Purchase Agreement (2003)Full Document 

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SONIC AUTOMOTIVE, INC. (a Delaware corporation)

The Guarantors Listed on Schedule A

 

$75,000,000

 

8 5/8% Senior Subordinated Notes due 2013

 

PURCHASE AGREEMENT

 

Dated: November 12, 2003

 


 


 

TABLE OF CONTENTS

 

PURCHASE AGREEMENT

   2

SECTION 1. Representations and Warranties

   3
   

(a)

  

Representations and Warranties by the Company and the Guarantors

   3
        

(i)

 

Similar Offerings

   3
        

(ii)

 

Offering Memorandum

   4
        

(iii)

 

Incorporated Documents

   4
        

(iv)

 

Independent Accountants

   4
        

(v)

 

Financial Statements

   4
        

(vi)

 

No Material Adverse Change in Business

   4
        

(vii)

 

Good Standing of the Company

   5
        

(viii)

 

Subsidiaries

   5
        

(ix)

 

Capitalization

   6
        

(x)

 

Authorization of Agreements

   6
        

(xi)

 

Authorization of the Indenture

   6
        

(xii)

 

Authorization of the Securities, the Guarantees and the Exchange Securities

   6
        

(xiii)

  Description of the Securities, the Guarantees, the Indenture, the Registration Rights Agreement and the Exchange Securities    7
        

(xiv)

 

Absence of Defaults and Conflicts

   7
        

(xv)

 

Absence of Labor Disputes

   8
        

(xvi)

 

Absence of Proceedings

   8
        

(xvii)

 

Possession of Intellectual Property

   8
        

(xviii)

 

Absence of Further Requirements

   9
        

(xix)

 

Possession of Licenses and Permits

   9
        

(xx)

 

Title to Property

   10
        

(xxi)

 

Tax Returns

   10
        

(xxii)

 

Insurance

   10
        

(xxiii)

 

Solvency

   10
        

(xxiv)

 

Stabilization or Manipulation

   11

 

- i -


        

(xxv)

 

Related Party Transactions

   11
        

(xxvi)

 

Suppliers

   11
        

(xxvii)

 

Environmental Laws

   11
        

(xxviii)

 

Registration Rights

   12
        

(xxix)

 

Accounting Controls

   12
        

(xxx)

 

Investment Company Act

   12
        

(xxxi)

 

Rule 144A Eligibility

   12
        

(xxxii)

 

No General Solicitation

   13
        

(xxxiii)

 

No Registration Required

   13
        

(xxxiv)

 

PORTAL

   13
        

(xxxv)

 

Fungibility

   13
        

(xxxvi)

 

Franchise Agreements

   13
        

(xxxvii)

 

Liquidity and Off Balance Sheet Arrangements

   13
        

(xxxviii)

 

Disclosure Controls

   13
   

(b)

  

Officer’s Certificates

   14

SECTION 2. Sale and Delivery to Initial Purchasers; Closing

   14
   

(a)

  

Securities and Guarantees

   14
   

(b)

  

Payment

   14
   

(c)

  

Qualified Institutional Buyer

   15
   

(d)

  

Denominations; Registration

   15

SECTION 3. Covenants of the Company and the Guarantors

   15
   

(a)

  

Offering Memorandum

   15
   

(b)

  

Notice and Effect of Material Events

   15
   

(c)

  

Amendment to Offering Memorandum and Supplements

   15
   

(d)

  

Qualification of Securities and Guarantees for Offer and Sale

   16
   

(e)

  

Exchange Offer

   16
   

(f)

  

Integration

   16

 

- ii -


   

(g)

  

No Directed Selling Effort or General Solicitation

   16
   

(h)

  

Rating of Securities

   17
   

(i)

  

Rule 144A Information

   17
   

(j)

  

Restriction on Resales

   17
   

(k)

  

Use of Proceeds

   17
   

(l)

  

Restriction on Sale of Securities

   17
   

(m)

  

DTC Clearance

   17
   

(n)

  

Legends

   18
   

(o)

  

Interim Financial Statements

   18
   

(p)

  

Periodic Reports

   18

SECTION 4. Payment of Expenses

   18
   

(a)

  

Expenses

   18
   

(b)

  

Termination of Agreement

   19

SECTION 5. Conditions of Initial Purchasers’ Obligations

   19
   

(a)

  

Opinion of Counsel for the Company and the Guarantors

   19
   

(b)

  

Opinion of Counsel for the Initial Purchasers

   19
   

(c)

  

Officers’ Certificate

   19
   

(d)

  

Accountants’ Letters and Consents

   20
   

(e)

  

Maintenance of Rating

   20
   

(f)

  

PORTAL

   20
   

(g)

  

Chief Financial Officer’s Certificate

   20
   

(h)

  

Registration Rights Agreement

   20
   

(i)

  

Manufacturers’ Consents

   20
   

(j)

  

Lenders’ Consents

   21

 

- iii -


   

(k)

  

Additional Documents

   21
   

(l)

  

Termination of Agreement

   21

SECTION 6. Indemnification

   21
   

(a)

  

Indemnification of Initial Purchasers

   21
   

(b)

  

Indemnification of Company, Guarantors, and Directors

   22
   

(c)

  

Actions against Parties; Notification

   22
   

(d)

  

Settlement without Consent if Failure to Reimburse

   23

SECTION 7. Contribution

   23

SECTION 8. Representations, Warranties and Agreements to Survive Delivery

   24

SECTION 9. Termination of Agreement

   25
   

(a)

  

Termination; General

   25
   

(b)

  

Liabilities

   25

SECTION 10. Default by One or More of the Initial Purchasers

   25

SECTION 11. Tax Disclosure

   26

SECTION 12. Notices

   26

SECTION 13. Parties

   26

SECTION 14. Governing Law and Time

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