Document:

2007 Board of Directors' Compensation Package

 EXHIBIT 10.16 
 2007 Director Compensation 
 $36,000 retainer; 
 $5,000 for personal attendance at regularly scheduled quarterly board meeting and committee meetings; 
 An option grant of
2,000 shares of Class A common stock at fair market value, vesting six months following grant. 
 A 1200 shares Class A common stock grant for
Board service; and 
 A 100 share Class A common stock grant for chairing the Audit Committee. 
 All shares grants will be made as of the annual shareholder meeting following a year of service and such grants are subject to such member completing the year of
service. Further, all grants to include resale restrictions to prohibit sale until the earlier of 3 years after the date of grant or 1 year after termination of board service.Loan Agreement and Amendments

 EXHIBIT 10.18 
 LOAN AGREEMENT 
 among 
 LITHIA MOTORS, INC., 
 THE LENDERS PARTY HERETO FROM TIME TO TIME, 
 and 
 U.S. BANK NATIONAL ASSOCIATION,

 as Agent 
 Dated as of
August 31, 2006 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page
	 ARTICLE 1. DEFINITIONS AND INTERPRETIVE PROVISIONS
	  	1
			
	 1.1
	  	Defined Terms	  	1
	 1.2
	  	Other Interpretive Provisions	  	14
		
	 ARTICLE 2. REVOLVING LOANS
	  	15
			
	 2.1
	  	Revolving Loan Commitment	  	15
	 2.2
	  	Purpose of Revolving Loans	  	15
	 2.3
	  	Revolving Notes	  	16
	 2.4
	  	Requests for Revolving Loans	  	16
	 2.5
	  	Payments	  	16
	 2.6
	  	Revolving Loan Fee	  	16
		
	 ARTICLE 3. SWINGLINE LOANS
	  	17
			
	 3.1
	  	Swingline Commitment	  	17
	 3.2
	  	Purpose of Swingline Loans	  	17
	 3.3
	  	Swingline Notes	  	17
	 3.4
	  	Requests for Swingline Loans	  	17
	 3.5
	  	Loan Payments	  	17
	 3.6
	  	Participation in Swingline Loans	  	18
	 3.7
	  	Settlement of Swingline Loans	  	18
	 3.8
	  	Credit Sweep	  	20
		
	 ARTICLE 4. LETTERS OF CREDIT
	  	20
			
	 4.1
	  	Letter of Credit Commitment	  	20
	 4.2
	  	Existing Letters of Credit	  	21
	 4.3
	  	LC Agreements	  	21
	 4.4
	  	Expiry Date	  	21
	 4.5
	  	Requests for Letters of Credit	  	21
	 4.6
	  	Participation in Letters of Credit	  	22
	 4.7
	  	Payments	  	22
	 4.8
	  	Terms Satisfactory to Issuing Lender	  	23
	 4.9
	  	Obligations Absolute	  	23
	 4.10
	  	Letter of Credit Fees	  	23
		
	 ARTICLE 5. CERTAIN ADDITIONAL PROVISIONS
	  	24
			
	 5.1
	  	Interest	  	24
	 5.2
	  	Borrowing Procedure	  	24
	 5.3
	  	Funding by Lenders	  	25
	 5.4
	  	Obligations Several	  	25
	 5.5
	  	Failure to Fund	  	25
	 5.6
	  	Authorization	  	25
	 5.7
	  	Computations	  	26
	 5.8
	  	Application of Payments	  	26

  

 -i- 

					
	 5.9
	  	Manner of Payment	  	26
	 5.10
	  	Payment by Automatic Debit	  	27
	 5.11
	  	Late Charges	  	27
	 5.12
	  	Maximum Charges	  	27
	 5.13
	  	Additional Payments	  	27
	 5.14
	  	Extension of Expiration Date	  	27
	 5.15
	  	Authorization	  	28
	 5.16
	  	Voluntary Reduction or Termination of Commitments	  	28
		
	 ARTICLE 6. TAXES, YIELD PROTECTION AND ILLEGALITY
	  	28
			
	 6.1
	  	Taxes	  	28
	 6.2
	  	Increased Costs	  	29
	 6.3
	  	Unavailability or Illegality	  	29
	 6.4
	  	Capital Adequacy	  	29
	 6.5
	  	Request for Compensation	  	30
		
	 ARTICLE 7. SECURITY AND GUARANTIES
	  	30
			
	 7.1
	  	Security	  	30
	 7.2
	  	Guaranties	  	31
	 7.3
	  	Joinder	  	31
		
	ARTICLE 8. CONDITIONS PRECEDENT	  	31
			
	 8.1
	  	Initial Conditions Precedent	  	31
	 8.2
	  	Conditions Precedent to Each Loan and Letter of Credit	  	33
		
	 ARTICLE 9. REPRESENTATIONS AND WARRANTIES
	  	34
			
	 9.1
	  	Existence and Power	  	34
	 9.2
	  	Power and Authority	  	34
	 9.3
	  	Operation of Business	  	34
	 9.4
	  	Governmental Approval	  	35
	 9.5
	  	Litigation	  	35
	 9.6
	  	Financial Condition	  	35
	 9.7
	  	Taxes	  	35
	 9.8
	  	Franchise Agreements; Material Business Relationships	  	35
	 9.9
	  	Other Agreements	  	36
	 9.10
	  	Burdensome Obligations	  	36
	 9.11
	  	Security Interest	  	36
	 9.12
	  	Compliance with Laws	  	36
	 9.13
	  	ERISA	  	36
	 9.14
	  	Information	  	36
	 9.15
	  	Enforceability	  	37
	 9.16
	  	Ownership and Liens	  	37
	 9.17
	  	Ownership of Equity Interests	  	37
	 9.18
	  	Labor Disputes and Acts of God	  	37
	 9.19
	  	Regulated Entities	  	37
	 9.20
	  	Solvency	  	37
	 9.21
	  	Continuing Representations and Warranties	  	37

  

 -ii- 

					
	 ARTICLE 10. FINANCIAL COVENANTS AND INFORMATION
	  	38
			
	 10.1
	  	Financial Covenants	  	38
	 10.2
	  	Financial Information	  	40
		
	ARTICLE 11. AFFIRMATIVE COVENANTS	  	41
			
	 11.1
	  	Maintenance of Existence and Permits	  	41
	 11.2
	  	ERISA Compliance	  	41
	 11.3
	  	Inspection Rights	  	41
	 11.4
	  	Collateral Audits	  	41
	 11.5
	  	Keeping of Books and Records	  	42
	 11.6
	  	Maintenance of Properties, Etc.	  	42
	 11.7
	  	Other Obligations	  	42
	 11.8
	  	Insurance	  	42
	 11.9
	  	Compliance with Laws	  	43
	 11.10
	  	Agreements with Sellers	  	43
	 11.11
	  	Management	  	43
	 11.12
	  	Landlord’s Consents	  	43
	 11.13
	  	Notification	  	43
	 11.14
	  	Further Assurances	  	44
	 11.15
	  	Deposit Accounts	  	44
		
	ARTICLE 12. NEGATIVE COVENANTS	  	45
			
	 12.1
	  	Mergers, Etc.	  	45
	 12.2
	  	Guaranties, Etc.	  	45
	 12.3
	  	Liens	  	45
	 12.4
	  	Restricted Payments	  	47
	 12.5
	  	Subordinated Debt	  	48
	 12.6
	  	Loans and Investments	  	48
	 12.7
	  	Transactions with Affiliates	  	49
	 12.8
	  	Type of Business	  	49
	 12.9
	  	Structure	  	49
	 12.10
	  	Debt	  	49
	 12.11
	  	Margin Stock; Speculation	  	51
	 12.12
	  	Restrictive Agreements	  	51
	 12.13
	  	Permitted Acquisition	  	51
	 12.14
	  	Fiscal Year	  	53
	 12.15
	  	Lithia Real Estate, Inc.	  	53
		
	ARTICLE 13. DEFAULT AND REMEDIES	  	53
			
	 13.1
	  	Events of Default	  	53
	 13.2
	  	Consequences of Default; Rights and Remedies	  	55
		  	ARTICLE 14. HAZARDOUS SUBSTANCES	  	57
	 14.1
	  	Representations and Warranties	  	57
	 14.2
	  	Activities	  	57
	 14.3
	  	Inspections	  	57
	 14.4
	  	Release and Indemnity	  	57

  

 -iii- 

					
	 14.5
	  	Survival	  	57
		
	 ARTICLE 15. AGENCY PROVISIONS
	  	57
			
	 15.1
	  	Authorization	  	57
	 15.2
	  	Duties and Obligations	  	58
	 15.3
	  	Agent in Individual Capacity	  	59
	 15.4
	  	Independent Credit Decisions	  	59
	 15.5
	  	Indemnification	  	59
	 15.6
	  	Successor Agent	  	60
	 15.7
	  	Notice of Default	  	60
	 15.8
	  	Defaulting Lenders	  	60
	 15.9
	  	U.S. Bank Deposit Accounts	  	60
		
	 ARTICLE 16. MISCELLANEOUS
	  	61
			
	 16.1
	  	Payment of Expenses and Taxes	  	61
	 16.2
	  	Successors and Assigns	  	62
	 16.3
	  	Participations	  	62
	 16.4
	  	Assignments	  	63
	 16.5
	  	Register	  	64
	 16.6
	  	Information	  	64
	 16.7
	  	Sharing of Payments	  	64
	 16.8
	  	Setoff; Security Interest	  	64
	 16.9
	  	Amendments and Waivers	  	65
	 16.10
	  	Waiver; Cumulative Remedies	  	66
	 16.11
	  	Notices	  	66
	 16.12
	  	Integration; Conflicting Terms	  	67
	 16.13
	  	Governing Law	  	67
	 16.14
	  	Jurisdiction and Venue	  	67
	 16.15
	  	Documents Satisfactory to Agent and Required Lenders	  	67
	 16.16
	  	Exhibits	  	67
	 16.17
	  	Counterparts	  	67
	 16.18
	  	Severability	  	67
	 16.19
	  	Construction	  	68
	 16.20
	  	USA Patriot Act Notice	  	68
	 16.21
	  	Confidentiality	  	68
	 16.22
	  	Waiver of Jury Trial	  	68
	 16.23
	  	Disclosure	  	70

  

