EXHIBIT 22
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AMENDED AND RESTATED
STOCKHOLDERS AGREEMENT
BY AND AMONG
AIF II, L.P.,
AENEAS VENTURE CORPORATION,
INTERNATIONAL MOTOR CARS GROUP I, L.L.C.,
INTERNATIONAL MOTOR CARS GROUP II, L.L.C.,
MITSUI & CO., LTD.,
MITSUI & CO. (U.S.A.), INC.,
AND
UNITED AUTO GROUP, INC.
Dated as of February 28, 2001
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Table of Contents
Page
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ARTICLE I. DEFINITIONS...............................................2
Section 1.1. Definitions.................................................2
Section 1.2. Rules of Construction.......................................3
ARTICLE II. BOARD COMPOSITION AND VOTING AGREEMENTS.....................4
Section 2.1. Board Composition...........................................4
Section 2.2. Composition of Committees of the Board of Directors.........4
Section 2.3. Voting Agreement............................................4
Section 2.4. Reduction in Right of PCP Entities to Designate Directors...4
Section 2.5. Suspension of Right to Designate Directors..................5
Section 2.6. Replacement Directors.......................................5
Section 2.7. Resignation of PCP Directors................................5
Section 2.8. Termination of Article II...................................6
Section 2.9. Quorum......................................................6
ARTICLE III. STANDSTILL PROVISIONS.......................................6
Section 3.1. Standstill Provisions.......................................6
Section 3.2. Exceptions to the Standstill Provisions.....................7
ARTICLE IV. TRANSFER RESTRICTIONS.......................................7
Section 4.1. Restrictions on Transfer of Restricted Securities...........7
Section 4.2. Tag-Along Rights............................................8
Section 4.3. Transferees; Noncomplying Transfers.........................8
Section 4.4. Restrictions on Transfers of Interests in the PCP
Entities....................................................8
ARTICLE V. CERTAIN COVENANTS...........................................9
Section 5.1. Legend on Certificates......................................9
Section 5.2. Xxxxx Xxxxxx to Serve as Chairman and Chief Executive
Officer.....................................................9
Section 5.3. Approval of Company Action Under the Securities Purchase
Agreement..................................................10
Section 5.4. Confidentiality Obligation.................................10
Section 5.5. Further Assurances.........................................10
ARTICLE VI. MUTUAL REPRESENTATIONS AND WARRANTIES......................10
Section 6.1. Organization...............................................10
Section 6.2. Authorization, Validity and Enforceability.................11
Section 6.3. No Violation or Breach.....................................11
ARTICLE VII. TERM.......................................................11
Section 7.1. Term.......................................................11
Section 7.2. Effects of Termination.....................................11
ARTICLE VIII. MISCELLANEOUS PROVISIONS...................................12
Section 8.1. Survival...................................................12
Section 8.2. Notices....................................................12
Section 8.3. Amendments.................................................13
Section 8.4. Assignment and Parties in Interest.........................13
Section 8.5. Expenses...................................................14
Section 8.6. Entire Agreement...........................................14
Section 8.7. Descriptive Headings.......................................14
Section 8.8. Counterparts...............................................14
Section 8.9. Governing Law; Jurisdiction................................14
Section 8.10. Severability...............................................15
Section 8.11. Specific Performance.......................................15
AMENDED AND RESTATED
STOCKHOLDERS AGREEMENT
THIS AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (the "Agreement")
dated as of February 28, 2001 by and among AIF II, L.P., a Delaware limited
partnership ("Apollo"), Aeneas Venture Corporation, a Delaware corporation
("Harvard"), International Motor Cars Group I, L.L.C., a Delaware limited
liability company ("PCP I"), International Motor Cars Group II, L.L.C., a
Delaware limited liability company ("PCP II" and, together with PCP I, the
"PCP Entities"), Mitsui & Co., Ltd., a Japanese company ("Mitsui Japan"),
Mitsui & Co. (U.S.A.), Inc., a New York corporation (Mitsui USA" and
together with Mitsui Japan, "Mitsui"), and United Auto Group, Inc. (the
"Company").
