Document:

sah-ex1014_883.htm

Exhibit 10.14

 

EXECUTION VERSION

 

 

FOURTH AMENDED AND RESTATED 

SECURITIES PLEDGE AGREEMENT

THIS FOURTH AMENDED AND RESTATED SECURITIES PLEDGE AGREEMENT (this “Pledge Agreement”) is made and entered into as of November 30, 2016 by SONIC AUTOMOTIVE, INC., a Delaware corporation (a “Company” and a “Pledgor”), EACH OF THE UNDERSIGNED SUBSIDIARIES OF THE COMPANY AND EACH OTHER PERSON WHO SHALL BECOME A PARTY HERETO BY EXECUTION OF A JOINDER AGREEMENT (each a “Pledgor” and, collectively with the Company, the “Pledgors”) and BANK OF AMERICA, N.A., a national banking association, as Administrative Agent (in such capacity, the “Administrative Agent”) for each of the lenders (the “Lenders”) now or hereafter party to the Revolving Credit Agreement defined below (collectively with the Administrative Agent and certain other Persons parties to Related Swap Contracts and Secured Cash Management Arrangements as more particularly described in Section 17 hereof, the “Revolving Secured Parties”).  All capitalized terms used but not otherwise defined herein shall have the respective meanings assigned thereto in the Revolving Credit Agreement.

W I T N E S S E T H:

WHEREAS, the Company, certain of the Lenders (the “Existing Lenders”) and the Administrative Agent entered into that certain Third Amended and Restated Credit Agreement dated as of July 23, 2014 (as amended prior to (but excluding) the date hereof, the “Existing Credit Agreement”), pursuant to which certain of the Existing Lenders agreed to make available to the Company a revolving credit facility, including a letter of credit subfacility and a swingline subfacility; and

 

WHEREAS, the Company and certain Subsidiaries of the Company (the “Existing Pledgors”) entered into a Third Amended and Restated Securities Pledge Agreement dated as of July 23, 2014 (as amended prior to (but excluding) the date hereof, the “Existing Pledge Agreement”), pursuant to which the Existing Pledgors have secured their obligations arising under the Existing Credit Agreement; and

WHEREAS, the Company has requested that the Existing Credit Agreement be amended and restated in order to, among other things, (a) extend the maturity date of the revolving credit facility provided therein, (b) increase the maximum aggregate amount of the revolving credit facility provided therein, and (c) make certain other amendments to the Existing Credit Agreement on the terms and conditions set forth in that certain Fourth Amended and Restated Credit Agreement dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Revolving Credit Agreement”) among the Company, the Administrative Agent and the Lenders party thereto from time to time (the “Lenders”); and

 

WHEREAS, the Administrative Agent and the Lenders have agreed to enter into the Revolving Credit Agreement, subject to, among other things, a condition that the parties amend and restate the Existing Pledge Agreement as provided herein; and

 

 

WHEREAS, each of (i) the Company, as collateral security for the payment and performance of the Obligations and the obligations and liabilities of any Loan Party now existing or hereafter arising under Related Swap Contracts and Secured Cash Management Arrangements other than Excluded Swap Obligations, and (ii) each other Pledgor (including each Subsidiary party to a Joinder Agreement), as collateral security for the payment and performance of its Guarantor’s Obligations (as defined in the Subsidiary Guaranty), and the payment and performance of its obligations and liabilities (whether now existing or hereafter arising) hereunder or under any of the other Loan Documents to which it is now or hereafter becomes a party (such obligations and liabilities of the Pledgors described in clauses (i) and (ii) being referred to as “Secured Obligations”), is willing to pledge and grant to the Administrative Agent for the benefit of the Revolving Secured Parties a security interest in all of the Equity Interests of certain of its Subsidiaries as more particularly described on Schedule I attached hereto (collectively, the “Pledged Interests”), and certain related property (such Subsidiaries, together with all other Subsidiaries whose Equity Interests may be required to be subject to this Pledge Agreement from time to time, are hereinafter referred to collectively as the “Pledged Subsidiaries”); and

 

WHEREAS, the Company and each Subsidiary party hereto will materially benefit from the Loans to be made, and the Letters of Credit to be issued, under the Revolving Credit Agreement and each such Subsidiary is a party (as signatory or by joinder) to the Subsidiary Guaranty pursuant to which such Subsidiary guarantees the Obligations of the Company and the other Loan Parties; and

 

WHEREAS, the Revolving Secured Parties are unwilling to make available or maintain the credit facilities under the Revolving Credit Agreement unless the Company and each other Pledgor enter into this Pledge Agreement; 

 

NOW, THEREFORE, in order to induce (i) the Lenders to amend and restate the Existing Credit Agreement and (ii) the Revolving Secured Parties to enter into the Loan Documents and to make or maintain the credit facilities provided for therein available to or for the account of the Company and in consideration of the promises and the mutual covenants contained herein, the parties hereto agree that the Existing Pledge Agreement is hereby amended and restated as follows:    

1.Pledge of Pledged Interests; Other Collateral.

	
(a)
	
As collateral security for the payment and performance by each Pledgor of its now or hereafter existing Secured Obligations, each Pledgor hereby grants, pledges and collaterally assigns to the Administrative Agent for the benefit of the Revolving Secured Parties a first priority security interest in all of the following items of property in which it now has or may at any time hereafter acquire an interest or the power to transfer rights therein, and wheresoever located:

(i)the Pledged Interests; and

(ii)all money, securities, security entitlements and other investment property, dividends, rights, general intangibles and other property at any time and 

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from time to time (x) declared or distributed in respect of or in exchange for or on conversion of any Pledged Interest, or (y) by its or their terms exchangeable or exercisable for or convertible into any Pledged Interest; and

(iii)all other property of whatever character or description, including money, securities, security entitlements and other investment property, and general intangibles hereafter delivered to the Administrative Agent in substitution for or as an addition to any of the foregoing; and

(iv)all securities accounts to which may at any time be credited any or all of the foregoing or any proceeds thereof and all certificates and instruments representing or evidencing any of the foregoing or any proceeds thereof; and

(v)all proceeds of any of the foregoing.

All such Pledged Interests, certificates, instruments, cash, securities, interests, dividends, rights and other property referred to in clauses (i) through (v) of this Section 1 are herein collectively referred to as the “Collateral.”

	
(b)
	
Subject to Section 10(a), each Pledgor agrees to deliver all certificates, instruments or other documents representing any Collateral to the Administrative Agent at such location as the Administrative Agent shall from time to time designate by written notice pursuant to Section 22 for its custody at all times until termination of this Pledge Agreement, together with such instruments of assignment and transfer as requested by the Administrative Agent.

	
(c)
	
Each Pledgor agrees to execute and deliver, or cause to be executed and delivered by other Persons, at Pledgor’s expense, all share certificates, documents, instruments, agreements, financing statements (and amendments thereto and continuations thereof), assignments, control agreements, or other writings as the Administrative Agent may reasonably request from time to time to carry out the terms of this Pledge Agreement or to protect or enforce the Administrative Agent’s Lien and security interest in the Collateral hereunder granted to the Administrative Agent for the benefit of the Revolving Secured Parties and further agrees to do and cause to be done upon the Administrative Agent’s request, at Pledgor’s expense, all things determined by the Administrative Agent to be necessary or advisable to perfect and keep in full force and effect the Lien in the Collateral hereunder granted to the Administrative Agent for the benefit of the Revolving Secured Parties, including the prompt payment of all out-of-pocket fees and expenses incurred in connection with any filings made to perfect or continue the Lien and security interest in the Collateral hereunder granted in favor of the Administrative Agent for the benefit of the Revolving Secured Parties.

	
(d)
	
All filing fees, advances, charges, costs and expenses (including fees, charges and disbursements of counsel (“Attorney Costs”)), incurred or paid by the Administrative Agent or any Lender in exercising any right, power or remedy conferred by this Pledge Agreement, or in the enforcement thereof, shall become a part of the Secured Obligations secured hereunder and shall be paid to the Administrative Agent for 

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the benefit of the Revolving Secured Parties by the Pledgor in respect of which the same was incurred immediately upon demand therefor, and any amounts not so paid on demand (in addition to other rights and remedies resulting from such nonpayment) shall bear interest from the date of demand until paid in full at the Default Rate.

(e)Each Pledgor agrees to register and cause to be registered the interest of the Administrative Agent, for the benefit of the Revolving Secured Parties, in the Collateral on its own books and records and the registration books of each of the Pledged Subsidiaries.

2.Status of Pledged Interests.  Each Pledgor hereby represents, warrants and covenants to the Administrative Agent for the benefit of the Revolving Secured Parties, with respect to itself and the Collateral as to which it has or acquires any interest, that:

	
(a)
	
All of the Pledged Interests are, as of the date of execution of this Pledge Agreement or Joinder Agreement by each Pledgor pledging such Pledged Interests (such date as applicable with respect to each Pledgor, its “Applicable Date”), and shall at all times thereafter be validly issued and outstanding, fully paid and non-assessable, are accurately described on Schedule I, and (except as set forth on Schedule I) constitute all of the issued and outstanding Equity Interests of each Pledged Subsidiary.

	
(b)
	
The Pledgor is as at its Applicable Date and shall at all times thereafter (subject to Dispositions permitted under the Revolving Credit Agreement) be the sole registered and record and beneficial owner of the Pledged Interests, free and clear of all Liens, charges, equities, options, hypothecations, encumbrances and restrictions on pledge or transfer, including transfer of voting rights (other than the pledge hereunder and applicable restrictions pursuant to federal and state and applicable foreign securities laws).  Without limiting the foregoing, the Pledged Interests are not and will not be subject to any voting trust, shareholders agreement, right of first refusal, voting proxy, power of attorney or other similar arrangement (other than the rights hereunder in favor of the Administrative Agent).

	
(c)
	
At no time shall any Pledged Interests (i) be held or maintained in the form of a security entitlement or credited to any securities account and (ii) which constitute a “security” (or as to which the related Pledged Subsidiary has elected to have treated as a “security”) under Article 8 of the Uniform Commercial Code of the State of North Carolina or of any other jurisdiction whose laws may govern (the “UCC”) be maintained in the form of uncertificated securities.  With respect to Pledged Interests that are “securities” under the UCC, or as to which the issuer has elected at any time to have such interests treated as “securities” under the UCC, such Pledged Interests are, and shall at all times be, represented by the share certificates listed on Schedule I hereto, which share certificates, with stock powers duly executed in blank by the Pledgor, have been delivered to the Administrative Agent or are being delivered to the Administrative Agent simultaneously herewith or, in the case of Additional Interests as defined in Section 21, shall be delivered pursuant to Section 21. In addition, with respect to all Pledged Interests, including Pledged Interests that are not “securities” under the UCC and as to which the applicable Pledged Subsidiary has not elected to have such interests treated as 

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“securities” under the UCC, the Pledgor has at its Applicable Date delivered to the Administrative Agent (or has previously delivered to the Administrative Agent or, in case of Additional Interests shall deliver pursuant to Section 21) Uniform Commercial Code financing statements (or appropriate amendments thereto) duly authorized by the Pledgor and naming the Administrative Agent for the benefit of the Revolving Secured Parties as “secured party,” in form, substance and number sufficient in the reasonable opinion of the Administrative Agent to be filed in all UCC filing offices and in all jurisdictions in which filing is necessary or advisable to perfect in favor of the Administrative Agent for the benefit of the Revolving Secured Parties the Lien on such Pledged Interests, together with all required filing fees.  Without limiting the foregoing provisions of this Section 2(c), with respect to any Pledged Interests issued by any Subsidiary organized under the laws of a jurisdiction other than the United States (a “Foreign Subsidiary”), Pledgor shall deliver or cause to be delivered, (i) in addition to or in substitution for all or any of the foregoing items, as the Administrative Agent may elect, such other instruments, certificates, agreements, notices, filings, and other documents, and take or cause to be taken such other action, as the Administrative Agent may determine to be necessary or advisable under the laws of the jurisdiction of formation of such Foreign Subsidiary, to grant, perfect and protect as a first priority lien in such Collateral in favor of the Administrative Agent for the benefit of the Revolving Secured Parties, and (ii) an opinion of counsel acceptable in form and substance to the Administrative Agent issued by a law firm acceptable to the Administrative Agent licensed to practice law in such foreign jurisdiction, addressing with respect to such Pledged Interests the matters described in Section 6.14 of the Revolving Credit Agreement.

	
(d)
	
It has full corporate power, legal right and lawful authority to execute this Pledge Agreement (and any Joinder Agreement applicable to it) and to pledge, assign and transfer its Pledged Interests in the manner and form hereof.

	
(e)
	
The pledge, assignment and delivery of its Pledged Interests (along with undated stock powers executed in blank, financing statements and other agreements referred to in Section 2(c) hereof) to the Administrative Agent for the benefit of the Revolving Secured Parties pursuant to this Pledge Agreement (or any Joinder Agreement) creates or continues, as applicable, a valid and perfected first priority security interest in such Pledged Interests in favor of the Administrative Agent for the benefit of the Revolving Secured Parties, securing the payment of the Secured Obligations, assuming, in the case of the Pledged Interests which constitute certificated “securities” under the UCC, continuous and uninterrupted possession by or on behalf of the Administrative Agent.  The Pledgor will at its own cost and expense defend the Revolving Secured Parties’ right, title and security interest in and to the Collateral against the claims and demands of all persons whomsoever.

	
(f)
	
Except as otherwise expressly provided herein pursuant to a Disposition permitted under the Revolving Credit Agreement, none of the Pledged Interests (nor any interest therein or thereto) shall be sold, transferred or assigned without the Administrative Agent’s prior written consent, which may be withheld for any reason.

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(g)
	
It shall at all times cause the Pledged Interests of such Pledgor that constitute “securities” (or as to which the issuer elects to have treated as “securities”) under the UCC to be represented by the certificates now and hereafter delivered to the Administrative Agent in accordance with Sections 1, 2 and 21 hereof and that it shall cause each of the Pledged Subsidiaries as to which it is the Pledgor not to issue any Equity Interests, or securities convertible into, or exchangeable or exercisable for, Equity Interests, at any time during the term of this Pledge Agreement unless the Pledged Interests of such Pledge Subsidiary are issued solely to either (y) such Pledgor who shall immediately comply with Sections 2 and 21 hereof with respect to such property or (z) the Company or a Subsidiary Guarantor who shall immediately pledge such additional Equity Interests to the Administrative Agent for the benefit of the Revolving Secured Parties pursuant to Section 21 or 23 hereof, as applicable, on substantially identical terms as are contained herein and deliver or cause to be delivered the appropriate documents described in Section 2(c) hereof to the Administrative Agent and take such further actions as the Administrative Agent may deem necessary in order to perfect a first priority security interest in such Equity Interests.

(h)The exact legal name and address, type of Person, jurisdiction of formation, jurisdiction of formation identification number (if any), and location of the chief executive office of such Pledgor are as specified on Schedule II attached hereto.  No Pledgor shall change its name, jurisdiction of formation (whether by reincorporation, merger or otherwise), or the location of its chief executive office, except upon giving not less than thirty (30) days’ prior written notice to the Administrative Agent and taking or causing to be taken all such action at such Pledgor’s expense as may be reasonably requested by the Administrative Agent to perfect or maintain the perfection of the Lien of the Administrative Agent in Collateral.

3.Preservation and Protection of Collateral.

	
(a)
	
The Administrative Agent shall be under no duty or liability with respect to the collection, protection or preservation of the Collateral, or otherwise, beyond the use of reasonable care in the custody and preservation thereof while in its possession.