 -iv- 

 SCHEDULE 1 
 DISCLOSURE
SCHEDULE 
 EXHIBIT A - REVOLVING NOTE 
 EXHIBIT B - SWINGLINE
NOTE 
 EXHIBIT C - JOINDER AGREEMENT 
 EXHIBIT D - COMPLIANCE
CERTIFICATE 
 EXHIBIT E - BORROWING BASE CERTIFICATE 
 EXHIBIT F
- ASSIGNMENT AGREEMENT 
 EXHIBIT G - PLEDGE AGREEMENT 
 EXHIBIT H
- SECURITY AGREEMENT 
 EXHIBIT I - AIRCRAFT SECURITY AGREEMENT 
  

 -v- 

 LOAN AGREEMENT 
 This Loan Agreement is entered into as of August 31, 2006, among Lithia Motors, Inc., an Oregon corporation (“Borrower”), each financial institution listed on the signature pages of this Agreement or
which hereafter becomes a party hereto (each a “Lender” and any two or more, “Lenders”); and U.S. Bank National Association (“U.S. Bank”), as agent for the Lenders (in such capacity, “Agent”). 
 ARTICLE 1. 
 DEFINITIONS AND
INTERPRETIVE PROVISIONS 
 1.1 Defined Terms. As used in this Agreement, the following terms shall have the following
meanings: 
 “Access Laws” means the Americans With Disabilities Act of 1990; the Fair Housing Amendments Act of 1988; all
other federal, state and local laws or ordinances related to disabled access; and all statutes, rules, regulations, ordinances, orders of governmental bodies and regulatory agencies and orders and decrees of any court adopted, enacted or issued with
respect thereto; all as now existing or hereafter amended or adopted. 
 “Acquisition” has the meaning set forth in
Section 12.13. 
 “Acquisition Subsidiary” has the meaning set forth in Section 12.13(d). 
 “Adjusted Funded Debt” has the meaning set forth in Section 10.1.4. 
 “Affiliate” means with respect to any Person (a) each other Person that, directly or indirectly, owns or controls, whether
beneficially, or as a trustee, guardian or other fiduciary, five percent (5%) or more of the stock or other ownership interests having ordinary voting power of such Person; (b) each Person that Controls, is Controlled by or is under common
Control with such Person or any Affiliate of such Person; and (c) each of such Person’s executive officers, directors, joint venturers, members and general partners. 
 “Agent” has the meaning set forth in the introductory paragraph. 
 “Agent-Related Persons” has the meaning set forth in Section 15.5. 
 “Aircraft Security Agreement” means an Aircraft and Flight Equipment Security Agreement substantially in the form attached hereto as
Exhibit I. 
 “Applicable Law” means all applicable provisions and requirements of all (a) constitutions, statutes,
ordinances, rules, regulations, standards, orders, and directives of any Governmental Bodies, (b) Governmental Approvals, and (c) orders, decisions, decrees, judgments, injunctions, and writs of all courts and arbitrators, whether such
Applicable Laws presently exist, or are modified, promulgated, or implemented after the date hereof. 
 “Assignee” has the
meaning set forth in Section 16.4. 
 “Assignment Agreement” has the meaning set forth in Section 16.4.2.

  

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 “Attorney Costs” means and includes all reasonable fees and disbursements of any law
firm or retained counsel and of any in-house or internal counsel whether or not litigation or arbitration is commenced, and if litigation or arbitration is commenced shall include fees and disbursements incurred at trial, in any appellate
proceeding, bankruptcy proceeding (including efforts to modify or vacate any automatic stay or injunction) or receivership, and post-judgment attorney fees incurred in enforcing any judgment. 
 “Borrower” has the meaning set forth in the introductory paragraph. 
 “Borrowing Base” means, as of any date of determination, the sum, without duplication, on such date of: 
 (a) 90% of Vehicle Equity. 
 (b) 50% of the amount of Eligible Receivables. 
 (c) 80% of the difference between
(i) the net book value of Service Loaner Vehicles owned by the Collateral Subsidiaries and (ii) the sum of (A) the aggregate outstanding principal balance of the Floor Plan Financing owed to all Floor Plan Lenders which is secured by
such Service Loaners and (B) the principal amount of any other indebtedness or obligations to any Person (other than the Obligations) which is secured by the Service Loaner Vehicles. 
 (d) 65% of the difference between (i) the net book value of the inventory of Borrower and its Subsidiaries consisting of new parts
and accessories and materials in which Agent has a perfected first priority security interest, and (ii) the unpaid acquisition cost owed to sellers or financers of such inventory. 
 (e) The lesser of (i) 80% of the net book value of aircraft owned by Lithia Aircraft, Inc., in which Agent has a perfected first
priority security interest, or (ii) $10,000,000.00. 
 (f) 35% of the net book value of equipment (excluding fixtures and
aircraft) of Borrower and the Collateral Subsidiaries in which Agent has a perfected first priority security interest. 
 Notwithstanding any
contrary provision of this Borrowing Base definition, the Borrowing Base shall in no event include any property owned by LRE, except cash to the extent included in clause (a) (iii) of the definition of Vehicle Equity. 
 “Business Day” means any day other than a Saturday, Sunday, or other day on which commercial banks in Minneapolis, Minnesota or New
York, New York are authorized or required by law to close. 
 “Capital Lease” means any lease which has been or should be
capitalized on the books of the lessee in accordance with GAAP. 
 “Cash Equivalent Investment” means at any time,
(a) direct obligations of, or which are guaranteed by, the United States of America, or any agency thereof, maturing not more than one year from the date of acquisition thereof; (b) commercial paper, maturing not more than one year from
the date of issue, or corporate demand notes, in each case rated at least A-1 (or its 

  

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equivalent) by Standard & Poor’s Ratings Group or P-1 (or its equivalent) by Moody’s Investor Service, Inc.; (c) any certificate of
deposit, time deposit account, or banker’s acceptance, maturing not more than one year after such time, or overnight Federal Funds transactions that are issued or sold by any commercial banking institution organized under the laws of the United
States or a state thereof or that is a Lender, and that is a member of the Federal Reserve System and has a combined capital and surplus and undivided profits of not less than $500,000,000.00; (d) any repurchase agreement entered into with a
commercial banking institution satisfying the criteria in clause (c) that (i) is secured by a fully perfected first priority security interest in any obligation of the type described in any of clauses (a) through (c) and
(ii) has market value at the time of such repurchase agreement is entered into of not less than 100% of the repurchase obligation of such commercial banking institution thereunder; (e) shares of money market mutual funds within the
definition of Rule 2a-7 promulgated by the Securities and Exchange Commission under the Investment Company Act of 1940; and (f) other cash equivalent investments approved by the Agent. 
 “Cash Flow Leverage Ratio” has the meaning set forth in Section 10.1.4. 
 “Change in Control” means: 
 (a) Lithia Holding Company, L.L.C. (“LHC”) ceases to directly own more than 51% of the voting power of Borrower’s capital stock ordinarily having the right to vote at an election of directors, or the
Principal ceases to Control LHC (through the ownership of voting membership interests or by contract or otherwise); 
 (b)
Borrower consolidates with or merges into another Person or conveys, transfers or leases all or substantially all of its property to any Person, or any Person consolidates with or merges into Borrower, in either event pursuant to a transaction in
which the outstanding capital stock of Borrower is reclassified or changed into or exchanged for (i) cash or Cash Equivalent Investments or (ii) securities, and the holders of the capital stock in Borrower immediately prior to such
transaction do not, as a result of such transaction, own, directly or indirectly, more than 51% of the combined voting power of Borrower’s capital stock or the capital stock of its successor entity in such transaction. 
 “Closing Date” means the date on which all conditions precedent in Section 8.1 are satisfied. 
 “Code” means the Internal Revenue Code of 1986, as amended, or any successor federal income tax statute or code and the regulations and
published interpretations promulgated thereunder. 
 “Collateral” has the meaning set forth in Section 7.1.1.

 “Collateral Subsidiary” means all Subsidiaries granting a security interest to Agent and the Lenders hereunder which
shall include all present and future Subsidiaries. 
 “Commitment” or “Commitments” means, as to any
Lender, such Lender’s Revolving Loan Commitment, Letter of Credit Commitment, and/or Swingline Commitment. 
  

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 “Contingent Obligation” means any guarantee of Debt or any other obligation of any other
Person or any assurance with respect to the financial condition of any other Person, whether direct, indirect or contingent, including, without limitation, any purchase or repurchase agreement or keep-well, take-or-pay, through-put or other
arrangement of whatever nature having the effect of assuring or holding harmless any Person against loss with respect to any obligation of such other Person; provided, however, that the term “Contingent Obligation” shall not include
endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of
which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined in good faith by the Person subject to such obligation. 
 “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of
a Person, whether through the ownership of voting securities, by contract or otherwise and “Controlled by” shall have the concomitant meaning. 
 “Current Assets” has the meaning set forth in Section 10.1.2. 
 “Current
Assets Commitment Amount” means, with respect to any Current Assets Election, the lesser of (a) the Maximum Amount, minus the sum of the then outstanding principal balance of the Revolving Loans, Swingline Loans, and LC Outstandings;
or (b) the Specified Current Assets Commitment Amount. 
 “Current Assets Election” has the meaning set forth in
Section 10.1.2. A Current Assets Election shall become effective on the date on which the Compliance Certificate electing the same is delivered to Agent and shall remain in effect until the next Compliance Certificate is due. 
 “Current Ratio” has the meaning set forth in Section 10.1.2. 
 “DCFS” has the meaning set forth in Section 8.1.6. 
 “DCFS Loan Agreement” has the meaning set forth in Section 8.1.6. 
 “DDA” has the meaning set forth in Section 3.8.2. 
 “Dealership” means a Subsidiary of
Borrower whose primary business is the retail sales or retail sale and lease of new and/or used automobiles and trucks. 
 “Debt” means, without duplication, with respect to any Person, (a) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services, (b) all obligations evidenced by
bonds, notes, debentures, convertible debentures or other similar instruments, (c) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired (even though the rights and
remedies of the seller or lender under such agreement in the event of default, acceleration, or termination are limited to repossession or sale of such property), (d) all obligations under letters of credit, bankers’ and trade acceptances,
surety bonds and similar instruments, (e) all obligations under Interest Rate Protection Agreements, (f) all obligations as lessee under Capital Leases or Synthetic Leases, (g) all obligations that are required in accordance with GAAP
to be included as 

  

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liabilities on such Person’s balance sheet, (h) all Contingent Obligations, and (i) all Debt referred to in clause (a), (b), (c), (d), (e),
(f), (g), and (h) above secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any lien, security interest or other charge or encumbrance upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, even though such Person has not assumed or become liable for the payment of such Debt, and (j) if any of the events described in Section 13.1.12 have occurred with respect to
any Plan, the liability, if any, related thereto. For purposes of this definition, the Debt of any Person shall include the indebtedness of any partnership or joint venture in which such Person is a general partner or joint venturer. 
 “Default” means any Event of Default or any event which with the giving of notice or the passage of time, or both, would constitute an
Event of Default. 
 “Default Rate” has the meaning set forth in Section 5.1.2. 
 “Defaulting Lender” has the meaning set forth in Section 15.8. 
 “Disclosure Schedule” means the Disclosure Schedule attached hereto. 
 “Dollar” or “$” means lawful money of the United States of America. 
 “EBITDA” has the meaning set forth in Section 10.1.4. 
 “EBITDAR” has the meaning set forth in Section 10.1.3. 
 “Eligible Account” means amounts owed by a customer to Borrower or any Collateral Subsidiary for parts or accessories sold to such
customer or for services performed for such customer, in which Agent has a perfected first priority security interest, which is due and payable in full not more than 60 days after date of sale or invoice, and which is not more than 60 days past due.

