{"data":{"id":"us-ok/okla.-stat.-tit.-47-47-565.2v2","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 47, § 47-565.2v2","heading":"Termination, cancellation or nonrenewal of new motor","body":"vehicle or new powersports vehicle dealer franchise.\n\nA. Irrespective of the terms, provisions, or conditions of any\n\nfranchise, or the terms or provisions of any waiver, no manufacturer\n\nshall terminate, cancel, or fail to renew any franchise with a\n\nlicensed new motor vehicle dealer or new powersports vehicle dealer\n\nunless the manufacturer has satisfied the notice requirements as\n\nprovided in this section and has good cause for cancellation,\n\ntermination, or nonrenewal. The manufacturer shall not attempt to\n\ncancel or fail to renew the franchise agreement of a new motor\n\nvehicle dealer in this state unfairly and without just provocation\n\nor without due regard to the equities of the dealer or without good\n\nfaith as defined herein. As used herein, \"good faith\" means the\n\nduty of each party to any franchise agreement to act in a fair and\n\nequitable manner toward each other, with freedom from coercion or\n\nintimidation or threats thereof from each other.\n\nB. Irrespective of the terms, provisions, or conditions of any\n\nfranchise, or the terms or provisions of any waiver, good cause\n\nshall exist for the purpose of a termination, cancellation, or\n\nnonrenewal when:\n\n1. The new motor vehicle dealer or new powersports vehicle\n\ndealer has failed to comply with a provision of the franchise, which\n\nprovision is both reasonable and of material significance to the\n\nfranchise relationship, or the new motor vehicle dealer or new\n\npowersports vehicle dealer has failed to comply with reasonable\n\nperformance criteria for sales or service established by the\n\nmanufacturer, and the new motor vehicle dealer or new powersports\n\nvehicle dealer has been notified by written notice from the\n\nmanufacturer; and\n\n2. The new motor vehicle dealer or new powersports vehicle\n\ndealer has received written notification of failure to comply with\n\nthe manufacturer's reasonable sales performance standards,\n\ncapitalization requirements, facility commitments, business-related\n\nequipment acquisitions, or other such remediable failings exclusive\n\nof those reasons enumerated in paragraph 1 of subsection C of this\n\nsection, and the new motor vehicle dealer or new powersports vehicle\n\ndealer has been afforded a reasonable opportunity of not less than\n\nsix (6) months to comply with such a provision or criteria.\n\nC. Irrespective of the terms, provisions, or conditions of any\n\nfranchise agreement prior to the termination, cancellation, or\n\nnonrenewal of any franchise, the manufacturer shall furnish\n\nnotification of such termination, cancellation, or nonrenewal to the\n\nnew motor vehicle dealer or new powersports vehicle dealer and the\n\nOklahoma New Motor Vehicle Commission as follows:\n\n1. Not less than ninety (90) days prior to the effective date\n\nof the termination, cancellation, or nonrenewal unless for a cause\n\ndescribed in paragraph 2 of this subsection;\n\n2. Not less than fifteen (15) days prior to the effective date\n\nof the termination, cancellation, or nonrenewal with respect to any\n\nof the following:\n\na. insolvency of the new motor vehicle dealer or new\n\npowersports vehicle dealer, or the filing of any\n\npetition by or against the new motor vehicle dealer or\n\nnew powersports vehicle dealer under any bankruptcy or\n\nreceivership law,\n\nb. failure of the new motor vehicle dealer or new\n\npowersports vehicle dealer to conduct its customary\n\nsales and service operations during its customary\n\nbusiness hours for seven (7) consecutive business\n\ndays, provided that such failure to conduct business\n\nshall not be due to an act of God or circumstances\n\nbeyond the direct control of the new vehicle dealer,\n\nor\n\nc. conviction of the new vehicle dealer or new\n\npowersports vehicle dealer of any felony which is\n\npunishable by imprisonment or a violation of the\n\nFederal Odometer Act; and\n\n3. Not less than one hundred eighty (180) days prior to the\n\neffective date of the termination or cancellation where the\nnot be due to an act of God or circumstances\n\nbeyond the direct control of the new vehicle dealer,\n\nor\n\nc. conviction of the new vehicle dealer or new\n\npowersports vehicle dealer of any felony which is\n\npunishable by imprisonment or a violation of the\n\nFederal Odometer Act; and\n\n3. Not less than one hundred eighty (180) days prior to the\n\neffective date of the termination or cancellation where the\n\nmanufacturer or distributor is discontinuing the sale of the product\n\nline.