(b)Each Pledgor agrees to pay when due all taxes, charges, Liens and assessments against the Collateral in which it has an interest, unless being contested in good faith by appropriate proceedings diligently conducted and against which adequate reserves have been established in accordance with GAAP applied on a basis consistent with that used in preparing the Audited Financial Statements and evidenced to the satisfaction of the Administrative Agent and provided that all enforcement proceedings in the nature of levy or foreclosure are effectively stayed.  Upon the failure of any Pledgor to so pay or contest such taxes, charges, Liens or assessments, or upon the failure of any Pledgor to pay any amount pursuant to Section 1(c), the Administrative Agent at its option may pay or contest any of them (the Administrative Agent having the sole right to determine the legality or validity and the amount necessary to discharge such taxes, charges, Liens or assessments) but shall not have any obligation to make any such payment or contest.  All sums so disbursed by the Administrative Agent, including Attorney Costs, court costs, expenses and other charges related thereto, shall be payable 

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on demand by the applicable Pledgor to the Administrative Agent and shall be additional Secured Obligations secured by the Collateral, and any amounts not so paid on demand (in addition to other rights and remedies resulting from such nonpayment) shall bear interest from the date of demand until paid in full at the Default Rate.

	
(c)
	
Each Pledgor hereby (i) irrevocably authorizes the Administrative Agent to file (with, or to the extent permitted by applicable law, without the signature of the Pledgor appearing thereon) financing statements (including amendments thereto and continuations and copies thereof) showing such Pledgor as “debtor” at such time or times and in all filing offices as the Administrative Agent may from time to time reasonably determine to be necessary or advisable to perfect or protect the rights of the Administrative Agent and the Revolving Secured Parties hereunder, or otherwise to give effect to the transactions herein contemplated, and (ii) irrevocably ratifies and acknowledges all such actions taken by or on behalf of the Administrative Agent prior to the Applicable Date.

4.Default.  Upon the occurrence and during the continuance of any Event of Default, the Administrative Agent is given full power and authority, then or at any time thereafter, to sell, assign, deliver or collect the whole or any part of the Collateral, or any substitute therefor or any addition thereto, in one or more sales, with or without any previous demands or demand of performance or, to the extent permitted by law, notice or advertisement, in such order as the Administrative Agent may elect; and any such sale may be made either at public or private sale at the Administrative Agent’s place of business or elsewhere, either for cash or upon credit or for future delivery, at such price or prices as the Administrative Agent may reasonably deem fair; and the Administrative Agent or any other Revolving Secured Party may be the purchaser of any or all Collateral so sold and hold the same thereafter in its own right free from any claim of any Pledgor or right of redemption.  Demands of performance, advertisements and presence of property and sale and notice of sale are hereby waived to the extent permissible by law.  Any sale hereunder may be conducted by an auctioneer or any officer or agent of the Administrative Agent.  Each Pledgor recognizes that the Administrative Agent may be unable to effect a public sale of the Collateral by reason of certain prohibitions contained in the Securities Act of 1933, as amended (the “Securities Act”), and applicable state law, and may be otherwise delayed or adversely affected in effecting any sale by reason of present or future restrictions thereon imposed by governmental authorities, and that as a consequence of such prohibitions and restrictions the Administrative Agent may be compelled (i) to resort to one or more private sales to a restricted group of purchasers who will be obliged to agree, among other things, to acquire the Collateral for their own account, for investment and not with a view to the distribution or resale thereof, or (ii) to seek regulatory approval of any proposed sale or sales, or (iii) to limit the amount of Collateral sold to any Person or group.  Each Pledgor agrees and acknowledges that private sales so made may be at prices and upon terms less favorable to such Pledgor than if such Collateral was sold either at public sales or at private sales not subject to other regulatory restrictions, and that the Administrative Agent has no obligation to delay the sale of any of the Collateral for the period of time necessary to permit the Pledged Subsidiary to register or otherwise qualify the Collateral, even if such Pledged Subsidiary would agree to register or otherwise qualify such Collateral for public sale under the Securities Act or applicable state law.  Each Pledgor further agrees, to the extent permitted by applicable law, that the use of private sales made under the foregoing circumstances to dispose of the Collateral shall be 

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deemed to be dispositions in a commercially reasonable manner.  Each Pledgor hereby acknowledges that a ready market may not exist for the Pledged Interests if they are not traded on a national securities exchange or quoted on an automated quotation system and agrees and acknowledges that in such event the Pledged Interests may be sold for an amount less than a pro rata share of the fair market value of the Pledged Subsidiary’s assets minus its liabilities.  In addition to the foregoing, the Revolving Secured Parties may exercise such other rights and remedies as may be available under the Loan Documents, at law (including without limitation the UCC) or in equity.

5.Proceeds of Sale.  The net cash proceeds resulting from the collection, liquidation, sale, or other disposition of the Collateral shall be applied first to the expenses (including all Attorney Costs) of retaking, holding, storing, processing and preparing for sale, selling, collecting, liquidating and the like, and then to the satisfaction of all Secured Obligations in accordance with the terms of Section 8.03 of the Revolving Credit Agreement.  Each Pledgor shall be liable to the Administrative Agent, for the benefit of the Revolving Secured Parties, and shall pay to the Administrative Agent, for the benefit of the Revolving Secured Parties, on demand any deficiency which may remain after such sale, disposition, collection or liquidation of the Collateral.

6.Presentments, Demands and Notices.  The Administrative Agent shall not be under any duty or obligation whatsoever to make or give any presentments, demands for performances, notices of nonperformance, protests, notice of protest or notice of dishonor in connection with any obligations or evidences of indebtedness held thereby as collateral, or in connection with any obligations or evidences of indebtedness which constitute in whole or in part the Secured Obligations secured hereunder.

7.Attorney-in-Fact.  Each Pledgor hereby appoints the Administrative Agent as the Pledgor’s attorney-in-fact for the purposes of carrying out the provisions of this Pledge Agreement and taking any action and executing any instrument which the Administrative Agent may deem necessary or advisable to accomplish the purposes hereof, which appointment is irrevocable and coupled with an interest; provided, that the Administrative Agent shall have and may exercise rights under this power of attorney only upon the occurrence and during the continuance of an Event of Default.  Without limiting the generality of the foregoing, upon the occurrence and during the continuance of an Event of Default, the Administrative Agent shall have the right and power to receive, endorse and collect all checks and other orders for the payment of money made payable to any Pledgor representing any dividend, interest payment, principal payment or other distribution payable or distributable in respect to the Collateral or any part thereof and to give full discharge for the same.

8.Reinstatement.  The granting of a security interest in the Collateral and the other provisions hereof shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Secured Obligations is rescinded or must otherwise be returned by any Revolving Secured Party or is repaid by any Revolving Secured Party in whole or in part in good faith settlement of a pending or threatened avoidance claim, whether upon the insolvency, bankruptcy or reorganization of any Pledgor or any other Loan Party or otherwise, all as though such payment had not been made. The provisions of this Section 8 shall survive repayment of all of the Secured Obligations and the termination or expiration of this Pledge Agreement in any 

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manner, including but not limited to termination upon occurrence of the Facility Termination Date.

9.Waiver by the Pledgors.  Each Pledgor waives to the extent permitted by applicable law (a) any right to require any Revolving Secured Party or any other obligee of the Secured Obligations to (i) proceed against any Person or entity, including without limitation any Loan Party, (ii) proceed against or exhaust any Collateral or other collateral for the Secured Obligations, or (iii) pursue any other remedy in its power, (b) any defense arising by reason of any disability or other defense of any other Person, or by reason of the cessation from any cause whatsoever of the liability of any other Person or entity, (c) any right of subrogation, (d) any right to enforce any remedy which any Revolving Secured Party or any other obligee of the Secured Obligations now has or may hereafter have against any other Person and any benefit of and any right to participate in any collateral or security whatsoever now or hereafter held by the Administrative Agent for the benefit of the Revolving Secured Parties.  Each Pledgor authorizes each Revolving Secured Party and each other obligee of the Secured Obligations without notice (except notice required by applicable law) or demand and without affecting its liability hereunder or under the Loan Documents from time to time to: (x) take and hold security, other than the Collateral herein described, for the payment of such Secured Obligations or any part thereof, and exchange, enforce, waive and release the Collateral herein described or any part thereof or any such other security; and (y) apply such Collateral or other security and direct the order or manner of sale thereof as such Revolving Secured Party or obligee in its discretion may determine.

The Administrative Agent may at any time deliver (without representation, recourse or warranty) the Collateral or any part thereof to a Pledgor and the receipt thereof by such Pledgor shall be a complete and full acquittance for the Collateral so delivered, and the Administrative Agent shall thereafter be discharged from any liability or responsibility therefor.

10.Dividends and Voting Rights.

(a)All dividends and other distributions with respect to any of the Pledged Interests shall be subject to the pledge hereunder, provided, however, that cash dividends paid to a Pledgor as record owner of the Pledged Interests, to the extent permitted by the Revolving Credit Agreement to be declared and paid, may be retained by such Pledgor so long as no Event of Default shall have occurred and be continuing, free from any Liens hereunder.

	
(b)
	
So long as no Event of Default shall have occurred and be continuing, the registration of the Collateral in the name of a Pledgor as record and beneficial owner shall not be changed and such Pledgor shall be entitled to exercise all voting and other rights and powers pertaining to the Collateral for all purposes not inconsistent with the terms of the Loan Documents.

(c)Upon the occurrence and during the continuance of any Event of Default, all rights of the Pledgors to receive and retain cash dividends and other distributions upon the Collateral pursuant to subsection (a) above shall cease and shall thereupon be vested in the Administrative Agent for the benefit of the Revolving Secured Parties, and each Pledgor shall promptly deliver, or shall cause to be promptly delivered, all such cash 

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dividends and other distributions with respect to the Pledged Interests to the Administrative Agent (together, if the Administrative Agent shall request, with the documents described in Sections 1(c) and 2(c) hereof or other negotiable documents or instruments so distributed) to be held by it hereunder or, at the option of the Administrative Agent, to be applied to the Secured Obligations.  Pending delivery to the Administrative Agent of such property, each Pledgor shall keep such property segregated from its other property and shall be deemed to hold the same in trust for the benefit of the Revolving Secured Parties.

(d)Upon the occurrence and during the continuance of any Event of Default, at the option of the Administrative Agent, all rights of each of the Pledgors to exercise the voting or consensual rights and powers which it is authorized to exercise pursuant to subsection (b) above shall cease and the Administrative Agent may thereupon (but shall not be obligated to), at its request, cause such Collateral to be registered in the name of the Administrative Agent or its nominee or agent for the benefit of the Revolving Secured Parties and/or exercise such voting or consensual rights and powers as appertain to ownership of such Collateral, and to that end each Pledgor hereby appoints the Administrative Agent as its proxy, with full power of substitution, to vote and exercise all other rights as a shareholder with respect to such Pledged Interests hereunder upon the occurrence and during the continuance of any Event of Default, which proxy is coupled with an interest and is irrevocable until the Facility Termination Date, and each Pledgor hereby agrees to provide such further proxies as the Administrative Agent may request; provided, however, that the Administrative Agent in its discretion may from time to time refrain from exercising, and shall not be obligated to exercise, any such voting or consensual rights or such proxy.

11.Continued Powers.  Until the Facility Termination Date shall have occurred, the power of sale and other rights, powers and remedies granted to the Administrative Agent for the benefit of the Revolving Secured Parties hereunder shall continue to exist and may, at any time after the occurrence and during the continuance of an Event of Default, be exercised by the Administrative Agent at any time and from time to time irrespective of the fact that any of the Secured Obligations or any part thereof may have become barred by any statute of limitations or that any part of the liability of any Pledgor may have ceased.

12.Other Rights.  The rights, powers and remedies given to the Administrative Agent for the benefit of the Revolving Secured Parties by this Pledge Agreement shall be in addition to all rights, powers and remedies given to the Administrative Agent or any Revolving Secured Party under any other Loan Document or by virtue of any statute or rule of law.  Any forbearance or failure or delay by the Administrative Agent in exercising any right, power or remedy hereunder shall not be deemed to be a waiver of such right, power or remedy, and any single or partial exercise of any right, power or remedy hereunder shall not preclude the further exercise thereof; and every right, power and remedy of the Revolving Secured Parties shall continue in full force and effect until such right, power or remedy is specifically waived in accordance with the terms of the Revolving Credit Agreement.

13.Anti-Marshaling Provisions.  The right is hereby given by each Pledgor to the Administrative Agent, for the benefit of the Revolving Secured Parties, to make releases 

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(whether in whole or in part) of all or any part of the Collateral agreeable to the Administrative Agent without notice to, or the consent, approval or agreement of other parties and interests, including junior lienors, which releases shall not impair in any manner the validity of or priority of the Liens and security interests in the remaining Collateral conferred hereunder, nor release any Pledgor from personal liability for the Secured Obligations.  Notwithstanding the existence of any other security interest in the Collateral held by the Administrative Agent, for the benefit of the Revolving Secured Parties, the Administrative Agent shall have the right to determine the order in which any or all of the Collateral shall be subjected to the remedies provided in this Pledge Agreement.  Each Pledgor hereby waives any and all right to require the marshaling of assets in connection with the exercise of any of the remedies permitted by applicable law or provided herein or in any Loan Document.

14.Entire Agreement.  This Pledge Agreement and each Joinder Agreement, together with the Revolving Credit Agreement and other Loan Documents, constitutes and expresses the entire understanding between the parties hereto with respect to the subject matter hereof, and supersedes all prior negotiations, agreements and understandings, inducements, commitments or conditions, express or implied, oral or written, except as herein contained.  The express terms hereof and of the Joinder Agreements control and supersede any course of performance or usage of the trade inconsistent with any of the terms hereof and thereof.  Neither this Pledge Agreement nor any Joinder Agreement nor any portion or provision hereof or thereof may be changed, altered, modified, supplemented, discharged, canceled, terminated, or amended orally or in any manner other than as provided in the Revolving Credit Agreement.

15.Further Assurances.  Each Pledgor agrees at its own expense to do such further acts and things, and to execute and deliver, and cause to be executed and delivered as may be necessary or advisable to give effect thereto, such additional conveyances, assignments, financing statements, control agreements, documents, certificates, stock powers, agreements and instruments, as the Administrative Agent may at any time reasonably request in connection with the administration or enforcement of this Pledge Agreement or any Joinder Agreement or related to the Collateral or any part thereof or in order better to assure and confirm unto the Administrative Agent its rights, powers and remedies for the benefit of the Revolving Secured Parties hereunder or thereunder.  Each Pledgor hereby consents and agrees that the Pledged Subsidiaries and all other Persons, shall be entitled to accept the provisions hereof and of the Joinder Agreements as conclusive evidence of the right of the Administrative Agent, on behalf of the Revolving Secured Parties, to exercise its rights, privileges, and remedies hereunder and thereunder with respect to the Collateral, notwithstanding any other notice or direction to the contrary heretofore or hereafter given by any Pledgor or any other Person to any of such Pledged Subsidiaries or other Persons.

16.Binding Agreement; Assignment.  This Pledge Agreement and each Joinder Agreement, and the terms, covenants and conditions hereof and thereof, shall be binding upon and inure to the benefit of the parties hereto, and to their respective successors and assigns, except that no Pledgor shall be permitted to assign this Pledge Agreement, any Joinder Agreement or any interest herein or therein or in the Collateral, or any part thereof or interest therein, or otherwise pledge, encumber or grant any option with respect to the Collateral, or any part thereof, or any cash or property held by the Administrative Agent as Collateral under this Pledge Agreement.  Without limiting the generality of the foregoing sentence of this Section 16, 

11

 

 

any Lender may assign to one or more Persons, or grant to one or more Persons participations in or to, all or any part of its rights and obligations under the Revolving Credit Agreement (to the extent permitted by the Revolving Credit Agreement); and to the extent of any such permitted assignment or participation such other Person shall, to the fullest extent permitted by law, thereupon become vested with all the benefits in respect thereof granted to such Lender herein or otherwise, subject however, to the provisions of the Revolving Credit Agreement, including Article IX thereof (concerning the Administrative Agent) and Section 10.06 thereof (concerning assignments and participations).  All references herein to the Administrative Agent and to the Revolving Secured Parties shall include any successor thereof or permitted assignee, and any other obligees from time to time of the Secured Obligations.