WHEREAS, pursuant to the terms of a Securities Purchase Agreement,
between the Company and the PCP Entities, dated as of April 12, 1999 (the
"Securities Purchase Agreement"), the PCP Entities acquired Series A
Convertible Preferred Stock, par value $.000l per share, of the Company
(the "Series A Preferred Stock"), Series B Convertible Preferred Stock, par
value $.0001 per share (the "Series B Preferred Stock") and warrants (the
"Warrants") to acquire the Company's voting Common Stock, par value $.0001
per share, and non-voting Common Stock, par value $.0001 per share
(together, the "Common Stock"), of the Company;
WHEREAS, in connection with the completion of the transactions
contemplated by the Securities Purchase Agreement, Apollo, Harvard, the PCP
Entities and Trace International Holdings, Inc. ("Trace") executed and
delivered a Stockholders Agreement, dated as of May 3, 1999 (the "Existing
Agreement");
WHEREAS, in December 2000, Penske Corporation ("Penske") purchased all
of the shares of Common Stock formerly held by Trace and Trace is no longer
a shareholder in the Company;
WHEREAS, on December 14, 2000, the Restricted Stockholders (other than
Mitsui) amended the Existing Agreement pursuant to Amendment No. 1 to the
Stockholders' Agreement ("Amendment No. 1");
WHEREAS, on February 28, 2001, conditioned upon the execution and
delivery of this Agreement and pursuant to the terms of a Purchase
Agreement, between the Company and Mitsui, dated as of January 31, 2001
(the "Purchase Agreement"), Mitsui subscribed for 1,302,326 shares of
Voting Common Stock of the Company; and
WHEREAS, the parties wish to amend and restate in its entirety the
Existing Agreement and Amendment No. 1 to continue to provide for certain
matters relating to the ownership and transfer of the Common Stock, on the
terms and conditions provided in this Agreement.
NOW, THEREFORE, in consideration of the promises, the mutual covenants
and agreements contained herein, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.1. DEFINITIONS.
Capitalized terms used herein without definition shall have the meanings
specified below:
"Adjusted Beneficial Ownership" is defined in Section 2.5.
"Affiliate" means "affiliate" as defined in Rule 405 promulgated under
the Securities Act.
"Amendment No. 1" has the meaning set forth in the recitals hereto.
"Apollo" has the meaning set forth in the preamble.
"Beneficial Ownership" means "beneficial ownership" as defined in Rule
13d-3 promulgated under the Exchange Act.
The term "Beneficial Owner" shall have a correlative meaning.
"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" has the meaning set forth in the recitals hereto, 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.
"Company" has the meaning set forth in the recitals hereto.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Harvard" has the meaning set forth in the preamble.
"Independent Directors" (a) initially means two persons who were
members of the Audit Committee of the Company's Board of Directors as of
December 31, 1998 and who shall be selected by a majority of said Audit
Committee, and (b) after the Initial Closing Date means persons nominated
by the immediately preceding Independent Directors who are not Affiliates
of either the PCP Entities or their respective Affiliates (other than the
Company).
"Initial Closing Date" means the date of the "Initial Closing" (as
defined in the Securities Purchase Agreement)
"Mitsui" has the meaning set forth in the preamble.
"Mitsui Closing Date" means the "Closing Date" (as defined in the
Purchase Agreement).
"PCP Directors" has the meaning set forth in Section 2.1.
"PCP Entities" has the meaning set forth in the preamble.
"PCP I" has the meaning set forth in the preamble.
"PCP II" has the meaning set forth in the preamble.
"Penske" has the meaning set forth in the recitals hereto.
"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.
"Purchase Agreement" has the meaning set forth in the recitals hereto.
"Registration Rights Agreement" means the Registration Rights
Agreement among the Company, Mitsui Japan and Mitsui USA, dated as of the
date hereof.
"Restricted Securities" means any Common Stock or other equity
security of the Company Beneficially Owned by a Restricted Stockholder
(other than Mitsui) and any securities convertible, exercisable or
exchangeable for Common Stock or such other equity securities, including,
without limitation, the Series A Preferred Stock and the Warrants.
"Restricted Stockholder" means each of Apollo, Harvard, the PCP
Entities and Mitsui.
"Second Closing Date" means the date of the "Second Closing" (as
defined in the Securities Purchase Agreement).
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Purchase Agreement" has the meaning set forth in the
recitals hereto.
"Series A Preferred Stock" has the meaning set forth in the recitals
hereto.
"Series B Preferred Stock" has the meaning set forth in the recitals
hereto.
"Tag-Along Notice" is defined in Section 4.2.
"Tag-Along Stockholders" is defined in Section 4.2.
"Trace" has the meaning set forth in the recitals hereto.
"Transfer" means any direct or indirect transfer, sale, assignment,
gift, pledge, mortgage, hypothecation or other disposition of any interest.
The term "Transferee" shall have a correlative meaning.
"Warrants" has the meaning set forth in the recitals hereto.
SECTION 1.2. RULES OF CONSTRUCTION.
