STRATEGIC ALLIANCE AGREEMENT AND
AGREEMENT FOR THE MUTUAL REFERRAL OF ACQUISITION OPPORTUNITIES
This STRATEGIC ALLIANCE AGREEMENT AND AGREEMENT FOR THE MUTUAL REFERRAL
OF ACQUISITION OPPORTUNITIES (this "Agreement") dated as of July ____, 1998, is
entered into by and between MAR MAR REALTY, L.P., a Delaware limited partnership
("MMR") and SONIC AUTOMOTIVE, INC., a Delaware corporation ("SAI").
WHEREAS, MMR is engaged in, among other things, the business of
acquiring, developing, owning and leasing real estate ("Real Properties")
associated with franchised motor vehicle dealerships; and
WHEREAS, SAI is engaged in, among other things, the business of
acquiring and operating franchised motor vehicle dealerships, including their
tangible and intangible assets ("Dealerships"); and
WHEREAS, MMR presently does not intend to operate Dealerships; and
WHEREAS, SAI presently does not intend generally to own Real
Properties; and
WHEREAS, MMR and SAI wish to enter into a strategic alliance to their
mutual benefit and create procedures regarding the referral of acquisition
opportunities for Real Properties to MMR by SAI and the referral of acquisition
opportunities for Dealerships to SAI by MMR; and
WHEREAS, SAI is the owner of certain Real Properties and of various
options to purchase Real Properties as set forth on Exhibit A hereto which SAI
is willing to transfer to MMR or Chartown Realty, a North Carolina General
Partnership (Chartown) by separate documents; and
WHEREAS, MMR is desirous of entering into a Contract to Purchase such
Real Properties as are owned by SAI and is desirous of accepting an assignment
of such options.
NOW, THEREFORE, the parties hereto hereby agree as follows:
SECTION 1. RECITALS AND EXHIBITS. The recitals above and Exhibits A and B
hereto are incorporated herein by reference.
SECTION 2. REFERRALS OF DEALERSHIP ACQUISITION OPPORTUNITIES. MMR hereby agrees
to refer, in accordance with Section 4 hereof, to SAI any Dealership acquisition
opportunity of which MMR becomes aware in connection with the acquisition of
Real Properties by MMR. Nothing in this Agreement shall cause or require MMR to
make such a referral if such referral would cause MMR to violate any agreement
with or duty to third parties, law, regulation or court order or would, in the
reasonable judgment of MMR, adversely affect its ability to consummate the
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acquisition of any particular Real Property. Nothing in this Agreement shall be
construed to obligate SAI to act upon such referral.
SECTION 3. REFERRALS OF REAL PROPERTY ACQUISITION OPPORTUNITIES. SAI hereby
agrees to refer, in accordance with Section 4 hereof, to MMR any Real Property
Acquisition opportunity of which SAI becomes aware in connection with the
acquisition of Dealerships by SAI. Nothing in this Agreement shall cause or
require SAI to make such a referral if such referral would cause SAI to violate
any agreement with or duty to third parties, law, regulations or court order or
would, in the reasonable judgment of SAI, adversely affect its ability to
consummate the acquisition of any particular Dealership. SAI shall not be
obligated to refer any Real Property which it determines to acquire itself.
Nothing in this Agreement shall be construed to obligate MMR or to act upon such
referral.
SECTION 4. REFERRAL PROCEDURES; NOTICES. In making any referral as contemplated
by this Agreement, the party making the referral shall provide to the other
party such information regarding the referral opportunity as the referring
party, in its sole and unrestricted judgment, determines to provide.
Notices and referrals contemplated by this Agreement may be made in writing or
orally and shall be sent as follows (or to such other addresses as the parties
hereto shall have identified in writing to their counterparty):
if to MMR, to:
Xxxxx X Xxxxxxxxxx
Executive Vice President
Mar Mar Realty Trust
Xxxxxxxxxxxx Xxxxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
0000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
if to SAI, to:
Xxxxxxxx X. Xxxxxx
Chief Financial Officer
Sonic Automotive, Inc.
0000 Xxxx Xxxxxxxxxxxx Xxxxxxxxx
P. O. Xxx 00000
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
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SECTION 5. ADDITIONAL UNDERTAKINGS.
5.1) Additional Undertakings of MMR. As additional consideration
for the undertakings of Sonic hereunder MMR agrees that during the term of
this agreement it will provide or make available to Sonic services as Sonic
shall reasonably request from time to time. Such items shall include,
without limitation, the following:
1.) Real Estate Development
a.)MMR will assist Sonic in identifying sites for
additional dealership locations, replacement
locations, body shop locations and any other
dealership related real estate needs that Sonic
may have from time to time.
b.)Once a location has been identified and a
purchase price agreed to, MMR will use its best
efforts to acquire such property either in its
own name or Sonic's name. As part of the
acquisition of sites MMR will assists in
obtaining all zoning changes that may be
necessary for the appropriate use of the
property.
c.)Once a location has been acquired and it has
been determined that MMR will be the owner of the
property, MMR will work with Sonic to identify,
have designed, and construct a facility on the
property provided all cost and lease items have
been agreed to.
2.) Maintenance
MMR will assist and advise Sonic with respect to
maintenance items on property that Sonic is leasing
from MMR and which sonic is responsible for paying
for. Such assistance and advice will include
identifying providers of service and repairs,
providers of facility improvements and general
maintenance providers.
3.) Inspection Service
In conjunction with Sonic's acquisition of new
dealerships, and without regard to whether MMR is
purchasing the real estate, MMR will arrange for
property inspections and environmental reports for
Sonic's account.
5.2) Additional Undertakings of SAI. As additional consideration
for the undertakings of MMR hereunder Sonic agrees that the
form of lease to be used with MMR for all subsequent real
estate acquisitions which has Sonic or an affiliate of Sonic
as a tenant, is attached hereto as Exhibit B.
5.3) Mutual Undertakings. Both parties agree to communicate to the
other such opportunities, as may become available from time to
time, for the joint purchase of services or purchase of
services from the same vendor when to do so will result in
volume discounts or other similar savings. Sonic agrees that
MMR may pass such volume discounts on to lessees other than
Sonic or its affiliates, and MMR agrees to use commercially
reasonable efforts to convince its lessees other than Sonic or
its affiliates to add to the volume in an effort to increase
the amount of such discounts.
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SECTION 6. NO AGENCY RELATIONSHIP. Nothing in this Agreement shall be construed
as creating any agency relationship among the parties hereto. Each party hereto
specifically denies the right and authority of their counterparty and such
counterparty's officers, directors, affiliates, agents and attorneys to
negotiate any acquisition opportunity on their behalf. Each party hereto
acknowledges its entire responsibility to pursue, negotiate and otherwise
consummate any acquisition opportunity referred by their counterparty. This
Agreement does not create or entitle any party hereto to fees or other
remuneration for the provision of referrals contemplated hereby.
SECTION 7. HEADINGS. The paragraph headings are inserted for convenience only
and are in no way intended to describe, interpret, define or limit the scope
or content of this Agreement or any provision hereof.
SECTION 8. CONSTRUCTION. Words of any gender used in this Agreement shall be
held and construed to include any other gender, and words in the singular number
shall be held to include the plural, and vice versa, unless the context requires
otherwise. Any disputes regarding the interpretation of any portion of this
Agreement shall not be presumptively construed against the drafting party.
SECTION 9. REMEDIES. Both parties hereto may enforce the rights and obligations
hereunder via any remedy available to them at law or equity, including, without
limitation, the remedy of injunctive relief compelling specific performance of
this Agreement. All rights, powers and privileges conferred hereunder upon the
parties hereto shall be cumulative. All such rights, powers and remedies may be
exercised separately or at once, and no exercise of any right, power or remedy
shall be construed to be an election of remedies or shall preclude the future
exercise of any or all other rights, powers and remedies granted hereunder or
available at law or in equity, except as expressly provided herein.
SECTION 10. NO WAIVER. Neither the failure of either party to exercise any power
given such party hereunder nor to insist upon strict compliance with its
obligations hereunder, nor any custom or practice of the parties at variance
with the terms hereof shall constitute a waiver of either party's right to
demand exact compliance with the terms hereof.
SECTION 11. APPLICABLE LAW. With respect to any particular Property, this
Agreement shall be construed and interpreted in accordance with the laws of the
state in which the Property is located, notwithstanding conflicts of laws or
choice of laws principles to the contrary, and otherwise, the Agreement shall be
governed by the laws of the State of North Carolina, notwithstanding conflicts
of laws or choice of laws principles to the contrary.
SECTION 12. INVALIDITY. If any provision of this Agreement shall be declared
invalid or unenforceable, the remainder of this Agreement shall continue in
full force and effect.
SECTION 13. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
successors and assigns.
SECTION 14. COUNTERPARTS. This Agreement may be executed in two (2) or more
counterparts.
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SECTION 15. TERM. The term of this Agreement shall be for a period of one (1)
year from the date hereof. Thereafter this Agreement shall automatically be
renewed for successive one (1) year terms unless either party shall give the
other written notice of intent not to renew at least thirty (30) days prior to
the expiration of the then existing term.
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IN WITNESS HEREOF, MMR and SAI have caused this Agreement to be
executed and delivered as of the date first written above.
MAR MAR REALTY, L.P.
BY: MAR MAR REALTY TRUST
By: /s/ Xxxxxxxx X. Xxxxx
____________________________
Xxxxxxxx X. Xxxxx, President
SONIC AUTOMOTIVE, INC.
By: /s/ B. Xxxxx Xxxxx
___________________________
Name: B. Xxxxx Xxxxx
___________________________
Title: President
___________________________
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