REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the “Agreement”) is made and entered into this 19th day of November, 2003, among Sonic Automotive, Inc., a Delaware corporation (the “Company”), the guarantors set forth on the signature page hereto (each a “Guarantor” and collectively, the “Guarantors”), Banc of America Securities LLC (“Banc of America”), J.P. Morgan Securities Inc. and Merrill Lynch, Pierce, Fenner & Smith, Incorporated (collectively, the “Initial Purchasers”).
This Agreement is made pursuant to the Purchase Agreement, dated November 12, 2003 among the Company, the Guarantors and the Initial Purchasers (the “Purchase Agreement”), which provides for the sale by the Company to the Initial Purchasers of an aggregate of $75 million principal amount of the Company’s 8 5/8% Senior Subordinated Notes due 2013, Series A, and related guarantees (collectively, the “Securities”). In order to induce the Initial Purchasers to enter into the Purchase Agreement, the Company has agreed to provide to the Initial Purchasers and their direct and indirect transferees the registration rights set forth in this Agreement. The execution of this Agreement is a condition to the closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
As used in this Agreement, the following capitalized defined terms shall have the following meanings:
“1933 Act” shall mean the Securities Act of 1933, as amended from time to time.
“1934 Act” shall mean the Securities Exchange Act of l934, as amended from time to time.
“Closing Date” shall mean the Closing Time as defined in the Purchase Agreement.
“Company” shall have the meaning set forth in the preamble and shall also include the Company’s successors.
“Depositary” shall mean The Depository Trust Company, or any other depositary appointed by the Company, provided, however, that such depositary must have an address in the Borough of Manhattan, in the City of New York.
“Exchange Offer” shall mean the exchange offer by the Company of Exchange Securities for Registrable Securities pursuant to Section 2.1 hereof.
“Exchange Offer Registration” shall mean a registration under the 1933 Act effected pursuant to Section 2.1 hereof.
“Exchange Offer Registration Statement” shall mean an exchange offer registration statement on Form S-4 (or, if applicable, on another appropriate form), and all amendments and supplements to such registration statement, including the Prospectus contained therein, all exhibits thereto and all documents incorporated by reference therein.
“Exchange Period” shall have the meaning set forth in Section 2.1 hereof.
“Exchange Securities” shall mean (i) the 8 5/8% Senior Subordinated Notes due 2013, Series A, issued by the Company and (ii) the related guarantees issued by the Guarantors, in each case under the Indenture containing terms identical to the Securities in all material respects (except for references to certain interest rate provisions, restrictions on transfers and restrictive legends), to be offered to Holders of Securities in exchange for Registrable Securities pursuant to the Exchange Offer.
“Holder” shall mean an Initial Purchaser, for so long as it owns any Registrable Securities, and each of its successors, assigns and direct and indirect transferees who become registered owners of Registrable Securities under the Indenture and each Participating Broker-Dealer that holds Exchange Securities for so long as such Participating Broker-Dealer is required to deliver a prospectus meeting the requirements of the 1933 Act in connection with any resale of such Exchange Securities.
“Indenture” shall mean the Indenture relating to the Securities, the Exchange Securities and the Private Exchange Securities, dated as of August 12, 2003 between the Company and U.S. Bank Trust National Association, as trustee, as the same may be amended, supplemented, waived or otherwise modified from time to time in accordance with the terms thereof.
“Initial Purchasers” shall have the meaning set forth in the preamble.
“Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of Outstanding (as defined in the Indenture) Registrable Securities; provided that whenever the consent or approval of Holders of a specified percentage of Registrable Securities is required hereunder, Registrable Securities held by the Company and other obligors on the Securities or any Affiliate (as defined in the Indenture) of the Company shall be disregarded in determining whether such consent or approval was given by the Holders of such required percentage amount.