ARBITRATION POLICY In-Lane and Online

EFFECTIVE DATE: August 1, 2019

As adopted from the National Auto Association's recommended national arbitration policies

Standards Arbitration Policy

Effective Date: August 1,2019

I. General Policies:

1. Fair and Ethical Sale 3. Auction VIN Policies The sales made at an Auction are intended to All vehicles consigned must have a visible promote fair and ethical treatment to both public Vehicle Identification Number (VIN) the Buyer and Seller. If Auction determines plate attached to the vehicle by the that the transaction is not fair and ethical to manufacturer or state inspector (state either party, the Seller and the Buyer agree reassigned VIN only). Those vehicles having that Auction may cancel the sale, at its sole a reassigned VIN plate by the State in place discretion. Federal, State, and Local laws of the original VIN plate must be announced supersede these policies where applicable. or will be subject to sale cancellation or Buyer return. Auction reserves the right to refuse the sale of any vehicle in which the 2. Auction Role in Sale: VIN plate appears to be altered in any way. Seller guarantees VIN plates and years on a. Auction makes no representations or any vehicle up to 20 model years old with guarantees on any vehicle sold or offered the exception of the VIN plates and year on for sale. trailers, RVs, , and watercraft, which are guaranteed up to 10 model years. b. Auction is not a party to the contract of the sale. The sales contract is between the Seller and Buyer only. 4. Lot Sales / Outside Sales / Off Block Sales c. All vehicles bought or sold on the Any sale in which the Auctioneer does not premises must be processed through the state the selling price of the vehicle or "sell Auction office. Failure to do so will result in suspension of trading privileges at under the hammer" is considered a "Lot Auction. Sale" (OFF BLOCK) AS IS SALE. All "Lot Sales" (OFF BLOCK) are conditional d. Auction reserves the right to review any until the buyer signs the block ticket or audio/video documentation to verify the accuracy of a sale. appropriate document for the vehicle signifying they have inspected and accepted e. Any vehicle consigned with the Auction is the vehicle. Until the appropriate document subject to government inspection, with or is signed, the sale is not binding to either without prior notice, by the FBI, State party. , National Auto Theft Bureau, Local Police Authorities, any other Seller may guarantee "Lot Sales" (OFF governmental agency, or quasi- BLOCK), but must do so in writing governmental agency. OTHERWISE IT IS CONSIDERED AS IS SALE. Buyers are cautioned to inspect "Lot Sale" (OFF BLOCK) vehicles very carefully and verify conditions before purchasing.

Standards Page 1 of 14 Arbitration Policy

Effective Date: August 1,2019

II. Sale Light System: 3. Red Light – As-Is: Vehicles selling under the red light will only qualify for arbitration under the rules outlined in this policy. (As- Auction has a standard light/video display Is dollar amount, model years, and mileage system to describe the condition and/or are subject to local auction policy). disclosures related to the vehicle being sold. The system is defined as: 4. Blue Light Title Attached/Title Unavailable/Title Absent: This light is 1. Green Light –Ride and Drive: The green used to announce that the title is not light signals that this vehicle is guaranteed present (auction managed location) at the under the conditions outlined in this policy time of the sale. For Auction rules regarding by the seller. Any defects or issues requiring titles please refer to the Title Arbitration disclosure per this policy should be Policy section. If “title announced using the green and yellow lights. attached/unavailable/absent” is not announced, a vehicle could be arbitrated for 2. Red Light – Drivetrain: This light is an no title in the absence of auction company indication to the Buyer that the Auctioneer policy. or Selling Representative has made announcements that qualify/clarify the condition limiting arbitration of this vehicle to drive line components only. Engine, transmission, rear-end, 4X4 system and hybrid vehicle batteries can be arbitrated per auction arbitration policy.

Announcement /Light Legend Light Usage Recommendation Announcements: Green Red Red Ride & Drive Only P N/A N/A Red Light - Drivetrain N/A P N/A Red Light - As-is, No Arbitration N/A N/A P

All Vehicles Sold For $1500 or Less Are Automatic Red Light AS-IS No Matter What Light or Annoucement(s)are made

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Effective Date: August 1,2019

