destinations specified by Case IH. The procedure for the repurchase of Repurchasable Parts shall be further subject to the Parts Return Policy issued by Case IH and in effect on the date of termination or expiration of the Agreement. Upon receipt of returned items, Case IH shall inspect them and issue credit to Dealer for all such items returned that meet the requirements specified in this Agreement and the DOG, less any amounts owed to Case IH or its Affiliates by Dealer. Any items returned to Case IH facilities that are not properly returnable as prescribed by this Agreement, shall be, at Dealer’s option, either destroyed or returned to Dealer at its cost. Dealer shall transfer all returned items by warranty bills of sale satisfactory to Case IH, if so requested.
|
29.3
|
Conditions Precedent to Payment
. Any costs incurred by Case IH in discharging all or any part of Dealer’s obligations under this Agreement, including but not limited to Dealer’s obligations to cease all use of the Licensed Trademarks or to pack, load and ship Parts to Case IH, shall be deducted from any amount owed by Case IH to Dealer. Dealer shall not be entitled to payment or credit for returned items until Dealer has complied with all applicable laws, rules, regulations and other legal requirements governing the bulk transfer of inventory or similar protection of creditors. Case IH shall have the right to withhold from the price of any items repurchased pursuant to this section a sum sufficient to discharge any liens or encumbrances against such items and to discharge such liens or encumbrances. Dealer shall execute such documents and take any additional action requested by Case IH to transfer ownership of returned items, free and clear of any claims, liens or encumbrances.
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29.4
|
Other Return Item
s. Upon expiration or termination of this Agreement, Dealer shall return to Case IH any materials (such as sales promotion, advertising and training materials, tools and signs) provided without charge to Dealer by Case IH or any predecessor.
|
30.1
|
Dealer Responsibility for Operating C
apital. This Agreement contemplates that Dealer, as an independent business, shall obtain on its own the capital investment necessary to operate its business. Nothing in this Agreement shall impose any liability on Case IH in connection with Dealer's operations under this Agreement or otherwise, or for any expenditure made or incurred by Dealer in preparation for performance or in performance of Dealer's responsibilities under this Agreement.
|
30.2
|
Disclaimer of Consequential Dam
ages. The Parties both understand and agree that this Agreement is of a limited duration, and therefore, except as provided herein, neither party shall be liable to the other for any damages caused by the termination or expiration of this Agreement, whether based upon loss of anticipated sales or prospective profits, expenditures, investments, leases, property improvements or other matters related to the business of the Parties. The damages to which either party may be entitled for breach of this Agreement are limited to actual out-of-pocket expenses incurred as a direct result of the breach.
|
30.3
|
Waiver of Punitive D
amages. The Parties hereby waive, to the fullest extent permitted by law, any right or claim for any punitive or exemplary damages against the other and agree that if there is a dispute with the other that each party shall be limited to the recovery of actual damages sustained by it.
|
30.4
|
No Group L
itigation. The Parties agree that any and all dispute resolution proceedings between them, including litigation, arising from or related to this Agreement shall be conducted on an individual basis only. Neither Party shall commence any dispute resolution with a third-party against the other, or join with any third party in any dispute resolution involving
|
30.5
|
Limitations Period
. All claims for any breach of this Agreement, and all claims arising out of the relationship between the Parties established by this Agreement, shall be made within two (2) years from the date such claim accrued.
|
31.1
|
Indemnification By Case I
H.
|
(a)
|
Licensed T
rademarks. If Case IH reasonably determines that Dealer has used the Licensed Trademarks in accordance with this Agreement, Case IH shall defend, indemnify, and hold harmless Dealer from all loss, cost, liability, and expense arising out of any claim, suit or demand regarding Dealer’s use of the Licensed Trademarks. If Case IH, in its sole discretion, determines that Dealer has not used the Licensed Trademarks in accordance with this Agreement, Dealer shall bear the cost of such defense, judgment or settlement.
|
(b)
|
Authorized S
oftware. Case IH shall defend, indemnify, and hold Dealer harmless from all loss, cost, liability, and expense arising out of any claim that Authorized Software used in accordance with its documentation infringes any valid patent, copyright, trade secret, or other enforceable proprietary right of any third party. Should any Authorized Software become (or in Case IH’s opinion be likely to become) subject to such a claim, Dealer will permit Case IH, at Case IH’s option and expense to (a) procure for Dealer or Dealer’s Customers the right to continue to use Authorized Software or (b) modify the allegedly infringing Authorized Software so that it becomes non-infringing. Case IH’s obligations under this Section will not apply if Authorized Software is modified without Case IH’s consent.
|
(c)
|
Case IH I
P. Except as otherwise provided in this Section with respect to Authorized Software and Licensed Trademarks, Case IH will indemnify, defend and hold harmless Dealer from all loss, cost, liability, and expense arising out of any claim based on an allegation that any Product infringes a valid patent, copyright, or trademark or misappropriates any protectable and enforceable trade secret. Case IH shall have no obligations under this provision for any Product that has been the subject of unauthorized modifications by Dealer or any third party or for infringement that results from the use of intellectual property other than Case IH IP in conjunction with Case IH IP that would otherwise not be infringing. If any Product becomes, or in Case IH’s opinion is likely to become, subject to such a claim of infringement, Case IH will, at its expense and at its option, either procure the right for Dealer and Dealer’s Customers to continue using the infringing Product(s) or replace or modify the Case IH Product(s) so that they are no longer infringing. Upon failure of the foregoing provisions, Case IH may, at its option, refund the purchase price for the infringing Product(s) less a reasonable allowance for use. This section states the entire liability of Case IH for infringement by any Product.
|
(d)
|
Dealer Cooperati
on. In the event of any litigation relating to Dealer’s use of the Licensed Trademarks, Authorized Software, or Case IH IP, Dealer shall promptly notify Case IH of such litigation and shall execute any and all documents and undertake such acts as may, in the opinion of Case IH, be necessary or useful to carry out such defense or prosecution, including becoming a nominal party to any legal action. Except to the extent that such litigation is the result of Dealer’s use of the Licensed Trademarks, Authorized Software, or Case IH IP in a manner inconsistent with the terms and conditions of this Agreement, Case IH agrees to reimburse Dealer for its out-of-pocket costs in undertaking such acts.
|
(e)
|
Control of L
itigation. Dealer acknowledges that Case IH has the right to direct and control any administrative proceeding or litigation involving the Licensed Trademarks, Authorized Software, or Case IH IP, including any settlement thereof. Case IH agrees to consult with Dealer regarding any settlement in which Dealer would be required to financially participate and to obtain Dealer’s consent to any such settlement, which consent will not be unreasonably withheld. Case IH has the right, but not the obligation, to take action against uses by others that may constitute infringement of the Licensed Trademarks, Authorized Software or Case IH IP. If Dealer fails to notify Case IH promptly of any litigation or refuses to give Case IH sole control of the defense and/or prosecution of such litigation and all settlement negotiations, Case IH will be relieved of its obligations under this Section.
|
31.2
|
Indemnification by D
ealer. Dealer agrees to defend, hold harmless and indemnify Case IH, its Affiliates and their respective shareholders, directors, officers, agents, employees, successors and assigns from and against any and all claims, damages, demands, settlements, judgments, legal actions, liabilities, costs and expenses of any nature, including without limitation, attorney's fees and court costs, resulting from the acts and/or omissions of Dealer, including but not limited to: (i) Dealer’s defrauding of or misrepresentations to customers; (ii) Dealer’s actions in violation of Sections 5.3, 5.4, 5.5, 10.1(d), 11.1, 11.2, 11.3, 11.5, 14.2, 15.2, 15.3, 15.4, 15.5, 15.6, 21.3, 21.5, 21.6, and 21.7; or (iii) Dealer’s
|
32.1
|
Governing L
aw. This Agreement shall be governed by and interpreted according to the laws of the state of Dealer’s Primary Location, without regard to such state’s conflicts of laws rules and except to the extent governed by the United States Trademark Act of 1946 (Lanham Act), the Copyright Act, and the Patent Act.
|
32.2
|
Consent to Jurisdiction and Venu
e. Dealer irrevocably submits itself to the exclusive jurisdiction of the federal court of the Milwaukee Division of the Eastern District of Wisconsin for the purpose of any suit, action, or other proceeding arising out of or relating to this Agreement, or of any of the transactions contemplated thereby, and irrevocably agrees that all claims in respect of such suit, action or proceeding may be heard and determined in such federal court, provided that Case IH may apply to any court of competent jurisdiction for interim protection or equitable relief such as an interlocutory or interim injunction. If the federal court of the Eastern District of Wisconsin lacks jurisdiction for any reason to hear such claims, Dealer irrevocably submits itself to the exclusive jurisdiction of the Circuit Court of Racine County, Wisconsin. By execution and delivery of this Agreement, Dealer irrevocably waives, to the fullest extent it may effectively do so, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action, or proceeding, any claim that it is not personally subject to the jurisdiction of the above-named courts for any reason whatsoever. The Parties agree that a final judgment (as to which all appeals have been exhausted or the time within which such appeals may be made has expired) in any such suit, action or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment or in any other manner provided by law.
|
32.3
|
Compliance With Local L
aws. The rights and obligations of the Parties to this Agreement may be subject to certain laws, orders, regulations, directions, restrictions, and limitations of governments and governmental agencies having jurisdiction over the Parties. If a change in any such law, order, regulation, direction, or restriction (including any limitation, appropriation, seizure, or interpretation thereof) shall, in the judgment of either party, substantially alter the relationship between the Parties, this Agreement, or the advantages derived from the Parties’ relationship, either party may request the other party to modify this Agreement. If, within thirty (30) days after such a request has been made, the Parties are unable to agree upon a mutually satisfactory modification of this Agreement, then the adversely affected party may terminate this Agreement on fifteen (15) days’ notice given to the other party.
|
32.4
|
Information S
haring. Case IH shall be allowed to share information regarding Dealer, including but not limited to Dealer’s financial and ownership information, with any of Case IH’s Affiliates.
|
32.5
|
Dealer Relationship to Case I
H. The Parties are independent businesses and neither has any fiduciary obligation to the other, and Dealer is an independent retailer which purchases Products for resale for Dealer’s principal benefit. Nothing in this Agreement shall be construed as constituting Dealer to be an employee, franchisee, agent or legal representative of Case IH for any purpose whatsoever. Dealer has no right or authority, express or implied, to assume or create any obligation or responsibility on behalf of or in the name of Case IH, or to bind Case IH in any manner.
|
32.6
|
Entire A
greement. This Agreement, together with the DOG and any changes thereto issued by Case IH from time to time, is and shall be deemed to be the complete and final expression of the agreement between the Parties as to the matters herein contained and provided for and supersedes all previous agreements between the Parties pertaining to such matters. IT IS CLEARLY UNDERSTOOD THAT NO PROMISE OR REPRESENTATION NOT CONTAINED HEREIN WAS AN INDUCEMENT TO EITHER PARTY OR WAS RELIED UPON BY EITHER PARTY IN ENTERING INTO THIS AGREEMENT.
|
32.7
|
Execution and M
odification. Except as expressly provided for herein, this Agreement may not be executed, amended or altered, or any of its provisions waived on behalf of Case IH, except in writing, signed by Case IH’s Director of Network Development or other authorized director in a similar capacity.
|
32.8
|
S
everability. In the event any part of this Agreement is held to be invalid or unenforceable under the law, this Agreement shall be enforceable to the maximum extent permitted by such law, without invalidating the remainder of this Agreement, or invalidating the effect of such portion of this Agreement elsewhere.
|
32.9
|
A
ssignment.
|
(a)
|
By D
ealer. In view of the personal nature of this Agreement, the rights, privileges and obligations conferred on Dealer under this Agreement are not transferable, assignable or salable by Dealer without the prior written consent of Case IH, and no property right or interest, direct or indirect, is sold, conveyed or transferred to Dealer under this Agreement. Any attempt by Dealer to assign its rights or obligations under this Agreement without Case IH’s written consent shall be null and void.
|
(b)
|
By Case
IH. Upon written notice to Dealer, Case IH may assign this Agreement and any rights and obligations thereunder to any Affiliate of Case IH or to any entity that succeeds to the interests of Case IH.
|
32.10
|
Waiver of D
efault. The waiver by Case IH of any default, or the failure of Case IH to exercise any of its rights, under this Agreement or otherwise shall not act as a waiver of such default or any subsequent default or a waiver of any of Case IH’s rights hereunder.
|
32.11
|
H
eadings. The headings of sections and subsections in this Agreement are inserted for convenience of reference only and shall not in any way affect the construction, meaning or interpretation of any provision of this Agreement, and shall not be deemed or construed in any way to limit the meaning of such sections.
|
32.12
|
I
nterpretation. This Agreement is being entered into by and among competent and sophisticated parties who are experienced in business matters. Therefore, any language in this Agreement deemed to be ambiguous by a court of law will not be construed against any particular party as the drafter of the language.
|
32.13
|
Notice, Approval and C
onsent. Any notice, approval or consent required or allowed under this Agreement shall be given in writing and, without prejudice to other forms of actual service, shall be considered as served upon being mailed in a properly sealed envelope with first class, certified or registered postage prepaid. Notices to Case IH shall be addressed to the Case IH Regional Dealer Development Manager for Dealer’s assigned region and shall be delivered or mailed to CNH Industrial America LLC, 621 State Street, Racine, Wisconsin 53402. Notices to Dealer shall be delivered or mailed to any person designated in Schedule A or to Dealer at Dealer’s Primary Location.
|
32.14
|
S
urvival. The Parties’ obligations in the following sections shall survive the expiration or termination of this Agreement: 5.5, 10.1(f), 16.6, 17.4, 24.4, 26.1, 26.2, 28.1, 28.3, 28.6, 29.1, 29.2, 29.3, 29.4, 30.2, 30.3, 30.4, 30.5, 31.1, 31.2, 32.1, 32.2, and 32.3.