 “Eligible Receivables” means amounts owing to Borrower or a Collateral Subsidiary (a) in which Agent has a perfected
first priority security interest, which are (i) Eligible Accounts; (ii) insurance receivables; (iii) subject to a maximum of $50,000.00 to be included in the Borrowing Base, amounts shown on the consolidated balance sheet of Borrower
and its Subsidiaries as “note and lease receivables,” and (iv) commissions owed to the Dealerships by financial institutions or finance companies which are not Affiliates of any Loan Party in connection with the purchase by such
institutions of retail installment contracts and leases arising from the sale or lease of New Vehicles, Used Vehicles and Program Vehicles (finance receivables) or which are (b) amounts owed to Borrower or a Collateral Subsidiary by a
manufacturer of Vehicles as factory holdbacks, incentive payments, rebates, factory credits and the like in which Agent has a perfected security interest, subject to the exclusion by Agent or Required Lenders of such amounts which are owed to a
Borrower by a manufacturer which has commenced or had commenced against it, any proceeding under any present or future bankruptcy law. 
 “Environmental Laws” means all local, state and federal laws, rules, regulations and ordinances pertaining to Hazardous Substances and environmental regulation, contamination or clean-up, all as now existing or hereafter
amended or adopted (including, without limitation, the federal statutes known as the Comprehensive Environmental Response, Compensation and 

  

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Liability Act of 1980, Resource Conservation and Recovery Act of 1976, Superfund Amendments and Reauthorization Act of 1986 and the Hazardous Materials
Transportation Act). 
 “Equity Interests “ means shares of capital stock, partnership interests, membership interests in a
limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest. 
 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time and regulations promulgated thereunder.

 “ERISA Affiliate,” as applied to a Loan Party, means any Person or trade or business which is a member of a group which
is under common control with such Loan Party and which, together with such Loan Party, is treated as a single employer within the meaning of Section 414 of the Code. 
 “Event of Default” means the occurrence of any event described in Section 13.1. 
 “Excluded Funded Debt” has the meaning set forth in Section 12.10(m). 
 “Existing Letters of
Credit” has the meaning set forth in Section 4.2. 
 “Expiration Date” means August 31, 2009, or such
earlier date as may be applicable due to acceleration of Obligations in accordance with the terms of this Agreement. 
 “Extension
Request” has the meaning set forth in Section 5.14. 
 “Federal Funds Rate” means, for any day, a rate per
annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day, provided that (a) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as
published on the next succeeding Business Day and (b) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average of the quotations for such day on such transactions received by Agent from three
Federal funds brokers of recognized standing selected by Agent. 
 “Fixed Charge Coverage Ratio” has the meaning set forth
in Section 10.1.3. 
 “Floor Plan Financing” means extensions of credit to Borrower or a Collateral Subsidiary (other
than extensions of credit under this Agreement), all proceeds of which are used to purchase or finance New Vehicles, Service Loaner Vehicles, or Program Vehicles. 
 “Floor Plan Lender” means a Person providing Floor Plan Financing to Borrower or any Subsidiary of Borrower. 
 “FLSA” means the Fair Labor Standards Act of 1938, as amended from time to time, and the regulations promulgated thereunder. 
  

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 “Franchise Agreement” has the meaning set forth in Section 9.8. 
 “Funded Debt” means Debt of the type described in clauses (a), (b), (c), and (f) of the definition of Debt, provided, however, that
Funded Debt shall not include unsecured trade accounts payable incurred in the ordinary course of business.  
 “GAAP” means generally accepted accounting principles set forth from time to time in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or agencies with similar functions of comparable stature and authority within the U.S. accounting profession) which are applicable to the circumstances as of the date of
application. 
 “Governmental Approval” means any authorization, consent, approval, certificate of compliance, license,
permit, or exemption from, contract with, registration or filing with, or report or notice to, any Governmental Body required or permitted by Applicable Law. 
 “Governmental Body” means (a) any foreign or domestic federal, state or local government or municipality or political subdivision of any government or municipality, (b) any assessment,
improvement, community facilities or other special taxing district, (c) any governmental or quasi-governmental body, authority, board, bureau, commission, corporation, department, instrumentality or public body, (d) any court,
administrative tribunal, arbitrator, public utility or regulatory body, or (e) any central bank or comparable authority. 
 “Guarantor” or “Guarantors” means each Person who at any time executes a Guaranty for the benefit of Agent and the Lenders which shall include each present and future Subsidiary of Borrower. 
 “Guaranty” means each guaranty of any Obligations of Borrower to Agent and the Lenders heretofore, contemporaneously herewith or
hereafter executed by any Person. 
 “Hazardous Substance” means (a) any substance or material now or hereafter defined
or designated as a hazardous, toxic or radioactive material, waste or substance, or as a pollutant or contaminant (or designated by any other similar term), by any Environmental Law now or hereafter in effect; (b) asbestos and any substance or
compound containing asbestos; (c) petroleum, natural gas, natural gas liquids, liquefied natural gas, synthetic gas usable for fuel (or mixtures of natural gas and such synthetic gas) and ash produced by a resource recovery facility utilizing a
municipal solid waste stream, and drilling fluids, produced waters and other wastes associated with the exploration, development or production of crude oil, natural gas, or geothermal resources; (d) urea formaldehyde foam insulation;
(e) polychlorinated biphenyls (PCBs); (f) radon; and (g) any other chemical, material, or substance, exposure to which (because of its quantity, concentration, or physical or chemical characteristics) is limited or regulated for
health and safety reasons by any governmental authority, or which poses a significant present or potential hazard to human health and safety or to the environment if released into the workplace or the environment. 
 “Indemnified Persons” has the meaning set forth in Section 14.4. 
 “Initial Condition” has the meaning set forth in Section 8.1. 
  

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 “Interest Rate Protection Agreements” means interest rate swap, cap or collar
agreements, options on any of the foregoing, and any other agreements or arrangements designed to provide protection against fluctuations in interest rates. 
 “Investments” has the meaning set forth in Section 12.6. 
 “Issuing
Lender” means U.S. Bank as issuer of Letters of Credit. 
 “Landlord’s Consent” has the meaning set forth in
Section 11.12. 
 “LC Agreement” has the meaning set forth in Section 4.3. 
 “LC Application” has the meaning set forth in Section 4.3. 
 “LC Outstandings” means, as of any date of determination, (a) the aggregate maximum principal amount available to be drawn under
all outstanding Letters of Credit issued by Issuing Lender for the account of Borrower, plus (b) the aggregate face amount of all payments made by Issuing Lender under such Letters of Credit which amounts have not been reimbursed by Borrower.

 “LFC Loan Agreement” has the meaning set forth in Section 8.1.7. 
 “LRE” means Lithia Real Estate, Inc., an Oregon corporation. 
 “Lender” has the meaning set forth in the introductory paragraph and includes, as the context requires, the Issuing Lender and Swingline
Lender. 
 “Letter of Credit” or “Letters of Credit” means any one or more of the Existing Letters of
Credit and any letters of credit issued pursuant to Article 4. 
 “Letter of Credit Commitment” means an amount equal to
$500,000.00, as such amount may be increased or decreased pursuant to Section 4.1.2. 
 “LIBOR Rate” means the
one-month LIBOR rate quoted by Agent from Telerate Page 3750 or any successor thereto, which shall be that one-month LIBOR rate in effect two Business Days prior to the beginning of each calendar month, adjusted for any Reserve Requirements and any
subsequent costs arising from a change in government regulation, such rate to be reset at the beginning of each succeeding month; provided, however, if the first Loan is made other than on the first day of the month, the initial monthly LIBOR Rate
shall be that one-month LIBOR rate in effect two Business Days prior to the date of the initial Loan, which rate shall be in effect for the remaining days of the month in which such Loan is made; such monthly LIBOR Rate to be reset at the beginning
of each succeeding month. Agent’s internal records of applicable interest rates shall be determinative in the absence of manifest error. 
 “Lien” means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preference, priority, or other security agreement or
preferential arrangement, charge, or encumbrance of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of
the 

  