17.Related Swap Contracts and Secured Cash Management Arrangements.  All obligations of any Pledgor under or in respect of Related Swap Contracts and Secured Cash Management Arrangements other than Excluded Swap Obligations shall be deemed to be Secured Obligations secured hereby, and each Hedge Bank or Cash Management Bank party to any such Related Swap Contract or Secured Cash Management Arrangement shall be deemed to be a Revolving Secured Party hereunder with respect to such Secured Obligations; provided, however, that such obligations under or in respect of any Related Swap Contract shall cease to be Secured Obligations at such time, prior to the Facility Termination Date, as the applicable Hedge Bank (or Affiliate of such Person) shall cease to be a “Hedge Bank” under the Revolving Credit Agreement.

No Person who obtains the benefit of any Lien by virtue of the provisions of this Section shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than in its capacity as a Lender and only to the extent expressly provided in the Loan Documents.  Notwithstanding any other provisions of this Pledge Agreement to the contrary, the Administrative Agent shall only be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, the Secured Obligations arising under Related Swap Contracts or Secured Cash Management Arrangements to the extent the Administrative Agent has received written notice of  such Obligations, together with such supportive documentation as it may request from the applicable Lender or Affiliate of a Lender.  The Administrative Agent shall not be required to verify the payment of, or that any other satisfactory arrangements have been made with respect to, obligations arising under Secured Cash Management Agreements and Related Swap Contracts in the case of a Facility Termination Date.  Each Revolving Secured Party not a party to the Revolving Credit Agreement who obtains the benefit of this Pledge Agreement by virtue of the provisions of this Section shall be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of the Revolving Credit Agreement, and that with respect to the actions and omissions of the Administrative Agent hereunder or otherwise relating hereto that do or may affect such Revolving Secured Party, the Administrative Agent and each of its Related Parties shall be entitled to all the rights, benefits and immunities conferred under Article IX of the Revolving Credit Agreement.

18.Severability.  The provisions of this Pledge Agreement are independent of and separable from each other.  If any provision hereof shall for any reason be held invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of 

12

 

 

any other provision hereof, but this Pledge Agreement shall be construed as if such invalid or unenforceable provision had never been contained herein.

19.Counterparts.  This Pledge Agreement may be executed in any number of counterparts each of which when so executed and delivered shall be deemed an original, and it shall not be necessary in making proof of this Pledge Agreement to produce or account for more than one such counterpart executed by the Pledgor against whom enforcement is sought.  Without limiting the foregoing provisions of this Section 19, the provisions of Section 10.10 of the Revolving Credit Agreement shall be applicable to this Pledge Agreement.

20.Termination.  Subject to the provisions of Section 8, this Pledge Agreement and each Joinder Agreement, and all obligations of the Pledgors hereunder (excluding those obligations and liabilities that expressly survive such termination) shall terminate without delivery of any instrument or performance of any act by any party on the Facility Termination Date.  Upon such termination of this Pledge Agreement, the Administrative Agent shall, at the sole expense of the Pledgors, promptly deliver to the Pledgors the certificates evidencing its shares of Pledged Interests (and any other property received as a dividend or distribution or otherwise in respect of such Pledged Interests to the extent then held by the Administrative Agent as additional Collateral hereunder), together with any cash then constituting the Collateral not then sold or otherwise disposed of in accordance with the provisions hereof, and take such further actions at the request of the Pledgors as may be necessary to effect the same.

21.Additional Interests.  If any Pledgor shall at any time acquire or hold any additional Pledged Interests, including any Pledged Interests issued by any Subsidiary not listed on Schedule I hereto which are required to be subject to a Lien pursuant to a Pledge Agreement by the terms hereof or of any provision of the Revolving Credit Agreement (any such shares being referred to herein as the “Additional Interests”), such Pledgor shall deliver to the Administrative Agent for the benefit of the Revolving Secured Parties (i) a Pledge Agreement Supplement in the form of Exhibit A hereto with respect to such Additional Interests duly completed and executed by such Pledgor and (iii) any other document required in connection with such Additional Interests as described in Section 2(c).  Each Pledgor shall comply with the requirements of this Section 21 concurrently with the acquisition of any such Additional Interests or, in the case of Additional Interests to which Section 6.14 of the Revolving Credit Agreement applies, within the time period specified in such Section or elsewhere in the Revolving Credit Agreement with respect to such Additional Interests; provided, however, that the failure to comply with the provisions of this Section 21 shall not impair the Lien on Additional Interests conferred hereunder.

22.Notices.  Any notice required or permitted hereunder shall be given (a) with respect to the Company and each Subsidiary which is a Pledgor hereunder, at the address of the Company indicated in Schedule 10.02 of the Revolving Credit Agreement, (b) with respect to the Administrative Agent or a Revolving Secured Party, at the Administrative Agent’s address indicated in Schedule 10.02 of the Revolving Credit Agreement.  All such addresses may be modified, and all such notices shall be given and shall be effective, as provided in Section 10.02 of the Revolving Credit Agreement for the giving and effectiveness of notices and modifications of addresses thereunder.

13

 

 

23.Joinder.  Each Person who shall at any time execute and deliver to the Administrative Agent a Joinder Agreement and who is identified therein as a “Pledgor” shall thereupon irrevocably, absolutely and unconditionally become a party hereto and obligated hereunder as a Pledgor and shall have thereupon pursuant to Section 1 hereof granted a security interest in and collaterally assigned and pledged to the Administrative Agent for the benefit of the Revolving Secured Parties all Pledged Interests which it has at its Applicable Date or thereafter acquires any interest or the power to transfer, and all references herein and in the other Loan Documents to the Pledgors or to the parties to this Pledge Agreement shall be deemed to include such Person as a Pledgor hereunder.  Each such Joinder Agreement shall be accompanied by the Supplemental Schedules referred to therein, appropriately completed with information relating to the Pledgor executing such Joinder Agreement and its property. Each of the applicable Schedules attached hereto shall be deemed amended and supplemented without further action by such information reflected on the Supplemental Schedules to each such Joinder Agreement.

24.Rules of Interpretation.  The rules of interpretation contained in Sections 1.03 and 1.06 of the Revolving Credit Agreement shall be applicable to this Pledge Agreement and each Joinder Agreement and are hereby incorporated by reference.  All representations and warranties contained herein shall survive the delivery of documents and any Credit Extensions referred to herein or secured hereby.

25.Governing Law; Waivers.

(a)THIS PLEDGE AGREEMENT AND EACH JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NORTH CAROLINA APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

(b)EACH PLEDGOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS PLEDGE AGREEMENT OR ANY JOINDER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN MAY BE INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN MECKLENBURG COUNTY, STATE OF NORTH CAROLINA, UNITED STATES OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS PLEDGE AGREEMENT OR A JOINDER AGREEMENT, EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY HAVE NOW OR HEREAFTER TO THE LAYING OF THE VENUE OR TO THE JURISDICTION OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.

(c)EACH PLEDGOR AGREES THAT SERVICE OF PROCESS MAY BE MADE BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR CERTIFIED MAIL (POSTAGE 

14

 

 

PREPAID) TO THE ADDRESS OF SUCH PLEDGOR PROVIDED IN SECTION 22 OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NORTH CAROLINA.

(d)NOTHING CONTAINED IN SUBSECTIONS (b) OR (c) HEREOF SHALL PRECLUDE THE ADMINISTRATIVE AGENT FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS PLEDGE AGREEMENT OR ANY JOINDER AGREEMENT OR THE OTHER LOAN DOCUMENTS IN THE COURTS OF ANY PLACE WHERE ANY PLEDGOR OR ANY OF SUCH PLEDGOR’S PROPERTY OR ASSETS MAY BE FOUND OR LOCATED.  TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, EACH PLEDGOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION OR PROCEEDING, OBJECTION TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY ANY SUCH OTHER COURT OR COURTS WHICH NOW OR HEREAFTER, BY REASON OF ITS PRESENT OR FUTURE DOMICILE, OR OTHERWISE, MAY BE AVAILABLE UNDER APPLICABLE LAW.

(e)IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER OR RELATED TO THIS PLEDGE AGREEMENT OR ANY JOINDER AGREEMENT OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION WITH THE FOREGOING, EACH PARTY HEREBY AGREES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY SUCH ACTION, SUIT OR PROCEEDING.

(f)EACH PLEDGOR HEREBY EXPRESSLY WAIVES ANY OBJECTION IT MAY HAVE THAT ANY COURT TO WHOSE JURISDICTION IT HAS SUBMITTED PURSUANT TO THE TERMS HEREOF IS AN INCONVENIENT FORUM.

26.Amendment and Restatement.  The parties hereto agree that the Existing Pledge Agreement is hereby amended and restated in this Pledge Agreement, and this Pledge Agreement shall constitute neither a release nor novation of any lien or security interest arising under the Existing Pledge Agreement nor a refinancing of any indebtedness or obligations arising thereunder or under the Existing Credit Agreement or related documents, but rather the liens and security interests in effect under the Existing Pledge Agreement shall continue in effect on the terms hereof.

[Signature Pages Follow.]

 

15

 

 

 

IN WITNESS WHEREOF, the parties have duly executed this Pledge Agreement on the day and year first written above.

PLEDGORS:

SONIC AUTOMOTIVE, INC.

	
 
	
By:
	
/s/ Heath R. Byrd

	
 
	
Name:
	
Heath R. Byrd

	
 
	
Title:
	
Executive Vice President and Chief

	
 
	

	
Financial Officer

 

ECHOPARK AUTOMOTIVE, INC.

FAA HOLDING CORP.

FIRSTAMERICA AUTOMOTIVE, INC.

L DEALERSHIP GROUP, INC.

SAI AL HC1, INC.

SAI FL HC3, INC.

SAI FL HC4, INC.

SAI FL HC7, INC.

SAI GA HC1, LLC

SAI MD HC1, INC.

SAI PEACHTREE, LLC

SAI TN HC1, LLC

SAI TN HC2, LLC

SONIC – LS, LLC

SONIC AUTOMOTIVE OF NEVADA, INC.

SONIC AUTOMOTIVE WEST, LLC

SONIC OF TEXAS, INC.

SRE HOLDING, LLC

	
 
	
By:
	
/s/ Heath R. Byrd

	
 
	
Name:
	
Heath R. Byrd

	
 
	
Title:
	
Vice President and Treasurer

 

FOURTH AMENDED AND RESTATED SECURITIES PLEDGE AGREEMENT

(Sonic Automotive, Inc. – Senior Facility)

Signature Page

 

ADMINISTRATIVE AGENT:

BANK OF AMERICA, N.A., as Administrative Agent

	
 
	
By:
	
/s/ Reneé Marion

	
 
	
Name:
	
Reneé Marion

	
 
	
Title:
	
Assistant Vice President

 

FOURTH AMENDED AND RESTATED SECURITIES PLEDGE AGREEMENT

 (Sonic Automotive, Inc. – Senior Facility)

Signature Page

 

SCHEDULE I

 

Pledged Interests

 

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
EchoPark Automotive, Inc.
	
AM GA, LLC

 

Georgia

Limited Liability Company

16063806
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
AM Realty GA, LLC

 

Georgia

Limited Liability Company

16063850
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
EchoPark NC, LLC

 

North Carolina

Limited Liability Company

1436923
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 1

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
EchoPark Automotive, Inc.
	
EchoPark SC, LLC

 

South Carolina

Limited Liability Company

 
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
EchoPark TX, LLC

 

Texas

Limited Liability Company

802448793
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
EchoPark Realty TX, LLC

Texas Limited Liability Company

802302813
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
EP Realty NC, LLC

North Carolina Limited Liability Company

1436919
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
EP Realty SC, LLC

South Carolina Limited Liability Company
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 2

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
EchoPark Automotive, Inc.
	
SAI AM Florida, LLC

 

Florida

Limited Liability Company

L16000202910111
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
FAA Holding Corp.
	
L Dealership Group, Inc.

Texas

Corporation

151278900
	
Common Stock
	
1,000
	
1,000
	
1,000
	
8
	
$0.01
	
 

	
FirstAmerica Automotive, Inc.
	
FAA Holding Corp.

California

Corporation

C2174202
	
Common Stock
	
100,000
	
10,000
	
10,000
	
2
	
N/A
	
 

	
L Dealership Group, Inc.
	
Autobahn, Inc.

California

Corporation

C1548941
	
Common Stock
	
1,000,000
	
400,000
	
400,000
	
2
	
N/A
	
 

Schedule I – Page 3

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SAI AL HC1, Inc.
	
SAI Montgomery CH, LLC 

Alabama

Limited Liability Company

428-747
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI AL HC1, Inc.
	
SAI Montgomery BCH, LLC

Alabama

Limited Liability Company

428-745
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI FL HC3, Inc.
	
SAI Orlando CS, LLC

Florida

Limited Liability Company

L08000116711
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI FL HC4, Inc.
	
SAI Fort Myers VW, LLC

Florida

Limited Liability Company

L08000116709
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 4

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SAI FL HC7, Inc.
	
SAI Fort Myers M, LLC

Florida

Limited Liability Company

L98000002089
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI GA HC1, LLC
	
SAI Peachtree, LLC

Georgia

Limited Liability Company

4746288
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI GA HC1, LLC
	
SAI S. Atlanta JLR, LLC

 

Georgia Limited Liability Company

16070312
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI MD HC1, Inc.
	
SAI Rockville Imports, LLC

Maryland
Limited Liability Company
W12796074
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 5

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SAI Peachtree, LLC
	
SAI Chamblee V, LLC 

Georgia

Limited Liability Company

1038946
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI TN HC1, LLC
	
SAI Nashville CSH, LLC

Tennessee

Limited Liability Company

0336183
	
LLC Interest

 
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI TN HC1, LLC

 

 
	
SAI Nashville M, LLC

Tennessee

Limited Liability Company

0336182
	
LLC Interest

 
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SAI TN HC2, LLC
	
SAI Nashville Motors, LLC

Tennessee
Limited Liability Company
0566970
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 6

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.
	
Arngar, Inc.

North Carolina

Corporation

0005612
	
Common Stock 

 
	
100,000
	
1,333
	
1,333
	
14
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Fort Mill Ford, Inc.

South Carolina

Corporation
	
Common Stock
	
10,000
	
2,700
	
2,700
	
13
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI Roaring Fork LR, Inc.

Colorado

Corporation

2014156978
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI AL HC1, Inc.

Alabama

Corporation

D/C 206-272
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI Columbus Motors, LLC

Ohio

Limited Liability Company

CP13127
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 7

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.
	
SAI Columbus VWK, LLC

Ohio

Limited Liability Company

CP13130
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI Denver M, Inc.

Colorado
Corporation
20131291339
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI FL HC3, Inc.

Florida
Corporation
P98000064012
	
Common Stock
	
1,000
	
100
	
100
	
2
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI FL HC4, Inc.

Florida
Corporation
P98000064009
	
Common Stock
	
1,000
	
100
	
100
	
2
	
N/A
	
 

	
Sonic Automotive, Inc.
	
SAI FL HC7, Inc.

Florida

Corporation

F86660
	
Common Stock
	
500
	
500
	
500
	
22
	
$1.00
	
 

Schedule I – Page 8

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.

 

Sonic Automotive of Nevada, Inc. 
	
SAI OK HC1, Inc.

Oklahoma

Corporation

1900632183
	
Common Stock

 

Common Stock
	
1,000
	
400
	
100

 

300

 
	
2

 

5

 
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Automotive Aviation, LLC

North Carolina

Limited Liability Company

1320781
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Automotive F&I, LLC

Nevada

Limited Liability Company

LLC8620-1999
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Automotive Support, LLC

Nevada

Limited Liability Company

LLC19412-2003
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 9

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.
	
Sonic Automotive West, LLC

Nevada

Limited Liability Company

LLC9139-1999
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Calabasas M, Inc.

California
Corporation
C2975101
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic–Capitol Imports, Inc.

South Carolina

Corporation
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Development, LLC

North Carolina Limited Liability Company

0483658
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 10

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.
	
Sonic Divisional Operations, LLC

Nevada

Limited Liability Company

LLC26157-2004
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic - Las Vegas C West, LLC

Nevada

Limited Liability Company

LLC7434-2000
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic - Newsome Chevrolet World, Inc.