\n\nThe notification required by this subsection shall be by\n\ncertified mail, return receipt requested, and shall contain a\n\nstatement of intent to terminate, to cancel, or to not renew the\n\nfranchise, a statement of the reasons for the termination,\n\ncancellation, or nonrenewal and the date the termination shall take\n\neffect.\n\nD. Upon the affected new motor vehicle or new powersports\n\nvehicle dealer's receipt of the aforementioned notice of\n\ntermination, cancellation, or nonrenewal, the new motor vehicle\n\ndealer shall have the right to file a protest of such threatened\n\ntermination, cancellation, or nonrenewal with the Commission within\n\nthirty (30) days and request a hearing. The hearing shall be held\n\nwithin one hundred eighty (180) days of the date of the timely\n\nprotest by the dealer and in accordance with the provisions of the\n\nAdministrative Procedures Act, Sections 250 through 323 of Title 75\n\nof the Oklahoma Statutes, to determine if the threatened\n\ncancellation, termination, or nonrenewal of the franchise has been\n\nfor good cause and if the factory has complied with its obligations\n\npursuant to subsections A, B, and C of this section and the factory\n\nshall have the burden of proof. Either party may request an\n\nadditional one-hundred-eighty-day extension of the hearing date from\n\nthe Commission. Approval of the requested extension may not be\n\nunreasonably withheld or delayed. If the Commission finds that the\n\nthreatened cancellation, termination, or nonrenewal of the franchise\n\nhas not been for good cause or violates subsection A, B, or C of\n\nthis section, then it shall issue a final order stating that the\n\nthreatened termination is wrongful. A factory shall have the right\n\nto appeal such order. During the pendency of the hearing and after\n\nthe decision, the franchise shall remain in full force and effect,\n\nincluding the right to transfer the franchise. If the Commission\n\nfinds that the threatened cancellation, termination, or nonrenewal\n\nis for good cause and does not violate subsection A, B, or C of this\n\nsection, the new motor vehicle or new powersports vehicle dealer\n\nshall have the right to an appeal. During the pendency of the\n\naction, including the final decision or appeal, the franchise shall\n\nremain in full force and effect, including the right to transfer the\n\nfranchise. If the dealer prevails in the threatened termination\n\naction, the Commission shall award to the dealer the attorney fees\n\nand costs incurred to defend the action.\n\nE. If the factory prevails in an action to terminate, cancel,\n\nor not renew any franchise, the new motor vehicle or new powersports\n\nvehicle dealer shall be allowed fair and reasonable compensation by\n\nthe manufacturer for:\n\n1. New, current, and previous model year vehicle inventory\n\nwhich has been acquired from the manufacturer, and which is unused\n\nand has not been damaged or altered while in the dealer's\n\npossession;\n\n2. Supplies and parts which have been acquired from the\n\nmanufacturer, for the purpose of this section, limited to any and\n\nall supplies and parts that are listed on the current parts price\n\nsheet available to the dealer;\n\n3. Equipment and furnishings, provided the dealer purchased\n\nthem from the manufacturer or its approved sources; and\n\n4. Special tools, with such fair and reasonable compensation to\n\nbe paid by the manufacturer within ninety (90) days of the effective\n\ndate of the termination, cancellation, or nonrenewal, provided the\narts that are listed on the current parts price\n\nsheet available to the dealer;\n\n3. Equipment and furnishings, provided the dealer purchased\n\nthem from the manufacturer or its approved sources; and\n\n4. Special tools, with such fair and reasonable compensation to\n\nbe paid by the manufacturer within ninety (90) days of the effective\n\ndate of the termination, cancellation, or nonrenewal, provided the\n\ndealer has clear title to the inventory and other items and is in a\n\nposition to convey that title to the manufacturer.\n\na. For the purposes of paragraph 1 of this subsection,\n\nfair and reasonable compensation shall be no less than\n\nthe net acquisition price of the vehicle paid by the\n\ndealer.\n\nb. For the purposes of paragraphs 2, 3, and 4 of this\n\nsubsection, fair and reasonable compensation shall be\n\nthe net acquisition price paid by the dealer less a\n\ntwenty-percent (20%) straight-line depreciation for\n\neach year following the dealer's acquisition of the\n\nsupplies, parts, equipment, furnishings, and/or\n\nspecial tools.\n\nF. If a factory prevails in an action to terminate, cancel, or\n\nnot renew any franchise and the new motor vehicle or new powersports\n\nvehicle dealer is leasing the dealership facilities, the\n\nmanufacturer shall pay a reasonable rent to the lessor in accordance\n\nwith and subject to the provisions of subsection G of this section.\n\nNothing in this section shall be construed to relieve a new motor\n\nvehicle or new powersports vehicle dealer of its duty to mitigate\n\ndamages.\n\nG. 1. Such reasonable rental value shall be paid only to the\n\nextent the dealership premises are recognized in the franchise and\n\nonly if they are:\n\na. used solely for performance in accordance with the\n\nfranchise. If the facility is used for the operation\n\nof more than one franchise, the reasonable rent shall\n\nbe paid based upon the portion of the facility\n\nutilized by the franchise being terminated, canceled,\n\nor nonrenewed, and\n\nb. not substantially in excess of facilities recommended\n\nby the manufacturer.\n\n2. If the facilities are owned by the new motor vehicle or new\n\npowersports vehicle dealer, within ninety (90) days following the\n\neffective date of the termination, cancellation, or nonrenewal, the\n\nmanufacturer will either:\n\na. locate a qualified purchaser who will offer to\n\npurchase the dealership facilities at a reasonable\n\nprice,\n\nb. locate a qualified lessee who will offer to lease the\n\npremises for the remaining lease term at the rent set\n\nforth in the lease, or\n\nc. failing the foregoing, lease the dealership facilities\n\nat a reasonable rental value for the portion of the\n\nfacility that is recognized in the franchise agreement\n\nfor one (1) year.\n\n3. If the facilities are leased by the new motor vehicle or new\n\npowersports vehicle dealer, within ninety (90) days following the\n\neffective date of the termination, cancellation, or nonrenewal the\n\nmanufacturer will either:\n\na. locate a tenant or tenants satisfactory to the lessor,\n\nwho will sublet or assume the balance of the lease,\n\nb. arrange with the lessor for the cancellation of the\n\nlease without penalty to the dealer, or\n\nc. failing the foregoing, lease the dealership facilities\n\nat a reasonable rent for the portion of the facility\n\nthat is recognized in the franchise agreement for one\nnufacturer will either:\n\na. locate a tenant or tenants satisfactory to the lessor,\n\nwho will sublet or assume the balance of the lease,\n\nb. arrange with the lessor for the cancellation of the\n\nlease without penalty to the dealer, or\n\nc. failing the foregoing, lease the dealership facilities\n\nat a reasonable rent for the portion of the facility\n\nthat is recognized in the franchise agreement for one\n\n(1) year.\n\n4. The manufacturer shall not be obligated to provide\n\nassistance under this section if the new motor vehicle or new\n\npowersports vehicle dealer:\n\na. fails to accept a bona fide offer from a prospective\n\npurchaser, sublessee, or assignee,\n\nb. refuses to execute a settlement agreement with the\n\nlessor if such agreement with the lessor would be\n\nwithout cost to the dealer, or\n\nc. fails to make written request for assistance under\n\nthis section within ninety (90) days after the\n\neffective date of the termination, cancellation, or\n\nnonrenewal.\n\n5. The manufacturer shall be entitled to occupy and use any\n\nspace for which it pays rent required by this section.\n\nH. In addition to the repurchase requirements set forth in\n\nsubsections E and G of this section, in the event the termination or\n\ncancellation is the result of a discontinuance of a product line,\n\nthe manufacturer or distributor shall compensate the new motor\n\nvehicle or new powersports vehicle dealer in an amount equivalent to\n\nthe fair market value of the terminated franchise as of the date\n\nimmediately preceding the manufacturer's or distributor's\n\nannouncement or provide the dealer with a replacement franchise on\n\nsubstantially similar terms and conditions as those offered to other\n\nsame line-make dealers. The dealer may immediately request payment\n\nunder this section following the announcement in exchange for\n\ncanceling any further franchise rights, except payments owed to the\n\nnew motor vehicle dealer in the ordinary course of business, or may\n\nrequest payment under this section upon the final termination,\n\ncancellation, or nonrenewal of the franchise. In either case,\n\npayment under this section shall be made not later than ninety (90)\n\ndays after the fair market value is determined. If the factory and\n\ndealer cannot agree on the fair market value of the terminated\n\nfranchise or agree to a process to determine the fair market value,\n\nthen the factory and dealer shall utilize a neutral third-party\n\nmediator to resolve the disagreement.","path":["OK Code","Title 47"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os47.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"f2a3a82dae09b2459b7ac48b0c996a28405f8efb4e2b82853e6c2c17a8aa2c04","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-47-47-565.2v1","next":"us-ok/okla.-stat.-tit.-47-47-565.3"},"notice":"GroundRules: Original legal text. Not legal advice."}