EXHIBIT 5
April 4, 2003
Mitsui & Co., Ltd.
First Motor Vehicles Div.
0-0, Xxxxxxxxx 0-Xxxxx, Xxxxxxx-xx
Xxxxx, Xxxxx 100-0004
Mitsui & Co. (U.S.A.), Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
The parties to this letter agreement (this "Agreement") wish to provide
for certain rights relating to transfers of the equity securities of United Auto
Group, Inc. (the "Company") in accordance with the terms of this Agreement.
Certain capitalized terms used herein are defined in Section 1(c) below.
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and intending to be legally bound hereby, the parties
hereto agree as follows:
1. Tag-Along Rights.
(a) In the event that any of the PCP Entities or Penske desires to
Transfer any Restricted Securities to a third party (other than (i) with respect
to any Restricted Securities, to their respective Permitted Transferees or
Affiliates or (ii) with respect only to those securities Transferred from Penske
Corporation's "Share Account" (as defined in the Operating Agreement(s)) to the
"Carry Account" (as defined in the Operating Agreement(s)) and those securities
held in the "Share Account" (as defined in the Operating Agreement(s)) of Penske
Capital Partners, L.L.C. to Penske Capital Partners, L.L.C. or by Penske Capital
Partners, L.L.C. to its members or by such members to their members ad infinitum
(it being understood that in no event will this clause (ii) apply to any
Transfer by Penske Corporation)) at any time on or after February 1, 2005 and
before February 1, 2006, such PCP Entity or Penske, as the case may be, shall
notify you in writing, of such proposed Transfer and its terms and conditions
(the "Tag Along Notice"); and
(b) Within ten (10) Business Days of the date of the Tag-Along
Notice, you shall notify the PCP Entities or Penske, as the case may be, if you
elect to participate
in such Transfer. If you fail to notify such PCP Entity or Penske, as the case
may be, within such ten (10) Business Day period, you shall be deemed to have
waived your right to participate in such Transfer. If you notify such PCP Entity
or Penske, as the case may be, in accordance with this section, you shall have
the right to Transfer, at the same price per share of Common Stock and on the
same terms and conditions as the applicable PCP Entity or Penske, as the case
may be, an amount of shares of Common Stock or Common stock equivalents equal to
the shares of Common Stock or Common Stock equivalents the Transferee actually
proposed to purchase multiplied by a fraction, the numerator of which shall be
the number of shares of Common Stock and Common Stock equivalents issued and
owned by you and the denominator of which shall be the aggregate number of
shares of Common Stock and Common Stock equivalents issued and owned by you and
such PCP Entity (or both PCP Entities, if both are selling pursuant to such
transaction) and/or Penske (if Penske is selling pursuant to such transaction)
and Harvard (to the extent that Harvard is selling in this transaction by virtue
of a similar tag-along agreement with the PCP Entities and Penske) (assuming for
purposes of calculating such fraction the conversion of all convertible
securities and the exercise of all options and warrants held by the PCP
Entities, Penske, Harvard and you).
(c) Capitalized terms used in this Section 1 of this Agreement shall
have the meanings specified below:
"Affiliate" means "affiliate" as defined in Rule 405 promulgated
under the Securities Act.
"Business Day" means a calendar day, other than (a) a Saturday or
Sunday, and (b) a day on which commercial banks are required or permitted
by law or other governmental action to close in New York, New York, United
States of America and Tokyo, Japan.
"Common Stock" means the voting Common Stock, par value $.0001 per
share, and non-voting Common Stock, par value $.001 per share, of the
Company, and includes any securities issued with respect to such shares by
way of stock dividend or stock split or in connection with a combination
of shares, recapitalization, amalgamation, merger, consolidation or other
reorganization or otherwise.
"Harvard" means Aeneas Venture Corporation.
"Operating Agreements" means each of (i) the Amended and Restated
Limited Liability Company Agreement for International Motor Cars Group I,
L.L.C. and (ii) the Amended and Restated Limited Liability Agreement for
International Motor Cars Group II, L.L.C., as amended.
"PCP Entities" means each of International Motor Cars Group I,
L.L.C. and International Motor Cars Group II, L.L.C.
"Penske" means each of Penske Corporation, Penske Automotive
Holdings Corp. and Penske Capital Partners, L.L.C.
