(a) Except as provided in subsection (d), a supplier shall provide a dealer at least 120 days’ prior written notice of any intention to amend, terminate, or decline to renew any dealer agreement. The notice shall state all of the reasons for the intended amendment, termination, or nonrenewal.
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Terms Used In Alabama Code 8-21B-5

  • Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Contract: A legal written agreement that becomes binding when signed.
  • Conviction: A judgement of guilt against a criminal defendant.
  • following: means next after. See Alabama Code 1-1-1
  • person: includes a corporation as well as a natural person. See Alabama Code 1-1-1
  • state: when applied to the different parts of the United States, includes the District of Columbia and the several territories of the United States. See Alabama Code 1-1-1
(b) Where such reason or reasons for amendment, termination, or nonrenewal relate to a condition or conditions which may be rectified by action of the dealer, the dealer shall have 90 days from the date of notice from the supplier in which to take such action and, within such 90-day period, shall give written notice to the supplier if and when such action is taken. If the condition or conditions have been rectified by the dealer, then the proposed amendment, termination, or nonrenewal shall be void and without legal effect. However, where the supplier contends that action on the part of the dealer has not rectified one or more of such conditions, the supplier must give written notice of such claimed deficiency to the dealer within 15 days after the dealer gave notice to the supplier of the action taken.
(c) During the 120-day notice period provided for in subsection (a), the dealer shall have the right to contract for a transfer of the dealership business or dealer agreement to another person who meets the material and reasonable qualifications and standards required by the supplier for its dealers. The dealer shall give notice of any such transfer to the supplier at least 45 days prior to the expiration of the 120-day notice period.
(d) A dealer agreement may be immediately terminated, amended, or nonrenewed and no notice shall be required if the reason for the amendment, termination, or nonrenewal is any of the following:

(1) The bankruptcy or receivership of the dealer.
(2) An assignment by the dealer for the benefit of the creditors or similar disposition of the assets of the business, other than the creation of a security interest in the assets of a dealer for the purpose of securing financing in the ordinary course of business.
(3) Willful or intentional misrepresentation made by the dealer to the supplier with the express intent to defraud the supplier.
(4) Failure of the dealer to conduct its customary sales and service operations during its customary business hours for seven consecutive business days, unless such failure has resulted from acts of God, casualties, strikes, or other similar circumstances beyond the dealer’s reasonable control.
(5) A final conviction of the dealer principal of a felony.
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