4.1-505 - Cancellation.
§ 4.1-505. Cancellation.
Notwithstanding the terms, provisions or conditions of any agreement, nobrewery shall unilaterally amend, cancel, terminate or refuse to continue torenew any agreement, or unilaterally cause a wholesaler to resign from anagreement, unless the brewery has first complied with § 4.1-506 and goodcause exists for amendment, termination, cancellation, nonrenewal,noncontinuation or causing a resignation. Good cause shall not include thesale or purchase of a brewery. Good cause shall include, but is not limitedto, the following:
1. Revocation of the wholesaler's license to do business in the Commonwealth;
2. Bankruptcy or receivership of the wholesaler;
3. Assignment for the benefit of creditors or similar disposition of theassets of the wholesaler other than the creation of a security interest inthe assets of a wholesaler for the purpose of securing financing in theordinary course of business; or
4. Failure by the wholesaler to substantially comply, without reasonableexcuse or justification, with any reasonable and material requirement imposedupon him in writing by the brewery, including, but not limited to, asubstantial failure by a beer wholesaler to (i) maintain a sales volume ofhis brewery's brand or brands, (ii) render services comparable in quality,quantity or volume to the sales volumes maintained and services rendered byother wholesalers of the same brand or brands within the Commonwealth, or(iii) failure to obtain the consent of the brewery to a transfer of awholesaler's business unless a determination has been made by the Boardpursuant to § 4.1-507 that such consent was unreasonably withheld by thebrewery. In any determination as to whether a wholesaler has failed tosubstantially comply, without reasonable excuse or justification, with anyreasonable and material requirement imposed upon him by the brewery,consideration shall be given to the relative size, population, geographicallocation, number of retail outlets and demand for the products applicable tothe territory of the wholesaler in question and to comparable territories.
Good cause shall not be construed to exist without a finding of a materialdeficiency for which the wholesaler is responsible in any case in which goodcause is alleged to exist based on circumstances not specifically set forthin subdivisions 1 through 4 of this section.
(1978, c. 579, § 4-118.7; 1985, c. 549; 1987, c. 247; 1989, c. 272; 1993, c.866; 1996, c. 3.)