Unless the context otherwise requires: (a) a term has the meaning assigned
to it by this Agreement; (b) an accounting term not otherwise defined has
the meaning assigned to it in accordance with generally accepted accounting
principles in effect in the United States of America; (c) "or" is not
exclusive; and (d) words in the singular include the plural, and in the
plural include the singular. The language used in this Agreement shall be
deemed to be the language chosen by the parties to express their mutual
intent, and no rule of strict construction shall be applied against any
party. Any references to any statute or law shall also refer to all rules
and regulations promulgated thereunder, unless the context requires
otherwise.
ARTICLE II.
BOARD COMPOSITION AND VOTING AGREEMENTS
SECTION 2.1. BOARD COMPOSITION.
The Restricted Stockholders will vote their shares of Common Stock to elect
the following directors:
(i) Xxxxx Xxxxxx, and four (4) additional directors designated by
the PCP Entities (the "PCP Directors").
(ii) One (1) director nominated by Mitsui.
(iii) Three (3) Independent Directors.
If Mitsui elects not to designate a person for the position of
director of the Company, Mitsui shall have the right to nominate a
non-voting observer to the Board of Directors of the Company (the
"Observer"). The Restricted Stockholders shall cause their nominees on the
Board of Directors of the Company to permit the Observer to participate in
all meetings of the Board of Directors of the Company. The Observer shall
be entitled to receive all materials and information distributed to
directors of the Company and shall have access to the Company's management
and records as if such Observer were a director.
SECTION 2.2. COMPOSITION OF COMMITTEES OF THE BOARD OF DIRECTORS.
The Restricted Stockholders shall use their reasonable best efforts to have
the Compensation and Stock Option Committee of the Board of Directors of
the Company consist of four persons as follows:
(i) Xxxxx Xxxxxx and one (1) additional PCP Director.
(ii) Two (2) Independent Directors.
SECTION 2.3. VOTING AGREEMENT.
Each of the Restricted Stockholders agrees to vote all of the voting
securities of the Company Beneficially Owned by it in favor of the persons
to be nominated as directors pursuant to Section 2.1 and to take all other
reasonable action to cause such Persons to be elected as the only directors
of the Company.
SECTION 2.4. REDUCTION IN RIGHT OF PCP ENTITIES TO DESIGNATE DIRECTORS.
Notwithstanding anything to the contrary contained in this Agreement, at
such time as the percentage Beneficial Ownership in the Company of the PCP
Entities together with the Beneficial Ownership in the Company of Penske,
taken together, and excluding Common Stock Beneficially Owned by the PCP
Entities as a result of unexercised Warrants ("Adjusted Beneficial
Ownership") is reduced below 20% then the number of PCP Directors shall be
reduced to the applicable number in the chart below:
If such Adjusted Beneficial Ownership is No. of PCP Directors to be
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equal to or greater than: But less than: designated thereafter
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17.5% 20.0% 4
15.0% 17.5% 3
12.5% 15.0% 2
10.0% 12.5% 1
Any reduction resulting from application of this Section 2.4 shall take
place on the earlier to occur of (x) the first meeting of stockholders of
the Company following the determination of such reduction, and (y) the
first vacancy on the Board of Directors following the determination of such
reduction.
SECTION 2.5. SUSPENSION OF RIGHT TO DESIGNATE DIRECTORS.
Notwithstanding anything to the contrary contained in this Agreement, the
right of the PCP Entities or Mitsui, as the case may be, to designate
directors of the Company shall be suspended as follows:
(a) with respect to the PCP Entities, their Adjusted Beneficial
Ownership combined with the Beneficial Ownership in the Company of Penske
is reduced below 10%; or
(b) with respect to Mitsui together with any of its Affiliates,
its Beneficial Ownership is reduced below 2.5%; or
(c) in the case of the PCP Entities, if either (i) they are in
default of Section 5.2(b) other than as a result of the death, incapacity,
or capture and detention of Mr. Penske, or (ii) one or both of the PCP
Entities has requested that the Company repurchase all or a portion of its
Restricted Securities pursuant to the terms of the Securities Purchase
Agreement.
SECTION 2.6. REPLACEMENT DIRECTORS.
During such time as the right of either the PCP Entities or Mitsui to
nominate directors is reduced or suspended pursuant to Section 2.4 or 2.5,
the Restricted Stockholders shall use their reasonable best efforts to have
the successors to such directors both: (a) be selected by a majority of the
remaining Board of Directors, excluding the director whose position is no
longer entitled to be designated by Mitsui or the PCP Entities, and (b) not
be Affiliates of the PCP Entities and their Affiliates (other than the
Company and its subsidiaries).
SECTION 2.7. RESIGNATION OF PCP DIRECTORS.
