State of Illinois
91st General Assembly
Legislation

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91_SB0377eng

 
SB377 Engrossed                                LRB9104949KSgc

 1        AN ACT to  amend  the  Motor  Vehicle  Franchise  Act  by
 2    changing Section 10.1.

 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:

 5        Section 5.  The Motor Vehicle Franchise Act is amended by
 6    changing Section 10.1 as follows:

 7        (815 ILCS 710/10.1) (from Ch. 121 1/2, par. 760.1)
 8        Sec. 10.1.  (a) As used  in  this  Section,  "motorcycle"
 9    means every motor vehicle having a seat or saddle for the use
10    of  the rider and designed to travel with 3 or less wheels in
11    contact with the ground, excluding  farm,  garden,  and  lawn
12    equipment, and including off-highway vehicles.
13        (b)  It shall be deemed a violation for a manufacturer, a
14    distributor,  a wholesaler, a distributor branch or division,
15    or officer, agent or other representative thereof:
16             (1)  To   require   a   motorcycle   franchisee   to
17        participate in a retail financing plan or retail  leasing
18        plan  or  to participate in any retail consumer insurance
19        plan.
20             (2)  To own, to operate or to control any motorcycle
21        dealership in this State  for  a  period  longer  than  2
22        years.
23             (3)  Whenever  any  motorcycle  dealer enters into a
24        franchise agreement, evidenced  by  a  contract,  with  a
25        wholesaler,   manufacturer  or  distributor  wherein  the
26        franchisee  agrees  to  maintain  an  inventory  and  the
27        contract is terminated by the  wholesaler,  manufacturer,
28        distributor,  or  franchisee,  then  the  franchisee  may
29        require  the  repurchase of the inventory as provided for
30        in this Act. If the franchisee has any outstanding  debts
31        to  the  wholesaler, manufacturer or distributor then the
 
SB377 Engrossed             -2-                LRB9104949KSgc
 1        repurchase amount may be  credited  to  the  franchisee's
 2        account.  The  franchise agreement shall either expressly
 3        or by operation of law  have  as  part  of  its  terms  a
 4        security  agreement whereby the wholesaler, manufacturer,
 5        or distributor  agrees  to  and  does  grant  a  security
 6        interest  to  the  motorcycle  dealer  in the repurchased
 7        inventory to secure payment of the repurchase  amount  to
 8        the  dealer.  The perfection, priority, and other matters
 9        relating to the security interest shall  be  governed  by
10        Article 9 of the Uniform Commercial Code.  The provisions
11        of  this  Section shall not be construed to affect in any
12        way any security interest that any financial institution,
13        person, wholesaler, manufacturer, or distributor may have
14        in the inventory of the motorcycle dealer.
15        (c)  The provisions of this Section 10.1  are  applicable
16    to all new or existing motorcycle franchisees and franchisors
17    and are in addition to the other rights and remedies provided
18    in  this  Act,  and,  in  the  case  of a conflict with other
19    provisions contained in this Act, with respect to  motorcycle
20    franchises, this Section shall be controlling.
21        (d)  The  filing  of  a  timely  protest  by a motorcycle
22    franchise before the Motor Vehicle Review Board as prescribed
23    by Sections 12 and 29 of this Act, shall stay  the  effective
24    date of a proposed additional franchise or selling agreement,
25    or  the  effective  date  of a proposed motorcycle dealership
26    relocation,  or  the  effective  date  of   a   cancellation,
27    termination or modification, or extend the expiration date of
28    a   franchise  or  selling  agreement  by  refusal  to  honor
29    succession to ownership or  refusal  to  approve  a  sale  or
30    transfer  pending  a final determination of the issues in the
31    hearing.
32    (Source: P.A. 88-349.)

33        Section 99.  Effective date.  This Act takes effect  upon
 
SB377 Engrossed             -3-                LRB9104949KSgc
 1    becoming law.

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