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32.15
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Review by Couns
el. Dealer acknowledges that it has had an adequate opportunity to review this Agreement and consult with legal counsel of its own choosing regarding the content and meaning of this Agreement.
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Case IH
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CNH Industrial America LLC
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TOTAL AG
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SPS
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SSL
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LT
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AG
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FW
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GH
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HF
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DT
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SF
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FT
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AS
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PT
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TF
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SC
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CT
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TS
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SL
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Dealer City
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Dealer State
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60 HP &
Under Plus Case IH Scouts
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2WD
Tractors above 60 HP
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4WD
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Combine
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H&F
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Yield Till
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Strip Till
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Pull Fert.
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Air Seed
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Pull Spray
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Floater
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Sugar- cane
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Cotton
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SP Spray
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Skid Steer
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Product Lines and County SSM Assignment
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|||||
Dealer Code
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Dealer City, State
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County Assignment
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ST
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Total AG
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SPS
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SSL
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Type
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Street Address
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City
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ST
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Zip Code
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Equipment, Parts &
Service
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Parts Only
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Parts & Service
Only
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Set-up Facility
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Corp Office
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GSC
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Dual Location
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Primary
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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2.
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Section 4.2 of the Agreement is deleted.
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3.
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Section 4.3 of the Agreement is replaced in its entirety with the following:
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4.3
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Changes in Dealer Form and Control
. Dealer shall provide Case IH with sixty (60) days’ prior written notice of Dealer’s intention to change its: (a) legal form or entity; or (b) control or management (a “Change of Control” as defined below); provided that, in the event that Dealer is not aware of such event, notice shall be furnished as soon as reasonably practical after Dealer acquires knowledge. Prior to consummating any such change described in this paragraph, or following such change if Dealer had no advance knowledge, Dealer must obtain Case IH’s written consent.
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(ii)
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any sale of all or substantially all of Dealer’s assets;
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4.
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Section 4.4 of the Agreement is replaced in its entirety with the following:
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4.4
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Death or Incapacity of Dealer Principals
. In the event of the death or incapacity of any person listed in Schedule A (“Dealer Principal(s)”), Dealer shall provide Case IH within ninety (90) days of such occurrence, an ownership or management succession plan for the replacement of such deceased or incapacitated Dealer Principal(s), if Dealer proposes to continue operation under this Agreement. Case IH may approve or deny Dealer’s proposed succession plan in its reasonable discretion.
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5.
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Section 4.6 of the Agreement is replaced in its entirety with the following:
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6.
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Section 9.1(a) of the Agreement is replaced in its entirety with the following:
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7.
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Section 9.2 of the Agreement is replaced in its entirety with the following:
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8.
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Section 13.1 of the Agreement is replaced in its entirety with the following:
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10.
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Section 16.6 of the Agreement is replaced in its entirety with the following:
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11.
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Section 20.4 of the Agreement is replaced in its entirety with the following:
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12.
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Section 21.1 of the Agreement is replaced in its entirety with the following:
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13.
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Section 21.4 of the Agreement is replaced in its entirety with the following:
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15.
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Section 27.3(b) of the Agreement is replaced in its entirety with the following:
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16.
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Subparagraphs (a), (c), (g), (h), (k) and (o) of Section 27.4 of the Agreement are amended as follows:
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(a)
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Dealer Financial Defaults
: (i) Dealer’s default in the payment when due of any obligations to Case IH or any of its Affiliates, including but not limited to CNH Industrial Capital America LLC (“CNH Capital”) after the expiration of any notice and cure periods in any applicable agreements with Case IH’s Affiliates or CNH Capital;; (ii) Dealer’s default under any chattel mortgage or other security agreement between Dealer and Case IH, any of its Affiliates or any other lender or financing entity with whom Dealer has a material credit arrangement (i.e., a credit arrangement for which the relevant agreements must be publicly disclosed pursuant to federal securities laws), if such default results in an acceleration of the indebtedness owed under the credit facility; or (iii) the refusal or failure of Dealer, following written demand, to account to Case IH or any of its Affiliates for the proceeds of the sale of Products for which Dealer is indebted to Case IH or such Affiliates;
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c.
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Subparagraph (d) of Section 27.4 is replaced in its entirety with the following:
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d.
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Subparagraph (g) of Section 27.4 is replaced in its entirety with the following
:
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e.
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Subparagraph (h) is amended to delete “or any Dealer Principal” from such section.
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f.
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Subparagraph (k) of Section 27.4 is replaced in its entirety with the following:
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g.
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Subparagraph (o) of Section 27.4 is replaced in its entirety with the following:
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By:
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Officer of CNH
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2.1
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Affiliate
: as to New Holland, any entity that directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with New Holland. For this definition, the term “control” means the power to direct the management and policies of an entity through the ownership of more than 50% of the voting securities, rights or other similar interests of that entity.
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2.2
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Branch Location(s)
: Dealer’s additional place(s) of business listed in Schedule D for the sale, rental, lease and service of Products, separate from Dealer’s Primary Location.
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2.3
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Customer(s)
: an end-user that purchases, leases or rents Products from an authorized dealer or New Holland for its own use and not for resale.
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2.4
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Dealer Claims
: Dealer’s claims to New Holland for Warranty Service, Other Required Service, or any retail promotional or sales incentive, including but not limited to refunds, credits, rebates, incentives, allowances, discounts, or payments under any New Holland program.
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2.5
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Dealer Location(s)
: Dealer’s Primary Location and Branch Locations, if any, authorized by New Holland for the sale, rental, lease and service of Equipment and/or Parts.
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2.6
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Dealer Market Share
: a percentage figure for measuring Dealer’s sales performance calculated by taking the number of units of new Equipment, by Product Line or Product Line grouping, sold by Dealer to Customers located within Dealer’s Primary Market of Responsibility (“PMR”), during a given time period as determined by New Holland, divided by the total industry volume of all new units of equipment of that same Product Line or Product Line grouping (including New Holland and competitive units) sold within Dealer's PMR during that same period, as determined and reported by the Association of Equipment Manufacturers (or other replacement organization selected by New Holland, hereinafter “AEM”). For market share purposes, Dealer will only be measured against the industry sales in a given county of Dealer’s PMR to the extent of the percentage of that county assigned to Dealer.
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2.7
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Domestic
: within the 50 states of the United States of America.
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2.8
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DPM
: refers to both the Dealer Policy Manual and Parts Policy Manual or any equivalent or successor documents and amendments thereto issued by New Holland setting forth for all dealers the various policies, procedures and operating standards for doing business with New Holland.
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2.9
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Equipment
: whole good machinery and any related attachments designated on Schedule B by Product Line and Licensed Trademark.
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2.10
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Licensed Trademarks
: the Trademarks listed in Schedule B that New Holland authorizes Dealer to use for the sole purpose of performing its obligations hereunder with respect to Products.
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2.11
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Limited Warranty
: the Warranty and Limitation of Liability agreement furnished by New Holland with respect to any Product sold to Customers.
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2.12
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New Holland IP
: any and all intellectual property including but not limited to patents, Trademarks (including the Licensed Trademarks), designs, copyrights, trade secrets, computer software (whether imbedded in Products or otherwise) and other proprietary technology and information, whether technical or business related, including registrations for and applications to register any of the foregoing, which are incorporated or used in or with Products or which are owned or licensed by New Holland for use with Products.
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2.13
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New Holland Regional Market Share
: a percentage figure calculated by taking the number of units of new New Holland brand Equipment for a given Product Line or Product Line grouping, sold in a regional sales area (a multi-state area determined by New Holland in its sole discretion) during a designated time period determined by New Holland, divided by the total industry volume of all comparable new units of equipment (including New Holland and competitive units) sold in that same regional sales area during that same time period. Total industry volume of new equipment sales shall be as reported by AEM.
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2.14
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New Holland State Market Share
: a percentage figure calculated by taking the number of units of new New Holland brand Equipment for a given Product Line or Product Line grouping, sold in a state, during a designated time period determined by New Holland, divided by the total industry volume of all comparable new units of equipment (including New Holland and competitive units) sold in that same state during that same time period. Total industry volume of new equipment shall be as reported by AEM.
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2.15
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Other Required Service
: service that New Holland, in its sole discretion, has deemed necessary or desirable and in the best interests of Customers and the goodwill associated with the Licensed Trademarks, including but not limited to, policy service, campaign service, or field improvement program service.
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2.16
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Parts
: proprietary replacement parts sold by New Holland for Equipment listed on Schedule B (specifically not including replacement parts for New Holland equipment not listed on Schedule B), together with all other common service or maintenance items (for example, including but not limited to filters, hoses, lubricants, etc.) and accessories which are offered for sale by New Holland to Dealer (either directly from New Holland or from an authorized source of supply), which New Holland has authorized to be identified with the Licensed Trademarks. Parts do not include ‘merchandise’ items such as clothing, toys, binders, gloves, etc.
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2.17
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Primary Location
: the primary Dealer facility location specified in Schedule D.
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2.18
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Primary Market of Responsibility (“PMR”)
: a market comprised of the total industry sales of all new Equipment (as reported by AEM), including New Holland and competitive equipment, sold (including first rentals or leases) within the geographic area designated in Schedule C.
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2.19
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Product(s)
: Equipment and related Parts that Dealer is authorized to represent under this Agreement.
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2.20
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Product Line
: the categories of Products set forth in Schedule B.
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2.21
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Strategic Accounts
: customer accounts typically referred to as “national accounts,” “corporate accounts,” national or regional equipment rental companies, or any customer designated by New Holland as such an account.
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2.22
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Trademarks
: all words, slogans, designs, pictures, logotypes or other symbols, including trademarks, service marks, trade dress, and trade names, regardless of whether registration has been sought or obtained therefor, used to (a) identify, distinguish or advertise the Products and services of New Holland or its Affiliates, (b) identify New Holland as the source or licensor of Products and services, or (c) identify the business of New Holland and its authorized dealers.
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2.23
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Warranty Service
: service that is required for any Product (a) to ensure that New Holland is in compliance with New Holland’s Limited Warranty obligations for such Product and (b) to comply with any extended service or maintenance plan purchased for that Product.
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2.24
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Will Call
: a program whereby New Holland, in its sole discretion, may permit Dealer to take delivery and possession of Products directly from a Will Call Provider or New Holland, in lieu of such Products being transported to Dealer at Dealer Location(s). The procedures for the Will Call program will be as set forth in the DPM.
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2.25
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Will Call Provider
: a third-party engaged by New Holland to facilitate Dealer's pick-up of Products at New Holland plant locations or port facilities under the terms of the Will Call program.
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3.1
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Scope of Appointment
. Pursuant to the provisions of this Agreement, New Holland hereby authorizes Dealer to market, promote, sell, lease or rent new Products and to provide Warranty Service for Products to Customers solely from the authorized Dealer Location(s) listed in Schedule D. The foregoing appointment is limited to Products identified with the Licensed Trademarks on Schedule B. Dealer accepts this appointment and agrees that the relationship between Dealer and New Holland shall be governed by the terms and conditions of this Agreement as well as the policies outlined in the DPM.
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3.2
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Incorporation of DPM
. The DPM includes the standards of quality and performance that New Holland seeks to have associated with its Trademarks and is hereby incorporated by reference into this Agreement. It is expressly understood and agreed that New Holland reserves the right to modify the DPM unilaterally to reflect reasonable standards of quality and performance so long as such standards do not conflict with the terms of this Agreement.