Upon exercise by the PCP Entities of their right pursuant to Section 7.2 or
7.4 of the Securities Purchase Agreement, the PCP Entities shall cause all
of the PCP Directors to immediately resign as members of the Board of
Directors of the Company.
SECTION 2.8. TERMINATION OF ARTICLE II.
The provisions contained in this Article II shall terminate and be of no
further effect from and after the third anniversary of this Agreement.
SECTION 2.9. QUORUM.
The presence of at least six Directors shall constitute a quorum for the
purpose of meetings of the Board of Directors of the Company.
ARTICLE III.
STANDSTILL PROVISIONS
SECTION 3.1. STANDSTILL PROVISIONS.
Subject to Section 3.2, at any time prior to December 14, 2003, each
Restricted Stockholder shall not, and shall cause its Affiliates not to,
either alone or as part of a "group" (as such term is used in Section 13d-5
(as such rule is currently in effect) of the Exchange Act), directly or
indirectly:
(a) acquire or seek to acquire, by purchase or otherwise,
ownership (including, but not limited to, Beneficial Ownership) of (i) any
capital stock of the Company, or direct or indirect rights (including
convertible securities) or options to acquire such capital stock or (ii)
any of the assets or businesses of the Company, or direct or indirect
rights or options to acquire such assets or businesses;
(b) offer, seek or propose to enter into any transaction of
merger, consolidation, sale of substantial assets or any other business
combination involving the Company or any of its Affiliates, whether or not
any parties other than such Restricted Stockholder and its Affiliates are
involved;
(c) make, or in any way participate, directly or indirectly, in
any "solicitation" of "proxies" (as such terms are defined or used in
Regulation 14A under the Exchange Act) or become a "participant" in any
"election contest" (as such terms are defined or used in Rule 14a-11 under
the Exchange Act) to vote, or seek to advise or influence any person or
entity with respect to the voting of, any voting securities of the Company
of any of its Affiliates, except as set forth in Article II of this
Agreement;
(d) initiate or propose any stockholder proposals for submission
to a vote of stockholders, whether by action at a stockholder meeting or by
written consent, with respect to the Company or any of its Affiliates, or
except as provided in this Agreement propose any person for election to the
Board of Directors of the Company;
(e) disclose to any third party, or make any filing under the
Exchange Act, including, without limitation, under Section 13(d) thereof,
disclosing, any intention, plan or arrangement inconsistent with the
foregoing;
(f) form, join or in any way participate in a group to take any
actions otherwise prohibited by the terms of this Agreement;
(g) enter into any discussions, negotiations, arrangements or
understandings with any third party with respect to any of the foregoing;
or
(h) make any public announcement with respect to any of the
foregoing.
SECTION 3.2. EXCEPTIONS TO THE STANDSTILL PROVISIONS.
Notwithstanding the foregoing, the provisions of Section 3.1 shall not
prohibit:
(a) any transaction by a Restricted Stockholder approved by either
(i) a majority of the members of the Board of Directors who are neither
designated by such Restricted Stockholder nor otherwise affiliated with
such Restricted Stockholder, or (ii) a majority of the stockholders of the
Company other than such Restricted Stockholder and its Affiliates;
(b) in the case of the PCP Entities, the acquisition of securities
pursuant to the terms of the Securities Purchase Agreement;
(c) (i) in the case of the PCP Entities, the acquisition of
securities or of Beneficial Ownership of securities if, after giving effect
to such acquisition, the Beneficial Ownership of the PCP Entities in the
Company is less than or equal to 65% and (ii) in the case of each of
Harvard, Apollo and Mitsui, the acquisition of securities of the Company or
of Beneficial Ownership of securities of the Company if, after giving
effect to such acquisition, the Beneficial Ownership of each such
Restricted Stockholder in the Company is less than or equal to 49%;
(d) the granting by the Board of Directors of options to
Affiliates of Restricted Stockholders; or
(e) the exercise of stock options.
ARTICLE IV.
TRANSFER RESTRICTIONS
SECTION 4.1. RESTRICTIONS ON TRANSFER OF RESTRICTED SECURITIES.
Until the third anniversary of the Initial Closing Date, the PCP Entities
shall not Transfer any of their Restricted Securities except:
(a) as part of a merger, consolidation or amalgamation of the
Company or a tender offer for Common Stock of the Company which is open to
all stockholders of the Company;
(b) a Transfer of Common Stock in compliance with Section 4.2 of
this Agreement to a Transferee that has agreed to comply with the
provisions of Section 4.2; or
(c) to a Permitted Transferee who shall have become a party to
this Agreement by executing a signature page hereto and delivering such
signature page to the Company and the other Restricted Stockholders, which
execution and delivery shall constitute an agreement by such Permitted
Transferee that it and the Restricted Securities that it acquires shall be
bound by and entitled to the benefits of this Agreement.
