General Policies and Arbitration Rules

Effective April 1, 2008

Only licensed motor vehicle dealers or their duly authorized representatives are eligible to transact business at our auction. We are a dealer only auction and retail customers are not allowed at our facilities unless specified by law.

All sales that are negotiated and/or consummated on our premises must be processed through the auction with full auction fees. Buying vehicles outside of the sale is strictly prohibited and could result in loss of auction privileges.

For safety and insurance purposes, you must be registered with the auction, 18 years old and have a valid driver’s license to be allowed on auction premises.

Factory warranties/ guarantees and the resolution thereof are not within the scope of the auctions operations.

1. A VIN plate that has been removed or altered unless reassigned by proper authorities.

The policies of this auction are intended to promote fair and ethical treatment to both the Buyer and Seller. If the auction determines that the transaction is not fair and ethical to either party, the Seller and Buyer agree that the auction may cancel the sale, at its sole discretion.

Certain sellers may establish arbitration rules that are independent of the Auction’s. These policies are posted and copies are available upon request. It is the Buyer's responsibility to understand these policies.

The Auction does not guarantee information listed in Electronic Data Vehicle Histories (i.e., Carfax, Auto Check, etc.) and will not arbitrate solely on EDVH data.

The auction has not verified and makes no representation or guarantees as to the description, equipment, warranties, or odometer on any vehicle sold or offered for sale. The buyer assumes the responsibility to verify all of the seller’s representations, warranties and descriptions and to notify the auction in case of any discrepancy, not later than the closing time of day of sale, or as specified in the guarantees. If information placed on windows by consignor is incorrect, the sale will be voided or the price adjusted at the Auction’s discretion.

All vehicles must be paid for on the day of sale or be subjected to applicable late payment fees. Acceptable Methods are:

2. Checks- company or certified, only with prior approval by auction management.

Pay for each car with a separate check. Any returned check will subject buyer to potential suspension or termination of trading privileges at this Auction. Buyer will also be expected to pay all expenses connected with collection of unpaid items.

Late Fees – A late fee of $100 per unit will be assessed for vehicles that are not paid for on sale day and an additional $15 per day after the first 7 days.

Insufficient Funds – A $100 fee will be assessed for each check that is returned by the bank.

SELLER and PURCHASER agree to abide by all auction policies which are incorporated herein, and all policy decisions of management.

PURCHASER and SELLER agree that the signed receipt agreement shall be of the same force and effects as though personally signed by them even though it only contains their identification plate, or other authorized signature on receipt. Any adjustments or rejection must be made prior to settlement. The Vehicle must be paid for on day of purchase or this sale may be considered null and void at AUCTION’s discretion.

SELLER and PURCHASER each agree that should any vehicle be left on AUCTION premises for a period in excess of six days, AUCTION may charge a reasonable daily storage fee of $10 per day. SELLER and PURCHASER agree that AUCTION and its affiliates retain the right to cease doing business with either of them as it sees fit, and that AUCTION is not a bailee.

Title to the Vehicle does not pass to PURCHASER until good funds are received. PURCHASER grants AUCTION a purchase money security interest in the Vehicle to secure payment, and authorizes AUCTION to file this security agreement or a reproduction hereof as a financing statement.

The PURCHASER agrees: to purchase this vehicle for the purchase price shown provided the vehicle is found to be as recommended before settling for this vehicle, to check the serial and/or engine numbers on the vehicle with those on the title; to check the actual condition of the vehicle with its description and with the recommendation, if any, when offered for sale at this auction; not to resell the Vehicle until good funds have been transmitted to AUCTION; upon making settlement in cash or by check or draft in lieu of cash to consider the transaction a fully consummated cash transaction for present consideration; that no stop payment of his check to this AUCTION shall be honored; that any stop payment order of a check/draft or giving a check/draft which is returned unpaid shall be deemed by the parties to be prima facie evidence of fraud existing at the time the transaction was consummated, and shall be constructed by the parties as an intent to defraud in order to consummate the transaction; and that AUCTION may deposit any check or draft immediately upon receiving, regardless of whether the Vehicle’s certificate of title has been submitted by the seller or whether AUCTION has agreed to hold the check or draft pursuant to a float arrangement with the seller.