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3.3
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Material Inducement
. Section 3.2 is a material inducement upon which New Holland relied in entering into this Agreement with Dealer, the breach or unenforceability of which represents a failure of consideration entitling New Holland to void this Agreement in its entirety.
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4.1
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Dealer Representations and Warranties
. The appointment of Dealer is made in reliance on Dealer’s representation and warranty that the information set forth in any dealer application provided to New Holland as well as in Schedule A regarding Dealer’s legal name, ownership (if corporation, as listed in a Stock Ownership Certificate), management personnel, business structure, and state of residence or organization is accurate and complete. Dealer also represents and warrants that entering into this Agreement does not violate any other contract or agreement to which Dealer is a party and that any person signing this Agreement on behalf of Dealer has the authority to do so. Any breach of any of the foregoing representations and warranties represents a failure of consideration entitling New Holland to void this Agreement in its entirety.
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4.2
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Personal Services Nature of Agreement
. Dealer ownership and management are important to the successful working relationship between the Parties. New Holland has chosen to contract with the present ownership and management of Dealer, and the Parties acknowledge that this Agreement represents a personal services relationship, and that any change to the ownership, management or business structure of Dealer could seriously and adversely impact such relationship. As such, New Holland may refuse to appoint as an authorized dealer any purchaser or prospective purchaser of any of the shares or assets of Dealer.
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4.3
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Changes in Dealer Form and Control
. Except as otherwise stated in Section 4.4, Dealer shall provide New Holland with sixty (60) days’ prior written notice of Dealer’s intention to change its: (a) legal form or entity; or
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4.4
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Death or Incapacity of Dealer Principals
. In the event of the death or incapacity of any person listed in Schedule A or in the Stock Ownership Certificate (“Dealer Principal(s)”), Dealer shall provide New Holland:
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4.5
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Succession Plan
. Upon request, Dealer shall provide a succession plan to New Holland in the format approved by New Holland. The submission of such succession plan shall not imply that New Holland has automatically
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4.6
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Ancillary Documents
. Dealer will execute such agreements or other documents as New Holland in its sole discretion may deem necessary to preserve New Holland's rights under this Agreement in response to (a) any change or proposed change in Dealer's legal form or entity, (b) any change in Dealer’s control, ownership, or management, or (c) death or incapacity of any Dealer Principal.
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5.1
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Authorized Products
. The Products which Dealer is authorized to purchase from New Holland for retail sale, lease or rental are those Product Lines listed on Schedule B that New Holland has authorized to be identified with the Licensed Trademarks listed on Schedule B. Upon sixty (60) days’ written notice to Dealer, New Holland in its sole discretion may amend Schedule B to add to, subtract from, or otherwise modify the Products and Licensed Trademarks to which this Agreement pertains. In the event New Holland removes Products from Schedule B, Dealer will thereafter no longer be able to sell or perform Warranty Service for such Products, and New Holland will repurchase such new Equipment from Dealer as provided in Section 29.1(a). This Agreement does not give Dealer the right to, and under the terms of this Agreement Dealer may not, purchase, market, promote, sell, lease or rent any other new (i.e. not previously sold) CNH Industrial America LLC products that are not listed on Schedule B or are not authorized to be identified with the Licensed Trademarks listed on Schedule B.
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5.2
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Dealer Obligation to Support New Equipment Models
. New Holland may introduce new models of Equipment for Product Lines that Dealer is authorized to sell on Schedule B. In order to provide service to Customers for such Equipment, Dealer shall support such new models by complying with New Holland-designated requirements for: (a) stocking all required Parts; (b) purchasing all required service tools; and (c) attending sales and service training for such new models. New Holland has no obligation to fill orders or ship such new models of Equipment to Dealer if Dealer fails to fulfill the foregoing Parts, tools and training requirements.
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5.3
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Product Packaging and Labels
. Dealer shall not modify or remove any warning labels affixed to Products. Further, without New Holland’s prior written consent, Dealer shall not modify any packaging or other labeling for Products.
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5.4
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Installation of Non-Standard Attachments or Accessories
. Without prior written approval from New Holland, Dealer shall not install or attach non-standard, “self-designed”, or “one-off” attachments or accessories to Equipment. Such non-standard, “self-designed,” or “one-off” attachments or accessories are those that are not manufactured and sold by established equipment manufacturers for the application and purpose for which they are being used. Dealers that install standard attachments or accessories from established equipment manufacturers shall ensure that the Equipment can properly and safely operate with such attachment or accessory.
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5.5
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Prohibited Modifications to Product
. Dealer shall not perform any of the following actions: (a) modify Equipment without New Holland’s prior written consent; (b) install upon Equipment any attachment, accessory or equipment that is beyond the rated capacity of that Equipment as stated in the Operator’s Manual furnished with the Equipment or as otherwise instructed by New Holland; or (c) perform any adjustment or assembly procedures to Equipment not recommended by or in contravention of the Operator’s Manual, Service Manual or other New Holland instruction.
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6.1
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Assignment of PMR
. The PMR assigned to Dealer is set forth in Schedule C. The Dealer’s PMR may vary by Equipment or Product Line. New Holland’s assignment to Dealer of a PMR is for the purpose of: (a) focusing Dealer’s sales, marketing and product support efforts; (b) measuring Dealer Market Share performance; and (c) maximizing the goodwill associated with Products and Licensed Trademarks. Dealer Market Share shall be measured only within Dealer’s PMR. New Holland, in its sole discretion and upon written notice to Dealer, may immediately amend Schedule C to add to, subtract from or otherwise modify Dealer’s PMR.
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6.2
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No Obligation to Support Sales Outside PMR
. To the extent New Holland decides to offer marketing programs, retail sales incentives, or other promotions, it shall have no obligation to do so for Dealer’s sales or marketing activities outside of Dealer’s PMR.
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6.3
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PMR Non-Exclusive
. Dealer’s PMR is non-exclusive. Without incurring any liability to Dealer, New Holland may determine the number and locations of authorized dealers necessary for adequate sales and service representation of Products within any geographic area, or within the designated PMR. Nothing in this Agreement shall be construed as requiring Dealer's consent to the establishment of new or additional dealer representation for Products in Dealer’s PMR or elsewhere.
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7.1
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Wholesale Line of Credit
. Dealer shall establish and at all times maintain an unrestricted wholesale line of credit for the purchase and stocking of new Products in an amount acceptable to New Holland in order to meet Dealer’s inventory and sales obligations hereunder. If within any six (6)-month period, Dealer’s primary wholesale line of credit is cumulatively reduced by twenty percent (20%) or more and such reduction is not for valid business reasons, said line of credit shall be deemed unacceptable to New Holland. Further, if Dealer’s primary wholesale line of credit is restricted, suspended or terminated, any new line of credit obtained by Dealer must be in the same amount as the prior line to be acceptable to New Holland.
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7.2
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Adjusted Debt to Tangible Net Worth Ratio
. Dealer hereby covenants and agrees that it will maintain an Adjusted Debt to Tangible Net Worth Ratio of not more than four to one (4.0:1.0). Unless specifically approved in advance in writing by New Holland, Dealer will not make any acquisitions or initiate new business activities if Dealer’s Adjusted Debt to Tangible Net Worth Ratio exceeds four to one (4.0:1.0) or if such ratio would increase beyond four to one (4.0:1.0) as a result of such actions. This ratio shall be calculated using the consolidated balance sheets and income statements of Dealer (and of Dealer’s related entities and affiliates, if New Holland so elects). All such balance sheets and income statements must be prepared in accordance with Generally Accepted Accounting Principles (“GAAP”). For purposes of calculating this ratio, the following definitions will apply:
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7.3
|
Working Capital Requirements
. Dealer shall maintain net working capital in amounts necessary for Dealer to comply with its obligations under this Agreement.
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8.1
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Equipment Stocking Requirements
. Dealer shall order, maintain in inventory and prominently display, at all Dealer Locations unless otherwise excepted in writing by New Holland, representative models of each type of new Equipment Dealer is authorized to sell as set forth in Schedule B, at the level deemed necessary by New Holland to meet Dealer’s Equipment sales obligations.
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8.2
|
Parts Stocking Requirements
. For the purpose of providing prompt Customer support, Dealer agrees to order and maintain in inventory all Parts at the level deemed necessary by New Holland to meet Dealer’s Parts sales obligations. Dealer must provide a retail display area for Parts acceptable to New Holland.
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8.3
|
Licensed Trademark Use
. At any Dealer Location and in all advertising for such Dealer Locations, Dealer shall not use or display the Licensed Trademarks in any way that might cause confusion with, or dilute the distinctive quality of, the Licensed Trademarks, or in any way that violates any New Holland trademark guidelines. In furtherance of this provision, if Dealer represents non-New Holland products, Dealer shall at any such location: (a) maintain internal and external display areas for new Products separate from non-New Holland products; (b) display new Products in the most visible and desirable position and in an area of greater size or space than the area used to display non-New Holland products.
|
9.1
|
Sales Responsibilities
. Dealer is solely responsible for developing its own plan for marketing and selling Products, and shall fulfill its sales obligations in several ways, including but not limited to the following:
|
(a)
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Equipment Market Share
. Dealer shall aggressively promote and sell new Equipment to attain within Dealer’s PMR for all Equipment designated on Schedule B, a Dealer Market Share that is equal to at least 90% of either, in New Holland’s sole discretion, the New Holland State Market Share or the New Holland Regional Market Share. In evaluating Dealer’s market share performance, New Holland, in its sole discretion, may (i) group Product Lines and/or (ii) evaluate Dealer’s performance on a per Dealer Location basis.
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(b)
|
Parts Sales Objectives
. Dealer shall aggressively promote and sell all Parts offered by New Holland.
|
(c)
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Advertising and Promotion
. Dealer shall conduct aggressive advertising and sales promotion activities, including but not limited to open houses, field days, product demonstrations, radio and/or television advertising, print advertising, trade shows and community events. Dealer shall appropriately display and distribute current Product sales literature, brochures and advertisements at its Dealer Locations and shall also maintain a dealer website that prominently displays new Products. Dealer’s use of Licensed Trademarks and its display of Products on Dealer’s website shall be subject to New Holland’s approval. Upon New Holland’s request, Dealer shall participate in national or regional sales promotion and advertising programs as New Holland may periodically conduct.
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(d)
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Sales Staff
. Dealer shall employ a sufficient number of properly trained Product-dedicated sales personnel based on the industry potential in Dealer’s PMR and as required by New Holland to call on all potential customers within the PMR. Such sales personnel shall attend New Holland’s sales training sessions as required in the DPM.
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(e)
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Extended Service Plans
. Dealer shall promote and sell extended service and maintenance plans.
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(f)
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Customer Surveys
. New Holland from time to time may conduct surveys (by use of questionnaires or otherwise) of Dealer’s Customers to determine the satisfaction of those Customers with the sales, leasing, rental and service efforts of Dealer. New Holland may use the results of these surveys in assessing Dealer's performance under this Agreement.
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(g)
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Other Performance Standards
. Dealer shall meet such other sales performance standards or best business practices as may be established by New Holland in the DPM.
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9.2
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Dealer Resource Commitment
. The Parties mutually recognize that one of the purposes of this Agreement is to assure that Dealer focuses its resources and efforts on the sale of new Products and the performance of its obligations under this Agreement. Therefore, Dealer agrees that if Dealer undertakes or engages in another business activity at a Dealer Location(s) separate from its representation of new Products pursuant
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9.3
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Sales Reporting
. Dealer shall report all new Equipment retail sales to New Holland, and shall provide true and accurate information on such sales as required by New Holland, including but not limited to registering the location of such Equipment sales and the end use designation in compliance with New Holland guidelines.
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10.1
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Warranty Service and Other Required Service
. Dealer shall provide Warranty Service for any Product, regardless of whether Dealer sold that specific Product; provided, however, Dealer may not provide Warranty Service for any New Holland (or other CNH Industrial America LLC) products not listed on Schedule B. Dealer also shall provide Other Required Service as directed by New Holland in its sole discretion. Dealer shall provide Warranty Service and Other Required Service in a prompt, professional and courteous manner, and shall fulfill these responsibilities in several ways, including but not limited to the following:
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(a)
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Service Technicians
. Dealer shall employ at all times a sufficient number of trained and fully certified service technicians based on industry sales in Dealer’s PMR. Dealer must have service technicians at each Dealer Location who are trained and fully certified to service each type of Equipment listed on Schedule B, and Dealer’s service technicians must attend New Holland service training sessions as required by New Holland in the DPM.
