§ 6-46-4 - Supplier's duty to repurchase inventory. - Rhode Island Statutes

SECTION 6-46-4

   § 6-46-4  Supplier's duty to repurchaseinventory. – (a) Whenever a dealer enters into a dealer agreement under which the dealeragrees to maintain an inventory, and the agreement is terminated by eitherparty as provided in this chapter, the supplier, upon written request of thedealer filed within thirty (30) days of the effective date of the termination,shall repurchase the dealer's inventory as provided in this chapter. Thereshall be no requirement for the supplier to repurchase inventory pursuant tothis section if:

   (1) The dealer has made an intentional and materialmisrepresentation as to the dealer's financial status;

   (2) The dealer has defaulted under the chattel mortgage orother security agreement between the dealer and supplier; or

   (3) The dealer has filed a voluntary petition in bankruptcy.

   (b) Whenever a dealer enters into a dealer agreement in whichthe dealer agrees to maintain an inventory and the dealer or the majoritystockholder of the dealer, if the dealer is a corporation, dies or becomesincompetent, the supplier shall, at the option of the heir, personalrepresentative, or guardian of the dealer, or the person who succeeds to thestock of the majority stockholder, repurchase the inventory as if the agreementhad been terminated. The heir, personal representative, guardian, or succeedingstockholder has six (6) months from the date of the death of the dealer ormajority stockholder to exercise the option under this chapter.