PURCHASER agrees to make any claim of defects with the car with SELLER, and immediately to notify AUCTION pursuant to its policies. PURCHASER agrees that it is responsible for its own transportation.

PURCHASER represents to AUCTION that it is solvent, and that the Vehicle is purchased solely for resale. The SELLER covenants with the PURCHASER that he is the true and lawful owner of the described vehicle (“Vehicle”), that the same is free from all liens and encumbrances; that he has good right and full power to sell and transfer title to the same; and that he will warrant and defend the same against the lawful claims and demands of all persons whomsoever. If SELLER is a corporation, by the execution of the agreement, the officers of said corporation do hereby individually and personally guarantee performance of the corporation’s warranties.

SELLER agrees that any amounts owing to the AUCTION may be deducted from the proceeds due SELLER, and that auction may stop payment or refuse to authorize payment on any check or draft to SELLER pursuant to this right of set-off.

SELLER agrees to be bound by the TERMS OF SALE and acknowledges responsibility for completion and execution of the required odometer mileage statement pertaining to the Vehicle described herein. Upon payment to SELLER, AUCTION shall be subrogated to all of the SELLER’s and PURCHASER’s rights, and the SELLER and PURCHASER agree to do whatever is necessary to secure such rights and do nothing to prejudice them.

SELLER and PURCHASER agree that AUCTION is neither responsible for odometer mileage on the consigned vehicles nor for the information contained in the odometer mileage statement which SELLER as Transferor is required to complete and sign and PURCHASER as Transferee is required to acknowledge.

SELLER and PURCHASER agree that all representations concerning the Vehicle are solely the responsibility of the SELLER, whether made on the block, before the sale, on this agreement, or otherwise, and acknowledge and agree that AUCTION has made no representations whatsoever about the Vehicle.

AUCTION is merely performing an auction service, and expressly disclaims all express and/or implied warranties as to merchantability, fitness or any other matter whatsoever other than the title guarantee set forth above.

SELLER and PURCHASER agree to indemnify and hold AUCTION harmless from any liability, loss, costs, damage or expense, including attorney’s fees which may arise either directly or indirectly from the sale and purchase of the Vehicle including, but not limited, …any matters relating to odometer mileage or odometer mileage statements.

If the AUCTION is required to make a claim as a result of this transaction against either SELLER or PURCHASER or an agent or employee of SELLER or PURCHASER or an insurance carrier insuring or bonding SELLER or PURCHASER, then the Auction shall recover, in addition to the amount of the claim and the costs incurred in the claim, reasonable attorney’s fee in an amount not less than 25% of the amount of the claim, regardless of whether suit is filed, including appellate fees and costs. Interest shall accrue on the unpaid balance of any such claim at the rate of 1.5% per month.

The Vehicle is purchased for resale in the form of tangible personal property in the regular course of business and is the sort usually purchased by the PURCHASER for resale. In the event that the property is used for any purpose other than for resale, PURCHASER will pay direct to the proper taxing authorities such sale or use tax as may then be accrued and become payable. The PURCHASER further certifies that he holds a retail sales tax registration certificate, license or other permit, issued by the sale tax authority of this State, and county.

If the dealer of record wishes to authorize an individual to act as his agent, the dealer of record must do so in writing. When the dealer extends this authorization, he shall be responsible until such time as he informs the auction, in writing, of cancellation of this authorization. The dealer of record shall be responsible for retrieving the Auto Auction identification card or informing the Auction if he is unable to do so.

Upon acceptance of the identification card issued by the Auction, the person, corporation, or firm whose name is on said card, by retaining or using the card, agrees to pay for all purchases. This obligation shall end only after payment of all purchases and the surrender of this card to the Auto Auction, or upon the Auction’s receipt of the notice in writing that the card has been lost, stolen or destroyed. The Auction reserves the right to cancel or modify the identification card at any time and to demand the surrender of the same. Admittance is allowed to only those persons holding individually issued Auction ID cards. Cards must be displayed on one’s person. Replacement cards are $25.