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(b)
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Service Tools and Manuals
. Dealer shall maintain, or have access to, at each Dealer Location all special service tools, electronic diagnostic tools or websites, electronic parts catalogs, service manuals, parts manuals and operator’s manuals required by New Holland to service the Equipment listed in Schedule B. Dealer may comply with the service tool requirements by subscribing to any New Holland rental tool program.
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(c)
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Service Standards
. Dealer shall perform Warranty Service and/or Other Required Service in a timely manner and in strict compliance with the DPM and any service bulletins or other instructions issued by New Holland. Dealer shall give priority to performing such Warranty Service or Other Required Service before general maintenance if a Customer’s Product is not operable.
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(d)
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Use of New Holland-Sourced Parts
. Except as otherwise instructed by New Holland in writing, Dealer shall use only Parts obtained from New Holland or New Holland’s authorized sources of supply in performing Warranty Service or Other Required Service.
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(e)
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Certification Standards
. Dealer shall meet or exceed New Holland’s service certification standards including pre-delivery, delivery and after-delivery requirements for all Products, as defined by New Holland in the DPM.
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(f)
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Compliance with Service Policies
. Dealer shall abide by all New Holland policies and procedures contained in the DPM when performing Warranty Service and Other Required Service or when submitting Dealer Claims, including creating and retaining all supporting documentation for such claims.
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10.2
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Strategic Account Service
. Dealer shall provide Warranty Service and/or Other Required Service for any Product sold by New Holland to Strategic Accounts, as well as for any Product sold or donated as charitable, educational or governmental entities.
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11.1
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Product Setup
. To ensure the proper operation of Products, before delivery of Products to a Customer Dealer shall perform the inspections, adjustments, conditioning, installations or servicing of such Products in accordance with instructions and procedures provided by New Holland.
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11.2
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Product Literature
. Dealer shall deliver to each Customer of a Product the appropriate current publications and forms for owners covering operation, maintenance, warranty and other matters as determined by New Holland.
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11.3
|
Customer Instruction
. At the time of delivery, Dealer shall instruct each Customer of a Product in the safe use, proper operation and required maintenance of that Product. Such instruction shall include, at a minimum:
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11.4
|
Accident Reporting
. Dealer shall promptly notify New Holland, pursuant to guidelines contained in the DPM, of any reports of accidents or injuries involving Products of which Dealer becomes aware, as well as any information concerning the existence of any significant Product failure or malfunction.
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11.5
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Post-Delivery Services
. Dealer shall perform all required post-delivery inspections and adjustments to Products as prescribed by instructions and procedures provided by New Holland from time to time or as stated in the DPM.
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12.1
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Facility Requirements
. Dealer shall establish and maintain at each authorized Dealer Location listed on Schedule D a facility to sell, service, display and store Products in accordance with facility standards contained in the DPM.
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12.2
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Unauthorized Locations
. Without New Holland’s prior written consent, Dealer shall not at any location other than those listed in Schedule D, directly or indirectly: (a) advertise or represent itself as an authorized dealer of New Holland Products; (b) use the Licensed Trademarks or any other Trademarks; (c) store, stock or display Products; (d) sell, advertise or market any Products; or (e) provide Warranty Service and/or Other Required Service.
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12.3
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Closure and Relocation
. Without New Holland’s prior written consent, Dealer may not close or relocate any Dealer Location listed on Schedule D. Dealer shall seek New Holland’s consent for the closure or relocation of a Dealer Location at least sixty (60) days prior to the proposed closure or relocation. Should New Holland give its consent, New Holland, in its sole discretion, may modify or reassign the PMR associated with the relocated or closed Dealer Location. Dealer acknowledges and agrees that any consent granted by New Holland for the closure of a Dealer Location shall not initiate the inventory repurchase obligations set forth in Section 29.
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12.4
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Brand Identification
. Dealer shall: (a) display a primary identification sign (flag mast or monument) and comply with dealer identity standards as specified in the DPM for each Dealer Location listed on Schedule D; and (b) comply with New Holland’s vehicle identity standards as set forth in the DPM.
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12.5
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Trademark Display
. Dealer’s use of Trademarks or Licensed Trademarks at any Dealer Location, including but not limited to signs, banners or displays, shall be subject to New Holland approval. Any such use not approved by New Holland must be removed immediately by Dealer.
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13.1
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Business Plan Requirements
. Annually, or as otherwise requested by New Holland, Dealer shall complete and make available for review by New Holland a written plan for the subsequent fiscal year (or additional years if requested by New Holland) that shall contain the information and objectives required by New Holland for a business plan (“Business Plan”), which may include but not be limited to the following:
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(a)
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Equipment inventory stocking and sales objectives to maximize Dealer’s Equipment sales in its PMR, but at a minimum to obtain Dealer Market Share requirements stated in Section 9.1(a), including action plans for obtaining such objectives;
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(b)
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Parts inventory stocking plan and sales objectives to maximize Dealer’s Parts sales;
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(c)
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training plans for Dealer sales and service personnel, including New Holland provided training;
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(d)
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advertising, promotional and marketing plans and budgets;
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(e)
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action plans for Dealer’s possible expansion or upgrading of its current facilities, or for the proposed addition of new facilities; and
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(f)
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any additional information required by New Holland as set forth in the DPM.
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13.2
|
Business Plan Acceptance
. Dealer agrees that providing a Business Plan reasonably acceptable to New Holland is a requirement for Dealer to effectively promote and sell Products under this Agreement. New Holland may conduct periodic reviews of Dealer’s performance against its approved Business Plan, and during such reviews Dealer agrees to make available all Dealer’s records and employees which would contribute to the overall value of these reviews.
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14.1
|
Insurance Coverage
. Dealer shall maintain an occurrence-based policy of Comprehensive General Liability insurance (including Products and Property Damage Liability) with a maximum per occurrence deductible of
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14.2
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Payment of Taxes
. Dealer shall pay all license fees, sales, use, personal property, and excise taxes, duties, and any other fees, assessments or taxes which may be assessed or levied by any governmental authority against any Products which are shipped to, or are in the possession of, Dealer.
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14.3
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Dealer Tax Representations
. By submitting an order to New Holland for the purchase of any Product, Dealer represents and warrants that (a) such Products are being purchased for resale, lease or rent to Customers in the ordinary course of Dealer's business, and (b) Dealer has complied and will comply with all requirements for collection and payment of applicable sales, use and similar taxes. Upon request, Dealer shall provide evidence satisfactory to New Holland of Dealer’s compliance with the foregoing representations and warranties.
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15.1
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Warranty Obligations
. New Holland’s warranties covering Products are as set forth in the Limited Warranty furnished by New Holland with respect to such Products. The performance and administration of the warranties so extended, and the reimbursement to Dealer for Warranty Service performed on Products, are as set forth herein and in the DPM in effect at the time warranty work is performed. The Parties shall promptly fulfill their respective warranty obligations as set forth in the Limited Warranty and DPM.
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15.2
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Dealer Obligations Upon Sale
. At the time of any retail sale of Products pursuant to this Agreement, Dealer shall (a) deliver to and review with the Customer New Holland’s Limited Warranty for such Products in force at the time of such sale, (b) have the Customer complete the operator’s manual/warranty receipt verification section of the Limited Warranty, (c) obtain the Customer’s signature on the Limited Warranty and (d) submit the signed Limited Warranty to New Holland within ten (10) days of the sales transaction. New Holland reserves the right not to reimburse Dealer for Warranty Service claims should Dealer fail to timely submit to New Holland the signed Limited Warranty.
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15.3
|
No Other Warranty Provisions
. Dealer is not authorized to assume or purport to assume for New Holland any additional obligations or liabilities in connection with the sale, lease, rental or service of Products covered by this Agreement, and Dealer shall not do so. New Holland shall not be liable nor shall it defend, indemnify or in any way be obligated to assist Dealer in defense of any notice, claim, or lawsuit alleging the existence of a warranty beyond the terms and conditions of New Holland’s Limited Warranty for any Product.
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15.4
|
Disclaimer of Other Warranties
. Dealer agrees and acknowledges that, except for the warranty extended to Customers under New Holland’s Limited Warranty, and to the extent allowed by law, New Holland makes no other representations or warranties, express or implied (including implied warranties of merchantability and fitness for a particular purpose) to Dealer or any Customer with respect to Products.
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15.5
|
Non-New Holland Equipment and Service
. If Dealer installs on or attaches to a Product any non-New Holland equipment, attachment, accessory or part, Dealer shall advise Customer in writing that the non-New Holland equipment, attachment, accessory or part is not covered by the Limited Warranty. If Dealer sells any service contract not provided by New Holland or its Affiliates in conjunction with the sale of Equipment, Dealer will disclose to Customer the identity of the service contract provider and will further advise that New Holland has no responsibility to fulfill the obligations of such service contract.
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15.6
|
Actions Voiding Limited Warranty
. Dealer acknowledges and agrees that any breach of Sections 5.4 or 5.5 may result in New Holland voiding the Limited Warranty for Products in its sole discretion, and Dealer must so advise its Customer in writing to whom such Product has been sold. In such a case where New Holland elects to void the Limited Warranty, as between Dealer and New Holland, Dealer shall be solely responsible for any warranty service claims relating to such Product.
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15.7
|
Use of Unauthorized Parts
. In the event Dealer breaches Section 10.1(d), New Holland in its sole discretion may (a) refuse to reimburse Dealer for such Warranty Service and/or Other Required Service, (b) void New Holland’s Limited Warranty for such Products, and/or (c) hold Dealer solely responsible for all Warranty Service relating to such Products.
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16.1
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Financial Statements
. Dealer shall submit to New Holland, within ninety (90) days after the end of Dealer’s fiscal year, audited (or where audited are not available then certified) balance sheets and financial statements for that year.
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16.2
|
Supplemental Financial Records
. Dealer shall submit monthly financial statements to New Holland in the manner directed by New Holland. New Holland reserves the right to request at any time personal financial statements from the Dealer Principal(s) or guarantor(s) of Dealer, and Dealer shall supply such statements within thirty (30) days.
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16.3
|
Sales Reports
. Dealer shall maintain and provide to New Holland upon request current reports of Equipment or Parts sales, owner registration, inventory, service and warranty reports, as well as such other reports as may be requested by New Holland.
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16.4
|
Inspections
. Dealer shall permit New Holland or its authorized representatives during normal business hours to (a) enter and inspect all Dealer Locations, (b) examine Dealer’s Product inventory, (c) test Equipment in Dealer’s possession, custody or control, (d) examine and audit Dealer’s books and records and all supporting data of Dealer’s business, and (e) make copies of any such records or accounts.
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16.5
|
Records Retention
. Dealer shall maintain for at least two (2) years all original records and documents relating to Dealer Claims submitted to or paid by New Holland.
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16.6
|
Chargeback for Improper or Unsubstantiated Claims
. Dealer’s submission of unsubstantiated Dealer Claims or Dealer Claims not in compliance with the requirements of the DPM will result in a chargeback to Dealer for such claims, including interest at the then current prime rate. If Dealer refuses to permit an audit, fails to maintain a substantial amount of the required records, or intentionally submits false or fraudulent Dealer Claims, the chargeback will include all amounts paid on Dealer Claims for the prior two (2) years, including any dealer settlement allowances, plus interest at the then current prime rate. This remedy is in addition to those available to New Holland for breach of this Agreement, including but not limited to termination of this Agreement.
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17.1
|
Dealer Management System Requirements
. Dealer shall install and maintain in good working order at each Dealer Location: (a) a computerized dealer management system (“DMS”) satisfactory to New Holland that maintains New Holland-to-DMS interfaces and functions to communicate and conduct business with New Holland’s computer applications and systems (the “System”); (b) a Dealer-to-New Holland network connection that meets or exceeds New Holland specified Dealer-to-New Holland connectivity requirements; and (c) all necessary hardware and software to maintain compatibility with the System.
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17.2
|
New Holland Applications
. Dealer shall subscribe to, install and maintain required software applications as communicated to Dealer by New Holland or as set forth in the DPM, including (but not limited to) the Electronic Parts Catalog applications.
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17.3
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Operating Costs
. Dealer shall pay all costs, including taxes, for the DMS, the Dealer-to-New Holland network connection, and any monthly access charges for use of the System.
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17.4
|
Confidentiality
. Dealer shall keep confidential any information and data contained in the System, and shall not use the System or any information or data derived from the System for purposes unrelated to Dealer’s performance of its obligations under this Agreement.
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17.5
|
Disclaimer of Liability
. New Holland shall not be responsible or liable for any defects, problems or resulting damages incurred by Dealer from the operation and use of the DMS, the Dealer-to-New Holland network connection, or the System.