III. Seller Responsibilities:

1. Seller will be held responsible for the 6. The announcement of the presence of accuracy and completeness of all warning lights does not exempt a Seller representations or descriptions. This from arbitration responsibilities as defined includes handouts, catalogues, vehicle by the policy. The issue/defect found to be markings, condition information or vehicle the cause of the light may be arbitrated listings and verbal or written statements within the stated time period and dollar made by Seller, Auction, Auctioneer or amount threshold according to Appendix 1. Selling Representative at the time of sale. This includes the condition report written by 7. The availability of a manufacturer’s or on behalf of the seller as per the “NAAA warranty shall not affect a Buyer’s right to Generic Condition Report Position arbitrate a vehicle. Regardless of the Statement”. The Seller understands that warranty coverage in terms of the root the sale light/video display is a binding cause of the complaint, an announcement arbitration representation of vehicle may be required. condition, and is therefore responsible for ensuring that their vehicles sell under the 8. In the event of a successful arbitration by correct light in the lane. the Buyer, the Seller is responsible for reimbursement of all reasonable 2. Mileage announcements are not required for documented expenses incurred by the vehicles that are 10 years or older and/or Buyer (excluding profit, commissions and deemed exempt from Odometer and Title detail charges) on vehicles arbitrated for disclosure laws unless a mileage undisclosed conditions. Reimbursements discrepancy is known or apparent to the that qualify under these guidelines will be at seller. The Seller may represent miles on the sole discretion of the Auction and will be exempt vehicles; any disclosures made by limited to the reasonable and documented the Seller and all known odometer expenses at auction (wholesale) repair cost. discrepancies are grounds for arbitration. 9. Seller will not be paid for vehicles in 3. Title discrepancies must be announced arbitration until arbitration is settled and including, but not limited to: not actual vehicles are sold. For arbitrations occurring miles, salvage, theft recovery, stolen after the seller has been paid, seller is vehicle, flood damage, Law buybacks required to promptly return the payment to and trade assist. the auction if the transaction is voided as a result of arbitration. 4. If a vehicle is being offered for sale by a third party, an announcement of “3rd Party Seller” is required. Disclosure requirements and time limits are subject to local auction policy.

5. Announcements are required for any matters that relate to the safety or integrity of the vehicle including as per the stated dollar threshold and disclosure requirements stated in this policy, all requirements under local, state or federal statutes or regulations. Announcements must be made both verbally and disclosed on the auction invoice/sale contract/bill of sale or equivalent document in a physical or environment.

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Effective Date: August 1,2019

IV. Buyer Responsibilities: 6. The Buyer shall not surrender possession of the vehicle to any claimant, except as 1. Prior to placing bids, the Buyer is responsible required by legal process, nor shall Buyer for inspecting the vehicle, listening to and voluntarily pay or acknowledge the validity reviewing any verbal or written announcements of any claim, without the prior approval of and disclosures made by the Seller, Auction, Auction. Time is of the essence. Any failure Auctioneer or Selling representative. Buyers are on the part of the Buyer, after becoming also responsible for reviewing all pertinent aware of said claim, to notify Auction of any information available online, including, but not claim in a timely manner or failure of the limited to, announcements, disclosures, Buyer to cooperate in defending any such condition reports, pictures and online listings. claim shall relieve Auction and seller of any Buyers are also responsible for observing and liability under this policy. understanding the sale lights (Green, Green/Yellow, Yellow, Red, and/or Blue), which 7. A vehicle is not considered returned until identify various sale conditions for the vehicle. received, inspected and approved for return Once the vehicle is sold, the Buyer must review by Auction management. Any vehicle the Auction sales receipt or appropriate returned must be in the same or better document to confirm the vehicle price, condition as when sold. Any vehicles disclosures and announcements are correct delivered to and left on Auction premises before legibly printing and signing their name or without Auction approval remain the sole digitally/electronically signing the Auction sales responsibility of the Buyer. Buyer assumes receipt or appropriate document. all risk of loss. Vehicle must be returned in a timely manner consistent with Auction 2. It is strongly encouraged that a Buyer should direction. have a Post Sale Inspection (PSI), warranty or assurance product from the auction on vehicles 8. Vehicles with over (auction choice) miles purchased. from when sold are not eligible for arbitration. 3. Buyer agrees to be liable for any and all work 9. The Seller/Auction shall not be liable for any done to a vehicle (including a vehicle purchased vehicle sale or repairs made by the Buyer as title attached, unavailable or absent) prior to before the title is received by the Buyer. If returning the vehicle to Auction except on the title has been mailed from Auction to vehicles arbitrated for undisclosed conditions Buyer, Buyer may not return vehicle. If the not detectable through vehicle inspection, Seller presents a valid negotiable title to the including but not limited to, not actual miles, Auction within close of business on the next salvage, theft recovery, stolen vehicle, flood day (excluding weekends and auction damage, Lemon Law buybacks and trade assist. observed holidays) from the time that the Buyer notifies the auction of their intent to 4. The Buyer is financially responsible for any return the vehicle, then the transaction will pending sale and assumes all risk of loss until stand. arbitration is final.