 Page 8 

 
foregoing, the interest of a lessor under a Capital Lease or Synthetic Lease and the filing of any financing statement under the Uniform Commercial Code or
comparable law of any jurisdiction to evidence of any of the foregoing). 
 “Loan” or “Loans” means any one
or more of the Revolving Loans and Swingline Loans. 
 “Loan Documents” means this Agreement, the Notes, the LC Agreements,
the Letters of Credit, the LC Applications, the Security Documents, the Guaranties, and all other documents and instruments attached hereto, referred to herein, heretofore or contemporaneously herewith or hereafter executed or delivered to Agent and
the Lenders by any Loan Party in connection with the Obligations of any Loan Party to the Lenders. 
 “Loan Fee” has the
meaning set forth in Section 2.6. 
 “Loan Party” or “Loan Parties” means any one or more of Borrower,
Guarantors and Collateral Subsidiaries. 
 “Majority Acquisition” means any Acquisition of Equity Interests of an entity, in
which the Borrower is not permitted to hold 100% of such equity interests because of limitations imposed by the relevant manufacturer’s Franchise Agreement. 
 “Material Adverse Effect” means a (a) material adverse change in or material adverse effect upon the business, management, properties, prospects, condition (financial or otherwise), assets or
operations of the Borrower, or the Borrower and its Subsidiaries taken as a whole; (b) a material adverse effect upon or material impairment in (i) the attachment, perfection, or priority of the security interests of Agent and the Lenders
in the Collateral or in the value of any material part of the Collateral; (ii) the ability of Borrower or Borrower and the other Loan Parties taken as a whole to perform its or their obligations under this Agreement or any other Loan Document;
or (iii) the legality, validity, binding effect or enforceability of or the rights and remedies available to Agent and the Lenders under this Agreement or any other Loan Document. 
 “Maximum Amount” means, as of any date of determination, the lesser of (a) the Total Revolving Loan Commitment; and (b) the
Borrowing Base at such time. 
 “Monthly Payment Date” means the twentieth day of each month. 
 “Multiemployer Plan” means a Plan described in Section 4001(a)(3) of ERISA. 
 “New Vehicle” means a Vehicle that is held by a Dealership for sale or lease in the ordinary course of business, has never been owned
except by a manufacturer, distributor or dealer, and has never been registered or titled. 
 “Note” or
“Notes” means any one or more of the Revolving Notes or the Swingline Notes. 
 “Obligations” means all
present and future Loans, LC Outstandings, and other debts, liabilities, obligations, covenants, warranties, duties and obligations of Borrower to Agent and the Lenders under the Notes, the LC Agreements, LC Applications, the Letters of Credit, this
Agreement and the other Loan Documents, whether now or hereafter existing or incurred, 

  

 Page 9 

 
whether liquidated or unliquidated, whether absolute or contingent, and including without limitation principal, interest, fees, Attorney Costs, expenses and
charges relating to any of the foregoing. 
 “Participant” has the meaning set forth in Section 16.3.1. 
 “PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. 

“Permitted Acquisition” means an Acquisition which is permitted by Section 12.13. 
 “Permitted Liens” means Liens permitted by Section 12.3, together with any Liens to which Required Lenders have consented in
writing. 
 “Permitted Restrictions” means restrictions on the ability of any Subsidiary to declare or pay any dividend or
make other distributions, or to advance or loan funds, to the Borrower, to grant Liens on the assets of such Subsidiary to secure Obligations of Borrower or to guaranty the Obligations: (a) as set forth on the Disclosure Schedule on the Closing
Date, including restrictions imposed by existing Floor Plan Financing arrangements; (b) pursuant to modifications to Floor Plan Financing arrangements in effect on the Closing Date, provided that such modifications are not materially more
restrictive; (c) pursuant to Floor Plan Financing arrangements with any Floor Plan Lender other than a Person which is a Floor Plan Lender on the Closing Date; (d) applicable to a Person at the time such Person becomes a Subsidiary and not
created in contemplation of such an event; (e) resulting from manufacturer-imposed modifications to any Franchise Agreement; or (f) imposed by applicable law. 
 “Person” means any natural person, corporation, general or limited partnership, joint venture, limited liability company, trust, association, unincorporated organization, government or governmental
agency, political subdivision or any other entity, whether acting in an individual, fiduciary or other capacity. 
 “Plan”
means any pension plan which is covered by Title IV of ERISA and in respect of which any Loan Party or an ERISA Affiliate is an “employer” as defined in Section 3(5) of ERISA. 
 “Pledge Agreement” means a pledge agreement substantially in the form attached hereto as Exhibit G. 
 “Prime Rate” means the rate established by Agent from time to time as its prime rate, which is set by Agent in its sole discretion and
is not necessarily the lowest rate charged by Agent to any borrower or class of borrowers. When the Prime Rate is applicable, the interest rate will change automatically and correspondingly on the date of each change in the Prime Rate. 

“Principal” means Sidney D. DeBoer, Bryan DeBoer or another successor, or successors, reasonably acceptable to Agent and the Required
Lenders. 
 “Program Vehicle” means a Vehicle (other than a New Vehicle or a Service Loaner Vehicle) that is held by a
Dealership for sale or lease in the ordinary course of business and that is obtained directly from a manufacturer, distributor, or Floor Plan Lender (including electronic 

  

 Page 10 

 
or on-line purchases) or through an auction conducted at the direction of, or sponsored by, a manufacturer, distributor, or Floor Plan Lender. 
 “Prohibited Transaction” means any transaction set forth in Section 406 of ERISA or Section 4975 of the Code. 
 “Properties” has the meaning set forth in Section 11.6. 
 “Pro Rata Share” means (a) with respect to the Revolving Loan Commitment, Revolving Loan Exposure, or Revolving Loans of any
Lender, the percentage obtained by dividing (i) the Revolving Loan Exposure of that Lender by (ii) the aggregate Revolving Loan Exposure of all Lenders; (b) with respect to the Swingline Loans of the Swingline Lender, the Swingline
Lender’s 100% interest in the Swingline Loans; (c) with respect to any Lender’s participating interest in the Swingline Loans, or its obligation to make Revolving Loans to repay Swingline Loans, the percentage obtained by dividing
(i) the Revolving Loan Exposure of that Lender by (ii) the aggregate Revolving Loan Exposure of all Lenders; (d) with respect to the Letters of Credit issued by the Issuing Lender, the Issuing Lender’s 100% interest in the
Letters of Credit; (e) with respect to any Lender’s participating interest in Letters of Credit and drawings thereunder and its obligation to reimburse Issuing Lender for any drawing under Letters of Credit, the percentage obtained by
dividing the Revolving Loan Exposure of that Lender by the Revolving Loan Exposure of all Lenders; and (f) with respect to the total Obligations, Commitments, Loans, and Letters of Credit of any Lender, the percentage obtained by dividing
(i) the sum of the Revolving Loan Exposure of that Lender, by (ii) the sum of the aggregate Revolving Loan Exposure of all Lenders. 
 “Refunding Revolving Loan” has the meaning set forth in Section 3.7.1(a) 
 “Register” has
the meaning set forth in Section 16.5. 
 “Reportable Event” means any of the events set forth in Section 4043 of
ERISA for which reporting has not been waived under applicable regulations. 
 “Required Lenders” means Lenders holding 66%
or more of the sum of the Revolving Loan Exposure of all Lenders; provided, however, that so long as U.S. Bank, Toyota Motor Credit Corporation and DaimlerChrysler Financial Services Americas LLC are the only Lenders, Required Lenders shall mean all
Lenders. 
 “Reserve Requirements” means the maximum reserves (whether basic, supplemental, marginal, emergency, or
otherwise) prescribed by the Board of Governors of the Federal Reserve System (or any successor) with respect to liabilities or assets consisting of or including “Eurocurrency liabilities” (as defined in Regulation D of the Board of
Governors of the Federal Reserve System). 
 “Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in any Loan Party or any Subsidiary, or any payment (whether in cash, securities or other property) on account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any such Equity Interests in any Loan Party, or any option, warrant or other right to acquire any such Equity Interests in any Loan Party. 
  

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 “Revolving Loan” has the meaning set forth in Section 2.1.1. 
 “Revolving Loan Borrowing” means a revolving loan borrowing consisting of the Revolving Loans to be made by the Lenders on any date.

 “Revolving Loan Borrowing Rate” has the meaning set forth in Section 5.1. 
 “Revolving Loan Commitment” means, with respect to any Lender at any time, the amount set forth as such for such Lender on Schedule 1
hereto as it may be amended from time to time. 
 “Revolving Loan Exposure” means, with respect to any Lender at any time
(a) prior to the termination of the availability of Revolving Loans, such Lender’s Revolving Loan Commitment, and (b) after the termination of the availability of Revolving Loans, (i) the aggregate outstanding principal amount of
the Revolving Loans of such Lender, plus (ii) the aggregate principal amount of such Lender’s participation interests (whether funded or unfunded) in the Swingline Loans (or, in the case of the Swingline Lender, the outstanding principal
amount of the Swingline Loans, net of the participation interests of the other Lenders), plus (iii) the aggregate amount of such Lender’s participation interests (whether funded or unfunded) in the Letters of Credit and drawings thereunder
(or, in the case of the Issuing Lender, the aggregate LC Outstandings, net of the participation interests of the other Lenders). 
 “Revolving Note” has the meaning set forth in Section 2.3. 
 “Security Agreement” means a
security agreement substantially in the form attached hereto as Exhibit H. 
 “Security Documents” means and includes
the Security Agreement, the Pledge Agreement, the Aircraft Security Agreement, and all deeds of trust, assignments, mortgages, security agreements, bank account control agreements, and other documents executed by any Person at any time to evidence
and/or perfect security interests in the Collateral, including documents executed pursuant to Section 7.1.2. 
 “Seller
Agreement” means any material agreement between a Borrower and a manufacturer, distributor or other seller of New Vehicles (including without limitation Franchise Agreements, distribution agreements and the like). 
 “Senior Subordinated Notes” means the $85,000,000 of 2.875% Convertible Senior Subordinated Notes due 2014 of Borrower issued pursuant
to the Indenture dated as of May 4, 2004, between the Borrower and U.S. Bank, as trustee. 
 “Service Loaner Vehicle”
means a Vehicle that is obtained by a Dealership directly from a manufacturer or distributor and which is (a) used for short-term rental in the ordinary course of business or as a service loaner, (b) leased to employees for terms of up to
one year, or (c) a “donation vehicle” which is loaned to educational institutions for their use. 
 “Solvent”
means, with respect to any Person on any date, that on such date (a) the fair value of the property of such Person is greater than the total amount of the liabilities (including, without limitation, the net present value of contingent
liabilities discounted by the probability 

  

 Page 12 

 
that the contingency will occur) of such Person, (b) the present fair saleable value of the assets of such Person is not less than the amount that will
be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to
pay as such debts and liabilities mature and (d) such Person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such Person’s assets would constitute an unreasonably small
capital. 
 “Specified Current Assets Commitment Amount” means, with respect to any Current Assets Election, the amount
specified by Borrower as the “Specified Current Assets Commitment Amount” in such Current Assets Election. 
 “Subordinated
Debt” means (i) the Senior Subordinated Notes and (ii) other unsecured subordinated debt of Borrower that has subordination terms, covenants, pricing and other terms that have been approved in writing by the Required Lenders.