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18.1
|
Marketing Assistance
. To assist Dealer in its marketing and promotional efforts, New Holland will develop the following marketing and promotional materials: (a) training and videos of Product features, operations, demonstrations and competitive comparisons; (b) Product sales literature and brochures; (c) Product and promotional posters, banners and point of sale materials; (d) print and media copy for advertisements in newspapers, magazines, and trade publications; and (e) radio and television advertising scripts. New Holland may also make cooperative advertising funds available to Dealers, in its sole discretion.
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18.2
|
Communications to Dealer
. Dealer expressly consents to the receipt of unsolicited commercial faxes, emails, text messages, instant messages or other form of electronic communication, from New Holland, its Affiliates, or other New Holland-designated sender.
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18.3
|
Products and Services Provided by New Holland
. From time to time, New Holland will provide Dealer with certain products and services necessary for Dealer to market, sell and service Products. Dealer agrees that New Holland, in its discretion, may charge Dealer for any such products or services so provided.
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18.4
|
Dealer Knowledge of PMR
. New Holland expects Dealer to know and understand its market area and the promotional activities that would best be used to market Products within Dealer’s PMR. As such, it is Dealer’s responsibility to determine which marketing and promotional materials to use in its marketing efforts to meet its sales responsibilities under this Agreement.
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19.1
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Purchase Orders
. Dealer may seek to purchase Products from New Holland under this Agreement by submitting purchase orders through New Holland’s System in accordance with instructions provided by New Holland. New Holland may specify in writing the minimum quantity of a given Product that Dealer shall be obligated to order at one time as a condition for filling such order, provided that such minimum quantity requirements will be consistently imposed on Dealers.
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19.2
|
Offer and Acceptance
. Dealer’s transmission of an order for Products through New Holland’s System will be a binding offer by Dealer to purchase the Products ordered, unless New Holland rejects the order. Purchase orders submitted by Dealer shall not be binding upon New Holland unless and until accepted in writing or electronically by New Holland. All orders for Products may not be canceled by Dealer, and shall be subject to New Holland’s then applicable conditions of sale.
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19.3
|
Delivery Dates
. New Holland shall endeavor to meet the delivery date specified in the System, but shall have no liability for failing to timely fill or deliver any order.
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19.4
|
Product Allocation
. New Holland shall have the right to allocate delivery of Dealer’s Product orders based on their relative order or sales status as compared to other pending orders.
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19.5
|
Product Shipment
. New Holland shall arrange delivery of Products to Dealer and reserves the right to determine the method and routing for such delivery. New Holland shall not be responsible for guaranteeing shipping rates or for delays in shipment. New Holland, in its discretion, may permit Dealer to designate orders for Will Call delivery pursuant to the terms of the DPM.
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19.6
|
Risk of Loss / Passage of Title
. New Holland’s release of Products to any carrier for transportation to Dealer shall constitute delivery to Dealer for purposes of passage of title, and Dealer shall bear all risk of loss or damage to Products thereafter. For Will Call orders, risk of loss and passage of title shall be as set forth in the DPM.
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19.7
|
Equipment Transfer
. The transfer of Equipment from Dealer to other authorized dealers of Products shall be in accordance with New Holland’s transfer program described in the DPM. New Holland shall have no liability as a result of any such transfer.
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19.8
|
Product Return Authorization
. Dealer agrees that no Products delivered to it hereunder are to be returned to New Holland without prior written authorization. Dealer shall pay all transportation charges on any returned Products authorized by New Holland, and Dealer is responsible for payment of all restocking charges stated in the DPM.
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20.1
|
Prices
. Unless otherwise authorized by New Holland, the price charged to Dealer for any Product shall be the price in effect at the time the Product is invoiced to Dealer.
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20.2
|
Price Changes
. New Holland reserves the right at any time to change its prices, terms, discounts and any other pricing provision for Products.
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20.3
|
Payment
. Dealer shall pay New Holland for all Products immediately upon invoicing of Products to Dealer. The terms and conditions of sale and payments for all Products invoiced to Dealer shall be subject to New Holland’s applicable conditions of sale and prices as published and modified from time to time by New Holland. Failure to make payment in accordance with this provision may, in New Holland’s sole discretion, result in New Holland revoking the sale and repossessing the Product without notice or formality. New Holland reserves the right, without liability, to refuse to sell or deliver Products to Dealer when in New Holland’s opinion Dealer’s financial condition does not warrant or support further sales or deliveries.
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20.4
|
Equipment Relocation
. New Holland may request Dealer to transfer new Equipment to another authorized dealer to accommodate such dealer’s sale to another Customer. If Dealer refuses, New Holland, in its sole discretion, may decline to pay, on Dealer’s behalf, the wholesale finance interest charges associated with that specific Equipment and may decline to make available to Dealer any retail sales programs for such Equipment.
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20.5
|
Application of Money and Credits
. Any money or credits due and payable or becoming due and payable from New Holland to Dealer may be applied in any order New Holland may determine for the satisfaction, in full or in part, of any debts, liabilities or obligations due and payable or becoming due and payable or owing from Dealer to New Holland or its Affiliates.
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21.1
|
Domestic Sales Only
. Without New Holland’s prior written approval, Dealer shall not sell, lease or rent Products outside of the Domestic United States.
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21.2
|
Retail Sales Only
. Dealer shall sell Products only to retail Customers or to other authorized dealers of Products. As such, except for sales to authorized New Holland dealers, Dealer may not sell any Products at wholesale, including but not limited to sales to jobbers, jockeys, or other unauthorized dealers.
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21.3
|
No Deceptive or Unethical Practices
. Dealer shall conduct business in a manner that will reflect favorably at all times on Dealer, New Holland, Products, Licensed Trademarks and other authorized dealers of Products. Dealer shall refrain from business practices, advertisements, promotions and conduct that are unethical, deceptive, misleading, fraudulent, confusing or would likely contravene any voluntary or involuntary advertising standard or any law. Dealer shall not make, directly or indirectly, any false or misleading statement or representation concerning any Product, its source, condition, capabilities, price, or charges for the Product’s distribution, delivery, taxes or other items.
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21.4
|
No Internet Sales
. Dealer may not consummate sales of new Products on or through an Internet website, including but not limited to an auction-type website, except as otherwise authorized by New Holland.
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21.5
|
Announcements
. Dealer shall not publish public relation announcements that in any way involve or mention New Holland without New Holland’s prior written consent.
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21.6
|
Compliance with Federal, State and Local Laws
. Dealer shall comply with all applicable federal, state, and local laws and regulations governing Dealer’s operations and its ordering, sales and service of Products, including without limitation those laws or regulations concerning safety, emissions control and customer service. Dealer shall obtain all governmental approvals, permits or licenses required to do business in its PMR.
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21.7
|
Compliance With Export Laws
. Certain Products purchased by Dealer from New Holland may be subject to United States export control laws. Dealer agrees that it is responsible for knowing and complying with such laws. Diversion contrary to United States law is prohibited.
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21.8
|
Compliance with Fraud and Anti-Corruption Laws
.
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(a)
|
Dealer and its Dealer Principals represent that they have not been convicted of, or pleaded guilty to, an offense involving fraud or corruption and that they are not now listed by any government agency as debarred, suspended, or proposed for suspension or debarment, or otherwise ineligible for any government bid or procurement programs. Dealer agrees to promptly inform New Holland of any change in this representation.
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(b)
|
Dealer shall become familiar with and strictly comply with all applicable laws, statutes, regulations and codes relating to anti-bribery and anti-corruption, including but not limited to the United States Foreign Corrupt Practices Act and similar anti-corruption or anti-bribery laws. Dealer shall promptly report to New Holland any request or demand for any undue financial or other advantage of any kind received by Dealer in connection with the performance of this Agreement. Dealer warrants that it has no foreign public officials as direct or indirect owners, officers or employees at the date of this Agreement, and shall immediately notify New Holland in writing if a foreign public official becomes an officer or employee of Dealer or acquires a direct or indirect interest in Dealer.
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22.1
|
Product Changes and Improvements
. New Holland may make changes or improvements at any time in the specifications, construction, color and design of Products without incurring any obligation to Dealer or Dealer’s Customers.
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22.2
|
Product Discontinuation
. New Holland reserves the right at any time, without liability to Dealer, to discontinue the manufacture of any and all model(s), Equipment, or Product Line(s) under the Licensed Trademarks covered by this Agreement. Products shall be considered discontinued notwithstanding the fact that similar or identical products continue to be manufactured or sold by CNH Industrial America LLC or its Affiliates under Trademarks other than the Licensed Trademarks or brands for which this Agreement grants Dealer certain Product distribution rights. For any models, Equipment or Product Line(s) so discontinued, New Holland shall not be required to offer Dealer the right to represent a similar model, Equipment or Product Line(s), if any, marketed, manufactured or sold by CNH Industrial America LLC or its Affiliates under Trademarks other than the Licensed Trademarks or brand(s) listed on Schedule B.
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24.1
|
Trademark License
. Subject to and only in accordance with the terms and conditions of this Agreement, New Holland grants Dealer the right and Dealer accepts the obligation to make only Permitted Uses of the Licensed Trademarks set forth in Section 24.2 and to refrain from engaging in Prohibited Uses of the Licensed Trademarks set forth in Section 24.3. Dealer’s right to use the Licensed Trademarks is limited to the Permitted
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24.2
|
Permitted Uses
. Dealer shall and is permitted to: (a) use the Licensed Trademarks to identify and advertise its business at Dealer Locations in connection with the marketing, sale, distribution and service of Products under the Licensed Trademarks; (b) use the Licensed Trademarks only in connection with the marketing, sale, distribution and service of the Products for which New Holland has authorized them to be used; (c) identify itself (and not New Holland) as the owner of Dealer’s business in conjunction with any use of the Licensed Trademarks, including the use thereof on leases, invoices, order forms, receipts, and business stationery, as well as at such other locations and in the manner as New Holland may designate in the DPM; and (d) use the Licensed Trademarks to identify itself as an authorized dealer of Products.
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24.3
|
Prohibited Uses
. Dealer shall not: (a) use the Licensed Trademarks (or any other Trademarks owned or licensed by New Holland or its Affiliates) as part of its corporate or other legal name without the prior written consent of New Holland; (b) sublicense or assign its right to use the Licensed Trademarks to any other person or entity; (c) use the Licensed Trademarks to incur any obligation or indebtedness on behalf of New Holland;
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24.4
|
Unauthorized Internet Registrations
. In the event that Dealer registers, attempts to register, obtains any ownership in, or otherwise uses any Internet Registration in violation of this Agreement, in addition to any rights New Holland may have under this Agreement, Dealer hereby acknowledges and agrees that any such Internet Registration, including any copyrights therein, shall be deemed to be the property of New Holland. Dealer will assign, transfer or assist in the perfection of any rights necessary to transfer said registration to New Holland with no compensation to Dealer and at no additional cost to New Holland. In the event that a court of competent jurisdiction determines that any ownership rights to any Internet Registration are not automatically transferred to New Holland pursuant to this Agreement, Dealer agrees to execute any documents deemed necessary by New Holland to give effect to this provision. New Holland may condition approval of Dealer’s use of any such Internet Registration on the transfer to New Holland of any and all ownership rights therein, including any copyrights. In the event that this Agreement expires or is terminated, Dealer shall not use or register a domain name that includes, or in New Holland's sole discretion is confusingly similar to, a Licensed Trademark or any other Trademark.
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24.5
|
Notice of Trademark Claims
. Dealer shall promptly notify New Holland in writing of any suspected unauthorized or infringing use of the Licensed Trademarks, any challenge to the validity of the Licensed Trademarks, any challenge to New Holland’s ownership of the Licensed Trademarks, any challenge to New Holland’s right to use and license others to use such Licensed Trademarks, or any challenge to Dealer’s right to use the Licensed Trademarks.
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24.6
|
Validity of Licensed Trademarks
. Dealer expressly understands and acknowledges that the Licensed Trademarks are valid and serve to identify Products and those authorized by New Holland to market, sell, distribute, and service Products. Dealer shall not directly or indirectly contest, attack, oppose, attempt to cancel or otherwise challenge in any manner or in any forum, the validity of the Licensed Trademarks or New Holland’s ownership of, or New Holland’s right to use or license others to use, the Licensed Trademarks, either during or after the term of this Agreement.