South Carolina

Corporation
	
Common Stock
	
1,000
	
100
	
100
	
2
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic of Texas, Inc.

Texas

Corporation

150782300
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

Schedule I – Page 11

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.
	
Sonic Resources, Inc.

Nevada

Corporation

C24652-2001
	
Common Stock
	
1,000
	
100
	
100
	
2
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Santa Monica M, Inc.

California

Corporation

C2727452
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic-Volvo LV, LLC

Nevada

Limited Liability Company

LLC6829-1999
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Sonic Walnut Creek M, Inc.

California

Corporation

C2508517
	
Common Stock
	
1,000
	
100
	
100
	
2
	
N/A
	
 

Schedule I – Page 12

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive, Inc.
	
SRE Holding, LLC

North Carolina
Limited Liability Company
0551475
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive, Inc.
	
EchoPark Automotive, Inc.

Delaware

Corporation

5387434
	
Common Stock
	
1,000
	
100
	
100
	
1
	
N/A
	
 

	
Sonic Automotive, Inc.
	
Town and Country Ford, Incorporated

North Carolina

Corporation

0148959
	
Common Stock
	
2,000
	
471.25
	
471.25
	
75
	
N/A
	
 

	
Sonic Automotive of Nevada, Inc.
	
SAI TN HC1, LLC

Tennessee
Limited Liability Company
0336184
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 13

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic Automotive of Nevada, Inc.
	
SAI TN HC2, LLC

Tennessee
Limited Liability Company
0336185
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic Automotive of Nevada, Inc.
	
SAI TN HC3, LLC

Tennessee
Limited Liability Company
0336184
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic – LS, LLC

Sonic Automotive West, LLC
	
Sonic – LS Chevrolet, L.P.

Texas

Limited Partnership

11958210
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A

 
	
.10%

99.90%
	
.10%

99.90%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
Sonic Advantage PA, L.P.

Texas

Limited Partnership

800235623
	
General Partner Interest

 

 

Limited Partner Interest
	
N/A

 

 

 

N/A
	
1.00%

 

 

 

99.00%
	
1.00%

 

 

 

99.00%
	
N/A
	
N/A
	
 

Schedule I – Page 14

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic Automotive of Texas, L.P. 

Texas

Limited Partnership

11324210
	
General Partner Interest

Limited Partner Interest

 
	
N/A

N/A

 
	
1.00%

99.00%

 
	
1.00%

 

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic Automotive - 3401 N. Main, TX, L.P.

Texas

Limited Partnership

11376510
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A

 
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic Automotive - 4701 I-10 East, TX, L.P.

Texas

Limited Partnership

11345010
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A

 
	
 

Schedule I – Page 15

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic – Cadillac D, L.P.

Texas

Limited Partnership

800061917
	
General Partner Interest

Limited Partner Interest

 
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A

 
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic–Clear Lake Volkswagen, L.P.

Texas

Limited Partnership

800207889
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

 

Sonic Automotive of Nevada, Inc.
	
Sonic Houston JLR, LP

Texas
Limited Partnership
800735509
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic Houston LR, L.P.

Texas

Limited Partnership

800236309
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

Schedule I – Page 16

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic – Houston V, L.P

Texas

Limited Partnership

15286810
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic–Jersey Village Volkswagen, L.P.

Texas

Limited Partnership

800207902
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.
	
Sonic – LS, LLC

Delaware

Limited Liability Company

3440418
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic Momentum JVP, L.P.

Texas

Limited Partnership

800235475
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

Schedule I – Page 17

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic Momentum VWA, L.P. 

Texas

Limited Partnership

800207910
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
Sonic – Richardson F, L.P.

Texas

Limited Partnership

14037410
	
General Partner Interest

Limited Partner Interest
	
N/A

N/A
	
1.00%

99.00%
	
1.00%

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas - 1, L.P.

Texas

Limited Partnership

13523310
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas - 2, L.P.

Texas

Limited Partnership

13523410
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

Schedule I – Page 18

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas - 3, L.P.

Texas

Limited Partnership

13523510
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas - 4, L.P.

Texas

Limited Partnership

800048705
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas – 5, L.P.

Texas
Limited Partnership
800048740
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas - 6, L.P.

Texas

Limited Partnership

800048741
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas – 7, L.P.

Texas
Limited Partnership
800048742
	
General Partner Interest

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

Schedule I – Page 19

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
SRE Texas-8, L.P.

Texas

Limited Partnership

800048743
	
General Partner Interest

 

Limited Partner Interest
	
N/A
	
1.00%

 

 

99.00%
	
1.00%

 

 

99.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
AnTrev, LLC

North Carolina
Limited Liability Company
0659676
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Alabama–2, LLC

Alabama
Limited Liability Company
670-275
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Alabama-5, LLC

Alabama

Limited Liability Company

DLL691-622
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 20

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE California – 1, LLC

California
Limited Liability Company
200202910110
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE California-2, LLC

California

Limited Liability Company

200202910111
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE California - 3, LLC

California

Limited Liability Company

200202810141
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE California - 5, LLC

California

Limited Liability Company

200203110006
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 21

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE California - 6, LLC

California

Limited Liability Company

200203110007
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE California – 7 SCB, LLC

California

Limited Liability Company

201033410181
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE California – 8 SCH, LLC

California

Limited Liability Company

201033510021
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE California – 9 BHB, LLC

California

Limited Liability Company

201126410082
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 22

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE California 10 LBB, LLC

California

Limited Liability Company

201413910313
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Colorado RF – 1, LLC

Colorado
Limited Liability
Company
20021330518
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Colorado CC – 2, LLC

Colorado
Limited Liability
Company
20021330523
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Colorado – 3, LLC

Colorado
Limited Liability
Company
20021330530
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 23

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Colorado – 4, LLC

Colorado
Limited Liability
Company
20141516951
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Colorado – 5, LLC

Colorado
Limited Liability
Company
201415486855
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Georgia 4, LLC

Georgia

Limited Liability Company

4219711
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Florida - 1, LLC

Florida

Limited Liability Company

L00000006050
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 24

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Maryland - 1, LLC

 

Maryland Limited Liability Company

200162227
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Nevada-2, LLC

Nevada

Limited Liability Company

LLC5021-2000
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE North Carolina-2, LLC

North Carolina

Limited Liability Company

0682830
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE North Carolina - 3, LLC

 

North Carolina Limited Liability Company

0682833
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 25

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Ohio 1, LLC

Ohio

Limited Liability Company

2146293
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Ohio 2, LLC

Ohio

Limited Liability Company

2146292
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Oklahoma–2, LLC

Oklahoma
Limited Liability Company
3500697105
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE South Carolina – 2, LLC

South Carolina
Limited Liability Company
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 26

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE South Carolina -3, LLC

South Carolina

Limited Liability Company
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE South Carolina – 4, LLC

South Carolina
Limited Liability Company
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Tennessee - 1, LLC

Tennessee
Limited Liability Company
000390360
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Tennessee - 2, LLC

Tennessee
Limited Liability Company
000390358 
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 27

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Tennessee - 3, LLC

Tennessee
Limited Liability Company
000390359
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Tennessee-4, LLC

Tennessee
Limited Liability Company
000450279
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Tennessee-5, LLC

Tennessee
Limited Liability Company
000450278 
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Tennessee - 6, LLC

 

Tennessee Limited Liability Company

000797947
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 28

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Virginia - 1, LLC

Virginia
Limited Liability Company
5050246-0
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Virginia - 2, LLC

 

Virginia
Limited Liability Company
S1012154
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Texas 9, LLC

Texas
Limited Liability Company
801419276
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Texas 10, LLC

Texas
Limited Liability Company
801675082
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 29

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Texas 11, LLC

Texas
Limited Liability Company
801723757
	
LLC Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 30

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Texas 12, LLC

Texas
Limited Liability Company
801807250
	
LLC Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 31

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Texas 13, LLC

 

Texas
Limited Liability Company
13-802180003
	
LLC Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 32

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
SRE Holding, LLC
	
SRE Texas 14, LLC

 

Texas
Limited Liability Company
14-802402987
	
LLC Interest

 

 

 

 

 

 

 

 

 

 

 

 

 

 
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
SRE Holding, LLC
	
SRE Texas 15, LLC

 

Texas
Limited Liability Company
15-802570108
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

	
EchoPark Automotive, Inc.
	
TT Denver, LLC

Colorado
Limited Liability Company
20131462193
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

Schedule I – Page 33

									
	
Name of

Pledgor
	
Name, 

Jurisdiction of

Formation and

Type of Entity

of Pledged

Subsidiary
	
Class or Type of Pledged Interest
	
Total Amount of Class or Type of Pledged Interests Authorized
	
Total Amount of Class or Type Outstanding
	
Total Amount Pledged
	
Certificate Number (if applicable)
	
Par Value (if applicable)
	
Name of Transfer Agent (if any)

	
EchoPark Automotive, Inc.
	
TTRE CO 1, LLC

Colorado
Limited Liability Company
20131504490
	
LLC Interest
	
N/A
	
100.00%
	
100.00%
	
N/A
	
N/A
	
 

 

Schedule I – Page 34

 

SCHEDULE II

 

				
	
Name and Address of Pledgor
	
Type of Person
	
Jurisdiction of Formation 

of Pledgor
	
Jurisdiction of Formation

Identification Number

	
EchoPark Automotive, Inc.

4401 Colwick Rd.

Charlotte, NC

 
	
Corporation
	
Delaware
	
5387434

	
FAA Holding Corp.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
California
	
C2174202

	
FirstAmerica Automotive, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Delaware
	
2761294

	
L Dealership Group, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Texas
	
151278900

	
SAI AL HC1, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Alabama
	
206-272

	
SAI FL HC3, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Florida
	
P98000064012

	
SAI FL HC4, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Florida
	
P98000064009

	
SAI FL HC7, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Florida
	
F86660

	
SAI GA HC1, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Limited Liability Company
	
Georgia
	
4705444

	
SAI MD HC1, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Maryland
	
D05310776

	
SAI Peachtree, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Limited Liability Company
	
Georgia
	
4746288

	
SAI TN HC1, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Limited Liability Company
	
Tennessee
	
0336184

Schedule II – Page 1

				
	
Name and Address of Pledgor
	
Type of Person
	
Jurisdiction of Formation 

of Pledgor
	
Jurisdiction of Formation

Identification Number

	
SAI TN HC2, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Limited Liability Company
	
Tennessee
	
0336185

	
Sonic Automotive, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Delaware
	
2714319

	
Sonic Automotive of Nevada, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Nevada
	
C18014-1997

	
Sonic Automotive West, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Nevada
	
LLC9139-1999

	
Sonic – LS, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Limited Liability Company
	
Delaware
	
3440418

	
Sonic Momentum B, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Texas
	
800235477

	
Sonic of Texas, Inc.

4401 Colwick Road

Charlotte, NC 28211

 
	
Corporation
	
Texas
	
150782300

	
SRE Holding, LLC

4401 Colwick Road

Charlotte, NC 28211

 
	
Limited Liability Company
	
North Carolina
	
0551475

 

 

 

Schedule II – Page 2sah-ex1015_881.htm

Exhibit 10.15

 

EXECUTION VERSION

 

 

FOURTH AMENDED AND RESTATED 

ESCROW AND SECURITY AGREEMENT

THIS FOURTH AMENDED AND RESTATED ESCROW AND SECURITY AGREEMENT (this “Agreement”) is made and entered into as of November 30, 2016 among SONIC AUTOMOTIVE, INC., a Delaware corporation (the “Company” and a “Grantor”), EACH OF THE UNDERSIGNED SUBSIDIARIES OF THE COMPANY AND EACH OTHER PERSON WHO SHALL BECOME A PARTY HERETO BY EXECUTION OF A JOINDER AGREEMENT (each a “Grantor”, and collectively with the Company, the “Grantors”), and BANK OF AMERICA, N.A., a national banking association, as Administrative Agent (the “Administrative Agent”) for each of the lenders (the “Lenders”) now or hereafter party to the Revolving Credit Agreement defined below (collectively with the Administrative Agent, and certain other Persons parties to Related Swap Contracts and Secured Cash Management Arrangements as more particularly described in Section 4.17 hereof, the “Revolving Secured Parties”).  All capitalized terms used but not otherwise defined herein shall have the respective meanings assigned thereto in the Revolving Credit Agreement. 

W I T N E S S E T H:

 

WHEREAS, the Company, certain of the Lenders (the “Existing Lenders”) and the Administrative Agent entered into that certain Third Amended and Restated Credit Agreement dated July 23, 2014 (as amended prior to (but excluding) the date hereof, the “Existing Credit Agreement”), pursuant to which certain of the Existing Lenders agreed to make available to the Company a revolving credit facility, including a letter of credit subfacility and a swingline subfacility; and

WHEREAS, the Company and certain Subsidiaries of the Company (the “Existing Grantors”) entered into a Third Amended and Restated Escrow and Security Agreement dated as of July 23, 2014 (as amended prior to (but excluding) the date hereof, the “Existing Escrow and Security Agreement”), pursuant to which the Existing Grantors have secured their obligations arising under the Existing Credit Agreement; and

WHEREAS, the Company has requested that the Existing Credit Agreement be amended and restated in order to, among other things, (a) extend the maturity date of the revolving credit facility provided therein, (b) increase the maximum aggregate amount of the revolving credit facility provided therein, and (c) make certain other amendments to the Existing Credit Agreement on the terms and conditions set forth in that certain Fourth Amended and Restated Credit Agreement dated as of the date hereof (as amended, restated, supplemented or otherwise modified from time to time, the “Revolving Credit Agreement”) among the Company, the Administrative Agent and the Lenders; 

WHEREAS, the Administrative Agent and the Lenders have agreed to enter into the Revolving Credit Agreement, subject to, among other things, a condition that the parties amend and restate the Existing Escrow and Security Agreement as provided herein; and

 

 

WHEREAS, each Grantor will materially benefit from the Loans to be made, and the Letters of Credit to be issued, under the Revolving Credit Agreement, and each Grantor (other than the Company) is a party (as signatory or by joinder) to the Subsidiary Guaranty pursuant to which such Grantor guarantees the Obligations of the Company and the other Subsidiaries; 

 

WHEREAS, in order to induce the Revolving Secured Parties to enter into the Loan Documents and to make Loans and issue Letters of Credit, each Grantor has agreed to make all shares of capital stock or Equity Interests of the Subsidiaries described on Schedule I (as such schedule may be supplemented from time to time) (collectively, the “Escrow Subsidiaries”) of the respective Grantor subject to the terms and provisions of this Agreement;

WHEREAS, the Equity Interests in the Escrow Subsidiaries are not permitted to be pledged under the terms of the applicable Franchise Agreements, Framework Agreements, similar manufacturer agreements or indebtedness agreements of such Escrow Subsidiaries (the “Restricted Equity Interests”);   

WHEREAS, in lieu of a pledge by the Grantors to the Administrative Agent of the Restricted Equity Interests, the Grantors shall grant a security interest in certain Disposition Proceeds (as defined below) of such Restricted Equity Interests;

WHEREAS, to further protect the Revolving Secured Parties, the Grantors will continue to deliver the Escrowed Shares (as defined below) into escrow to be held in accordance with this Agreement;

WHEREAS, as collateral security for payment and performance of the Obligations and the obligations and liabilities of any Loan Party now existing or hereafter arising under Related Swap Contracts and Secured Cash Management Arrangements, each Grantor is willing to grant to the Administrative Agent for the benefit of the Revolving Secured Parties a security interest in certain of its personal property and assets pursuant to the terms of this Agreement; 

 

WHEREAS, the Revolving Secured Parties are unwilling to make available or maintain the credit facilities under the Revolving Credit Agreement unless the Company and each other Grantor enter into this Agreement;

 

NOW, THEREFORE, in order to induce (i) the Lenders to amend and restate the Existing Credit Agreement and (ii) the Revolving Secured Parties to enter into the Loan Documents and to make or maintain the credit facilities provided for therein available to or for the account of the Company and in consideration of the promises and the mutual covenants contained herein, the parties hereto agree that the Existing Escrow and Security Agreement is hereby amended and restated as follows:  

 

ARTICLE I
ESCROW

1.1Escrow.  Upon the terms hereof, each Grantor hereby delivers to the Administrative Agent, in escrow (the “Escrow”) all of the issued and outstanding certificated shares of capital stock or other Equity Interests now or hereafter owned by such Grantor 

2

 

described on Schedule I attached hereto and incorporated herein, as Schedule I may be amended or supplemented from time to time (collectively, the “Escrowed Shares”).  In addition, each Grantor hereby agrees to deliver to the Administrative Agent, in escrow, any Restricted Disposition Proceeds (as defined below) as and when received by the Grantor in respect of such Escrowed Shares.