 “Subsidiary” of a Person means any corporation, association, partnership, limited liability company, joint venture or
other business entity of which more than 50% of the voting stock, membership interests or other equity interests (in the case of Persons other than corporations), is owned or Controlled directly or indirectly by such Person, or one or more of the
Subsidiaries of such Person, or a combination thereof. Unless the context otherwise requires, each reference to a Subsidiary shall be deemed to be a reference to a Subsidiary of Borrower. 
 “Sweep Advance” has the meaning set forth in Section 3.8.1. 
 “Swingline Borrowing Rate” has the meaning set forth in Section 5.1. 
 “Swingline Commitment” means an amount equal to $35,000,000.00. 
 “Swingline Lender” means U.S. Bank. 
 “Swingline Loan” has the meaning set forth in Section 3.1.1. 
 “Swingline
Note” has the meaning set forth in Section 3.3. 
 “Synthetic Lease” means any lease of goods or other
property, whether real or personal, which is treated as an operating lease under GAAP and as a loan or financing for U.S. income tax purposes. 
 “Taxes” has the meaning set forth in Section 6.1. 
 “Title Documents” means all
manufacturer’s certificates of origin, manufacturers’ statements of origin, certificates of title, certificates of ownership and any other documents evidencing ownership of a motor vehicle or the transfer of ownership of a motor vehicle
from a manufacturer or another dealer to a Dealership, and all warehouse receipts, bills of lading and other negotiable documents of title. 
 “Total Net Worth” has the meaning set forth in Section 10.1.1. 
  

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 “Total Revolving Loan Commitment” means an amount equal to $225,000,000.00. 

“Used Vehicle” means a Vehicle which is held by a Dealership for sale in the ordinary course of business and which is not a New
Vehicle, Service Loaner Vehicle, or Program Vehicle. 
 “U.S. Bank” means U.S. Bank National Association. 
 “U.S. Bank Control Agreement” has the meaning set forth in Section 15.9. 
 “Vehicle” means an automobile, truck, van, or other motor vehicle. 
 “Vehicle Equity” means, as of any date of determination, (a) the sum of: (i) amounts (excluding commissions included in clause
(a) (iv) of the definition of Eligible Receivables) which are owed to the Dealerships by financial institutions or finance companies which are not Affiliates of any Loan Party for the purchase by such institutions of retail installment
contracts and leases arising from the sale or lease of New Vehicles, Used Vehicles and Program Vehicles (contracts in transit) and in which Agent has a perfected first priority security interest, (ii) amounts which are owed to the Dealerships
by retail customers for the purchase or lease of New Vehicles, Used Vehicles and Program Vehicles, which have not remained unpaid for more than 30 days and which consist of interim financing provided by a Dealership prior to the customer’s
obtaining permanent financing, and in which Agent has a perfected first priority security interest, (iii) cash on deposit in deposit accounts of the Borrower and its Subsidiaries in which Agent has a perfected first priority security interest;
provided, however, that cash included in the Borrowing Base shall not exceed (A) $50,000,000.00 as of the last day of any fiscal quarter, or (B) $10,000,000.00 on any other date, and (iv) the net book value of the New Vehicles,
Program Vehicles and Used Vehicles of the Dealerships in which Agent has a perfected security interest; minus (b) the sum of (i) the aggregate outstanding principal balance of the Floor Plan Financing owed to all Floor Plan Lenders which
is secured by such New Vehicles, Program Vehicles and/or Used Vehicles, and (ii) the principal amount of any other indebtedness or obligation to any Person (other than the Obligations) which is secured by the New Vehicles, Program Vehicles
and/or Used Vehicles, including but not limited to amounts owing to holders of any lien or security interest in a Used Vehicle at the time it is traded in, sold to, or otherwise acquired by any Dealership. 
 1.2 Other Interpretive Provisions. 
 1.2.1 Unless otherwise specified, the words “herein,” “hereof,” hereto,” “hereunder” and similar terms refer to this Agreement as a whole and not to any particular provision of this
Agreement and subsection, Section, and exhibit references are to this Agreement. 
 1.2.2 The word “or” shall not be
exclusive; the singular includes the plural and the plural includes the singular; the masculine, the feminine and neuter gender, each include the masculine, feminine and neuter gender; and the word “including” is not limiting and means
“including without limitation.” 
 1.2.3 References to any Loan Document shall mean such Loan Document as amended,
modified, supplemented or extended from time to time and any number of substitutions, renewals, restatements, consolidations, and replacements thereof or therefor. 
  

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 1.2.4 References to governmental laws, statutes, ordinances, rules and regulations shall
be construed as including all amendments, consolidations and replacements thereof or therefor. 
 1.2.5 Headings in this
Agreement and each of the other Loan Documents are for convenience of reference only and are not part of the substance hereof or thereof. 
 1.2.6 Terms used herein without definition which are defined in the Uniform Commercial Code shall have the meanings given to them in such Uniform Commercial Code. 
 1.2.7 Unless otherwise indicated in this Agreement or any other Loan Document, all accounting terms used in this Agreement or any other
Loan Document shall be construed, and all accounting and financial information or computations shall be prepared or computed, in accordance with GAAP. If GAAP changes during the term of this Agreement such that any covenants contained herein would
then be calculated in a different manner or with different components, the Borrower, the Lenders, and Agent agree to negotiate in good faith to amend this Agreement in such respects as is necessary to conform those covenants as criteria for
evaluating the Loan Parties’ financial condition to substantially the same criteria as were effective before such change in GAAP, provided, however, that until the Borrower, the Lenders and Agent so amend this Agreement, all such covenants
shall be calculated in accordance with GAAP as in effect on the date of this Agreement. 
 ARTICLE 2. 
 REVOLVING LOANS 
 2.1 Revolving Loan
Commitment. 
 2.1.1 Maximum Amount. Subject to the terms and conditions of this Agreement, each Lender severally
and not jointly agrees to make loans (each a “Revolving Loan” and collectively, the “Revolving Loans”) to Borrower on a revolving credit basis during the period from the Closing Date to but not including the Expiration Date;
provided that (a) the aggregate outstanding principal balance of the Revolving Loans made by each Lender, plus the outstanding principal balance of such Lender’s participating interest in the Swingline Loans and Letters of Credit shall not
at any time exceed an amount equal to such Lender’s Revolving Loan Commitment; (b) the outstanding principal balance of all Revolving Loans shall not at any time exceed, in the aggregate, as to all Lenders, the Maximum Amount, and
(c) the outstanding principal balance of all Revolving Loans, plus the outstanding principal balance of all Swingline Loans, plus the LC Outstandings shall not at any time exceed, in the aggregate, as to all Lenders, the Maximum Amount.

 2.1.2 Term. Subject to the terms and conditions hereof, Borrower may borrow, prepay and reborrow Revolving Loans.
The commitment of the Lenders to make Revolving Loans shall terminate automatically and permanently on the Expiration Date and no Revolving Loans shall be made on or after that date. 
 2.2 Purpose of Revolving Loans. Borrower shall use the proceeds of the Revolving Loans solely to finance used vehicles, for its general
corporate purposes and to finance Permitted Acquisitions. 
  

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 2.3 Revolving Notes. The Revolving Loans to be made by each Lender shall be evidenced by a
promissory note substantially in the form of Exhibit A hereto, payable to the order of such Lender and in the principal amount of such Lender’s Revolving Loan Commitment (each, a “Revolving Note” and collectively, the
“Revolving Notes”). 
 2.4 Requests for Revolving Loans. Whenever Borrower wishes to obtain Revolving Loans, Borrower shall
give Agent irrevocable notice thereof no later than 11:00 a.m. (Pacific Time) at least two Business Days prior to the date of the requested borrowing. Such notice shall specify the requested borrowing date (which must be a Business Day), the amount
of the Revolving Loan Borrowing, and include any other information and documentation reasonably requested by Agent. 
 2.5 Payments.

 2.5.1 Interest Payments. Interest on the unpaid principal balance of the Revolving Notes shall be paid monthly in an
amount equal to all interest accrued during the prior calendar month. Such interest payments shall be made on each Monthly Payment Date commencing the month immediately following the Closing Date and continuing thereafter. All accrued interest
outstanding on the Expiration Date shall be due and payable in full on the Expiration Date. All interest payments on the Revolving Notes shall be made to Agent for the benefit of the Lenders based upon their respective Revolving Loan Pro Rata
Shares. 
 2.5.2 Voluntary Principal Payments. Borrower may make voluntary repayments of all or any portion of the
outstanding principal balance of the Revolving Loans if Borrower gives Agent written or telephonic notice of such voluntary repayment no later than 11:00 a.m. Pacific Time at least one Business Day prior to the date of such repayment. Such notice
shall specify the anticipated date of the voluntary repayment and the principal amount of the Revolving Loans that will be repaid on such date. Any voluntary repayment of the Revolving Loans that is received by Agent without such notice shall be
deemed to have been received by Agent on the Business Day after such payment is actually received by Agent and interest shall accrue on the amounts so repaid through the date of such deemed receipt. All payments under this Section 2.5.2 shall
be made to Agent for the benefit of the Lenders based upon their respective Revolving Loan Pro Rata Shares. 
 2.5.3
Principal Payment at Maturity. The entire outstanding principal balance of the Revolving Notes plus all interest accrued thereon shall be due and payable in full on the Expiration Date. Such payments shall be made to Agent for the benefit of
the Lenders based upon their respective Revolving Loan Pro Rata Shares. 
 2.6 Revolving Loan Fee. Borrower shall pay to Agent, for
the account of the Lenders, a fee (the “Loan Fee”): equal to the sum of the following: (a) for the Swingline Loans, an amount equal to ____% per annum on the amount, calculated on a daily basis, by which the Swingline Commitment
exceeds the actual aggregate outstanding principal balance of the Swingline Loans on each day (it being understood that any portion of the outstanding principal balance of the Swingline Loans ceases to be outstanding under the Swingline Loans and
commences being a portion of the outstanding principal balance under the Revolving Loans on the date that the Revolving Loans are funded to repay such portion of the outstanding principal balance of the Swingline Loans); and (b) for the
Revolving Loans, an amount equal to ____% 
  

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per annum on the amount, calculated on a daily basis, by which $190,000,000 exceeds the sum of the actual aggregate outstanding principal balance of the
Revolving Loans plus the LC Outstandings on each day. The accrued Loan Fee shall be due and payable in arrears on the first Monthly Payment Date in each fiscal quarter (and on the Expiration Date) for the three month period or other time period
ending on the last day of the preceding fiscal quarter or on the Expiration Date. One hundred percent (100%) of the fee for the Swingline Loans (as set forth in Section 2.6(a)) shall be paid by Agent to the Swingline Lender. The fee for
the Revolving Loans (as set forth in Section 2.6(b)) shall be paid (i) to each Lender other than the Swingline Lender based upon a percentage determined by dividing such Lender’s Revolving Loan Commitment by $190,000,000 and
(ii) to Swingline Lender based upon a percentage determined by dividing (A) the product of Swingline Lender’s Revolving Loan Commitment minus $35,000,000, by (B) $190,000,000. 
 ARTICLE 3. 
 SWINGLINE LOANS 

 3.1 Swingline Commitment. 
 3.1.1 Maximum Amount. Subject to the terms and conditions of this Agreement, the Swingline Lender agrees to make loans (each, a “Swingline Loan” and collectively, the Swingline Loans”) to
Borrower on a revolving credit basis during the period from the Closing Date to but not including the Expiration Date; provided that (a) the aggregate outstanding principal balance of the Swingline Loans shall not at any time exceed the
Swingline Commitment; and (b) the outstanding principal balance of all Revolving Loans made by all Lenders plus the outstanding principal balance of all Swingline Loans, plus the LC Outstandings, shall not at any time exceed the Maximum Amount.