5. The Buyer or Buyer’s agent (transporter or driver) must document any damage on the gate release prior to removing the vehicle from the Auction or facilitation service provider’s location. Auction or facilitation service provider and Seller will not be responsible for any damage not identified on the gate release once the vehicle is removed from the location.

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Effective Date: August 1,2019

If the title problem is due to a clerical or V. 6. Title Arbitration Policy: coding error, or incomplete documentation, Auction shall be given reasonable time after 1. All titles submitted by Seller must be in receiving notice to have the error corrected. Seller’s company name on title or on a properly executed reassignment form. The 7. Applications or other documents related to a Seller guarantees the titles of vehicles that duplicate title will not be accepted, unless are sold through Auction. This guarantee of announced as such or if allowed by the the title warrants that the title shall be appropriate jurisdiction. marketable and free and clear of all liens and encumbrances. This includes any brand 8. Where legal by municipal and/or state law, (such as “salvage”) noted upon the current any vehicle being offered for sale with a or any prior certificate of title unless such foreign (non-US) title, must be disclosed encumbrances were announced at the time prior to the sale by the seller. Disclosure the vehicle is sold through Auction and for a requirements and time limits are subject to period of four (4) years from the date of local auction title policy. Vehicle must be sale. Seller’s liability under this title legal to sell in the United States. guarantee shall never exceed the Auction sale price (the “maximum amount”) of the 9. Seller has up to a maximum of 21calendar vehicle, and this maximum amount shall be days for title to be received by Auction. reduced by two percent (2%) per month (Sale day is Day 1). After 21 calendar day following Auction sale date. All liability under period, it is the Buyer’s option to return the this title guarantee shall expire and vehicle or wait a reasonable period of time terminate four (4) years after Auction sale for the title. The buyer must give a 5 date. Auction will not be responsible for any business day notice to the auction after the expenses incurred on vehicles returned for 5th day at the close of business which ever late title. is received first the title or vehicle will be honored at that time. The Seller/Auction 2. Seller warrants, represents and guarantees shall not be liable for any vehicle sale or possession and conveyance of a certificate repairs made by the buyer before the title is of title, properly executed, valid in the state received by the buyer. If the title has been where the transaction is occurring and clear mailed from Auction to Buyer, Buyer may of all liens and encumbrances (except not return vehicle. If, after 90 calendar current year DMV fees in California), and days, Seller has not produced negotiable seller warrants and will defend the title title and Buyer has not returned the vehicle, against the claims and demands of all this title guarantee shall not apply and persons whatsoever. Auction shall have no duty to produce the certificate of title to the Buyer and shall 3. Seller will ensure that the title must be have no duty to pay Seller. reassigned directly to Buyer. Any title assigned directly to facilitating auction will 10. Vehicles lacking a properly assigned title or not be accepted. reassignment to transfer a title at time of sale must sell “Title Attached/Title Seller will not be paid for vehicles until a 4. Unavailable/Title Absent,” with the Blue light transferable title is received. on. Auction accepts no responsibility for non- 5. 11. Vehicles lacking lien release or a valid repo titled vehicles sold without title. Seller must affidavit for a repossessed vehicle (where announce the vehicle being sold with a bill allowed by law) must be sold “Title of sale only and that there is no title to Attached/Title Unavailable/Title Absent,” transfer (NO TITLE EVER). All non-titled with the Blue light on. vehicles and equipment will be sold “As-Is.”

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Effective Date: August 1,2019

12. In regard to defect in title, and in any 3. Required Conversion matter relating to odometer mileage, odometer statements, or damage disclosure a. All other vehicles imported must be statements: Seller and Buyer agree to imported through a Registered indemnify and hold harmless Auction from Importer. Registered Importers are any liability, loss costs, damage or expense, required to post a bond with the U.S. including attorney fees which may arise Department of Transportation and/or either directly or indirectly from the sale National Highway Transportation Safety and purchase of the consigned vehicle Administration. All vehicles imported including but not limited to title services through a Registered Importer must provided. have:

13. Whenever any claim is made by any person i. U.S. Safety Standard Certification against the title of a vehicle, whether by Label that identifies the Registered suit or otherwise, the Buyer, after becoming Importer aware of said claim, shall immediately notify ii. Valid U.S. Title or Legal Foreign Title Auction. This involves giving full particulars iii. Meet ALL Federal NHTSA, D.O.T. of claim, cooperating fully in defending any and/or E.P.A. Mandated Guidelines legal action, and in taking other steps to iv. Documentation must be provided at minimize possible loss. any time by seller. v. Cleared the mandated wait time.

b. All vehicles, whether imported by a VI. Previous Canadian Manufacturer or a Registered Importer, and/or Grey Market must show miles per hour on the speedometer and miles traveled on the Vehicles: odometer. Title 49, United States Code, Chapter 327, Section 32704, allows 1. A “Previous Canadian” disclosure is required replacement odometers without a door for any vehicle (regardless of manufacturing frame sticker if the conversion from origin) having been registered in a Canadian kilometers to miles can be done without province. Additional announcements may be changing the distance traveled by the required as well due to the use in Canada vehicle; therefore, replacement of an (i.e. Full or partial voided warranty, foreign odometer under these circumstances title and etc.) does not have to be announced by the Seller. 2. Any vehicle not originally built to U.S. specifications can, under certain circumstances, be imported through a VII. Arbitration Guidelines: registered importer who modifies the Vehicles that have any of the defects outlined in vehicle to comply with U.S. equipment and Appendix I that were not disclosed by the seller safety regulations (DOT and NHTSA) and or announced at the time of sale must be then certifies it as compliant, and an reported to Auction within the time frame noted independent commercial importer who below in order to be eligible for arbitration. modifies the vehicle to comply with U.S. Vehicles must be returned to Auction in the emissions regulations and then certifies it as same or better condition than when purchased compliant. Only vehicles properly converted with no more than (auction choice) miles. to U.S. specifications can be sold and must be announced as such.

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Effective Date: August 1,2019

1. Time Period: Refer to Appendix I for e. Inherent Conditions: No arbitration can be arbitration time periods. Sale day is Day 1. based on conditions that are inherent or Arbitration shall end at 5:00 PM. The auction typical to a particular model or reserves the right to adjust arbitration manufacturer. Manufacturer warranty timelines. guidelines will be used where applicable to 2. Process: Any single mechanical defect that determine whether the condition is inherent. has a repair cost of $500 or more is subject to Additional resources can be found on NAAA’s arbitration on vehicles sold under qualifying Standards page at www.NAAA.com. lights and lack of announcement by the seller per Appendix I. Each vehicle transaction is f. Manual Transmissions: Vehicles with allowed one chance at arbitration. The standard (full or partial shift) transmissions arbitrator will inspect only the defect that is on cannot be arbitrated for manual clutch the initial arbitration claim. Repair costs will be assemblies unless the defect will not allow a determined by the auction and will reflect the safe test drive. auction cost to repair. If price adjustment is made and accepted, vehicle becomes “As-Is, g. Wearable Items: Auction will not arbitrate No Arbitration” property of the Buyer, and is vehicles for wearable items normally worn vs not subject to any further arbitration. The excessively worn or inoperative (not auction management makes the binding inherent). For purposes of this policy decision upon both the Buyer and Seller on all wearable items are defined as parts of the arbitration matters. vehicle that the manufacturer recognizes the need for replacement/adjustment during the 3. Fees: Auction reserves the right to assess an expected life of the vehicle driven the arbitration fee to the Buyer. If the arbitration average miles per model year (15k). These is valid, Auction reserves the right to assess items are normally identified in the Owner’s an arbitration fee to the Seller in addition to Manual for routine check and replacement any charges associated with the arbitration. and would include, but are not limited to, air ride suspensions, tires, wipers, brake pads, 4. 3rd Party: Should the Buyer or Seller feel the shoes, rotors, belts, hoses, lubricants/fluids, arbitration department is incorrect, both timing belts, bulbs, filters, shocks and struts. parties may agree to an outside third inspection selected at the sole discretion of h. Unsafe vehicles: Auction reserves the right to the auction. The cost of the third party reject any vehicle that management judges to inspection subject to inspection cost and be unsafe. round-trip transportation to be paid /charged to the dealer who is ruled incorrect. The third party decision will be FINAL. i. Vehicles may not be arbitrated based solely upon information provided in Electronic Data 5. Not subject to arbitration: Vehicle Histories (EDVH) or printed EDVH a. Vehicles exceeding 20 model years, with reports. Auction and Seller are not bound by the exception of trailers, RVs, and information listed in EDVH. Examples of watercraft, which cannot be arbitrated if EDVH include Carfax, AutoCheck, NMVTIS, as they are sold AS-IS. etc. The facilitating Auction may investigate vehicle history based on information found in b. Kit vehicles, homemade vehicles, or EDVH for information that may impact modified vehicles are sold “As-Is” and arbitration. cannot be arbitrated for odometer, structural issues, warranty books, or j. Auction is not bound by vehicle grades or model year. other types of scoring systems placed upon the vehicle. Buyers may only arbitrate a c. Radios unless purchased online vehicle based upon damage or defects that were present at the time of the sale of the d. Air conditioning systems with exception of vehicle. Green Light vehicles that are current model year or newer