· Green Light / Auction Guarantee - Meets conditions for sale under Auction Guarantee.

· Yellow Light / Defect- Announcement exists. Ask auctioneer or ringman. Buyer beware.

Any announcements on the invoice must be placed by the Auction staff prior to vehicle crossing the block. Failure to follow this procedure MAY result in unwind of vehicle. These announcements include:

Broken Odometer / TMU – (Sellers still must announce Miles Over on TMU if over 100k), Fuel Conversion, Miles Over 100k, 200k, etc.

Engine Change, No Published Vin, Air Bags Missing/ Deployed, Fire Damage, Salvage Title, Flood Damage, Frame Damage

Prior-Police, Taxi, Auto Check Discrepancies, Emission control equipment as manufactured must be present or announced missing.

Sellers are not required to certify mileage on vehicles that are considered “exempt” under federal law (Sec. 7105,

Public Law 105-178, June 9, 1998), except in cases where the local or state laws supercede the federal requirements. However, Sellers may represent miles on exempt units - any statements made by the Seller and all known odometer discrepancies are grounds for arbitration.

The Seller is responsible for all documented expenses incurred by the Buyer (excluding profit, commissions and detail charges) on vehicles arbitrated for unannounced conditions not detectable through vehicle inspection (i.e. stolen vehicle, odometer, title discrepancy). The Seller has the responsibility to announce any state or local DMV fees, taxes or other fees due on the vehicle.

Buyers are encouraged to inspect vehicles prior to the sale. Buyers are responsible to ensure that they are aware of the price the auctioneer is offering. A misunderstanding of the price must be clarified prior to signing the bill of sale. The sale price of the vehicle is not subject for arbitration.

Buyers should put any vehicle that they deem to be misrepresented into arbitration no later than two hours after the sale ends unless otherwise noted. Once a vehicle has permanently left the lot, it is no longer arbitratable for sale day items.

Expenses regarding any mediated vehicle must be in writing, verifiable, reasonable and are the responsibility of the seller. All expense invoices must be turned in at the time of arbitration. Arbitration has sole discretion in determining the validity of any bills submitted for reimbursement.

The Buyer will follow Auctioneer’s cadence on price – any misunderstanding concerning price must be addressed at the drop of the auctioneer’s hammer not following the sale of the vehicle.

Arbitration rules excludes mechanical, non-wearable items that can be fixed for $500 (wholesale) or less as determined by the Auction’s Arbitration Department. Cars are sold subject to any and all visible defects. Mechanical labor will be based on the Mitchell Manual.

· Drive train (Backlash and computers are covered on current model year and one year old vehicles with less than 50,000 miles.)

· Air conditioning guarantee is limited to the compressor clutch engaging only.

· Vehicles will be deemed to have excessive body and paint on current year vehicles only and will be deemed excessive only if three or more side panels or two or more panels, i.e. hood, roof or deck lid are affected.

· Supplemental restraint systems (SRS) are present on all vehicles manufactured with such systems. Any SRS warning lights, which are on or inoperative, must be announced.

· Brakes, Front ends, Clutches, Electrical System, Fuel System, Steering Components, Universal Joints, Transmission or Power Steering leaks, wheel bearings.

The following carry a 2-day guarantee. Sale Day is Day 1. Expense reimbursement will be for transportation related expenses only.

The following carry a 7-day guarantee. Sale Day is Day 1. Expense reimbursement will be for transportation related expenses only.

· Engine changes and fuel conversions not announced on vehicles five model years and newer.

The auction has elected to follow the frame damage guidelines as set forth by the National Auto Auction Association. Copies of these guidelines are available from dealer registration. In addition, the auction has the following policies regarding frame damage:

2. Lowered vehicles must be announced and are not subject to Frame Damage guarantees if damage is the result of lowering the vehicle only!

Frame Damage Reimbursement Policy on vehicles returned for frame, the auction will only reimburse the buyer for transportation related expenses. Vehicle must be returned to the Auction within 48 hours of notification unless specific arrangements are made for such events as an out of state buyer.