SECTION 4.2. TAG-ALONG RIGHTS
(a) In the event either or both of the PCP Entities desires to
Transfer any Restricted Securities pursuant to Section 4.1(b) at any time
prior to the third anniversary of the Initial Closing Date, such PCP Entity
shall notify Apollo and Harvard (the "Tag-Along Stockholders") 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, each Tag-Along Stockholder shall notify the PCP Entities if it
elects to participate in such Transfer. Any such Tag-Along Stockholder that
fails to notify either PCP Entity within such ten (10) Business Day period
shall be deemed to have waived its rights to participate in such Transfer.
Each such Tag-Along Stockholder that so notifies the PCP Entities 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 Entities,
an amount of shares equal to the shares the Transferee actually proposes to
purchase multiplied by a fraction, the numerator of which shall be the
number of shares of Common Stock issued and owned by such Tag-Along
Stockholder and the denominator of which shall be the aggregate number of
shares of Common Stock issued and owned by such PCP Entity (or both PCP
Entities, if both are selling pursuant to such transaction) and each other
Tag-Along Stockholder exercising its rights under this Section (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 and each other Tag-Along Stockholder exercising its rights under
this Section).
SECTION 4.3. TRANSFEREES; NONCOMPLYING TRANSFERS.
In the event of any purported Transfer of any Restricted Securities in
violation of Article IV of this Agreement, such purported Transfer shall be
void and of no effect, and no dividend of any kind whatsoever nor any
distribution pursuant to liquidation or otherwise shall be paid by the
Company to the purported transferee in respect of such Restricted
Securities (all such dividends and distributions being deemed waived), and
the voting rights of such Restricted Securities, if any, on any matter
whatsoever shall remain vested in the Transferor, and the Transferor shall
not be relieved of any of its obligations hereunder as the holder of such
Restricted Securities. In the event of such a non-complying Transfer, the
Company shall not Transfer any such Restricted Securities on its books or
recognize the purported Transferee as a stockholder, for any purpose, until
all applicable provisions of this Agreement have been complied with.
SECTION 4.4. RESTRICTIONS ON TRANSFERS OF INTERESTS IN THE PCP ENTITIES.
Until the second anniversary of the Initial Closing Date:
(a) Each of the PCP Entities shall not register or permit any
Transfer of the membership interests in such entity by Penske or Penske
Capital Partners, L.L.C., except pursuant to a pro rata Transfer by all of
the members of interests valued at up to $15 million to certain members of
the Company's management (a "Management Incentive Transfer").
(b) Penske and Penske Capital Partners, L.L.C. each agrees not to
Transfer any interest in the PCP Entities or Restricted Securities, except
for a Management Incentive Transfer.
ARTICLE V.
CERTAIN COVENANTS
SECTION 5.1. LEGEND ON CERTIFICATES.
(a) Each certificate for Restricted Securities held by the PCP
Entities shall be stamped or otherwise imprinted with a legend in
substantially the following form:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE RESTRICTED BY THAT
CERTAIN STOCKHOLDERS AGREEMENT, BY AND AMONG UNITED AUTO GROUP, INC.,
INTERNATIONAL MOTOR CARS GROUP I, L.L.C., INTERNATIONAL MOTOR CARS
GROUP II, L.L.C., AIF II, L.P., AENEAS VENTURE CORPORATION AND MITSUI
& CO., LTD., A COUNTERPART OF WHICH STOCKHOLDERS AGREEMENT HAS BEEN
PLACED ON FILE BY THE COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS AND
ITS REGISTERED OFFICE. A COPY OF SUCH STOCKHOLDERS AGREEMENT WILL BE
FURNISHED WITHOUT CHARGE BY THE COMPANY TO THE RECORD HOLDER HEREOF
UPON WRITTEN REQUEST TO THE COMPANY AT THE PRINCIPAL PLACE OF BUSINESS
OF THE COMPANY."
(b) Each certificate for shares of Common Stock of the Company
held by Mitsui shall include the legend set forth in Section 1.5 of the
Purchase Agreement.
SECTION 5.2. XXXXX XXXXXX TO SERVE AS CHAIRMAN AND CHIEF EXECUTIVE OFFICER.
(a) On the Initial Closing Date, the Restricted Stockholders
(other than Mitsui) shall use their reasonable best efforts to have Xxxxx
Xxxxxx appointed as Chairman and Chief Executive Officer of the Company.