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24.7
|
Ownership of Licensed Trademarks and Goodwill
. Dealer acknowledges the Licensed Trademarks are exclusively owned by New Holland. Dealer’s use of the Licensed Trademarks pursuant to this Agreement does not give Dealer any ownership interest or other interest in or to the Licensed Trademarks. Dealer shall execute any documents deemed necessary or useful by New Holland to obtain protection for the Licensed Trademarks or to maintain their validity and enforceability. Any and all goodwill arising from Dealer’s use of the Licensed Trademarks shall inure solely and exclusively to the benefit of New Holland. Upon expiration or termination of this Agreement, no monetary amount shall be attributable to any goodwill associated with Dealer’s use of the Licensed Trademarks or the sale and service of Products.
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24.8
|
Nonexclusive License
. This Agreement grants Dealer only a nonexclusive right and license to use the Licensed Trademarks. New Holland has and retains the rights to use the Licensed Trademarks itself in connection with selling Products and services and to grant other licenses for the Licensed Trademarks and for Trademarks.
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24.9
|
Discontinuation and Substitution of Licensed Trademarks
. New Holland reserves the right in its sole discretion to discontinue any Licensed Trademark and to substitute or add different Licensed Trademarks for use in identifying Products or the dealers authorized to sell or service Products. Dealer shall implement promptly any such substitution or addition of new Licensed Trademarks.
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24.10
|
Copyrights
. Dealer shall not copy any aspect or portion of New Holland's website or other electronically stored information or printed documents or publications without the express prior written consent of New Holland.
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25.1
|
Software License
. Dealer acknowledges that certain Products contain imbedded computer software and related technology (collectively, “Authorized Software”) in which New Holland owns or licenses copyrights and/or other intellectual property rights. During the term of this Agreement, New Holland grants Dealer a non- transferable, royalty-free license to use Authorized Software in object code form only (“Software License”). The Software License is limited to the sale and service of any Product containing Authorized Software only in the manner authorized by New Holland in writing. Except as expressly authorized by this Agreement, Dealer may not sublicense Authorized Software to any other entity nor assign its Software License. This Agreement does not grant Dealer any right, title, or interest in Authorized Software anywhere in the world except the Software License granted herein. Dealer acknowledges that the use of any Product containing Authorized Software may require a Software License from New Holland. New Holland reserves the right to require all users of Products containing Authorized Software to possess a valid license in the form prescribed by New Holland, and in such case Dealer shall not transfer or permit the transfer or use of any Product containing Authorized Software unless the transferee or user is subject to such valid license. This Software License shall continue until it is terminated in accordance with this Agreement, or for the useful life of the Product in which Authorized Software is imbedded or of which Authorized Software is an integral part, or for the useful life of Authorized Software, whichever is shorter.
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25.2
|
Automatic Termination
. The Software License shall automatically terminate upon the occurrence of any of the following: (a) removal of Authorized Software from the Product for which it was obtained or authorized,
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26.1
|
Company Information
. Periodically, New Holland will provide Dealer with proprietary, confidential information, technical knowledge and/or assistance, and other materials that derive value from not being generally known in the industry (“Company Information”) that are reasonably necessary for the distribution, sale, promotion and service of Products. New Holland has sole discretion to determine what information it provides to Dealer is Company Information. Dealer agrees that Company Information remains the property of New Holland. Dealer must take commercially reasonable measures, but in any event no less strict than the measures Dealer uses with its own confidential information, to maintain the confidentiality of Company Information and to ensure
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26.2
|
Return of Company Information
. Dealer acknowledges that New Holland provides Company Information to Dealer for use by Dealer pursuant to this Agreement. Therefore, upon expiration or termination of this Agreement for any reason, Dealer shall immediately return to New Holland all Company Information in any form.
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26.3
|
No Reverse Engineering
. Dealer shall not engage in, cause to be engaged in, or permit any reverse engineering of Authorized Software, Products, or component parts thereof. “Reverse engineering” is defined as attempting through analysis of Products or component parts thereof to determine their functionality and thereby gain the ability to alter or reproduce that functionality.
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26.4
|
Right to Use New Holland IP
. Dealer shall use New Holland IP only in accordance with the provisions of and for the purposes contemplated by this Agreement and in accordance with any procedures that New Holland may establish for use of New Holland IP.
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27.1
|
Term of Agreement and Renewal
. This Agreement shall commence on the Effective Date and continue to the Expiration Date (“Term”). The Expiration Date of this Agreement shall be extended for additional successive one year periods unless, at least ninety (90) days prior to the Expiration Date or the expiration date of any subsequent extension period, either party notifies the other of its intention not to extend. Upon such notification not to extend, this Agreement shall expire on the Expiration Date or at the expiration date of any extension period.
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27.2
|
Replacement Agreement
. In the event New Holland offers to all authorized dealers in the state of Dealer’s Primary Location a new dealer agreement or an amendment to this Agreement (“Replacement Agreement”), New Holland shall provide Dealer with at least ninety (90) days’ prior written notice of such Replacement Agreement and shall furnish Dealer a copy of the Replacement Agreement with such notice. Failure by Dealer to return an executed copy of the Replacement Agreement to New Holland within such ninety (90) day period shall be deemed “good cause” for New Holland to terminate this Agreement effective upon the end of the ninety (90) day period. Dealer’s return to New Holland of an executed Replacement Agreement shall not give rise to any repurchase rights and obligations provided for in Section 29.
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27.3
|
Breach
.
|
(a)
|
Except where termination of the Agreement due to Dealer’s breach is allowed immediately pursuant to Section 27.4, and except as stated in Sections 27.3(b) and (c), in the event that either Dealer or New Holland fails to fulfill any of their responsibilities under this Agreement, the other party may terminate this Agreement by providing ninety (90) days’ written notice listing the reasons for termination, within which period the other party will have sixty (60) days to rectify the identified breach and avoid termination.
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(b)
|
If Dealer breaches Section 7.2, New Holland may, in its sole discretion, terminate the Agreement upon ninety (90) days’ advance written notice to Dealer. However, during this ninety (90) day period, Dealer may cure its breach of Section 7.2 by providing New Holland, within sixty (60) days of New Holland’s notice to Dealer, a written plan to return to compliance with Section 7.2 within twelve (12) months from the date of New Holland’s notice. Thereafter, if Dealer fails to perform such submitted plan, New Holland may terminate the Agreement with thirty (30) days’ written notice.
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(c)
|
If Dealer is in breach of Section 9.1(a), New Holland may terminate Dealer for such default only after providing Dealer with written notice and a six (6)-month period within which Dealer may cure such default to New Holland’s sole satisfaction.
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(d)
|
A breach by Dealer of any other written agreements between Dealer and New Holland or its Affiliates that is due to fraud committed by Dealer, shall also be considered a breach under this Agreement allowing New Holland to immediately terminate the Agreement.
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(e)
|
As an additional or alternative remedy for any breach by Dealer of the Agreement, New Holland, in its sole discretion and after providing Dealer with an opportunity to cure said breach as provided in Sections 27.3(a), (b) or (c), may amend Schedule D to remove authorization for the Dealer Location at which such breach occurred. In such event, Dealer shall cease all activities related to the display, stocking, sales and service of Products at such Dealer Location, including the use of Licensed Trademarks and New Holland will repurchase new Parts located only at such Dealer Location as provided in Section 29.1(b).
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27.4
|
Immediate Termination
. New Holland may terminate this Agreement immediately upon the occurrence of any of the following events:
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(a)
|
Dealer Financial Defaults
: (i) Dealer’s default in the payment when due of any obligations to New Holland or any of its Affiliates, including but not limited to CNH Industrial Capital America LLC (“CNH Capital”); (ii) Dealer’s default under any chattel mortgage or other security agreement between Dealer and New Holland, any of its Affiliates or any other lender or financing entity; or (iii) the refusal or failure of Dealer upon demand to account to New Holland or any of its Affiliates for the proceeds of the sale of Products for which Dealer is indebted to New Holland or such Affiliates;
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(b)
|
Loss of Wholesale Credit Line
: the termination (or suspension, where such suspension continues for more than sixty (60) calendar days), of any of Dealer’s significant wholesale lines of credit for the purchase of new Products;
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(c)
|
Insolvency
: (i) the filing of a voluntary or involuntary petition in bankruptcy by or against Dealer; (ii) the making of an assignment by Dealer for the benefit of creditors; (iii) a closeout or sale of a substantial part of Dealer’s assets related to the business; (iv) the commencement of dissolution, receivership or liquidation proceedings by or against Dealer; (v) the insolvency of Dealer; or (vi) the levy of a writ of attachment or execution against Dealer;
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(d)
|
Change in Dealer Entity, Control, Ownership or Management
: without the prior written consent of New Holland: (i) any change in Dealer’s legal form or entity; (ii) any change in Dealer’s control, ownership or management (as defined in Section 4.3) listed in Schedule A; or (iii) any assignment or attempted assignment by Dealer of this Agreement;
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(e)
|
Death or Incapacity
: if Dealer fails to provide New Holland with an acceptable ownership or management succession plan as set forth in Section 4.4 upon the death or incapacity of any Dealer Principal;
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(f)
|
Misrepresented or False Information
: Dealer or anyone acting on its behalf has: (i) submitted false records, contracts, statements, reports or documents to New Holland or any of its Affiliates, including CNH Capital; (ii) submitted any false or fraudulent documents for Dealer Claims or in support thereof;
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(g)
|
Failure to Operate
: failure to operate any Dealer Location in the normal course of business for seven
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(h)
|
Criminal and/or Tortious Conduct
: Dealer or any Dealer Principal has pleaded guilty to or been convicted of a felony or any other violation of law that in New Holland’s opinion affects adversely the operation or business of Dealer, or the good name, goodwill or reputation of New Holland, Products, Licensed Trademarks, Dealer, or other authorized dealers of Products;
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(i)
|
Dealer Closure/Loss of License
: (i) a permanent closure of any Dealer Location without the prior written consent of New Holland; or (ii) the revocation, suspension or other invalidation of any Dealer license, permit or authorization necessary to conduct business pursuant to this Agreement;
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(j)
|
Inspection/Audit Refusal
: any failure by Dealer to permit New Holland to inspect or audit Dealer’s inventory or business and financial records pursuant to Section 16.4;
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(k)
|
Detrimental Conduct
: any conduct by Dealer or any Dealer Principal which in the sole discretion of New Holland: (i) is injurious or detrimental to Dealer’s Customers, the public welfare, other authorized dealers of Products, or the reputation of New Holland, Products and the Licensed Trademarks; (ii) is unbecoming of a reputable business person; (iii) is abusive or threatening to any New Holland employee; or (iv) evidences a disagreement between any Dealer Principals that in New Holland’s opinion adversely affects the operation of Dealer or the good name, goodwill or reputation of New Holland, Products, Licensed Trademarks, or Dealer;
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(l)
|
Breach of Confidentiality
: any misuse or unauthorized disclosure of New Holland IP, Company Information or Authorized Software;
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(m)
|
Revocation of Guaranty
: the withdrawal or revocation of a guaranty of Dealer’s indebtedness to New Holland or its Affiliates by one or more personal or corporate guarantors;
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(n)
|
Incurable Breach
: any breach of the Agreement that is incapable of being remedied by an affirmative present action by the Dealer;
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(o)
|
Repetitive Breach
: breach of the Agreement by Dealer for which it has received notice by New Holland of that same type of breach on at least two (2) prior separate and distinct occasions;
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(p)
|
Unauthorized Location
: any breach of Section 12.2 of the Agreement.
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27.5
|
New Holland’s Exercise of Termination Rights
. New Holland may exercise its termination rights under Sections 27.3 and 27.4 without regard to the performance of other authorized dealers or to the circumstances under which New Holland has terminated or refrained from terminating the sales and service agreements of other authorized dealers.
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27.6
|
Termination At Will
. This Agreement may be terminated at any time at will, without cause, upon sixty (60) days’ written notice by Dealer to New Holland, or as mutually agreed upon in writing by both Parties.
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28.1
|
Dealer’s Obligations
. Upon the termination or expiration of this Agreement, Dealer shall cease to operate or represent itself as an authorized dealer of Products under the Licensed Trademarks, and shall promptly: (a) cease using the Licensed Trademarks and remove from Dealer Locations and vehicles all signs or advertising displays that bear the Licensed Trademarks; (b) remove and discontinue the use of, and cause any third party to remove, any identification and any promotion or advertising that associates Dealer with Products, the Licensed Trademarks, or New Holland; and (c) at New Holland’s request, provide to New Holland all sales records, mailing lists, customer lists, service history records, microfiche, catalogs, registrations and any other material of any kind relating to the promotion, marketing, sale, operation or servicing of Products covered by this Agreement. If Dealer fails to promptly comply with any of its obligations upon the termination or expiration of this Agreement, including but not limited to Dealer’s obligations under this section, New Holland may take steps, as it deems necessary in its sole discretion, to effect Dealer’s compliance with such obligations or the same result as would be realized by Dealer’s compliance, and Dealer shall reimburse New Holland for all costs and expenses, including attorney's fees, incurred by New Holland in effecting or enforcing such compliance.