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National Arbitration Policy Guidelines (Appendix 1) Amended 9/5/17 Effective Date: August 1,2019

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Effective Date: August 1,2019

VIII. Structural Damage, b. UVMS-Used Vehicle Measurement Standard. The commercially acceptable Alteration or Certified measurement deviation from the vehicle’s original structural Structural Repair or specification in order for any deviation Replacement Policy not to be considered structural damage. The purpose of the NAAA Structural Damage Policy is to define and clarify terminology c. Permanent Damage (aka “Kinked” or associated with structural issues and to specify “Broken”)- The result of two or more the disclosure requirements of the seller for objects striking or coming together at a vehicles offered at NAAA affiliated . significant change in velocity that The policy is intended to provide adequate permanently deforms the structural disclosure to the buyer for informed purchase component(s) rendering it non- decisions and to limit arbitrations for the seller. repairable per the manufacturer. This policy, along with the main Arbitration Policy will serve as the primary criteria for all arbitration proceedings. 2. Recommended Disclosures a. Structural Damage-Damage to the 1. Definitions structure or a specific structural a. Vehicle Structure-The main load- component of the vehicle. Often bearing platform of a vehicle that gives referred to as frame damage, although strength, stability and design it also applies to Unibody and Unibody exclusivity and to which all other on Frame structures in addition to components of the vehicle are Conventional Frame. fastened. For purposes of this policy, there are three macro types: b. Certified Structural Repairs/Replacement-Repairs to a i. Unibody - A type of structure specifically identified structural whereby the floor pan assembly, roof component of a vehicle that has been bows/braces, pillars, etc. are bonded certified to be within the Used Vehicle together into one unit, thereby Measurement Standard (UVMS). eliminating the need for a separate conventional structure c. Structural Alteration -An alteration to the vehicle’s structure including a ii. Unibody on Frame-A type of lengthened or shortened frame, a structure whereby a unitized modified suspension, or the installation structure is bolted to a conventional or removal of after-market accessories. structure.

iii. Conventional Structure-A type of structure consisting of two symmetrical rails (beams) connected by various cross-members.

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Effective Date: August 1,2019

3. Seller Disclosure Requirements h. Corrosion of structural components determined by one or more of the Sellers must disclose permanent structural following; when the substrate loses its damage, any structural alterations, structural shape, the original bonds near the repairs or replacements (certified or non- affected area are loose or are no certified) as outlined in this policy prior to longer in existence, the original selling a vehicle at auction regardless of sales thickness of the substrate has been channel or light condition. Disclosures are changed by more than 25%, the required for the following: affected area no longer possesses its absorption or deflection properties. a. Any/all existing permanent (non- repairable aka kinked or broken) i. Structural tear damage (i.e. transport structural damage as defined in this tie down) if more than 1" in length policy (measured from tear start/stop points)

b. Improper and/or substandard prior j. Damage due to improper jacking or repairs (not meeting OEM repair lifting that permanently deforms guidelines) structural components outlined in this policy. c. Repairs not certified using OEM guidelines or to be within the UVMS k. Damage due to contact with parking Improper alterations to the structure abutments and/or road debris that Lengthened or Shortened structure permanently deforms structural verified by visual inspection. components outlined in this policy.

d. Altered suspension that requires the l. Roof bows/braces that have been structure to be modified from its OEM modified, have existing permanent form. damage or removed. A replaced roof skin is not a required disclosure in e. After-market accessories installed or terms of the Structural Damage Policy. removed to the structure. m. The C pillar/quarter or Cab panel may f. Towing packages installed (or or may not be a structural removed) where new holes are drilled, component(s) as per the vehicle OEM holes are enlarged, or if the manufacturer. towing package is welded or brazed to n. All multipurpose and utility type the structure. vehicles are assumed to be 4X2 unless otherwise announced. g. Multiple access holes (regardless of However, if a 4X2 multipurpose, size) or singular access holes greater utility-type vehicle or pickup has been than 5/8". Access holes between 1/4" altered in appearance or stance to and 5/8" are subject to disclosure resemble a 4X4, a 4X2 announcement based upon location and condition of will be required. Examples include: structural component. new badges, raised suspension, and off-road tires.