1.2Terms of Escrow.  (a)  The parties hereby appoint the Administrative Agent as escrow agent in accordance with the terms and conditions set forth herein, and the Escrow Agent hereby accepts such appointment as escrow agent.

(b)The Administrative Agent shall disburse all or any part of the Escrowed Shares as follows: any time the Administrative Agent receives (i) a written notification executed by a Grantor (or such Grantor’s successor interest to the Escrowed Shares), advising the Administrative Agent of a proposed Disposition (as defined below) of Escrowed Shares or other Restricted Disposition Proceeds, (ii) (subject to Section 4.5(a)(iii)) all Disposition Proceeds (as herein defined) paid or payable to Grantors in respect of such Escrowed Shares and, (iii) if other than cash, duly executed instruments of assignment and delivery, the Administrative Agent shall immediately release such portion of the Escrowed Shares, subject as herein provided, as is specified in such written notice to the Persons specified in such written notice.

(c)The Administrative Agent shall not be responsible for the sufficiency or accuracy of the form of, or the execution, validity, value or genuineness of, any document or property received, held or delivered by it hereunder, or of any signature or endorsement thereon, or for any lack of endorsement thereon, or for any description therein, nor shall the Administrative Agent be responsible or liable to the other parties hereto or to anyone else in any respect on account of the identity, authority, or rights of the Persons executing or delivering or purporting to execute or deliver any document or property or this Agreement.

(d)(i)  In its capacity as escrow agent, the Administrative Agent shall have no duties or responsibilities other than those expressly set forth herein and except as expressly set forth herein, shall have no duty to enforce any obligation of any Person, to make any payment or delivery of Disposition Proceeds, or to direct or cause any payment or delivery thereof, or to direct or cause any payment or delivery thereof to be made, or to enforce any obligation of any Person to perform any other act.  The Administrative Agent shall be under no liability to any Person by reason of any failure on the part of any other Person to perform such Person’s obligations under any agreement involving or relating in any way to the Escrowed Shares or the disposition thereof by the Grantors.  Except as provided in Section 1.2(b), the Administrative Agent shall not be obligated to recognize any agreement between any or all of the Grantors and any other Persons.

(ii)The Administrative Agent shall not be liable to the Grantors or to any other Person for any action taken or omitted by it in good faith and in the exercise of its own best judgment.  The Administrative Agent may rely conclusively and shall be protected in acting upon any order, notice, demand, certificate, opinion or advice of counsel (including counsel chosen by the Administrative Agent), statement, instrument, report or other paper or document (not only as to its due execution and the validity and effectiveness of its provisions, but as to the acceptability and reliability of any 

3

 

information therein contained) which is believed by the Administrative Agent to be genuine and to be signed or presented by the proper Person or Persons.

(e)The Grantors shall pay all income, withholding and any other taxes imposed on or measured by income which are attributable to income from the Escrowed Shares and the Disposition Proceeds for the time all or any part thereof are held in escrow hereunder, and shall file all tax and information returns applicable thereto.  To the extent that the Administrative Agent becomes liable for the payment of taxes, including withholding taxes, in respect of income derived from the Escrowed Shares and Disposition Proceeds, the Administrative Agent may but shall not be obligated to pay such taxes.  The Administrative Agent may withhold or offset from any amount payable by the Administrative Agent to the Grantors such amount as the Administrative Agent determines in its sole discretion to be sufficient to provide for the payment of such taxes; alternately any such amount paid by the Administrative Agent shall become a part of the Obligations.  In addition, the Administrative Agent shall be indemnified and held harmless by the Grantors from and against any liability for such taxes and for any penalties or interest in respect of taxes on such investment income or payments in the manner provided in subparagraph (k) below.

(f)The Administrative Agent is acting as an escrow agent only with respect to the Escrowed Shares and related Restricted Disposition Proceeds (as defined below).  If any dispute arises as to whether the Administrative Agent is obligated to deliver the Escrowed Shares or as to whom the Escrowed Shares are to be delivered, the Administrative Agent shall not be required to make any delivery, but in such event the Administrative Agent may hold the Escrowed Shares until receipt by the Administrative Agent of the Disposition Proceeds and (i) instructions in writing, signed by all parties which have, or claim to have, an interest in the Escrowed Shares, directing the disposition of the Escrowed Shares, or (ii) in the absence of such writing, a final judgment from a court of competent jurisdiction or final binding arbitration award providing for the disposition of the Escrowed Shares.

(g)The Administrative Agent shall be entitled to reimbursement from the Grantors for all expenses paid or incurred by the Administrative Agent in the administration of its duties hereunder, including, but not limited to, all attorneys’ fees, advisors’ and consultants’ fees and disbursements and all taxes or other governmental charges.

(h)The Administrative Agent may resign as escrow agent at any time and be discharged from its duties as escrow agent hereunder by giving the Grantors at least 30 days’ notice thereof.  As soon as practicable after its resignation, the Administrative Agent shall turn over to a successor escrow agent appointed by it and the Grantors all Escrowed Shares held hereunder upon presentation of a document appointing the new escrow agent and its acceptance thereof.  If no new escrow agent is so appointed within the 60-day period following such notice of resignation, the Administrative Agent may deposit the Escrowed Shares with any court it deems appropriate.

(i)From time to time on and after the date hereof, including without limitation concurrently with the delivery of a written notice as provided in Section 1.02(b), the Grantors shall deliver or cause to be delivered to the Administrative Agent such further documents and instruments and shall do and cause to be done such further acts as the 

4

 

Administrative Agent shall reasonably request to carry out more effectively the provisions and purposes of this Agreement, to evidence compliance herewith or to assure itself that it is protected in acting hereunder.

(j)It is agreed that the Grantor shall retain all rights to dividends, all rights to vote and all other rights in respect of ownership of the Escrowed Shares, subject only to the Security Interest in the Disposition Proceeds Collateral (each as defined below); provided, that any certificated Restricted Equity Interests received as a dividend or other distribution in respect of Escrowed Shares shall be delivered to the Administrative Agent in escrow to be held pursuant to the terms of this Agreement.  

(k)EACH GRANTOR SHALL AND DOES HEREBY JOINTLY AND SEVERALLY INDEMNIFY AND HOLD THE ADMINISTRATIVE AGENT AND EACH OF THE LENDERS AND OTHER REVOLVING SECURED PARTIES AND THEIR RESPECTIVE SHAREHOLDERS, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, ATTORNEYS-IN-FACT AND AFFILIATES (EACH AN “INDEMNITEE” AND COLLECTIVELY, THE “INDEMN1TEES”) HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, COSTS, DAMAGES, JUDGMENTS, ATTORNEYS FEES, EXPENSES, OBLIGATIONS AND LIABILITIES OF ANY KIND OR NATURE INCLUDING REASONABLE ATTORNEYS FEES AND EXPENSES INCURRED IN CONNECTION THEREWITH (“LIABILITIES”) WHICH ANY INDEMNITEE INCURS OR SUSTAINS, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE SERVICES OF THE ADMINISTRATIVE AGENT HEREUNDER, THE ACTIONS OR OMISSIONS OF ANY INDEMNITEE IN CONNECTION WITH THIS AGREEMENT, THE ESCROWED SHARES AND/OR THE DISPOSITION PROCEEDS HELD BY THE ADMINISTRATIVE AGENT HEREUNDER OR ANY INCOME EARNED THEREFROM INCLUDING, WITHOUT LIMITATION, LIABILITIES WHICH ARISE IN WHOLE OR IN PART FROM THE NEGLIGENCE, WHETHER SOLE OR CONCURRENT ON THE PART OF ANY INDEMNITEE BUT EXPRESSLY EXCLUDING THEREFROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY SUCH INDEMNITEE.  THE FOREGOING INDEMNITY SHALL SURVIVE SATISFACTION OF THE OBLIGATIONS AND TERMINATION OF THIS AGREEMENT.

ARTICLE II
GRANT OF SECURITY iNTEREST

2.1Assignment and Grant of Security.  Each Grantor hereby grants as collateral security for the payment, performance and satisfaction of all of its Obligations and the obligations and liabilities of any Loan Party now existing or hereafter arising under Related Swap Contracts and Secured Cash Management Arrangements other than Excluded Swap Obligations (such Obligations, obligations and liabilities referred to collectively as the “Secured Obligations”), to the Administrative Agent for the benefit of the Revolving Secured Parties a continuing first priority security interest in and to, and collaterally assigns to the Administrative Agent for the benefit of the Revolving Secured Parties (collectively, the “Security Interest”) all rights, titles and interests which such Grantor now has or at any time in the future may acquire in 

5

 

the following (collectively, the “Disposition Proceeds”): (i) all purchase and sale agreements relating to any of the Restricted Equity Interests and all rights to secure payment thereunder; (ii) the net cash proceeds and all securities, general intangibles, contract rights, or any other proceeds whatsoever (other than shares of a Subsidiary which the Grantor is not obligated to pledge) which are received or from time to time receivable or otherwise distributed in respect of the transfer, sale, assignment, conveyance or other disposition of any kind (each, a “Disposition”) of the Escrowed Shares or other Restricted Equity Interests and any other property substituted or exchanged therefor (other than Restricted Disposition Proceeds (as hereinafter defined) and other shares of a Subsidiary which the Grantor is not obligated to pledge) including without limitation proceeds from any foreclosure sale or any other forced sale or liquidation or any sale or disposition arising or occurring pursuant to a plan in bankruptcy; and (iii) any and all proceeds or other sums payable and/or distributable with respect to, all or any of the Escrowed Shares or other Restricted Equity Interests and the other interests described in the preceding clauses (i), (ii) and (iii) hereof.  Disposition Proceeds which constitute Restricted Equity Interests shall be referred to herein as “Restricted Disposition Proceeds” and shall not be included within the property subject to the Security Interest.  The Disposition Proceeds subject to the Security Interest are referred to herein as the “Disposition Proceeds Collateral”.

2.2Delivery of Disposition Proceeds.  Upon any Disposition of all or a part of the Escrowed Shares or other Restricted Equity Interests (including without limitation any foreclosure sale, any other forced sale or any sale or disposition arising or occurring pursuant to a plan in bankruptcy), subject to Section 4.5(a)(iii), the Grantors shall deliver to the Administrative Agent the Disposition Proceeds, including (with respect to any certificated Disposition Proceeds) duly executed instruments of transfer, all in form and substance satisfactory to the Administrative Agent.  The term “certificated” when used with the term “Disposition Proceeds” shall mean any such Disposition Proceeds which are evidenced or represented by a note, certificate, instrument, chattel paper or other written evidence of ownership or entitlement.  All Restricted Disposition Proceeds shall be held by the Administrative Agent as part of the Escrow.  All Disposition Proceeds Collateral shall be held by the Administrative Agent in its capacity as Administrative Agent under the Loan Documents and the Administrative Agent shall be deemed to have possession thereof for purposes of perfecting the Security Interest in any such property.

ARTICLE III
REPRESENTATIONS AND WARRANTIES 

3.1Representations and Warranties.  Each Grantor represents and warrants as follows:

(a)This Agreement and the grant of the Security Interest pursuant hereto creates a valid first priority security interest in the Disposition Proceeds securing the payment of the Obligations, and upon taking possession thereof, the filing of financing statements in accordance with the UCC, and/or any other necessary actions to perfect such security interest, such first priority security interest in such Disposition Proceeds will be duly perfected; and all filings and other actions necessary or desirable to perfect and protect such security interest and such priority have been duly taken (or will be taken).

6

 

(b)No consent of any other Person and no authorization, approval or other action by, and no notice to or filing with, any Governmental Authority is required (i) for the grant by Grantors of the Security Interest in the Disposition Proceeds or for the execution, delivery, performance or enforceability of this Agreement by the Grantors, (ii) for the perfection or maintenance of the Security Interest in the Disposition Proceeds created hereby (including the first priority nature of such Security Interest) except for the taking of possession thereof, the UCC filings or any other action required by the UCC or other applicable perfection statutes, or (iii) for the exercise by the Administrative Agent or any Revolving Secured Party of the rights provided for in this Agreement or the remedies in respect of the Disposition Proceeds pursuant to this Agreement.

(c)The Grantors are, individually or collectively, as applicable, the legal and beneficial owners of the Escrowed Shares and other Restricted Equity Interests; all of the Escrowed Shares and other Restricted Equity Interests currently outstanding and described on Schedule I are duly authorized and issued, fully paid and non-assessable, and all documentary, stamp or other taxes or fees owing in connection with the issuance thereof have been paid; to the knowledge of the Grantors, no dispute, right of setoff, counterclaim or defense exists with respect to all or any part of the Escrowed Shares or other Restricted Equity Interests; the Escrowed Shares and other Restricted Equity Interests are free and clear of all Liens, mortgages, pledges, charges, security interests or other encumbrances, options, warrants, puts, calls and other rights of third persons, and restrictions, other than restrictions on transferability imposed by this Agreement, the Revolving Credit Agreement, the other Loan Documents and the applicable Franchise Agreement and applicable state and federal securities laws; neither this Agreement, the Revolving Credit Agreement nor any of the other Loan Documents creates or requires the creation or the granting by any Grantor of a Security Interest in the Escrowed Shares and other Restricted Equity Interests.

(d)The original certificates representing all of the certificated Escrowed Shares and other certificated Restricted Equity Interests have been delivered to the Administrative Agent, in escrow; the Restricted Equity Interests described on Schedule I constitute (i) all of the issued and outstanding capital stock of each of the Escrow Subsidiaries as of the date hereof and (ii) the indicated number of shares and/or ownership interest percentages of the entities as shown on Schedule I; none of the Escrow Subsidiaries have issued, nor are there outstanding, any options, warrants or other rights in favor of any Grantor or any other Person to acquire the Escrowed Shares or other Restricted Equity Interests or any capital stock of any of the Escrow Subsidiaries.

(e)This Agreement constitutes a legal, valid and binding obligation of each Grantor enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally and general principals of equity; each Grantor has the corporate or partnership, as the case may be, power and authority and the legal right to execute and deliver, to perform its obligations under, and to (i) deliver the Escrowed Shares into the Escrow, and (ii) to grant the Security Interest in the Disposition Proceeds Collateral pursuant to this Agreement; and each Grantor has taken all necessary, corporate, limited liability company or partnership, as the case may be, action to authorize its execution, delivery and performance of, the delivery of the Escrowed 

7

 

Shares into the Escrow, and the grant of the security interest in the Disposition Proceeds Collateral pursuant to this Agreement.

(f)The execution, delivery and performance of this Agreement will not (i) conflict with or result in any breach or contravention of any Contractual Obligation of any Grantor, including any agreement between a Grantor and any manufacturer or distributor, (ii) violate any Law, or (iii) result in the creation or imposition of any Lien on any of the properties or revenues of any Grantor pursuant to any applicable Law or Contractual Obligation of any Grantor, except as contemplated hereby.

(g)No action, suit or proceeding of or before any Governmental Authority is pending or, to the knowledge of Grantors, threatened by or against any Grantor or against any of its properties or revenues with respect to this Agreement or any of the transactions contemplated hereby.

(h)There are no conditions precedent to the effectiveness of this Agreement that have not been satisfied or waived.