(b) From and after the Initial Closing Date, the PCP Entities
shall cause Xxxxx Xxxxxx:
(i) to serve as the Chairman of the Company until the third
anniversary of the Second Closing Date and as Chief Executive Officer
of the Company until the second anniversary of the Second Closing
Date; provided, however, such obligation shall cease if pursuant to
Sections 2.4 or 2.5, PCP Directors shall no longer constitute a
majority of the Company's Board of Directors, and provided further,
that upon exercise by the PCP Entities of their right pursuant to
Section 7.2 or 7.4 of the Securities Purchase Agreement, Xxxxx Xxxxxx
shall promptly, but in no event later than the Business Day
immediately following such exercise, resign as Chairman, as a Director
and as Chief Executive Officer;
(ii) to receive compensation payable by the Company no greater
than: (x) salary of $1 per annum, (y) a bonus determined by the
Compensation Committee of the Board of Directors, and (z) options for
400,000 shares of Common Stock with an exercise price of $10.00 per
share to be granted on the Second Closing Date.
Such options shall vest in equal installments over a three year
period from and after the Initial Closing Date, so long as Mr. Penske
continues to serve as Chairman of the Board of Directors.
SECTION 5.3. APPROVAL OF COMPANY ACTION UNDER THE SECURITIES PURCHASE
AGREEMENT.
From and after the Initial Closing Date, all consents, waivers, amendments
or other actions on the part of the Company under the Securities Purchase
Agreement and the other agreements with the PCP Entities contemplated by
the Securities Purchase Agreement shall be undertaken under the direction
of a majority of the Board of Directors (excluding for such purposes the
PCP Directors and any other directors Affiliated with either PCP Entity).
SECTION 5.4. CONFIDENTIALITY OBLIGATION.
(a) Mitsui shall treat as secret and confidential any and all
confidential information communicated by the Company to the member of the
Board of Directors designated by Mitsui or the Observer and shall therefore
not disclose or communicate such confidential information to any person or
entity, except to those employees and persons within Mitsui and/or its
affiliates who need to have access to such information for the purpose of
monitoring Mitsui's investment in the Company. Any such employee or person
shall be bound by this confidentiality obligation and shall be informed of
the confidential nature of the information.
(b) The obligations imposed above shall not apply to information.
(i) which becomes publicly available;
(ii) which Mitsui can establish was already in its possession at
the time such information was communicated to it;
(iii) which is received from a third party without restriction
and without breach of this Agreement;
(iv) which Mitsui can establish has been independently developed
by it; or
(v) which is required to be disclosed by applicable law, legal
process or, in connection with any judicial process, arbitration or
other proceeding.
SECTION 5.5. FURTHER ASSURANCES.
Each of the parties hereto shall use commercially reasonable efforts to do
such additional things and execute such documents as are reasonably
necessary or proper to carry out and effectuate the intent of this
Agreement or any part hereof.
ARTICLE VI.
MUTUAL REPRESENTATIONS AND WARRANTIES
Each of the parties hereto represents and warrants to the others as
follows:
SECTION 6.1. ORGANIZATION.
It is duly organized, validly existing and in good standing under the laws
of its jurisdiction of formation.
SECTION 6.2. AUTHORIZATION, VALIDITY AND ENFORCEABILITY.
It has full power and authority to execute, deliver and perform its
obligations under this Agreement. The execution, delivery and performance
by it of this Agreement and the consummation by it of the transactions
contemplated hereby have been duly authorized by its board of directors or
other governing body and no other proceedings on its part are necessary to
authorize this Agreement or the transactions contemplated hereby. This
Agreement has been duly executed and delivered by it, and constitutes the
legal, valid and binding obligation of it, enforceable against it in
accordance with the terms hereof, except as such enforcement may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting rights of creditors generally and by general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity).
SECTION 6.3. NO VIOLATION OR BREACH.
The execution, delivery and performance by it of this Agreement and the
consummation of the transactions contemplated hereby, do not and will not
conflict with, result in a violation or breach of, constitute a default (or
an event which with the giving of notice or the lapse of time or both would
constitute a default) or give rise to any right of termination or
acceleration of any right or obligation of it under, or result in the
creation or imposition of any lien, mortgage, pledge, security interest,
claim, right of first refusal or other limitation on transfer or other
encumbrance upon any of its Restricted Securities or shares of Common Stock
of the Company, as the case may be, by reason of the terms of, (a) its
memorandum of association, certificate of incorporation, by-laws or other
charter or organizational document, (b) any contract, agreement, lease,
license, mortgage, note, bond, debenture, indenture or other instrument or
obligation to which it is a party or by or to which it or its assets or
properties may be bound or subject, (c) any order, writ, judgment,
injunction, award, decree, law, statute, rule or regulation applicable to
it or (d) any license, permit, order, consent, approval, registration,
authorization or qualification with or under any governmental agency, other
than in the case of clauses (b), (c) or (d) above any conflict, violation,
breach or default which would not, individually or in the aggregate
together with all other such conflicts, violations, breaches or defaults,
have a material adverse effect on it or have a material adverse effect on
its ability to perform its obligations, or consummate the transactions
contemplated, hereunder.