Gray Market Vehicles (Canadian Vehicles) 14-Day Guarantee from receipt of title.

1. Only vehicles made in North America for Canadian use and properly converted to U.S. specifications can be sold. No other Gray Market vehicles are accepted for sale. If a vehicle was manufactured in Canada for the Canadian Market, the Manufacturer is required to obtain and affix a U.S. Safety Standard Certification Label to the vehicle.

2. Sellers must inform the auction that a vehicle is a Canadian vehicle at time of registration and must disclose that to the Buyer in writing as an announced condition on the block ticket.

3. If a vehicle was manufactured in Canada for the U.S. Market, there must be a Manufacturer’s Certification Label affixed to the vehicle. This label must clearly state the vehicle was in conformance with federal safety standards on the date of manufacture.

4. All other vehicles imported from Canada must be imported through a Registered Importer. Registered Importers are required to post a bond with the U.S. Department of Transportation. All vehicles imported through a Registered Importer must have:

a) U.S. Safety Standard Certification Label that identifies the Registered Importer

b) Safety Defect Recall Insurance Policy issued by the Registered Importer. This insurance policy must be with the

vehicle and remain in effect for eight (8) years from the date of issuance by the Registered Importer.

5. All Canadian vehicles, whether imported by a Manufacturer or a Registered Importer, must show miles per hour on the speedometer and miles traveled on the odometer. Title 49, United States Code, Chapter 327, Section 32704, allows replacement of odometers without a doorframe sticker if the conversion from kilometers to miles can be done without changing the distance traveled by the vehicle; therefore, replacement of an odometer under these circumstances does not have to be announced by the Seller.

6. Vehicles must be sold under the yellow light with the following announcements:

The following vehicle types are “As-Is”. Look for red lights on these vehicles:

Seller may override the “As-Is” and sell the following with an Auction Guarantee.

Some states do not recognize the announcement of “Exempt” as applied to an odometer statement. If you buy a vehicle with an “Exempt” odometer disclosure and intend to retail or title this vehicle be advised that the title you obtain may bear an odometer brand of “Not Actual Mileage.” This is the policy of the State of Ohio and some other states and will not serve as a reason to arbitrate the vehicle. Buyer Beware! The Exempt announcement does not cover odometers that have been changed or tampered with.

All vehicles consigned to the sale must cross the block prior to an offer being approved by the auction. Vehicles sold off-the-block or on an offer, will be sold the same as on the block unless stipulated in writing by the seller and agreed to by the buyer. Off block deals are not final until both the buyer and the seller consummate the transaction. Once an offer has been made the buyer should consider the deal completed unless advised to the contrary by the auction. The appropriate sale fees are due to the auction on any transaction when contact is made on the auction premises whether or not the vehicle is sold on the auction block.

The Auction guarantees the title of vehicles that are sold through the Auction. This guarantee of the title warrants that title shall be marketable and free and clear of all liens and encumbrances, including any brand such as ‘salvage,’ noted upon the current or any prior certificate of title, at the time the vehicle is sold through the Auction and for a period of 60 days from the date of the auction sale. The Auction's liability under this title guarantee shall never exceed the auction sale price of the vehicle and this maximum amount shall be reduced by 2% per month following the auction sale date. Buyers are cautioned not to sell or spend money on any vehicle until the title is received. The Auction will not be responsible for any expenses incurred on vehicles returned for late title.

Sale Day is Day One for all auctions. There will be no expense reimbursements for this rule.

· Online Sale Day is the day when the vehicle is delivered to the buyer’s lot – Not to exceed 7 days. The buyer has 24 hours for sale day arbitration.

· Substandard paintwork must be announced on Internet sales within 5 model years.

Effective April 1, 2008

General Policies

Dealer Approval

Method of Payment

Authorized Representatives

ID Cards

Light / Announcement System

Sellers Announcements

Buyer Responsibilities

Sale Day Guarantee Arbitration Guidelines

As-Is Vehicles

Exempt Mileage Announcements

Offers and Outside Sales

Title Policy

TA – Vehicle Return Policy

Internet/Online Sales