ARTICLE IV
COVENANTS 

Grantors covenant and agree as follows:

4.1Further Assurances.  (a)  Each Grantor agrees that, where any agreement existing as of the date hereof or hereafter to which such Grantor is a party contains any restriction prohibiting such Grantor from (i) transferring the Escrowed Shares into the Escrow, or (ii) granting the Security Interest in the Disposition Proceeds Collateral, such Grantor will obtain or use its best efforts to obtain the necessary consent to or waiver of such restriction from any Person so as to enable such Grantor to effectively transfer the Escrowed Shares into the Escrow and grant to Administrative Agent such Security Interest in the Disposition Proceeds Collateral.

(b)Each Grantor will from time to time at its expense promptly execute and deliver all further instruments and documents, and take all further action, that may be reasonably necessary or desirable, or that Administrative Agent may reasonably request, in order to perfect and protect the Security Interest granted or purported to be granted hereby or in any Joinder Agreement, in the Disposition Proceeds Collateral, in the priority thereof, or to create or preserve the full benefits of this Agreement and the rights and powers of Administrative Agent herein or in any Joinder Agreement, or to enable Administrative Agent to exercise and enforce its rights and remedies hereunder or thereunder with respect to any of the Disposition Proceeds Collateral.  Without limiting the generality of the foregoing, upon written request by Administrative Agent, each Grantor will: (i) if the Disposition Proceeds Collateral are certificated, deliver to Administrative Agent such certificated Disposition Proceeds Collateral duly endorsed and accompanied by duly executed instruments of transfer or assignment, all in form and substance satisfactory to the Administrative Agent; and (ii) execute and file such financing or continuation statements, or amendments thereto, and such other instruments or notices, as may be necessary, or as Administrative Agent may request, in order to perfect and preserve the Security Interest 

8

 

granted or purported to be granted hereby with respect to any and all such Disposition Proceeds Collateral.

(c)Each Grantor hereby authorizes Administrative Agent to file one or more financing or continuation statements, and amendments thereto, relating to all or any part of the Disposition Proceeds Collateral without the signature of such Grantor where and to the extent permitted by applicable law.  A photocopy or other reproduction of this Agreement or any financing statement covering the Disposition Proceeds Collateral or any part thereof shall be sufficient as a financing statement where and to the extent permitted by applicable law.

(d)Each Grantor will furnish to Administrative Agent from time to time, upon the written request of Administrative Agent, statements and schedules further identifying and describing the Disposition Proceeds Collateral, and such other reports in connection with the Disposition Proceeds Collateral, as Administrative Agent may reasonably request.

(e)In addition to such other information as shall be specifically provided for herein, Grantors shall furnish to Administrative Agent such other information with respect to the Disposition Proceeds Collateral as Administrative Agent may reasonably request from time to time in connection with the Disposition Proceeds Collateral, or the protection, preservation, maintenance or enforcement of the Security Interest or the Disposition Proceeds Collateral, including, without limitation, all documents and things in Grantors’ possession, or subject to its demand for possession, related to the Disposition Proceeds Collateral.

(f)Subject to Section 4.5(a)(iii), each Grantor shall, if any of the Disposition Proceeds Collateral are received by such Grantor, (i) in the case of Disposition Proceeds Collateral, forthwith transfer and deliver to Administrative Agent all such Disposition Proceeds Collateral either in cash or if certificated, duly endorsed and accompanied by duly executed instruments of transfer, all in form satisfactory to the Administrative Agent, all of which thereafter shall be held by Administrative Agent as collateral security for payment and performance of the Obligations, pursuant to the terms of this Agreement, and (ii) in the case of Restricted Disposition Proceeds, forthwith deliver such Restricted Disposition Proceeds in escrow to the Administrative Agent to be held as Escrowed Shares.

(g)Each Grantor agrees that if such Grantor shall at any time acquire any additional Restricted Equity Interests of any Escrow Subsidiary, such Grantor shall, as soon as practically possible, (and without the necessity for any request or demand by Administrative Agent) deliver the certificates representing such shares or interests to Administrative Agent, in escrow in the same manner and with the same effect as described in Article 1 hereof.  Upon delivery, such shares or evidences of ownership shall thereupon constitute Escrowed Shares for the purposes and upon the terms and conditions set forth in this Agreement.

(h)No Grantor will make any Disposition of the Escrowed Shares or other Restricted Equity Interests (whether certificated or uncertificated) or any part thereof, or create directly or indirectly any security interest or otherwise encumber (other than any restriction imposed by any Franchise Agreement to which the Grantor is a party)  any of the Escrowed Shares or other Restricted Equity Interests, or permit any of the Escrowed Shares or other Restricted Equity Interests to ever be or become subject to any warrant, put, option or other 

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rights of third Persons or any attachment, execution, sequestration or other legal or equitable process, or any security interest or encumbrance of any kind, in each case, unless and until any Disposition Proceeds Collateral are paid and/or delivered to the Administrative Agent in accordance with the Agreement, or are received and retained by the requisite Grantor in accordance with Section 4.5(a)(iii), and any Restricted Disposition Proceeds are delivered in escrow to the Administrative Agent to be held as Escrowed Shares.

(i)The Grantors shall enforce or secure in the name of Administrative Agent, for the benefit of the Revolving Secured Parties, the performance of each and every obligation, term, covenant, condition and agreement relating to any Disposition Proceeds Collateral, and the Grantors shall appear in and defend any action or proceeding arising under, occurring out of or in any manner connected therewith and upon request by the Administrative Agent, the Grantors will do so in the name of the Administrative Agent and on behalf of the Revolving Secured Parties, but at the expense of the Grantors, and the Grantors shall pay all costs and expenses of the Administrative Agent and the Revolving Secured Parties, including, but not limited to, attorneys’ fees and disbursements, in any action or proceeding in which the Revolving Secured Parties may appear.

(j)Each Grantor shall allow the Administrative Agent to inspect all records of such Grantor relating to the Escrowed Shares and/or the Disposition Proceeds Collateral, and to make and take away copies of such records.

(k)Each Grantor shall promptly notify the Administrative Agent of any material change in any fact or circumstance warranted or represented by such Grantor in this Agreement or in any other writing furnished by such Grantor to the Administrative Agent in connection with the Escrowed Shares or this Agreement.

(l)Each Grantor shall promptly notify the Administrative Agent of any claim, action or proceeding affecting title to the Escrowed Shares, or any part thereof, the Disposition Proceeds Collateral, or the Security Interest, and at the request of the Administrative Agent, appear in and defend, at the Grantors’ expense, any such action or proceeding.

(m)The Grantors (jointly and severally) shall promptly pay to the Administrative Agent the amount of all reasonable costs and expenses of the Administrative Agent and/or the Revolving Secured Parties, including, but not limited to, reasonable attorneys’ fees, incurred by the Administrative Agent or the Revolving Secured Parties in connection with this Agreement and the enforcement of the rights of the Administrative Agent or the Revolving Secured Parties hereunder, in accordance with Section 10.05 of the Revolving Credit Agreement.

(n)At no time shall any Escrowed Shares or other Restricted Equity Interests (i) be held or maintained in the form of a security entitlement or credited to any securities account and (ii) which constitute a “security” (or as to which the related Escrow Subsidiary has elected to have treated as a “security”) under Article 8 of the Uniform Commercial Code of the State of North Carolina or of any other jurisdiction whose laws may govern (the “UCC”) be maintained in the form of uncertificated securities.  

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(o)Each Grantor and each issuer of any Escrowed Shares or other Restricted Equity Interests shall mark each register or other ownership or transfer record relating to any of the Escrowed Shares or other Restricted Equity Interests with a notation indicating that (a) such securities, if Escrowed Shares, are subject to this Agreement and the Escrow hereunder, (b) any Disposition of any Escrowed Shares or other Restricted Equity Interests is subject to this Agreement, and (c) any Disposition Proceeds Collateral are subject to the Security Interest and Escrow hereunder.

4.2Conversions; etc.  Should the Escrowed Shares, or any part thereof, ever be in any manner converted by any of the Escrow Subsidiaries into another property of the same or another type or any money or other proceeds ever be paid or delivered to any Grantor as a result of such Grantor’s rights in the Escrowed Shares, then in any such event (except as otherwise provided herein), (i) (in the case of property other than Restricted Equity Interests) all such property, money and other proceeds shall be and/or become part of the Disposition Proceeds Collateral, and each Grantor covenants forthwith to pay or deliver to the Administrative Agent all of the same which is susceptible of delivery; and at the same time, if the Administrative Agent deems it necessary and so requests, such Grantors will properly endorse or assign the same to the Administrative Agent for the benefit of the Revolving Secured Parties, and (ii) (in the case of Restricted Equity Interests) such property shall be delivered in escrow to the Administrative Agent to be held as Escrowed Shares.  Without limiting the generality of the foregoing, each Grantor hereby agrees that the shares of capital stock of the surviving corporation in any merger or consolidation involving any of the Escrow Subsidiaries or any of the Escrowed Shares shall be deemed to constitute Disposition Proceeds Collateral (or, if applicable, Restricted Disposition Proceeds) if the surviving Escrow Subsidiary ceases to be either a direct or indirect wholly owned Subsidiary of the Company.

4.3Preservation of Escrowed Shares.  Neither the Administrative Agent nor the Revolving Secured Parties shall have any responsibility for or obligation or duty with respect to all or any part of the Escrowed Shares or other Restricted Equity Interests or any Disposition Proceeds Collateral or any matter or proceeding arising out of or relating thereto, including, without limitation, beyond the use of reasonable care in the custody and preservation thereof while in its possession, any obligation or duty to collect any sums due in respect thereof or to protect or preserve any rights against prior parties or any other rights pertaining thereto, it being understood and agreed that the Grantors shall be responsible generally for the preservation of all rights in the Escrowed Shares, the other Restricted Equity Interests and the Disposition Proceeds Collateral.

4.4Collection of the Loan.  Neither the Administrative Agent nor any Revolving Secured Party shall ever be liable for any failure to use due diligence in the collection of any and all amounts due and owing under the Notes, the Revolving Credit Agreement or any other Loan Documents, or any part thereof.

4.5Rights of Parties Before the Occurrence of an Event of Default.

(a)Exercising Rights and Receipt of Cash Proceeds Prior to an Event of Default.  Unless and until an Event of Default shall occur and be continuing:

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(i)With respect to all Disposition Proceeds Collateral, subject to the other provisions of this Agreement, the Grantors shall be entitled to receive all cash dividends or interest paid in respect of or attributable to such Disposition Proceeds Collateral and any and all other Distributions.  As used herein “Distributions” shall mean the declaration or payment of any dividend or other distribution on or with respect to such Disposition Proceeds Collateral, and any other payment made with respect to such Disposition Proceeds Collateral other than in respect of a Disposition thereof.  All such Distributions shall if received by any Person other than the Administrative Agent, be held in trust for the benefit of the Administrative Agent and the Revolving Secured Parties and shall forthwith be delivered to the Administrative Agent duly endorsed and accompanied by duly executed instruments of transfer, all in form and substance satisfactory to the Administrative Agent to be held subject to the Security Interest and the other provisions of this Agreement.

(ii)With respect to all Disposition Proceeds Collateral, each Grantor shall have the right to vote and give consents with respect to all such Disposition Proceeds Collateral owned by it and to consent to, ratify, or waive notice of any and all meetings and take such other action as it deems appropriate to protect or further its interests in respect thereof; provided that such right shall in no case be exercised for any purpose contrary to, or in violation of, any of the terms or provisions of this Agreement, the Notes, the Revolving Credit Agreement, or any other Loan Document.

(iii)The requisite Grantor shall be entitled to receive and retain the cash purchase price for any sale of Restricted Equity Interests that is a Permitted Disposition (the “Retained Cash”) and shall not be required to deliver the Retained Cash to the Administrative Agent pursuant to Section 4.1(f) or any other provision hereof.

(b)Exercising Rights in Disposition Proceeds Collateral After the  Occurrence of an Event of Default.  Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent, without the consent of any Grantor, may:

(i)At any time vote or consent in respect of any Disposition Proceeds Collateral and authorize any such Disposition Proceeds Collateral to be voted and such consents to be given, ratify and waive notice of any and all meetings, and take such other action as shall seem desirable to the Administrative Agent, in its sole discretion, to protect or further the interests of the Administrative Agent and the Revolving Secured Parties in respect of any such Disposition Proceeds Collateral as though it were the outright owner thereof, and, each Grantor hereby irrevocably constitutes and appoints the Administrative Agent, after the occurrence and during the continuance of an Event of Default, its sole proxy and attorney-in-fact, with full power of substitution to vote and act with respect to any and all such Disposition Proceeds Collateral standing in the name of such Grantor or with respect to which such Grantor is entitled to vote and act.  The proxy and power of attorney herein granted are coupled with interests, are irrevocable, and shall continue throughout the term of this Agreement;

(ii)In respect of any Disposition Proceeds Collateral, join in and become a party to any plan of recapitalization, reorganization or readjustment (whether 

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voluntary or involuntary) as shall seem desirable to the Administrative Agent in respect of any such Disposition Proceeds Collateral, and deposit any such Disposition Proceeds Collateral under any such plan; make any exchange, substitution, cancellation or surrender of such Disposition Proceeds Collateral required by any such plan and take such action with respect to any such Disposition Proceeds Collateral as may be required by any such plan or for the accomplishment thereof; and no such disposition, exchange, substitution, cancellation or surrender shall be deemed to constitute a release of such Disposition Proceeds Collateral from the Security Interest of this Agreement;

(iii)Receive for application as provided in Section 8.03 of the Revolving Credit Agreement all payments of whatever kind made upon or with respect to any Disposition Proceeds Collateral; and

(iv)Subject to the provisions of Section 4.5(c) hereof, transfer or endorse into its name, or into the name or names of its nominee or nominees, all or any of the Disposition Proceeds Collateral.

(c)Right of Sale of Disposition Proceeds Collateral After the Occurrence of an Event of Default.  Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent may sell, without recourse to judicial proceedings, by way of one or more contracts, with the right (except at private sale) to bid for and buy, free from any right of redemption, any Disposition Proceeds Collateral upon five (5) days’ notice (which notice is agreed to be reasonable notice for the purposes hereof) to the Grantors of the time and place of sale, for cash, upon credit or for future delivery, at the Administrative Agent’s option and in the Administrative Agent’s complete discretion:

(i)At public sale, including a sale at any broker’s board or exchange; or

(ii)At private sale in any manner which will not require the Disposition Proceeds Collateral, or any part thereof, to be registered in accordance with the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder, or any other law or regulation, at the best price reasonably obtainable by the Administrative Agent at any such private sale or other disposition in the manner mentioned above.

The Administrative Agent is also hereby authorized, but not obligated, to take such actions, give such notices, obtain such consents, and do such other things as the Administrative Agent may deem required or appropriate in the event of sale or disposition of such Disposition Proceeds Collateral.  Each Grantor understands that the Administrative Agent may in its sole discretion approach a restricted number of potential purchasers and that a sale under such circumstances may yield a lower price for such Disposition Proceeds Collateral, or any portion thereof, than would otherwise be obtainable if the same were registered and sold in the open market.  Each Grantor agrees (A) that in the event the Administrative Agent shall so sell such Disposition Proceeds Collateral, or any portion thereof, at such private sale or sales, the Administrative Agent shall have the right to rely upon the advice and opinion of any member firm of a national securities exchange as to the best price reasonably obtainable upon such a private sale thereof 

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(any expense borne by the Administrative Agent in obtaining such advice to be paid by the Grantors as an expense related to the exercise by the Administrative Agent of its rights hereunder), and (B) that such reliance shall be conclusive evidence that the Administrative Agent handled such matter in a commercially reasonable manner.  No Revolving Secured Party shall be under any obligation to take any steps to permit such Disposition Proceeds Collateral to be sold at a public sale or to delay a sale to permit the Escrow Subsidiaries to register such Disposition Proceeds Collateral for public sale under the Securities Act of 1933 or applicable state securities law.  In ease of any sale by the Administrative Agent of the Disposition Proceeds Collateral on credit or for future delivery, the Disposition Proceeds Collateral sold may be retained by the Administrative Agent until the selling price is paid by the purchaser, but the Administrative Agent shall incur no liability in case of failure of the purchaser to take up and pay for the Disposition Proceeds Collateral so sold.  In case of any such failure, such Disposition Proceeds Collateral so sold may be again similarly sold.  In connection with the sale of the Disposition Proceeds Collateral, the Administrative Agent is authorized, but not obligated, to limit prospective purchasers to the extent deemed necessary or desirable by the Administrative Agent to render such sale exempt from the registration requirements of the Securities Act of 1933, as amended, and any applicable state securities laws, and no sale so made in good faith by the Administrative Agent shall be deemed not to be “commercially reasonable” because so made.  In no event, however, shall the Administrative Agent or any Revolving Secured Party have any right to sell, foreclose upon, or compel the sale of, any Escrowed Shares.