ARTICLE VII.
TERM
SECTION 7.1. TERM.
This Agreement shall commence on the date hereof, and shall terminate on
December 31, 2009. This Agreement shall terminate with respect to a
Restricted Stockholder at such time as it ceases to Beneficially Own any
Restricted Securities or any shares of Common Stock of the Company, as the
case may be.
SECTION 7.2. EFFECTS OF TERMINATION.
Upon termination of this Agreement, this Agreement (other than Section 8.9)
shall thereafter become void and have no effect, and no party hereto shall
have any liability or obligation to any other party hereto in respect of
this Agreement, except for any liability resulting from such party's breach
of this Agreement.
ARTICLE VIII.
MISCELLANEOUS PROVISIONS
SECTION 8.1. SURVIVAL.
All of the representations, warranties, covenants, and agreements of the
parties contained in this Agreement shall survive until this Agreement is
terminated.
SECTION 8.2. NOTICES.
All notices, demands or other communications to be given or delivered under
or by reason of the provisions of this Agreement shall be in writing and
shall be deemed to have been given (a) when delivered personally to the
recipient, (b) two Business Days after the date when sent to the recipient
by reputable express courier service (charges prepaid), or (c) seven
Business Days after the date when mailed to the recipient by certified or
registered mail, return receipt requested and postage prepaid. Such
notices, demands and other communications shall be sent to the parties at
the addresses indicated below:
If to Apollo Apollo Advisors, LP
0000 Xxxxxx xx xxx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telecopy: (000) 000-0000
If to Harvard Aeneas Venture Corporation
c/o Charlesbank Capital Partners, LLC
000 Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxx
With a copy to: Ropes & Xxxx
(which shall not One International Place
constitute notice) Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxx Xxxx
Facsimile No. (000) 000-0000
If to either PCP Entity c/o Penske Capital Partners, LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
With a copy to: Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx
(which shall not One New York Plaza
constitute notice) Xxx Xxxx, XX 00000
If to Mitsui Japan: Mitsui & Co., Ltd.
First Motor Vehicles Div.
0-0, Xxxxxxxxx, 0-Xxxxx, Xxxxxxx-Xx
Xxxxx, Xxxxx
Attention: General Manager of First
Motor Vehicles Div.
If to Mitsui USA: Mitsui & Co. (U.S.A.), Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Manager,
Detroit Machinery and
Automotive Department,
Second Machinery Division
With a copy to: Debevoise & Xxxxxxxx
(which shall not 000 Xxxxx Xxxxxx
constitute notice) Xxx Xxxx, XX 00000
Attention: :Xxxxxxxxxxx Xxxxxx, Esq.
Telecopy: (000) 000-0000
If to the Company: United Auto Group, Inc.
00000 Xxxxx Xxxxx Xxxx, Xxxxx X00
Xxxxxxx, XX 00000
Attn: General Counsel
Facsimile: (000) 000-0000
or to such other address as either party hereto may, from time to time,
designate in writing delivered pursuant to the terms of this Section 8.2.
SECTION 8.3. AMENDMENTS.
The terms, provisions and conditions of this Agreement may not be changed,
modified or amended in any manner except by an instrument in writing duly
executed by all of the parties hereto.
SECTION 8.4. ASSIGNMENT AND PARTIES IN INTEREST.
(a) Except as provided in Section 4.1(c), neither this Agreement
nor any of the rights, duties, or obligations of any party hereunder may be
assigned or delegated (by operation of law or otherwise) by any party
hereto except with the prior written consent of the other parties hereto.
(b) This Agreement shall not confer any rights or remedies upon
any person or entity other than the parties hereto and their respective
permitted successors and assigns; provided, however, that (i) the rights
set forth in Article II hereof shall not inure to the benefit of any
transferee (other than a Permitted Transferee) without the prior written
consent of each Restricted Stockholder (other than the Transferor) and (ii)
the provisions of this Agreement shall not be binding on any Transferee of
Restricted Securities or shares of Common Stock of the Company, as the case
may be, except as set forth in Sections 4.1(c) and 4.2.