 3.1.2 Term. Subject to the terms and conditions hereof, Borrower may borrow, prepay and reborrow Swingline Loans.
The commitment of the Swingline Lender to make Swingline Loans shall terminate automatically and permanently on the Expiration Date and no Swingline Loans shall be made on or after that date. 
 3.2 Purpose of Swingline Loans. Borrower shall use the proceeds for purposes permitted by Section 2.2 and to fund Sweep Advances pursuant to
Section 3.8. 
 3.3 Swingline Notes. The Swingline Loans shall be evidenced by one or more promissory notes substantially in the
form of Exhibit B hereto, payable to the order of Swingline Lender and in an aggregate principal amount equal to the Swingline Commitment (each, a “Swingline Note” and collectively, “Swingline Notes”). 
 3.4 Requests for Swingline Loans. Subject to Section 3.8, whenever Borrower wishes to obtain a Swingline Loan, Borrower shall give Agent
irrevocable notice thereof no later than 1:00 p.m. (Pacific Time) on the requested date of such Swingline Loan, unless Swingline Lender agrees in each instance, in its sole discretion, to a shorter time period. Such notice shall specify the
requested borrowing date (which must be a Business Day) and the amount of the Swingline Loan. 
 3.5 Loan Payments. 
  

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 3.5.1 Interest Payments. Interest on the unpaid principal balance of the Swingline
Loans shall be paid monthly in an amount equal to all interest accrued during the prior calendar month. Such interest payments shall be made on each Monthly Payment Date commencing the month immediately following the Closing Date and continuing
thereafter. All accrued interest outstanding on the Expiration Date shall be due and payable in full on the Expiration Date. 
 3.5.2 Principal Payments. The entire outstanding principal balance of the Swingline Notes plus all interest accrued thereon shall be due and payable in full on the Expiration Date. In addition, the principal balance of the Swingline
Loans shall be due and payable as required by Section 3.7. 
 3.6 Participation in Swingline Loans. Immediately upon the making
of a Swingline Loan by the Swingline Lender, the Swingline Lender shall be deemed to have sold and transferred to each Lender and each Lender shall be deemed to have purchased and received from the Swingline Lender, without any further action by any
party, an undivided participating interest in each Swingline Loan in an amount equal to such Lender’s Revolving Loan Pro Rata Share; provided, however, that (a) no Lender shall be required to fund its participation in any Swingline Loan
except as set forth in Sections 3.7.2 and 3.7.4, and (b) no Lender shall be entitled to share in any payments of principal or interest in respect of its participation except, with respect to any participation funded by such Lender, as set forth
in Sections 3.7.2 and 3.7.3. Such participation shall be subject to the terms and conditions of this Agreement. 
 3.7 Settlement of
Swingline Loans. 
 3.7.1 Refunding of Loans. 
 (a) Upon the request of the Swingline Lender, the Agent from time to time shall, on behalf of Borrower (and Borrower hereby irrevocably
authorizes the Agent to so act on its behalf) request each Lender (including Swingline Lender in its capacity as a Lender) to make a Revolving Loan to the Borrower, in accordance with the provisions of Sections 3.7.1(b) and (c), which shall be
applied to repay all or a portion of the outstanding principal balance of the Swingline Loans (each such Revolving Loan, a “Refunding Revolving Loan”), in an amount equal to that Lender’s Revolving Loan Pro Rata Share of all or a
portion of the then outstanding principal balance of the Swingline Loans. 
 (b) Unless the Agent has requested the Lenders to
fund participations in Swingline Loans pursuant to Section 3.7.2, the Agent shall, by giving notice thereof within the time required hereunder, request the Lenders to make such Refunding Revolving Loans on the fifth day and the twentieth day of
each month (or on the next Business Day if such day is not a Business Day) based upon the outstanding principal balance of the Swingline Loans on the date which is two Business Days prior to such date. 
 (c) In addition to the Refunding Revolving Loans required by Section 3.7.1(b), Agent may request the Lenders to make Refunding
Revolving Loans at any time if (i) a Default has occurred and is continuing, or (ii) in the judgment of Swingline Lender, taking into account the outstanding principal balance of the Swingline Loans, the anticipated usage of the Swingline
Loans and the operation of the Credit Sweep pursuant to Section 3.8, such Refunding 

  

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Revolving Loans are reasonably necessary to ensure that the outstanding principal balance of the Swingline Loans will not at any time exceed the Swingline
Commitment or such lesser amount as is permitted to be outstanding on the Swingline Loans at such time (it being understood that in order to attain such objective, Swingline Lender may request repayment of the Swingline Loans even though the
principal balance of the Swingline Loans at the time of such request is less than the Swingline Commitment or the amount permitted to be outstanding on the Swingline Loans). 
 (d) If the Agent makes a request for funding under this Section 3.7.1 by 11:00 a.m. Pacific Time on any Business Day, the Lenders
will deliver the required amount to Agent no later than 11:00 a.m. Pacific Time on the Business Day after such request. The proceeds of all Refunding Revolving Loans shall be paid by the Agent to the Swingline Lender in repayment of the outstanding
principal balance of the applicable Swingline Loans. 
 (e) Notwithstanding any contrary provision of this Section 3.7.1,
except for participations funded pursuant to Section 3.7.2, and so long as no Default has occurred and is continuing, Agent will not ask the Lenders to make Revolving Loans pursuant to this Section 3.7.1 to repay the Swingline Loans to the
extent that, after giving effect to the making of such Revolving Loans, the principal balance of the Swingline Loans will be less than $15,000,000.00. 
 3.7.2 Funding of Participations. In addition to the right of the Swingline Lender to request refunding of the Swingline Loans pursuant to Section 3.7.1, upon the request of the Swingline Lender, the Agent
shall request each Lender (including Swingline Lender in its capacity as a Lender) to fund its participation in the Swingline Loans by paying to the Agent, for the account of the Swingline Lender, its Revolving Loan Pro Rata Share of the principal
amount of the Swingline Loans. If the Agent makes such request by 11:00 a.m. Pacific Time on any Business Day, the Lenders will deliver such amount to Agent no later than 11:00 a.m. Pacific Time on the Business Day after such request. All
participations funded by the Lenders under this Section 3.7.2 shall be treated as the funding of the Revolving Loans for purposes of the calculation of the Loan Fee under Section 2.6. If any payment paid to any Lender with respect to its
participating interest in any Swingline Loan is thereafter recovered from or must be returned or paid over by Swingline Lender for any reason, such Lender will pay to the Agent for the account of the Swingline Lender, such Lender’s Revolving
Loan Pro Rata Share of such amount and of any interest and other amounts paid or payable by the Swingline Lender with respect to such amount. Agent agrees not to request any funding of the Lender’s participations in the Swingline Loans under
this Section 3.7.2 at any time that such participations may be legally repaid using advances of the Revolving Loan under Section 3.7.1. 
 3.7.3 Payment to Swingline Lender. Notwithstanding any contrary provision of this Agreement (a) except as set forth in Section 3.7.3(b) all payments of principal and interest on the Swingline Loans
shall be paid by Agent solely to the Swingline Lender; and (b) with respect to each participation in Swingline Loans which is funded by any Lender, such Lender (including Swingline Lender in its capacity as Lender) shall be entitled to receive
its Revolving Loan Pro Rata Share of payments of (i) principal on such Swingline Loans and (ii) interest on such Swingline Loans only for the period following the date such participation is funded. 
 3.7.4 Obligations Unconditional. The obligation of each Lender to make Revolving Loans to repay Swingline Loans pursuant to
Section 3.7.1 or to fund its participation interests in Swingline Loans pursuant to Section 3.7.2 shall be absolute and unconditional and 
  