(d)Other Rights After an Event of Default.  Upon the occurrence and during the continuance of an Event of Default, the Administrative Agent, at its election, may with respect to all Disposition Proceeds Collateral exercise any and all rights available to a secured party under the Uniform Commercial Code as enacted in the State of North Carolina or other applicable jurisdiction, as amended, in addition to any and all other rights afforded hereunder, under the Revolving Credit Agreement, the Notes, under the other Loan Documents, at law, in equity or otherwise.

(e)Application of Proceeds.  Any and all Disposition Proceeds Collateral including cash proceeds and the proceeds from the disposition as hereinabove provided of Disposition Proceeds Collateral received by Lenders or any part thereof shall be applied as provided in Section 8.03 of the Revolving Credit Agreement.

4.6Right to File as Financing Statement.  The Administrative Agent shall have the right at any time to execute and file this Agreement as a financing statement, but the failure of the Administrative Agent to do so shall not impair the validity or enforceability of this Agreement or the Security Interest.

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4.7Restricted Disposition Shares; No Control by Administrative Agent or Lenders.

(a)Notwithstanding anything herein or in any other Loan Document to the contrary, the Administrative Agent shall not have, or be deemed to have, a security interest in any Restricted Disposition Proceeds or the Escrowed Shares, but the Administrative Agent shall have, and is hereby granted, a security interest in Disposition Proceeds Collateral (the “Subsequent Proceeds”) of Restricted Disposition Proceeds so long as such Subsequent Proceeds are not themselves Restricted Disposition Proceeds.  Any Restricted Disposition Proceeds delivered to the Administrative Agent to be held in escrow by the Administrative Agent and will be deemed to be Escrowed Shares for purposes of this Agreement.  

(b)Notwithstanding anything herein or in any other Loan Document to the contrary, this Agreement, the Revolving Credit Agreement and the other Loan Documents, and the transactions contemplated hereby and thereby, do not and will not, constitute, create or have the effect of constituting or creating, directly or indirectly, the actual or practical ownership of any of the Escrow Subsidiaries by the Administrative Agent or any Revolving Secured Party, or control, affirmative or negative, direct or indirect, by the Administrative Agent or any Revolving Secured Party over the management or any other aspect of the day-to-day operation of the Escrow Subsidiaries, which ownership and control remains exclusively and at all times in each of the Escrow Subsidiaries.

4.8Agreement to Supplement.  Each Grantor acknowledges and agrees that this Agreement shall be amended and supplemented from time to time to specifically include a description of all Escrowed Shares subject hereto subsequent to the date hereof, and the Administrative Agent shall be entitled to supplement Schedule I from time to time, without any action or joinder of the Grantors to reflect the addition of all such additional Escrowed Shares.  The Administrative Agent shall have a valid first priority security interest in all additional Disposition Proceeds which come into existence after the date hereof, whether or not reflected on a supplement to Schedule I.  The Grantor hereby agrees to execute, deliver and cause the filing of all stock powers, financing statements and other documents and to take such further action as deemed necessary in the Administrative Agent’s reasonable discretion with respect to each such additional Escrowed Shares and Disposition Proceeds to ensure each Grantor’s compliance hereunder with respect thereto.

4.9Reinstatement.  The granting of a security interest in the Disposition Proceeds Collateral and the other provisions hereof shall continue to be effective or be reinstated, as the case may be, if at any time any payment of any of the Obligations is rescinded or must otherwise be returned by any Revolving Secured Party or is repaid by any Revolving Secured Party in whole or in part in good faith settlement of a pending or threatened avoidance claim, whether upon the insolvency, bankruptcy or reorganization of any Grantor or any other Loan Party or otherwise, all as though such payment  had not been made.  The provisions of this Section 4.9 shall survive repayment of all of the Secured Obligations and the termination or expiration of this Agreement in any manner, including but not limited to termination upon occurrence of the Facility Termination Date.

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4.10Certain Waivers by the Grantors.  Each Grantor waives to the extent permitted by applicable law (a) any right to require any Revolving Secured Party or any other obligee of the Secured Obligations to (x) proceed against any Person or entity, including without limitation any Loan Party, (y) proceed against or exhaust the Disposition Proceeds Collateral or other collateral for the Secured Obligations, or (z) pursue any other remedy in its power; (b) any defense arising by reason of any disability or other defense of any other Person, or by reason of the cessation from any cause whatsoever of the liability of any other Person or entity, (c) any right of subrogation, and (d) any right to enforce any remedy which any Revolving Secured Party or any other obligee of the Secured Obligations now has or may hereafter have against any other Person and any benefit of and any right to participate in any collateral or security whatsoever now or hereafter held by the Administrative Agent for the benefit of the Revolving Secured Parties.  Each Grantor authorizes each Revolving Secured Party and each other obligee of the Secured Obligations without notice (except notice required by applicable law) or demand and without affecting its liability hereunder or under the Loan Documents from time to time to: (i) take and hold security, other than the Disposition Proceeds Collateral herein described, for the payment of such Secured Obligations or any part thereof, and exchange, enforce, waive and release the Disposition Proceeds Collateral herein described or any part thereof or any such other security; and (ii) apply such Disposition Proceeds Collateral or other security and direct the order or manner of sale thereof as such Revolving Secured Party or obligee in its discretion may determine.

The Administrative Agent may at any time deliver (without representation, recourse or warranty) the Disposition Proceeds Collateral or any part thereof to a Grantor and the receipt thereof by such Grantor shall be a complete and full acquittance for the Disposition Proceeds Collateral so delivered, and the Administrative Agent shall thereafter be discharged from any liability or responsibility therefor.

4.11Continued Powers.  Until the Facility Termination Date shall have occurred, the power of sale and other rights, powers and remedies granted to the Administrative Agent for the benefit of the Revolving Secured Parties hereunder shall continue to exist and may be exercised by the Administrative Agent at any time and from time to time irrespective of the fact that any of the Secured Obligations or any part thereof may have become barred by any statute of limitations or that any part of the liability of any Grantor may have ceased.

4.12Other Rights.  The rights, powers and remedies given to the Administrative Agent for the benefit of the Revolving Secured Parties by this Agreement shall be in addition to all rights, powers and remedies given to the Administrative Agent or any Revolving Secured Party under any other Loan Document or by virtue of any statute or rule of law.  Any forbearance or failure or delay by the Administrative Agent in exercising any right, power or remedy hereunder shall not be deemed to be a waiver of such right, power or remedy, and any single or partial exercise of any right, power or remedy hereunder shall not preclude the further exercise thereof; and every right, power and remedy of the Revolving Secured Parties shall continue in full force and effect until such right, power or remedy is specifically waived in accordance with the terms of the Revolving Credit Agreement.

4.13Anti-Marshaling Provisions.  The right is hereby given by each Grantor to the Administrative Agent, for the benefit of the Revolving Secured Parties, to make releases 

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(whether in whole or in part) of all or any part of the Disposition Proceeds Collateral agreeable to the Administrative Agent without notice to, or the consent, approval or agreement of other parties and interests, including junior lienors, which releases shall not impair in any manner the validity of or priority of the Liens and security interests in the remaining Disposition Proceeds conferred hereunder, nor release any Grantor from personal liability for the Secured Obligations.  Notwithstanding the existence of any other security interest in the Disposition Proceeds held by the Administrative Agent, for the benefit of the Revolving Secured Parties, the Administrative Agent shall have the right to determine the order in which any or all of the Disposition Proceeds shall be subjected to the remedies provided in this Agreement.  Each Grantor hereby waives any and all right to require the marshaling of assets in connection with the exercise of any of the remedies permitted by applicable law or provided herein or in any Loan Document.

4.14Entire Agreement.  This Agreement and each Joinder Agreement, together with the Revolving Credit Agreement and other Loan Documents, constitutes and expresses the entire understanding between the parties hereto with respect to the subject matter hereof, and supersedes all prior negotiations, agreements and understandings, inducements, commitments or conditions, express or implied, oral or written, except as herein contained.  The express terms hereof and of the Joinder Agreements control and supersede any course of performance or usage of the trade inconsistent with any of the terms hereof and thereof.  Neither this Agreement nor any Joinder Agreement nor any portion or provision hereof or thereof may be changed, altered, modified, supplemented, discharged, canceled, terminated, or amended orally or in any manner other than as provided in the Revolving Credit Agreement.

4.15Reliance.  Each Grantor hereby consents and agrees that all Persons shall be entitled to accept the provisions hereof and of the Joinder Agreements as conclusive evidence of the right of the Administrative Agent, on behalf of the Revolving Secured Parties, to exercise its rights, privileges, and remedies hereunder and thereunder with respect to the Disposition Proceeds, notwithstanding any other notice or direction to the contrary heretofore or hereafter given by any Grantor or any other Person to any Persons.

4.16Binding Agreement; Assignment.  This Agreement and each Joinder Agreement, and the terms, covenants and conditions hereof and thereof, shall be binding upon and inure to the benefit of the parties hereto, and to their respective successors and assigns, except that no Grantor shall be permitted to assign this Agreement, any Joinder Agreement or any interest herein or therein or in the Disposition Proceeds, or any part thereof or interest therein, or otherwise pledge, encumber or grant any option with respect to the Disposition Proceeds, or any part thereof, or any cash or property held by the Administrative Agent as the Disposition Proceeds under this Agreement.  Without limiting the generality of the foregoing sentence of this Section 4.16, any Lender may assign to one or more Persons, or grant to one or more Persons participations in or to, all or any part of its rights and obligations under the Revolving Credit Agreement (to the extent permitted by the Revolving Credit Agreement); and to the extent of any such assignment or participation such other Person shall, to the fullest extent permitted by law, thereupon become vested with all the benefits in respect thereof granted to such Lender herein or otherwise, subject however, to the provisions of the Revolving Credit Agreement, including Article IX thereof (concerning the Administrative Agent) and Section 10.06 thereof (concerning assignments and participations).  All references herein to the Administrative Agent and to the 

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Revolving Secured Parties shall include any successor thereof or permitted assignee, and any other obligees from time to time of the Secured Obligations.

4.17Related Swap Contracts.  All obligations of any Grantor under or in respect of Related Swap Contracts and Secured Cash Management Arrangements other than Excluded Swap Obligations shall be deemed to be Secured Obligations secured hereby, and each Hedge Bank or Cash Management Bank party to any such Related Swap Contract or Secured Cash Management Arrangement shall be deemed to be a Revolving Secured Party hereunder with respect to such Secured Obligations; provided, however, that such obligations under or in respect of any Related Swap Contract shall cease to be Secured Obligations at such time, prior to the Facility Termination Date, as the applicable Hedge Bank (or Affiliate of such Person) shall cease to be a “Hedge Bank” under the Revolving Credit Agreement.

No Person who obtains the benefit of any Lien by virtue of the provisions of this Section shall have any right to notice of any action or to consent to, direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Disposition Proceeds (including the release or impairment of any Disposition Proceeds) other than in its capacity as a Lender and only to the extent expressly provided in the Loan Documents.  Notwithstanding any other provisions of this Agreement to the contrary, the Administrative Agent shall only be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, the Secured Obligations arising under Related Swap Contracts or Secured Cash Management Arrangements to the extent the Administrative Agent has received written notice of  such Obligations, together with such supportive documentation as it may request from the applicable Lender or Affiliate of a Lender.  The Administrative Agent shall not be required to verify the payment of, or that any other satisfactory arrangements have been made with respect to, obligations arising under Secured Cash Management Agreements and Related Swap Contracts in the case of a Facility Termination Date.  Each Revolving Secured Party not a party to the Revolving Credit Agreement who obtains the benefit of this Agreement by virtue of the provisions of this Section shall be deemed to have acknowledged and accepted the appointment of the Administrative Agent pursuant to the terms of the Revolving Credit Agreement, and that with respect to the actions and omissions of the Administrative Agent hereunder or otherwise relating hereto that do or may affect such Revolving Secured Party, the Administrative Agent and each of its Related Parties shall be entitled to all the rights, benefits and immunities conferred under Article IX of the Revolving Credit Agreement.

4.18Severability.  The provisions of this Agreement are independent of and separable from each other.  If any provision hereof shall for any reason be held invalid or unenforceable, such invalidity or unenforceability shall not affect the validity or enforceability of any other provision hereof, but this Agreement shall be construed as if such invalid or unenforceable provision had never been contained herein.

4.19Counterparts.  This Agreement may be executed in any number of counterparts each of which when so executed and delivered shall be deemed an original, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such counterpart executed by the Grantor against whom enforcement is sought.  Without limiting the foregoing provisions of this Section 4.19, the provisions of Section 10.10 of the Revolving Credit Agreement shall be applicable to this Agreement.

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4.20Termination.  Subject to the provisions of Section 4.9, this Agreement and each Joinder Agreement, and all obligations of the Grantors hereunder (excluding those obligations and liabilities that expressly survive such termination) shall terminate without delivery of any instrument or performance of any act by any party on the Facility Termination Date.  Upon such termination of this Agreement, the Administrative Agent shall, at the sole expense of the Grantors, promptly deliver to the Grantors the Escrowed Shares, all other certificated Restricted Equity Interests and the Disposition Proceeds Collateral and take such actions at the request of the Grantors as may be necessary to effect the same.

4.21Notices.  Any notice required or permitted hereunder shall be given (a) with respect to any Grantor hereunder, at the address of the Company indicated in Schedule 10.02 of the Revolving Credit Agreement, (b) with respect to the Administrative Agent or a Lender, at the Administrative Agent’s address indicated in Schedule 10.02 of the Revolving Credit Agreement.  All such addresses may be modified, and all such notices shall be given and shall be effective, as provided in Section 10.02 of the Revolving Credit Agreement for the giving and effectiveness of notices and modifications of addresses thereunder.

4.22Joinder.  Each Person who shall at any time execute and deliver to the Administrative Agent a Joinder Agreement who is identified therein as a “Grantor” (as such term is defined in this Agreement) shall thereupon irrevocably, absolutely and unconditionally become a party hereto and obligated hereunder to the extent required pursuant to such Joinder Agreement as a Grantor and shall have thereupon pursuant to Section 1 hereof granted a security interest in and collaterally assigned and pledged to the Administrative Agent for the benefit of the Revolving Secured Parties all Disposition Proceeds which it has at its applicable date of execution of its respective Joinder Agreement or thereafter acquires any interest or the power to transfer, and all references herein and in the other Loan Documents to the Grantors or to the parties to this Agreement shall be deemed to include such Person as a Grantor hereunder.  Each such Joinder Agreement shall be accompanied by the Supplemental Schedules referred to therein, appropriately completed with information relating to the Grantor executing such Joinder Agreement and its property. Each of the applicable Schedules attached hereto shall be deemed amended and supplemented without further action by such information reflected on the Supplemental Schedules to each such Joinder Agreement.

4.23Rules of Interpretation.  The rules of interpretation contained in Sections 1.03 and 1.06 of the Revolving Credit Agreement shall be applicable to this Agreement and each Joinder Agreement and are hereby incorporated by reference.  All representations and warranties contained herein shall survive the delivery of documents and any Credit Extensions referred to herein or secured hereby.

4.24Governing Law; Waivers.

(a)THIS AGREEMENT AND EACH JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NORTH CAROLINA APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.