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Effective Date: August 1,2019

4. Arbitration Rules for Structural responsible for the charges paid to the Damage, Alteration, Certified facility. Repairs or Certified Replacement f. Visual evidence supersedes any/all a. A vehicle may be arbitrated if it has mechanical or electronic undisclosed existing permanent measurements. damage alteration, Certified Repairs or Certified Replacement, which should g. For measurements according to the have been disclosed under this policy, UVMS, the following guidelines will even though the vehicle is within the apply: UVMS. If a structural issue is properly disclosed, the vehicle may only be i. The vehicle structure must arbitrated for improper repair of the measure to a total tolerance of no designated area, existing permanent more than +/- 8 millimeters (mm) damage or repairs to other areas of the of published specification of length, vehicle not disclosed, or for failure to width and height at control points be within the UVMS that was verified that capture the front (2), center by visual inspection. (4) and rear (2) sections of the vehicle. b. Damaged or replaced radiator core supports or rear body panels do not ii. Symmetrically (comparative require a structural disclosure under measure from side to side and this policy. point to point based on point measurement), the length, width c. Damage to the aprons, rail floor pan and height must measure to a assembly, inner wheelhouse (upper or difference of no more than lower), D pillar (if equipped) or other 6 mm. Upper body measurements ancillary structural components on a (tram gauge) by themselves will unitized structure in the area where not be adequate. the radiator core support or rear body panel attaches will require a disclosure h. Buyer must arbitrate any/all structural if permanent damage exists. misrepresentations as outlined in this policy within published timelines d. Brazed exhaust hangers are not a (outlined in the main Arbitration Policy required disclosure under this policy. Guidelines) from date of purchase (purchase day counts as Day One). e. Facilitating auction will, at its discretion, have a vehicle measured i. The buyer must contact and follow the according to the UVMS at a facility of arbitration process of the auction its choice. Prior to sending the vehicle where the vehicle was purchased for measurement, the auction reserves including the auction’s direction for the right to complete a visual return of the vehicle and the timeframe verification of the physical condition of allowed for the vehicle to be returned. the vehicle to determine that it should be measured. If the measuring facility j. In the event of improperly disclosed determines that the vehicle is within structural damage by the seller, the the UVMS, the buyer of the vehicle will buyer will be entitled to reimbursement be responsible for the charges paid to in accordance with the main Arbitration the facility. Likewise, if the measuring Policy. facility determines that the vehicle is not within the UVMS, the seller will be

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Effective Date: August 1,2019

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2. Disclosure Required IX. Flood, Damage Policy Disclosure is required and arbitration shall Vehicles are frequently exposed to moisture be allowed under the following conditions: during their ordinary operation, maintenance, and reconditioning. Occasionally, such a. The title has been correctly branded exposure may leave residual marks or indicating flood history of the vehicle. indicators similar to those left by exposure or immersion of the vehicle in floodwater. In b. Any of the following components have determining what conditions require disclosure been damaged due to stream, pond, or in arbitrating vehicles for flood puddle or floodwater exposure/damage it is critical that the total immersion/ingress: condition of the vehicle be considered including VIN data history. Disclosure requirements can i. Front or rear internal lighting or be found in Appendix I. wiring harnesses ii. Engine and its major components 1. Disclosure Not Required iii. Transmission and differential iv. Dash instrument panel and wiring No disclosure is required nor is arbitration v. Passenger seat cushions allowed for the following types of water vi. Power seat functions or window exposure, provided that none of the motor components outlined below are damaged: vii. Major sound system components

a. Rain, snow or sleet due to open windows, doors or tops or leaking seals.

b. Car wash or rinse water.

c. Carpet or upholstery shampooing or cleaning.

d. Stream, pond, puddle or floodwater that does not rise above the rocker panel or otherwise enter the passenger compartment.

e. Stream, pond, puddle or floodwater that enters the luggage compartment, but does not damage any electrical components (such as lighting or wiring harness) or does not enter the passenger compartment.

Standards Page 13 of 14 651 Precast Lane, Moncks Corner SC 29461 (843) 719-1900 www.charlestonautoauction.com