"Permitted Transferee" of a person means (a) a corporation,
partnership or other entity wholly owned by such person; provided, that
such corporation, partnership or other entity shall agree in writing that
it shall transfer to such person any Restricted Securities which it holds
prior to such time as it ceases to be wholly owned by such person, and (b)
the equity owners of such person to the extent such equity owners receive
a pro rata distribution of Restricted Securities.
"Restricted Securities" means any Common Stock or other equity
security of the Company owned, directly or indirectly, by a PCP Entity,
Penske or an Affiliate of a PCP Entity or Penske or by any other person
who holds such securities on behalf of a PCP Entity, Penske or an
Affiliate, and any securities convertible, exercisable or exchangeable for
Common Stock or such other equity securities.
"Transfer" means any direct or indirect transfer, sale, assignment,
gift, pledge, mortgage, hypothecation or other disposition of any
interest. The terms "Transferee," "Transferor, "Transferred," and
"Transferable" shall each have a correlative meaning.
2. Public Filings. Prior to the making of any filings required by Sections
13 of the Securities Exchange Act of 1934, as amended, each of the PCP Entities
and Penske, on the one hand, and you, on the other hand, shall provide the other
party or parties with a reasonable opportunity to review such filings and
comment thereon.
3. Governing Law; Jurisdiction. This Agreement shall be construed and
enforced in accordance with and governed by the laws of the State of New York
without giving effect to the conflicts of law principles thereof which might
result in the application of the laws of any other jurisdiction. Each party to
this Agreement irrevocably submits to the jurisdiction of the courts of the
State of New York and the Federal courts of the United States of America located
in the State of New York solely in respect of the interpretation and enforcement
of the provisions of this Agreement, and in respect of the transactions
contemplated hereby.
4. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument. All signatures need not appear on any
one counterpart.
5. Further Assurances. Each party hereto shall do and perform or cause to
be done and performed all such further acts and things and shall execute and
deliver all such other agreements, certificates, instruments, and documents as
any other party hereto reasonably may request in order to carry out the intent
and accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
6. Specific Performance. The parties hereto acknowledge that there would
be no adequate remedy at law if any party fails to perform any of its
obligations hereunder, and accordingly agree that each party, in addition to any
other remedy to which it may be entitled at law or in equity, shall be entitled
to injunctive relief, including specific performance, to enforce such
obligations without the posting of any bond, and, if any action should be
brought in equity to enforce any of the provisions of this Agreement, none of
the parties hereto shall raise the defense that there is an adequate remedy at
law.
7. Successors and Assigns. This Agreement will be binding upon and inure
to the benefit of the parties hereto and their successors and permitted assigns.
8. Termination. This Agreement shall terminate (i) if the Purchase
Agreement entered into on the date hereof between you and X.X. Xxxxxx Partners
(BHCA), LP terminates without the transactions contemplated thereby having been
consummated, or (ii) at such time at which you cease to own any Common Stock or
other equity security of the Company.
[The remainder of this page was left intentionally blank]
Please acknowledge the foregoing agreement by signing the enclosed
original of this Agreement and returning the original to the undersigned.
Very truly yours,
PENSKE CORPORATION
By /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: President
PENSKE CAPITAL PARTNERS, L.L.C.
By /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: President
PENSKE AUTOMOTIVE HOLDINGS CORP.
By /s/ Xxxxxx X. Xxxxxxx, Xx.
--------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Vice President
INTERNATIONAL MOTOR CARS GROUP I, L.L.C.
By: Penske Capital Partners, L.L.C.,
as Managing Member
By /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: President
INTERNATIONAL MOTOR CARS GROUP II, L.L.C.
By: Penske Capital Partners, L.L.C.,
as Managing Member
By /s/ Xxxxx X. Xxxxxx
-------------------
Name: Xxxxx X. Xxxxxx
Title: President
Agreed to by:
MITSUI & CO., LTD.
By /s/ Munemasa Izumi
--------------------
Name: Munemasa Izumi
Title: General Manager
First Business Department
First Motor Vehicles Division
MITSUI & CO. (U.S.A.), INC.
By /s/ Xxxxx Xxxxxx
------------------
Name: Xxxxx Xxxxxx
Title: S.V.P & General Manager
Second Machinery Division