SECTION 8.5. EXPENSES.
Each party to this Agreement shall bear all of its legal, accounting,
investment banking, and other expenses incurred by it or on its behalf in
connection with the transactions contemplated by this Agreement, whether or
not such transactions are consummated.
SECTION 8.6. ENTIRE AGREEMENT.
This Agreement and the other documents executed on the date hereof
constitute the entire agreement among the parties hereto with respect to
the subject matter hereof and supersede and are in full substitution for
any and all prior agreements and understandings among them relating to such
subject matter, and no party shall be liable or bound to the other party
hereto in any manner with respect to such subject matter by any warranties,
representations, indemnities, covenants, or agreements except as
specifically set forth herein or in the other documents executed on the
date hereof.
SECTION 8.7. DESCRIPTIVE HEADINGS.
The descriptive headings of the several sections of this Agreement are
inserted for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
SECTION 8.8. COUNTERPARTS.
For the convenience of the parties, any number of counterparts of this
Agreement may be executed by any one or more parties hereto, and each such
executed counterpart shall be, and shall be deemed to be, an original, but
all of which shall constitute, and shall be deemed to constitute, in the
aggregate but one and the same instrument.
SECTION 8.9. GOVERNING LAW; JURISDICTION.
(a) This Agreement shall be governed by and construed in
accordance with 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.
(b) Each of the parties hereto hereby irrevocably and
unconditionally consents to submit to the jurisdiction of the courts of the
State of New York and the United States of America located in the County 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, and further agrees that service of any process,
summons, notice or document to its respective address set forth in Section
8.2 shall be effective service of process for any action or proceeding
brought against it in any such court. Each of the parties hereto hereby
irrevocably and unconditionally waives any objection to the laying of venue
of any action or proceeding arising out of this Agreement or the
transactions contemplated hereby in the courts of the State of New York or
the United States of America located in the County of New York, and hereby
further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action or proceeding brought in any
such court has been brought in an inconvenient forum.
SECTION 8.10. SEVERABILITY.
In the event that any one or more of the provisions contained in this
Agreement or in any other instrument referred to herein, shall, for any
reason, be held to be invalid, illegal or unenforceable in any respect,
then to the maximum extent permitted by law, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement or
any other such instrument. Furthermore, if lieu of any such invalid or
unenforceable term or provision, the parties hereto intend that there shall
be added as a part of this Agreement a provision as similar in terms to
such invalid or unenforceable provision as may be possible and be valid and
enforceable.
SECTION 8.11. SPECIFIC PERFORMANCE.
(a) The parties hereto acknowledge and agree that irreparable
damage would occur in the event that any provision of this Agreement was
not performed in accordance with its specific terms or was otherwise
breached, and further acknowledge and agree that money damages are an
inadequate remedy for the breach of this Agreement because of the
difficulty of ascertaining the amount of damage that would be suffered in
the event of such breach. The parties hereto accordingly agree that they
each shall be entitled to obtain specific performance of any provision of
this Agreement and injunctive or other equitable relief to prevent or cure
breaches of any provision of this Agreement, this being in addition to any
other remedy to which they may be entitled by law or equity.
(b) The parties hereto further agree that they shall not be
permitted or have the right to terminate or suspend performance of any
provision of this Agreement, it being agreed that all provisions of this
Agreement shall continue and be specifically enforceable in all events and
under all circumstances regardless of any events, occurrences, actions or
omissions before or after the date hereof. In furtherance of the foregoing,
the parties hereto agree that they shall not be permitted to, and shall
not, bring any claim seeking to terminate or suspend performance of any
provision of this Agreement or seeking any determination that any provision
of this Agreement (including, without limitation, this Section 8.11) is
invalid, inapplicable or unenforceable.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
AIF II. L.P.
By:
--------------------------------------
Name:
Title:
AENEAS VENTURE CORPORATION
By:
--------------------------------------
Name:
Title:
INTERNATIONAL MOTOR CARS GROUP I, LLC
By:
--------------------------------------
Name:
Title:
INTERNATIONAL MOTOR CARS GROUP II, LLC
By:
--------------------------------------
Name:
Title:
MITSUI & CO., LTD.
By:
--------------------------------------
Name:
Title:
MITSUI & CO. (U.S.A.), INC.
By:
--------------------------------------
Name:
Title:
UNITED AUTO GROUP, INC.
By:
--------------------------------------
Name:
Title:
Solely for the purposes
of Section 4.4 hereof:
PENSKE CORPORATION
By:
----------------------------
Name:
Title:
PENSKE CAPITAL PARTNERS, L.L.C.
By:
----------------------------
Name:
Title:
