Texas Business & Commerce Code - Section 19.26. Transfer Of Interest In Dealership
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Texas Lawyer > Business & Commerce Code > Texas Business & Commerce Code - Section 19.26. Transfer Of Interest In Dealership
§ 19.26. TRANSFER OF INTEREST IN DEALERSHIP. (a) A
supplier may not prevent, by contract or otherwise, a dealer or any
officer, member, partner, or stockholder of a dealer from selling
or transferring a noncontrolling interest in the dealership to
another party.
(b) A supplier may prevent a person from selling or
transferring a controlling interest in a dealership without the
supplier's written consent. A supplier may not unreasonably
withhold the supplier's consent to a sale or transfer of a
controlling interest in a dealership.
(c) A supplier and a dealer may provide by written agreement
for succession rights to a controlling interest in a dealership on
the death of an individual owning the controlling interest. If not
otherwise determined by written agreement between the dealer and
supplier, on the death of an individual owning a controlling
interest, the family member of the individual to whom the interest
passes by will or intestate succession may request that the
supplier consent to a transfer of the ownership interest to the
family member. The supplier shall consent to the transfer if the
family member meets the reasonable financial, business experience,
and character standards of the supplier. The supplier shall send a
written response to the family member before the 91st day after the
date of receipt of the family member's request, granting the
supplier's consent or stating the supplier's refusal to consent and
the specific reasons for the refusal.
(d) In this section, "family member" means an individual
related within the second degree by consanguinity or affinity to an
individual owning a controlling interest.
(e) Nothing in this section requires a supplier to continue
a dealer agreement if the supplier determines that the dealer's
area of responsibility or trade area lacks sufficient sales
potential to reasonably support continuation of the agreement.
Added by Acts 1991, 72nd Leg., ch. 119, § 1, eff. May 19, 1991.
Section: 19.04 19.05 19.21 19.22 19.23 19.24 19.25 19.26 19.27 19.28 19.41 19.42 19.43 19.44 19.45
Last modified: August 10, 2007
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