(1) Before any license as a "wholesaler" or "dealer" is issued to an applicant, he must file an application with the Department of Motor Vehicles and furnish the information the Department may require, including, but not limited to, information adequately identifying by name and address any individual who owns or controls ten percent or more of the interest in the business. The policy of this section is full disclosure.

(2) Each applicant for licensure as a motorcycle dealer or wholesaler must furnish a surety bond in the penal amount of fifteen thousand dollars on a form to be prescribed by the director of the department. The bond must be given to the Department and executed by the applicant, as principal, and by a corporate surety company authorized to do business in this State, as surety. The bond must be conditioned upon the applicant or licensee complying with the provisions of the statutes applicable to the license and as indemnification for any loss or damage suffered by an owner of a motorcycle, or his legal representative, by reason of any fraud practiced or fraudulent representation made in connection with the sale or transfer of a motorcycle by a licensed dealer or wholesaler or the dealer's or wholesaler's agent acting for the dealer or wholesaler or within the scope of employment of the agent or any loss or damage suffered by reason of the violation by the dealer or wholesaler or his agent, of any of the provisions of this chapter. An owner or his legal representative who suffers the loss or damage has a right of action against the dealer or wholesaler and against the dealer's or wholesaler's surety upon the bond and may recover damages as provided in this chapter. A new bond or a proper continuation certificate must be delivered to the Department annually before the license is renewed. However, regardless of the number of years a bond remains in effect, the aggregate liability of the surety for any and all claims is limited to fifteen thousand dollars on each bond and to the amount of the actual loss incurred. The surety has the right to terminate its liability under the bond by giving the Department thirty days' written notice of its intent to cancel the bond. The cancellation does not affect any liability incurred or accrued prior to the cancellation.

(3) If, during any license year, there is any change in the information that a dealer or wholesaler gave the Department in obtaining or retaining a license under this section, the licensee shall report the change to the Department within thirty days after the change occurs on the form the Department requires.

(4) In the event a licensee ceases being a dealer or wholesaler, he shall, within ten days thereafter, notify the Department of this fact and return to the Department any license issued pursuant to this chapter and all current dealer license plates issued to the dealer or wholesaler.

HISTORY: 1984 Act No. 511, Section 1; 1993 Act No. 181, Section 1489.