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shall not be affected by the occurrence of a Default or Event of Default, the fact that any one or more of the conditions in Section 8.1 or 8.2 is not
satisfied, the termination of the availability of Loans, the fact that such Revolving Loan is made after the Expiration Date, any defense, setoff, counterclaim or claim for recoupment of any Lender against Agent or Swingline Lender or any other
circumstance, whether or not similar to the foregoing. Notwithstanding the foregoing, the Lenders shall not be required to repay Swingline Loans pursuant to Section 3.7.1 or to fund their participation interests in Swingline Loans pursuant to
Section 3.7.2 with respect to any portions of the outstanding principal balance of the Swingline Loans (including Sweep Advances) that are funded by Swingline Lender after Agent is deemed to have knowledge or notice of the occurrence of a
Default or after the Expiration Date. 
 3.8 Credit Sweep. 
 3.8.1 Notwithstanding the provisions of Section 3.4, in addition to Swingline Loans requested pursuant to Section 3.4, Borrower
may also obtain and repay Swingline Loans in accordance with the provisions of this Section 3.8 (each, a “Sweep Advance”). Sweep Advances shall be Swingline Loans. 
 3.8.2 Funds may be transferred between one or more deposit accounts maintained by Borrower with U.S. Bank (each, a “DDA”) and
the Swingline Loans. Collected funds in the DDA may be transferred to the Swingline Loans to reduce the outstanding principal balance thereof and Sweep Advances may be made to maintain an agreed upon collected balance in the DDA. 
 3.8.3 All Sweep Advances shall be deemed to have been requested by Borrower and shall be subject to the terms and conditions of this
Agreement and the other Loan Documents, and shall also be subject to U.S. Bank’s deposit account, treasury management and other agreements with Borrower; provided, however, that if there is any conflict between the terms of such agreements and
the Loan Documents, the terms of the Loan Documents shall control. 
 3.8.4 Borrower may terminate this service by written
notice executed by Borrower and delivered to Agent. Agent or U.S. Bank may change the terms or discontinue this service at any time upon written notice to Borrower. 
 3.8.5 Borrower shall pay such fees for this sweep service as may be disclosed to Borrower by Agent. Such fees shall be for the sole
account of U.S. Bank. 
 ARTICLE 4. 
 LETTERS OF CREDIT 
 4.1 Letter of Credit Commitment. 
 4.1.1 Maximum Amount. Subject to and upon the terms and conditions of this Agreement, Issuing Lender may from time to time during
the period from the Closing Date to the date which is 30 days prior to the Expiration issue one or more standby letters of credit for the account of Borrower; provided that (a) the LC Outstandings shall not exceed at any time the Letter of
Credit Commitment; and (b) the outstanding principal balance of all Revolving Loans 

  

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made by all Lenders, plus the outstanding principal balance of all Swingline Loans, plus the LC Outstandings shall not at any time exceed the Maximum Amount.

 4.1.2 Increase or Decrease in Letter of Credit Commitment. Notwithstanding any contrary provision of this Agreement,
Issuing Lender may, in its sole discretion, with the consent of Agent (but without the necessity of obtaining consent of any Lenders) agree with Borrower to increase or decrease the Letter of Credit Commitment, so long as the Letter of Credit
Commitment does not at any time exceed $1,000,000.00. 
 4.2 Existing Letters of Credit. Issuing Lender has previously issued
the following letters of credit (“Existing Letters of Credit”) for the account of Borrower: 
  

							
	 Letter of Credit
Number
	  	 Beneficiary
	  	 Expiration Date
	  	 Amount

	 SLCPPDX01674
	  		  	09/10/06	  	10,000.00
	 SLCPPDX01879
	  		  	09/30/06	  	33,333.33
	 SLCPPDX01880
	  		  	09/30/06	  	11,666,78
	 SLCPPDX01881
	  		  	09/30/06	  	21,666,67
	 SLCPPDX02784
	  		  	02/01/07	  	22,480.00
	 SLCPPDX02814
	  		  	02/15/08	  	18,495,00

 Each of the Existing Letters of Credit shall be subject to the terms and conditions
of this Agreement. 
 4.3 LC Agreements. On the Closing Date, and from time to time as required by Issuing Lender, Borrower
shall execute and deliver to Issuing Lender a letter of credit reimbursement agreement or an amendment to existing agreements executed by Borrower (each, an “LC Agreement”) in a form acceptable to Issuing Lender. Whenever Borrower wishes
to request the issuance of a Letter of Credit, Borrower shall execute and deliver to Issuing Lender an application therefor in Issuing Lender’s standard form appropriately completed with all required information (an “LC Application”)
and such other documents and information as Issuing Lender reasonably requires. Each Letter of Credit shall be subject to all terms and conditions of this Agreement and of the applicable LC Application and LC Agreement. In the event of any express
conflict between the terms of this Agreement and of the applicable LC Agreement, the terms of this Agreement shall control. 
 4.4 Expiry
Date. No Letter of Credit shall be issued later than the 30 days prior to the Expiration Date. Each Letter of Credit shall have an expiration date no later than the earlier of (a) two years after the issuance date (or date of extension or
renewal, if applicable); or (b) 30 days prior to Expiration Date. Drafts drawn under a Letter of Credit may be sight drafts or time drafts; provided, however, that no draft shall have a maturity date later than the 30 days prior to Expiration
Date. 
 4.5 Requests for Letters of Credit. Each LC Application shall be submitted to the Issuing Lender, with a copy to the Agent,
at least five Business Days prior to the date upon which the related Letter of Credit is proposed to be issued (unless the Issuing Lender, in any instance, in its sole discretion, agrees to a shorter time period). The Agent shall promptly notify the
Issuing Lender whether such LC Application, and the issuance of a Letter of Credit pursuant thereto, conforms to the requirements of this Agreement. Upon issuance of a Letter of Credit, 
  

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the Issuing Lender shall promptly notify the Agent, and Agent shall promptly notify the Lenders, of the amount and terms thereof. 
 4.6 Participation in Letters of Credit. Upon the issuance of a Letter of Credit in accordance with this Agreement (or on the Closing Date with
respect to Existing Letters of Credit), each Lender shall be deemed to have purchased a pro rata participation in such Letter of Credit and all unreimbursed drawings thereunder, from the Issuing Lender in an amount equal to that Lender’s
Revolving Loan Pro Rata Share of the face amount of the Letter of Credit. Without limiting the scope and nature of each Lender’s participation in any Letter of Credit, to the extent that the Issuing Lender is not reimbursed by Borrower for any
payment made by the Issuing Lender under any Existing Letter of Credit or any other Letter of Credit issued in accordance with the terms hereof, or if any reimbursement received by Issuing Lender is rescinded or must be returned, each Lender shall
reimburse Agent, for the benefit of the Issuing Lender, an amount equal to its Revolving Loan Pro Rata Share of such reimbursement amount as set forth below. To obtain funding by the Lenders of any reimbursement amount, Agent must request, before
11:00 a.m. Pacific Time on a Business Day, each Lender (including the Issuing Lender in its capacity as a Lender) to fund an amount equal to each Lender’s respective Revolving Loan Pro Rata Share of the reimbursement amount. The Lenders shall
fund to Agent the amounts so requested no later than 11:00 a.m. Pacific Time on the Business Day after the date that such request is delivered to the Lenders and all amounts so funded shall be paid by the Agent to the Issuing Lender in satisfaction
of each Lender’s participation obligations on the Business Day that such funds are received by Agent. The obligation of each Lender to so reimburse Agent, on behalf of the Issuing Lender, shall be absolute and unconditional and shall not be
affected by the occurrence of a Default or Event of Default, the termination of the availability of Letters of Credit, the fact that reimbursement is requested after the Expiration Date, any defense, setoff, counterclaim or claim for recoupment
against Agent or Issuing Lender, or any other circumstance, whether or not similar to the foregoing. Any such reimbursement shall not relieve or otherwise impair the obligation of Borrower to reimburse the Issuing Lender for the amount of any
payment made by the Issuing Lender under any Letter of Credit, together with interest as provided herein. 
 4.7 Payments. Borrower
agrees to pay to the Issuing Lender, on the date any payment is made by the Issuing Lender, an amount equal to any payment made by the Issuing Lender with respect to each Letter of Credit, together with interest on such amount from the date of any
payment made by the Issuing Lender at the Revolving Loan Borrowing Rate for the first three days and thereafter at the Default Rate. The principal amount of any such payment shall be used to reimburse the Issuing Lender for the payment made by it
under the Letter of Credit and, to the extent that the Lenders have not reimbursed the Agent pursuant to Section 4.6, the interest amount of any such payment shall be solely for the account of the Issuing Lender. Each Lender that has reimbursed
the Agent pursuant to Section 4.6 for its Revolving Loan Pro Rata Share of any payment made by the Issuing Lender under a Letter of Credit shall thereupon acquire a Revolving Loan Pro Rata Share participation, to the extent of such
reimbursement, in the claim of the Issuing Lender against Borrower for reimbursement of principal and interest under this Section 4.7 and shall share, in accordance with that pro rata participation, in any principal payment made by Borrower
with respect to such claim and in any interest payment made by Borrower (but only with respect to periods subsequent to the date such Lender reimbursed the Agent) with respect to such claim. The Issuing Lender shall promptly make available to the
Agent, in immediately available funds, any amounts due to the Lenders under this Section 4.7. 
  

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The Issuing Lender shall notify the Borrower and the Agent whenever any demand for payment is made under any Letter of Credit by the beneficiary thereof.

 4.8 Terms Satisfactory to Issuing Lender. Notwithstanding any contrary provision of this Agreement, any LC Agreement, LC
Application, or any other Loan Document, all terms and conditions of each Letter of Credit must be acceptable to Issuing Lender in its sole discretion and each Letter of Credit must conform to all requirements of the Issuing Lender. 
 4.9 Obligations Absolute. The obligation of Borrower to pay to the Issuing Lender the amount of any payment made by the Issuing Lender under any
Letter of Credit shall be absolute, unconditional, and irrevocable. Without limiting the foregoing, Borrower’s obligation shall not be affected by any of the following circumstances, except in the event of Issuing Lender’s gross negligence
or intentional misconduct: 
 (a) any lack of validity or enforceability of the Letter of Credit, this Agreement, the other
Loan Documents, or any other agreement or instrument relating thereto; 
 (b) the existence of any claim, setoff, defense, or
other rights which Borrower may have at any time against the Issuing Lender, any beneficiary of the Letter of Credit (or any Persons for whom any such beneficiary may be acting) or any other Person, whether in connection with the Letter of Credit,
this Agreement, or any other agreement or instrument relating thereto, or any unrelated transactions; 
 (c) any draft,
demand, statement, or any other document presented under the Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect whatsoever; 
 (d) the solvency or financial responsibility of any party issuing any documents in connection with a Letter of Credit; 
 (e) any failure or delay in notice of shipments or arrival of any property; 
 (f) any error, omission, or loss in the transmission or delivery of any draft, notice or other communication relating to a Letter of
Credit or any delay or interruption in any such message; 
 (g) any error, neglect or default of any correspondent of the
Issuing Lender in connection with a Letter of Credit; 
 (h) any error in interpretation of technical terms or any consequence
arising from circumstances beyond the control of the Issuing Lender; 
 (i) any other circumstance whatsoever, whether or not
similar to any of the foregoing that might constitute a legal or equitable discharge of, or provide a right of set-off against, the Obligations of Borrower. 
 4.10 Letter of Credit Fees. 
  

