Tennessee Code 47-25-1907 – Title to repurchased inventory – Account adjustments
Terms Used In Tennessee Code 47-25-1907
- Dealer: means any person engaged in the business of selling and retailing inventory, who enters into a retail agreement, and who, under the terms of the agreement receives inventory from the supplier. See Tennessee Code 47-25-1902
- Inventory: means motorcycles, off-road vehicles, attachments and repair parts. See Tennessee Code 47-25-1902
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Recourse: An arrangement in which a bank retains, in form or in substance, any credit risk directly or indirectly associated with an asset it has sold (in accordance with generally accepted accounting principles) that exceeds a pro rata share of the bank's claim on the asset. If a bank has no claim on an asset it has sold, then the retention of any credit risk is recourse. Source: FDIC
- Supplier: includes a:
(A) Wholesaler. See Tennessee Code 47-25-1902 - United States: includes the District of Columbia and the several territories of the United States. See Tennessee Code 1-3-105
- Year: means a calendar year, unless otherwise expressed. See Tennessee Code 1-3-105
Upon payment of the repurchase amount to the dealer, the title and right of possession to the repurchased inventory shall transfer to the supplier. Annually, at the end of each calendar year, after termination or cancellation, the dealer’s reserve account for recourse, retail sale or lease contracts shall not be debited by a supplier or lender for any deficiency unless the dealer or the heirs of the dealer have been given at least seven (7) business days’ notice by certified or registered United States mail, return receipt requested, of any proposed sale of the inventory financed and an opportunity to purchase the inventory. The former dealer or the heirs of the dealer shall be given quarterly status reports on any remaining outstanding recourse contracts. As the recourse contracts are reduced, any reserve account funds shall be returned to the dealer or the heirs of the dealer in direct proportion to the liabilities outstanding.