19

 

(b)EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY AGREES AND CONSENTS THAT ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY JOINDER AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREIN OR THEREIN MAY BE INSTITUTED IN ANY STATE OR FEDERAL COURT SITTING IN MECKLENBURG COUNTY, STATE OF NORTH CAROLINA, UNITED STATES OF AMERICA AND, BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT OR A JOINDER AGREEMENT, EXPRESSLY WAIVES ANY OBJECTION THAT IT MAY HAVE NOW OR HEREAFTER TO THE LAYING OF THE VENUE OR TO THE JURISDICTION OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND IRREVOCABLY SUBMITS GENERALLY AND UNCONDITIONALLY TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING.

(c)EACH GRANTOR AGREES THAT SERVICE OF PROCESS MAY BE MADE BY PERSONAL SERVICE OF A COPY OF THE SUMMONS AND COMPLAINT OR OTHER LEGAL PROCESS IN ANY SUCH SUIT, ACTION OR PROCEEDING, OR BY REGISTERED OR CERTIFIED MAIL (POSTAGE PREPAID) TO THE ADDRESS OF SUCH GRANTOR PROVIDED IN SECTION 4.21 OR BY ANY OTHER METHOD OF SERVICE PROVIDED FOR UNDER THE APPLICABLE LAWS IN EFFECT IN THE STATE OF NORTH CAROLINA.

(d)NOTHING CONTAINED IN SUBSECTIONS (b) OR (c) HEREOF SHALL PRECLUDE THE ADMINISTRATIVE AGENT FROM BRINGING ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY JOINDER AGREEMENT OR THE OTHER LOAN DOCUMENTS IN THE COURTS OF ANY PLACE WHERE ANY GRANTOR OR ANY OF SUCH GRANTOR’S PROPERTY OR ASSETS MAY BE FOUND OR LOCATED.  TO THE EXTENT PERMITTED BY THE APPLICABLE LAWS OF ANY SUCH JURISDICTION, EACH GRANTOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT AND EXPRESSLY WAIVES, IN RESPECT OF ANY SUCH SUIT, ACTION OR PROCEEDING, OBJECTION TO THE EXERCISE OF JURISDICTION OVER IT AND ITS PROPERTY BY ANY SUCH OTHER COURT OR COURTS WHICH NOW OR HEREAFTER, BY REASON OF ITS PRESENT OR FUTURE DOMICILE, OR OTHERWISE, MAY BE AVAILABLE UNDER APPLICABLE LAW.

(e)IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES UNDER OR RELATED TO THIS AGREEMENT OR ANY JOINDER AGREEMENT OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION WITH THE FOREGOING, EACH PARTY HEREBY AGREES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, THAT ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY AND HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT SUCH PERSON MAY HAVE TO TRIAL BY JURY IN ANY SUCH ACTION, SUIT OR PROCEEDING.

20

 

(f)EACH GRANTOR HEREBY EXPRESSLY WAIVES ANY OBJECTION IT MAY HAVE THAT ANY COURT TO WHOSE JURISDICTION IT HAS SUBMITTED PURSUANT TO THE TERMS HEREOF IS AN INCONVENIENT FORUM.

4.25Amendment and Restatement.  The parties hereto agree that the Existing Escrow and Security Agreement is hereby amended and restated in this Escrow and Security Agreement, and this Escrow and Security Agreement shall constitute neither a release nor novation of any lien or security interest arising under the Existing Escrow and Security Agreement nor a refinancing of any indebtedness or obligations arising thereunder or under the Existing Credit Agreement or related documents, but rather the liens and security interests in effect under the Existing Escrow and Security Agreement shall continue in effect on the terms hereof.

 

 [Signature page follows.]

 

21

 

 

IN WITNESS WHEREOF, the parties have duly executed this Agreement on the day and year first written above.

GRANTORS:

SONIC AUTOMOTIVE, INC.

	
 
	
By:
	
/s/ Heath R. Byrd

	
 
	
Name:
	
Heath R. Byrd

	
 
	
Title:
	
Executive Vice President and Chief

	
 
	

	
Financial Officer 

 

 

FAA HOLDING CORP.

FIRSTAMERICA AUTOMOTIVE, INC.

L DEALERSHIP GROUP, INC.

SAI AL HC1, INC.

SAI AL HC2, INC.

SAI FL HC2, INC.

SAI FL HC4, INC.

SAI GA HC1, LLC

SAI MD HC1, INC.

SAI OK HC1, INC.

SAI TN HC1, LLC

SAI TN HC3, LLC

SAI VA HC1, INC.

SONIC AUTOMOTIVE OF NEVADA, INC.

SONIC MOMENTUM B, L.P.

SONIC OF TEXAS, INC.

	
 
	
By:
	
/s/ Heath R. Byrd

	
 
	
Name:
	
Heath R. Byrd

	
 
	
Title:
	
Vice President and Treasurer

 

FOURTH AMENDED AND RESTATED ESCROW AND SECURITY AGREEMENT

 (Sonic Automotive, Inc. – Senior Facility)

Signature Page

 

ADMINISTRATIVE AGENT:

	
 
	

	
BANK OF AMERICA, N.A., as Administrative Agent
	
 

	
 
	
By:
	
/s/ Reneé Marion

	
 
	
Name:
	
Reneé Marion

	
 
	
Title:
	
Assistant Vice President

 

FOURTH AMENDED AND RESTATED ESCROW AND SECURITY AGREEMENT

 (Sonic Automotive, Inc. – Senior Facility)

Signature Page

 

 

SCHEDULE I

 

Escrowed Shares

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
FAA Holding Corp.
	
1.FAA Las Vegas H, Inc.

Nevada

Corporation

C13186-1999
	
Common Stock 
	
10,000
	
2

	
FAA Holding Corp.
	
2.Kramer Motors Incorporated

California

Corporation

C0392185
	
Common Stock
	
250
	
10

	
FirstAmerica Automotive, Inc.
	
3.FAA Beverly Hills, Inc.

California

Corporation

C2069519
	
Common Stock
	
10,000
	
2

	
FirstAmerica Automotive, Inc.
	
4.FAA Concord H, Inc.

California

Corporation

C2004304
	
Common Stock
	
10,000
	
2

	
FirstAmerica Automotive, Inc.
	
5.FAA Concord T, Inc.

California

Corporation

C0613543
	
Common Stock
	
1,000
	
5

	
FirstAmerica Automotive, Inc.
	
6.FAA Poway H, Inc.

California

Corporation

C2006230
	
Common Stock 
	
10,000
	
2

Schedule I – Page 1

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
FirstAmerica Automotive, Inc.
	
7.FAA San Bruno, Inc.

California

Corporation

C2004303
	
Common Stock 
	
10,000
	
2

	
FirstAmerica Automotive, Inc.
	
8.FAA Serramonte H, Inc.

California

Corporation

C2069465
	
Common Stock 
	
10,000
	
2

	
FirstAmerica Automotive, Inc.
	
9.FAA Serramonte L, Inc.

California

Corporation

C2004222
	
Common Stock 
	
10,000
	
2

	
L Dealership Group, Inc.
	
10.Franciscan Motors, Inc.

California

Corporation

C1532758
	
Common Stock
	
700,000
	
10

	
L Dealership Group, Inc.
	
11.Santa Clara Imported Cars, Inc.

California

Corporation

C0587296
	
Common Stock
	
1,082
	
10

	
L Dealership Group, Inc.
	
12.Stevens Creek Cadillac, Inc.

California

Corporation

 
	
Common Stock
	
 
	
 

	
L Dealership Group, Inc.
	
13.Sonic - Stevens Creek B, Inc.

California

Corporation

C0723787
	
Common Stock
	
300,000
	
10

Schedule I – Page 2

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
L Dealership Group, Inc.
	
14.Windward, Inc.

Hawaii

Corporation

41788D1FPD
	
Common Stock
	
140,500
	
10

	
SAI AL HC1, Inc.
	
15.SAI Montgomery B, LLC

Alabama
Limited Liability Company
428-746
	
LLC Interest
	
100.00%
	
N/A

	
SAI AL HC2, Inc.
	
16.SAI Irondale Imports, LLC

Alabama

Limited Liability Company

428-744
	
Common Stock
	
100.00%
	
N/A

	
SAI AL HC2, Inc.
	
17.SAI Irondale L, LLC

Alabama

Limited Liability Company

662-073
	
LLC Interest
	
100.00%
	
N/A

	
SAI GA HC1, Inc.
	
18.SAI Stone Mountain T, LLC

Georgia

Limited Liability Company

4746287
	
LLC Interest
	
100.00%
	
N/A

	
SAI FL HC2, Inc.
	
19.SAI Clearwater T, LLC

Florida

Limited Liability Company

L08000116713
	
LLC Interest
	
100.00%
	
N/A

	
SAI FL HC2, Inc.
	
20.SAI Fort Myers B, LLC

Florida

Limited Liability Company

L08000116712
	
LLC Interest
	
100.00%
	
N/A

Schedule I – Page 3

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
SAI FL HC2, Inc.
	
21.SAI Pensacola A , LLC

Florida

Limited Liability Company

 
	
LLC Interest
	
100.00%
	
N/A

	
SAI FL HC4, Inc.
	
22.SAI Fort Myers H, LLC

Florida

Limited Liability Company

L08000116710
	
LLC Interest
	
100.00%
	
N/A

	
SAI MD HC1, Inc.
	
23.SAI Rockville L, LLC 

Maryland
Limited Liability Company
W12791083
	
LLC Interest
	
100.00%
	
N/A

	
SAI OK HC1, Inc.
	
24.SAI Atlanta B, LLC

Georgia
Limited Liability Company
08083814
	
LLC Interest
	
100.00%
	
N/A

	
SAI TN HC1, LLC

 
	
 

25.SAI Chattanooga N, LLC

Tennessee

Limited Liability Company

000767923

 
	
LLC Interest 
	
100.00%
	
N/A

	
SAI TN HC1, LLC

 
	
 

26.SAI Cleveland N, LLC

Tennessee

Limited Liability Company

000770235

 
	
LLC Interest 
	
100.00%
	
N/A

	
SAI TN HC3, LLC

 
	
27.SAI Nashville H, LLC 

Tennessee

Limited Liability Company

0336180
	
LLC Interest 
	
100.00%
	
N/A

Schedule I – Page 4

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
SAI HC VA1, Inc.
	
28.SAI Fairfax B, LLC

Virginia

Limited Liability Company

S4346344
	
LLC Interest
	
100.00%
	
N/A

	
SAI VA HC1, Inc.
	
29.SAI Tysons Corner H, LLC

Virginia

Limited Liability Company

S4346369
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive, Inc.
	
30.FirstAmerica Automotive, Inc.

Delaware

Corporation

2761294
	
Common Stock
	
100.00%
	
2

	
Sonic Automotive, Inc.
	
31.Sonic – Integrity Dodge LV, LLC

 Nevada 

Limited Liability Company

LLC4879-1999
	
LLC Interest
	
100%
	
N/A

	
Sonic Automotive, Inc.
	
32.Marcus David Corporation

North Carolina

Corporation

0272880
	
Common Stock
	
579,000
	
8

	
Sonic Automotive, Inc.
	
33.Ontario L, LLC

California

Limited Liability Company

200330110050
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive, Inc.
	
34.SAI AL HC2, Inc.

Alabama

Corporation

D/C 199-217
	
Common Stock
	
100
	
1

Schedule I – Page 5

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
Sonic Automotive, Inc.
	
35.SAI Columbus T, LLC

Ohio

Limited Liability Company

CP13128
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive, Inc.
	
36.SAI Denver B, Inc.

Colorado

Corporation

20131294528
	
Common Stock
	
100
	
1

	
Sonic Automotive, Inc.
	
37.SAI FL HC2, Inc.

Florida

Corporation

P98000016038
	
Common Stock
	
100
	
2

	
Sonic Automotive, Inc.
	
38.SAI Long Beach B, Inc.

California
Corporation
C2998588
	
Common Stock
	
100
	
1

	
Sonic Automotive, Inc.
	
39.SAI McKinney M, LLC

Texas

Limited Liability Company
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive, Inc.
	
40.SAI MD HC1, Inc.

Maryland
Corporation
D05310776
	
Common Stock
	
100
	
2

	
Sonic Automotive, Inc.
	
41.SAI Monrovia B, Inc.

California
Corporation
C2979304
	
Common Stock
	
100
	
1

Schedule I – Page 6

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
Sonic Automotive, Inc.
	
42.SAI Philpott T, LLC

Texas

Limited Liability Company

802278062
	
LLC Interest
	
100.00%
	
 

	
Sonic Automotive, Inc.
	
43.SAI VA HC1, Inc.

Virginia
Corporation
07019870
	
Common Stock
	
100
	
1

	
Sonic Automotive, Inc.
	
44.Sonic Automotive of Nevada, Inc.

Nevada
Corporation
C18014-1997
	
Common Stock
	
1,000
	
1

	
Sonic Automotive, Inc.
	
45.Sonic Automotive 2752 Laurens Rd., Greenville, Inc.

South Carolina

Corporation
	
Common Stock
	
100
	
1

	
Sonic Automotive, Inc.
	
46.Sonic Automotive - 9103 E. Independence, NC, LLC

North Carolina

Limited Liability Company

 0470751
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive, Inc.
	
47.Sonic–Buena Park H, Inc.

California

Corporation

C2356456
	
Common Stock 
	
100
	
1

	
Sonic Automotive, Inc.
	
48.Sonic – Denver T, Inc.

Colorado

Corporation

20021350687
	
Common Stock
	
100
	
1

Schedule I – Page 7

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
Sonic Automotive, Inc.
	
49.Sonic – Harbor City H, Inc.

California

Corporation

C2356454
	
Common Stock
	
100
	
1

	
Sonic Automotive, Inc.
	
50.Sonic - Shottenkirk, Inc.

Florida

Corporation

P99000043291
	
Common Stock
	
100
	
1

	
Sonic Automotive of Nevada, Inc.
	
51.SAI GA HC1, LLC

Georgia

Limited Liability Company

4705444
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive of Nevada, Inc.

Sonic Automotive of Nevada, Inc.
	
52.Sonic Automotive of Chattanooga, LLC

Tennessee

Limited Liability Company

0336188
	
LLC Interest (Class A Units)

LLC Interest (Class B Units)
	
1

 

 

 

 

99
	
N/A

	
Sonic Automotive of Nevada, Inc.
	
53.Sonic Automotive of Nashville, LLC

Tennessee

Limited Liability Company

0336186
	
LLC Interest
	
100.00%
	
N/A

	
Sonic Automotive of Nevada, Inc.

Sonic Automotive of Nevada, Inc.
	
54.Sonic – 2185 Chapman Rd., Chattanooga, LLC

Tennessee

Limited Liability Company

0366281
	
LLC Interest (Class A Units)

LLC Interest (Class B Units)
	
1

 

99
	
N/A

Schedule I – Page 8

 

 

					
	
grantor
	
escrow subsidiaries
	
type of shares
	
no. of shares
	
cert. no.(s)

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
55.Philpott Motors, Ltd.

Texas

Limited Partnership

12223010
	
General Partner Interest

 

Limited Partner Interest
	
1.00%

 

 

 

99.00%
	
N/A

	
Sonic Momentum B, L.P.
	
56.SAI West Houston B, LLC

Texas

 Limited Liability Company

802152114
	
LLC Interest
	
100.00%
	
N/A

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
57.Sonic – Fort Worth T, L.P.

Texas

Limited Partnership

13920710
	
General Partner Interest

Limited Partner Interest
	
1.00%

 

99.00%
	
N/A

	
Sonic of Texas, Inc.

 

Sonic Automotive of Nevada, Inc.
	
58.Sonic - Lute Riley, L.P. 

Texas

Limited Partnership

11869810
	
General Partner Interest

Limited Partner Interest
	
1.00%

 

99.00%
	
N/A

	
Sonic of Texas, Inc.

Sonic Automotive of Nevada, Inc.
	
59.Sonic Momentum B, L.P.

Texas

Limited Partnership

800235477
	
General Partner Interest

Limited Partner Interest
	
1.00%

99.00%
	
N/A

 

 

Schedule I – Page 9

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