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28.2
|
Pending Orders
. Termination or expiration of this Agreement shall relieve New Holland of any obligation to make any further shipments of Products, and New Holland may without liability cancel any of Dealer’s unshipped orders for Products. For any Products which New Holland may ship after termination or notice thereof, New Holland may require payment prior to shipment.
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28.3
|
Financial Obligations
. Upon the termination or expiration of this Agreement, all indebtedness of Dealer shall become immediately due and payable to New Holland, and Dealer shall promptly pay New Holland all sums owed by Dealer. Final settlement of Dealer’s account with New Holland shall not be made until Dealer complies with all requirements of this Agreement.
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28.4
|
Continued Market Presence
. In advance of the effective date of termination, the scheduled Expiration Date or the expiration of any extension period of this Agreement, New Holland may consummate arrangements to appoint a replacement authorized dealer for Dealer’s PMR.
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28.5
|
Post-Termination Transactions
. Any business relations or transactions between the Parties after expiration or termination of this Agreement shall not constitute a waiver of the expiration or termination of this Agreement or in any manner reinstate the Parties’ contractual relationship, or establish any new contractual relationship, and all such relations shall be governed by terms and conditions identical to the relevant provisions of this Agreement unless the Parties execute a new agreement superseding this Agreement.
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28.6
|
Pre-Termination Warranty Service
. New Holland will reimburse Dealer for all Warranty Service claims performed prior to the expiration or termination of this Agreement that meet the requirements of the DPM.
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29.1
|
Items Subject to Repurchase
. Within thirty (30) days after the termination or expiration of this Agreement, either New Holland or Dealer may request in writing the return for repurchase of all of the following items originally purchased from New Holland by Dealer, on the terms specified herein, and Dealer shall return such items to New Holland as follows:
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(a)
|
Equipment
.
|
(i)
|
Equipment Eligible for Repurchase
. New, undamaged, salable, current, complete and unused Equipment, including attachments, purchased from New Holland and delivered to Dealer within twenty-four (24) months of the date this Agreement terminates or expires (“Repurchasable Equipment”). For purposes of this Section, “current” means the model or series of Equipment listed in New Holland’s price book or price list at the date of termination or expiration of the Agreement. New Holland will only repurchase separate attachments that were not previously installed on Equipment and which were invoiced separately to Dealer.
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(ii)
|
Equipment Repurchase Price
. Repurchasable Equipment shall be repurchased at the price paid by Dealer (A) not including transportation costs actually paid or incurred by Dealer for initial delivery, (B) less any discounts which may have been allowed or paid thereon by New Holland, (C) adjusted where appropriate to account for any damage or weathering. New Holland shall not be obligated to reimburse Dealer’s initial costs for unloading, set up, or preparation of Repurchasable Equipment.
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(b)
|
Parts
.
|
(i)
|
Parts Eligible for Repurchase
. New, undamaged, salable, complete and unused Parts purchased from New Holland by Dealer, that are listed as of the date of termination or expiration of the Agreement in New Holland’s then current Price List and not identified as discontinued in such Price List (“Repurchasable Parts”). Repurchasable Parts must be in original New Holland packaging with their original authorized New Holland identification label and must be properly identified prior to shipment to New Holland for repurchase. New Holland specifically excludes from repurchase Parts that: (A) have a limited shelf life or contain flammable or hazardous materials; (B) are direct shipped from a supplier other than New Holland; (C) have an altered or counterfeited identification label; (D) are in broken packaging; (E) are not in correct order multiples; (F) are coded non-returnable in the current parts Price List; or (G) are common service or ‘maintenance’ items, rather than repair parts, such as oil, filters, fluids, lubricants, tires, batteries, tracks, bucket edges and teeth.
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(ii)
|
Parts Repurchase Price
. Repurchasable Parts shall be repurchased at the then current dealer price (less discounts and freight), less a restocking charge as set forth in the Parts Return Policy.
|
(iii)
|
Merchandise Items
. ‘Merchandise’ items such as clothing, toys, binders, gloves, etc., are not eligible for repurchase.
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29.2
|
Return Procedures
. Within sixty (60) days after the date of the written request made pursuant to Section 29.1, Dealer shall return to New Holland all items subject to repurchase or required to be returned pursuant to this Agreement. All items returned to New Holland shall be identified as required by New Holland, packed, boxed,
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29.3
|
Conditions Precedent to Payment
. Any costs incurred by New Holland in discharging all or any part of Dealer’s obligations under this Agreement, including but not limited to Dealer’s obligations to cease all use of the Licensed Trademarks or to pack, load and ship Parts to New Holland, shall be deducted from any amount owed by New Holland to Dealer. Dealer shall not be entitled to payment or credit for returned items until Dealer has complied with all applicable laws, rules, regulations and other legal requirements governing the bulk transfer of inventory or similar protection of creditors. New Holland shall have the right to withhold from the price of any items repurchased pursuant to this section a sum sufficient to discharge any liens or encumbrances against such items and to discharge such liens or encumbrances. Dealer shall execute such documents and take any additional action requested by New Holland to transfer ownership of returned items, free and clear of any claims, liens or encumbrances.
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29.4
|
Other Return Items
. Upon expiration or termination of this Agreement, Dealer shall return to New Holland any materials (such as sales promotion, advertising and training materials, tools and signs) provided without charge to Dealer by New Holland or any predecessor.
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30.1
|
Dealer Responsibility for Operating Capital
. This Agreement contemplates that Dealer, as an independent business, shall obtain on its own the capital investment necessary to operate its business. Nothing in this Agreement shall impose any liability on New Holland in connection with Dealer's operations under this Agreement or otherwise, or for any expenditure made or incurred by Dealer in preparation for performance or in performance of Dealer's responsibilities under this Agreement.
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30.2
|
Disclaimer of Consequential Damages
. The Parties both understand and agree that this Agreement is of a limited duration, and therefore, except as provided herein, neither party shall be liable to the other for any damages caused by the termination or expiration of this Agreement, whether based upon loss of anticipated sales or prospective profits, expenditures, investments, leases, property improvements or other matters related to the business of the Parties. The damages to which either party may be entitled for breach of this Agreement are limited to actual out-of-pocket expenses incurred as a direct result of the breach.
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30.3
|
Waiver of Punitive Damages
. The Parties hereby waive, to the fullest extent permitted by law, any right or claim for any punitive or exemplary damages against the other and agree that if there is a dispute with the other that each party shall be limited to the recovery of actual damages sustained by it.
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30.4
|
No Group Litigation
. The Parties agree that any and all dispute resolution proceedings between them, including litigation, arising from or related to this Agreement shall be conducted on an individual basis only. Neither Party shall commence any dispute resolution with a third-party against the other, or join with any third party in any dispute resolution involving New Holland and Dealer. Neither of the Parties shall attempt to consolidate or otherwise combine in any manner a dispute resolution proceeding involving New Holland or Dealer with another dispute resolution proceeding of any kind.
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30.5
|
Limitations Period
. All claims for any breach of this Agreement, and all claims arising out of the relationship between the Parties established by this Agreement, shall be made within two (2) years from the date such claim accrued.
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31.1
|
Indemnification By New Holland
.
|
(a)
|
Licensed Trademarks
. If New Holland reasonably determines that Dealer has used the Licensed Trademarks in accordance with this Agreement, New Holland shall defend, indemnify, and hold harmless Dealer from all loss, cost, liability, and expense arising out of any claim, suit or demand regarding Dealer’s use of the Licensed Trademarks. If New Holland, in its sole discretion, determines that Dealer has not used the Licensed Trademarks in accordance with this Agreement, Dealer shall bear the cost of such defense, judgment or settlement.
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(b)
|
Authorized Software
. New Holland shall defend, indemnify, and hold Dealer harmless from all loss, cost, liability, and expense arising out of any claim that Authorized Software used in accordance with its documentation infringes any valid patent, copyright, trade secret, or other enforceable proprietary right of any third party. Should any Authorized Software become (or in New Holland’s opinion be likely to become) subject to such a claim, Dealer will permit New Holland, at New Holland’s option and expense to (a) procure for Dealer or Dealer’s Customers the right to continue to use Authorized Software or (b) modify the allegedly infringing Authorized Software so that it becomes non-infringing. New Holland’s obligations under this Section will not apply if Authorized Software is modified without New Holland’s consent.
|
(c)
|
New Holland IP
. Except as otherwise provided in this Section with respect to Authorized Software and Licensed Trademarks, New Holland will indemnify, defend and hold harmless Dealer from all loss, cost, liability, and expense arising out of any claim based on an allegation that any Product infringes a valid patent, copyright, or trademark or misappropriates any protectable and enforceable trade secret. New Holland shall have no obligations under this provision for any Product that has been the subject of unauthorized modifications by Dealer or any third party or for infringement that results from the use of intellectual property other than New Holland IP in conjunction with New Holland IP that would otherwise not be infringing. If any Product becomes, or in New Holland’s opinion is likely to become, subject to such a claim of infringement, New Holland will, at its expense and at its option, either procure the right for Dealer and Dealer’s Customers to continue using the infringing Product(s) or replace or modify the New Holland Product(s) so that they are no longer infringing. Upon failure of the foregoing provisions, New Holland may, at its option, refund the purchase price for the infringing Product(s) less a reasonable allowance for use. This section states the entire liability of New Holland for infringement by any Product.
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(d)
|
Dealer Cooperation
. In the event of any litigation relating to Dealer’s use of the Licensed Trademarks, Authorized Software, or New Holland IP, Dealer shall promptly notify New Holland of such litigation and shall execute any and all documents and undertake such acts as may, in the opinion of New Holland, be necessary or useful to carry out such defense or prosecution, including becoming a nominal party to any legal action. Except to the extent that such litigation is the result of Dealer’s use of the Licensed Trademarks, Authorized Software, or New Holland IP in a manner inconsistent with the terms and conditions of this Agreement, New Holland agrees to reimburse Dealer for its out-of-pocket costs in undertaking such acts.
|
(e)
|
Control of Litigation
. Dealer acknowledges that New Holland has the right to direct and control any administrative proceeding or litigation involving the Licensed Trademarks, Authorized Software, or New Holland IP, including any settlement thereof. New Holland agrees to consult with Dealer regarding any settlement in which Dealer would be required to financially participate and to obtain Dealer’s consent to any such settlement, which consent will not be unreasonably withheld. New Holland has the right, but not the obligation, to take action against uses by others that may constitute infringement of the Licensed Trademarks, Authorized Software or New Holland IP. If Dealer fails to notify New Holland promptly of any litigation or refuses to give New Holland sole control of the defense and/or prosecution of such litigation and all settlement negotiations, New Holland will be relieved of its obligations under this Section.
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31.2
|
Indemnification by Dealer
. Dealer agrees to defend, hold harmless and indemnify New Holland, its Affiliates and their respective shareholders, directors, officers, agents, employees, successors and assigns from and against any and all claims, damages, demands, settlements, judgments, legal actions, liabilities, costs and expenses of any nature, including without limitation, attorney's fees and court costs, resulting from the acts
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32.1
|
Governing Law
. This Agreement shall be governed by and interpreted according to the laws of the state of Dealer’s Primary Location, without regard to such state’s conflicts of laws rules and except to the extent governed by the United States Trademark Act of 1946 (Lanham Act), the Copyright Act, and the Patent Act.
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32.2
|
Consent to Jurisdiction and Venue
. Dealer irrevocably submits itself to the exclusive jurisdiction of the federal courts for the Middle District of Pennsylvania for the purpose of any suit, action, or other proceeding arising out of or relating to this Agreement, or of any of the transactions contemplated thereby, and irrevocably agrees that all claims in respect of such suit, action or proceeding may be heard and determined in such federal court, provided that New Holland may apply to any court of competent jurisdiction for interim protection or equitable relief such as an interlocutory or interim injunction. If the federal court for the Middle District of Pennsylvania lacks jurisdiction for any reason to hear such claims, Dealer irrevocably submits itself to the exclusive jurisdiction of the Court of Common Pleas of Lancaster County, Pennsylvania. By execution and delivery of this Agreement, Dealer irrevocably waives, to the fullest extent it may effectively do so, and agrees not to assert, by way of motion, as a defense, or otherwise, in any such suit, action, or proceeding, any claim that it is not personally subject to the jurisdiction of the above-named courts for any reason whatsoever. The Parties agree that a final judgment (as to which all appeals have been exhausted or the time within which such appeals may be made has expired) in any such suit, action or proceeding shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment or in any other manner provided by law.
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32.3
|
Compliance With Local Laws
. The rights and obligations of the Parties to this Agreement may be subject to certain laws, orders, regulations, directions, restrictions, and limitations of governments and governmental agencies having jurisdiction over the Parties. If a change in any such law, order, regulation, direction, or restriction (including any limitation, appropriation, seizure, or interpretation thereof) shall, in the judgment of either party, substantially alter the relationship between the Parties, this Agreement, or the advantages derived from the Parties’ relationship, either party may request the other party to modify this Agreement. If, within thirty (30) days after such a request has been made, the Parties are unable to agree upon a mutually satisfactory modification of this Agreement, then the adversely affected party may terminate this Agreement on fifteen (15) days’ notice given to the other party.
|
32.4
|
Information Sharing
. New Holland shall be allowed to share information regarding Dealer, including but not limited to Dealer’s financial and ownership information, with any of New Holland’s Affiliates.
|
32.5
|
Dealer Relationship to New Holland
. The Parties are independent businesses and neither has any fiduciary obligation to the other, and Dealer is an independent retailer which purchases Products for resale for Dealer’s principal benefit. Nothing in this Agreement shall be construed as constituting Dealer to be an employee, franchisee, agent or legal representative of New Holland for any purpose whatsoever. Dealer has no right or authority, express or implied, to assume or create any obligation or responsibility on behalf of or in the name of New Holland, or to bind New Holland in any manner.
|
32.6
|
Entire Agreement
. This Agreement, together with the DPM and any changes thereto issued by New Holland from time to time, is and shall be deemed to be the complete and final expression of the agreement between the Parties as to the matters herein contained and provided for and supersedes all previous agreements between the Parties pertaining to such matters. IT IS CLEARLY UNDERSTOOD THAT NO PROMISE OR REPRESENTATION NOT CONTAINED HEREIN WAS AN INDUCEMENT TO EITHER PARTY OR WAS RELIED UPON BY EITHER PARTY IN ENTERING INTO THIS AGREEMENT.
|
32.7
|
Execution and Modification
. Except as expressly provided for herein, this Agreement may not be executed, amended or altered, or any of its provisions waived on behalf of New Holland, except in writing, signed by New Holland’s Director of Network Development or other authorized director in a similar capacity.
|
32.8
|
Severability
. In the event any part of this Agreement is held to be invalid or unenforceable under the law, this Agreement shall be enforceable to the maximum extent permitted by such law, without invalidating the remainder of this Agreement, or invalidating the effect of such portion of this Agreement elsewhere.
|
32.9
|
Assignment
.
|
(a)
|
By Dealer
. In view of the personal nature of this Agreement, the rights, privileges and obligations conferred on Dealer under this Agreement are not transferable, assignable or salable by Dealer without the prior written consent of New Holland, and no property right or interest, direct or indirect, is sold, conveyed or transferred to Dealer under this Agreement. Any attempt by Dealer to assign its rights or obligations under this Agreement without New Holland’s written consent shall be null and void.
|
(b)
|
By New Holland
. Upon written notice to Dealer, New Holland may assign this Agreement and any rights and obligations thereunder to any Affiliate of New Holland or to any entity that succeeds to the interests of New Holland.
|
32.10
|
Waiver of Default
. The waiver by New Holland of any default, or the failure of New Holland to exercise any of its rights, under this Agreement or otherwise shall not act as a waiver of such default or any subsequent default or a waiver of any of New Holland’s rights hereunder.
|
32.11
|
Headings
. The headings of sections and subsections in this Agreement are inserted for convenience of reference only and shall not in any way affect the construction, meaning or interpretation of any provision of this Agreement, and shall not be deemed or construed in any way to limit the meaning of such sections.
|
32.12
|
Interpretation
. This Agreement is being entered into by and among competent and sophisticated parties who are experienced in business matters. Therefore, any language in this Agreement deemed to be ambiguous by a court of law will not be construed against any particular party as the drafter of the language.
|
32.13
|
Notice, Approval and Consent
. Any notice, approval or consent required or allowed under this Agreement shall be given in writing and, without prejudice to other forms of actual service, shall be considered as served upon being mailed in a properly sealed envelope with first class, certified or registered postage prepaid. Notices to New Holland shall be addressed to the New Holland Regional Dealer Development Manager for Dealer’s assigned region and shall be delivered or mailed to CNH Industrial America LLC, 500 Diller Avenue, New Holland, Pennsylvania 17557. Notices to Dealer shall be delivered or mailed to any person designated in Schedule A or to Dealer at Dealer’s Primary Location.
|
32.14
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Survival
. The Parties’ obligations in the following sections shall survive the expiration or termination of this Agreement: 5.5, 10.1(f), 16.6, 17.4, 24.4, 26.1, 26.2, 28.1, 28.3, 28.6, 29.1, 29.2, 29.3, 29.4, 30.2, 30.3, 30.4, 30.5, 31.1, 31.2, 32.1, 32.2, and 32.3.
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32.15
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Review by Counsel
. Dealer acknowledges that it has had an adequate opportunity to review this Agreement and consult with legal counsel of its own choosing regarding the content and meaning of this Agreement.
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Paragraph
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Page
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Paragraph
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Page
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DEALER COVER PAGE
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17. COMPUTER BUSINESS SYSTEM
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10
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1. PURPOSE STATEMENT
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1
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18. MARKETING & PROMOTIONAL SUPPORT
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11
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2. DEFINITIONS
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1
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19. ORDERS, DELIVERY AND PASSAGE OF TITLE
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11
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3. APPOINTMENT
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3
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20. PRODUCT PRICING AND PAYMENT
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12
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4. OWNER AND MANAGEMENT REQUIREMENTS
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3
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21. NEGATIVE COVENANTS AND COMPLIANCE
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12
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5. PRODUCTS
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4
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22. PRODUCT CHANGES AND DISCONTINUATION
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13
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6. PRIMARY MARKET OF RESPONSIBILITY
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4
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23. NEW HOLLAND SALES OF PRODUCTS
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13
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7. DEALER FINANCIAL REQUIREMENTS
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5
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24. LICENSED TRADEMARKS
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13
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8. DEALER INVENTORY AND DISPLAY RESPONSIBILITIES
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6
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25. AUTHORIZED SOFTWARE
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15
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9. DEALER SALES RESPONSIBILITIES
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6
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26. COMPANY INFORMATION AND NEW HOLLAND IP
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15
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10. DEALER SERVICE RESPONSIBILITIES
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7
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27. TERM AND TERMINATION
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16
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11. DEALER PRE-DELIVERY AND POST-DELIVERY RESPONSIBILITIES
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7
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28. EFFECT OF TERMINATION OR EXPIRATION
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18
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12. FACILITY REQUIREMENTS AND DEALER LOCATIONS
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8
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29. INVENTORY REPURCHASE AND RETURN OBLIGATIONS
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19
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13. BUSINESS PLAN
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8
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30. LIMITATION OF LIABILITY
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20
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14. INSURANCE AND TAXES
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9
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31. INDEMNIFICATION
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20
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15. WARRANTY
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9
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32. GENERAL PROVISIONS
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22
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16. RECORDS AND INSPECTIONS
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10
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SIGNATURE PAGE
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23
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CPT
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MRT
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CRW
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HHT
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4WD
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H&F
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CMB
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SPF
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SPS
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GPH
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CRP/SED
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KON
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SSL
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IND
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C01
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Dealer City
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Dealer State
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Compact Tractors
<40HP
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Mid‐Range HP Tractors 40‐139 HP
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Ag Crawler Tractors
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High HP Tractors
>140 HP
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4WD
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Hay and Forage
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Combine Harvester
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SP Forage Harvester
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SP
Sprayers
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Grape Harvester
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Crop Production Products
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Kongskilde Soil
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Skid‐Steer Loaders
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Industrial Backhoe Loaders
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Compact Excavators/ Wheel Loaders
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Product Lines and County Assignment
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CPT
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MRT
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HHT
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4WD
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H&F
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CMB
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SPF
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SPS
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CRP/SED
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KON
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SSL
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IND
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CPEX
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CPWL
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County Assignment
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ST
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Dealer City, ST
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Compact Tractors
<40HP
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Mid‐Range HP
Tractors 40 139 HP
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High HP Tractors
>140 HP
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4WD
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Hay and Forage
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Combine Harvester
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SP Forage Harvesters
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SP
Sprayers
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Crop Production Products
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Kongskilde Soil
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Skid‐ Steer Loaders
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Industrial Backhoe Loaders
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Comp Excavator
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Comp Wheel Loader
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Type
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Street Address
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City
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ST
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Zip Code
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Primary
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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Branch
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2.
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Section 4.2 of the Agreement is deleted.
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3.
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Section 4.3 of the Agreement is replaced in its entirety with the following:
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4.3
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Changes in Dealer Form and Control
. Dealer shall provide New Holland with sixty (60) days’ prior written notice of Dealer’s intention to change its: (a) legal form or entity; or (b) control or management (a “Change of Control” as defined below); provided that, in the event that Dealer is not aware of such event, notice shall be furnished as soon as reasonably practical after Dealer acquires knowledge. Prior to consummating any such change described in this paragraph, or following such change if Dealer had no advance knowledge, Dealer must obtain New Holland’s written consent.
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(ii)
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any sale of all or substantially all of Dealer’s assets;
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4.
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Section 4.4 of the Agreement is replaced in its entirety with the following:
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4.4
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Death or Incapacity of Dealer Principals
. In the event of the death or incapacity of any person listed in Schedule A (“Dealer Principal(s)”), Dealer shall provide New Holland within ninety (90) days of such occurrence, an ownership or management succession plan for the replacement of such deceased or incapacitated Dealer Principal(s), if Dealer proposes to continue operation under this Agreement. New Holland may approve or deny Dealer’s proposed succession plan in its reasonable discretion.
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5.
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Section 4.6 of the Agreement is replaced in its entirety with the following:
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6.
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Section 9.1(a) of the Agreement is replaced in its entirety with the following:
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7.
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Section 9.2 of the Agreement is replaced in its entirety with the following:
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8.
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Section 13.1 of the Agreement is replaced in its entirety with the following:
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10.
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Section 16.6 of the Agreement is replaced in its entirety with the following:
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11.
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Section 20.4 of the Agreement is replaced in its entirety with the following:
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12.
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Section 21.1 of the Agreement is replaced in its entirety with the following:
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13.
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Section 21.5 of the Agreement is replaced in its entirety with the following:
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15.
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Section 27.3(b) of the Agreement is replaced in its entirety with the following:
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16.
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Subparagraphs (a), (c), (g), (h), (k) and (o) of Section 27.4 of the Agreement are amended as follows:
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(a)
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Dealer Financial Defaults
: (i) Dealer’s default in the payment when due of any obligations to New Holland or any of its Affiliates, including but not limited to CNH Industrial Capital America LLC (“CNH Capital”) after the expiration of any notice and cure periods in any applicable agreements with New Holland’s Affiliates or CNH Capital; (ii) Dealer’s default under any chattel mortgage or other security agreement between Dealer and New Holland, any of its Affiliates or any other lender or financing entity with whom Dealer has a material credit arrangement (i.e., a credit arrangement for which the relevant agreements must be publicly disclosed pursuant to federal securities laws), if such default results in an acceleration of the indebtedness owed under the credit facility; or (iii) the refusal or failure of Dealer, following written demand, to account to New Holland or any of its Affiliates for the proceeds of the sale of Products for which Dealer is indebted to New Holland or such Affiliates;
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c.
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Subparagraph (d) of Section 27.4 is replaced in its entirety with the following:
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d.
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Subparagraph (g) of Section 27.4 is replaced in its entirety with the following:
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e.
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Subparagraph (h) is amended to delete “or any Dealer Principal” from such section.
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f.
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Subparagraph (k) of Section 27.4 is replaced in its entirety with the following:
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g.
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Subparagraph (o) of Section 27.4 is replaced in its entirety with the following:
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By:
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Officer of CNH
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1.
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I have reviewed this Quarterly report on Form 10-Q of Titan Machinery Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ David J. Meyer
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David J. Meyer
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Board Chair and Chief Executive Officer
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(a)
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Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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(b)
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Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
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(c)
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Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
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Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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(a)
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All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
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(b)
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Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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/s/ Mark Kalvoda
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Mark Kalvoda
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Chief Financial Officer
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/s/ David J. Meyer
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David J. Meyer
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Board Chair and Chief Executive Officer
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/s/ Mark Kalvoda
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Mark Kalvoda
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Chief Financial Officer
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