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 4.10.1 Borrower agrees to pay to Agent, for the account of the Lenders (based upon each
Lender’s Revolving Loan Pro Rata Share), on the date any Letter of Credit is issued, renewed or extended, with respect to each Letter of Credit, an issuing fee of 1.5% per annum on the face amount thereof, calculated from the date of
issuance (or renewal or extension) to the expiry date thereof. All issuing fees paid under this Section 4.10.1 are non-refundable, even if the Letter of Credit for which they are paid is terminated before its anticipated expiration or extended
expiration date. 
 4.10.2 Borrower agrees to pay to Issuing Lender on demand, for its sole account, with respect to each
Letter of Credit and each draft drawn thereunder, Issuing Lender’s customary fees and charges, including processing, drawing, transfer, amendment, negotiation, acceptance, and other fees. 
 ARTICLE 5. 
 CERTAIN ADDITIONAL PROVISIONS 
 5.1 Interest. 
 5.1.1
Interest Rate. Unless the Default Rate is applicable, (a) the Revolving Loans shall bear interest at a variable per annum rate equal to the LIBOR Rate plus ____% (“Revolving Loan Borrowing Rate”); and (b) the Swingline
Loans shall bear interest at a variable per annum rate equal to the LIBOR Rate plus ____% (“Swingline Borrowing Rate”), in each case adjusted without notice on the date of each change in the LIBOR Rate. 
 5.1.2 Default Interest Rate. Upon the occurrence and during the continuance of any Event of Default, at the option of the Required
Lenders, the Loans shall bear interest at a per annum rate equal to the Revolving Loan Borrowing Rate plus ___% (“Default Rate”). 
 5.1.3 Determination of Rate. Notwithstanding any provision of this Agreement to the contrary, each Lender shall be entitled to fund and maintain its funding of all or any part of the Loans in any manner it
elects; it being understood, however, that with respect to the LIBOR Rate, all determinations hereunder shall be made as if each Lender had actually funded and maintained its Loans through the purchase of deposits in the London interbank eurodollar
market. 
 5.2 Borrowing Procedure. 
 5.2.1 Requests for Loans. Whenever Borrower wishes to request a Loan, Borrower shall give Agent irrevocable notice thereof within the time required by Section 2.4 or 3.4, as applicable. Borrower may
request a Loan in writing or by telephone promptly confirmed in writing (or with respect to Sweep Advances, as set forth in Section 3.8) for deposit into Borrower’s deposit account(s) with Agent. Requests for Loans to be deposited or
forwarded elsewhere shall be in writing in such form and containing such additional information as Agent may reasonably require in order to confirm the request and transmit funds. 
 5.2.2 Notice to Lenders. Agent will promptly (but in any event no later than 11:00 a.m. Pacific Time on the Business Day that is
one Business Day before the Business Day upon which each Lender is required to make its Pro Rata Share of such Revolving Loan available 

  

 Page 24 

 
to Agent) notify each Lender of its receipt of any request for a Revolving Loan and of the amount of its Pro Rata Share of such Revolving Loan. 

5.3 Funding by Lenders. Each Lender will make the amount of its Pro Rata Share of each Revolving Loan available to Agent for the account of
Borrower by 11:00 a.m. (Pacific Time) on the date of any Revolving Loan Borrowing in immediately available funds; provided that such Lender has received notice from Agent of such request for funding as set forth in Section 5.2.2. 
 5.4 Obligations Several. The failure of any Lender to make any Loan shall not relieve any other Lender of its obligation to make its Loan on such
date, but no Lender shall be responsible for the failure of any other Lender to make any Loan to be made by such other Lender. 
 5.5
Failure to Fund. Unless the Agent has received prior written notice from a Lender that such Lender will not make available to the Agent an amount equal to its Pro Rata Share of any Loan or participation, the Agent may assume that such Lender has
made such amount available to the Agent on the dates required under Section 3.7.1, 3.7.2, 3.7.4, 4.6, or 5.3 (as applicable) and the Agent may, in reliance upon such assumption, make available to Borrower, Issuing Lender, or Swingline Lender
(as applicable) on such date an amount equal to such Pro Rata Share. If and to the extent such Lender has not made its Pro Rata Share available to the Agent and the Agent has made such amount available to Borrower, Issuing Lender, or Swingline
Lender, such Lender and Borrower severally agree to pay to the Agent on demand such amount (to the extent not previously paid by the other), together with interest thereon for each day from the date such amount is made available to Borrower, Issuing
Lender, or Swingline Lender until the date such amount is paid to the Agent, at a rate per annum equal to (a) in the case of Borrower, the Revolving Loan Borrowing Rate, and (b) in the case of any Lender, the daily Federal Funds Rate for
the first two Business Days after such payment was to be made by the Lender to Agent, and thereafter, the Revolving Loan Borrowing Rate. Such payment by Borrower, however, shall be without prejudice to Borrower’s rights against such Lender. If
such Lender shall pay to the Agent such corresponding amount, the amount so paid shall constitute such Lender’s Loan. 
 5.6
Authorization. Any Loan made to Borrower shall be conclusively presumed to have been made to or for the benefit of Borrower when the proceeds of such Loan (a) is deposited to the credit of Borrower in an account of Borrower with Agent, or
(b) is transmitted to any other bank with directions to credit the same to the account of any Borrower at such bank, regardless of whether Persons other than those authorized to make requests for Loans have authority to draw against any such
account. Borrower acknowledges that Agent cannot effectively determine whether a particular request for a Loan is valid, authorized, or authentic. Therefore, Borrower assumes all risk of the validity, authenticity, and authorization of such
requests, whether or not the individual making such requests has authority to request Loans. Agent shall be entitled to act on the instructions of anyone identifying himself or herself as authorized to request Loans and Borrower shall be bound
thereby in the same manner as if the Person were actually so authorized. Agent is authorized to credit any account of a Borrower with Agent (or any account Borrower designates in writing) for Loans made to Borrower. Borrower’s failure to
confirm any telephonic request or otherwise comply with the provisions of this Section 5.6 shall not in any manner affect the obligation of Borrower to repay such Loans in 
  

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accordance with the terms of this Agreement. Borrower agrees not to hold Agent or the Lenders liable for any errors or misunderstanding in complying with
any written or oral directions for Loans; and Borrower agrees to indemnify and hold Agent and the Lenders harmless from any and all claims, damages, liabilities, losses, costs and expenses (including Attorney Costs) which may arise or be created by
the acceptance of instructions (telephonic or otherwise) for making Loans by wire transfer or otherwise, or for application of payments, other than as a result of Agent’s gross negligence or willful misconduct. 
 5.7 Computations. All interest rates and fees referred to herein shall be computed on the basis of a 360-day year and applied to the actual number
of days elapsed. 
 5.8 Application of Payments. If at any time insufficient funds are received by and available to the Agent to fully
pay all fees, costs, expenses, principal, interest and other amounts due to Agent and the Lenders under this Agreement and the other Loan Documents, such funds shall be applied: first, to the payment of fees, costs, disbursements, indemnities and
other expenses owing to Agent, including without limitation, if applicable, amounts incurred in realizing on Collateral or otherwise enforcing the Loan Documents; second, to the payment of fees, costs, disbursements, indemnities, and other expenses
owing to the Lenders, including without limitation, if applicable, amounts incurred in realizing on Collateral or otherwise enforcing the Loan Documents and amounts owing pursuant to Article 5 and Section 16.1; third, to the payment of accrued
interest on all of the Loans and other Obligations, allocated pro rata to the Lenders based upon their Pro Rata Shares determined under subsection (f) of the definition of Pro Rata Share; fourth, to fully cash collateralize the undrawn face
amount of all Letters of Credit; and, fifth, to the payment of the remaining principal owing to all of the Lenders on all of the Loans, LC Outstandings, and other Obligations, allocated pro rata to the Lenders based upon their Pro Rata Shares
determined under subsection (f) of the definition of Pro Rata Share. 
 5.9 Manner of Payment. All sums payable by Borrower
pursuant to this Agreement (including, without limitation, principal, interest, fees, late charges, costs, expenses, and other payments) shall be paid directly to Agent in immediately available United States funds. Whenever any payment to be made
hereunder or on any of the Notes becomes due and payable on a day other than a Business Day, such payment may be made on the next succeeding Business Day and such extension of time shall in such case be included in computing interest on such
payment. All payments due on any day shall be paid to the office specified by Agent no later than 3:00 p.m. Pacific time on such date. Any payment made after such time may, in the discretion of the Agent, be deemed made on the following Business
Day. Agent shall distribute to the applicable Lender or Lenders, the applicable Pro Rata Share of any payments received by Agent (including, without limitation, payments of principal, interest, fees, late charges, costs, expenses, and other
payments) which such Lender or Lenders is entitled to receive under this Agreement. Such distributions shall be made by Agent to the applicable Lenders no later than 11:00 a.m. Pacific Time on the first Business Day after Agent’s receipt of
such payments. If and to the extent any Lender has not received its applicable Pro Rata Share of any such distribution on or before 11:00 a.m. Pacific Time on the first Business Day after Agent’s receipt of such payments, Agent agrees to pay
such amount to the non-receiving Lender, on demand, together with interest thereon at the daily Federal Funds Rate for the first two Business Days after such distribution was to be made by the Agent to the non-receiving Lender and, thereafter, at
the Revolving Loan Borrowing Rate. 
  

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 5.10 Payment by Automatic Debit. Borrower hereby authorizes Agent to automatically deduct the
amount of all principal and interest payments and fees from a deposit account with Agent specified in a writing provided to Agent. Borrower will pay all the fees on the account which result from the automatic deductions, including any overdraft and
non-sufficient funds charges. If for any reason Agent does not charge the account for a payment, or if an automatic payment is reversed, the payment is still due. Borrower may change the account number by notifying Agent of the new account number.

 5.11 Late Charges. Subject to any limitations imposed by Applicable Law, if any payment of principal or interest on any Note or the
LC Outstandings is fifteen (15) days or more past due, Borrower shall pay to Agent on demand, for the account of the Lenders based upon their applicable Pro Rata Shares, a late charge of five percent of the delinquent payment. Each party hereto
agrees that it would be difficult or costly to determine the actual costs incurred by any Lender by reason of late payment. Therefore, the parties agree that this late charge represents a fair and reasonable estimate of the costs incurred by each
Lender and is reasonable under the circumstances existing as of the date hereof. Collection of the late payment fee shall not be deemed to be a waiver of any Default hereunder. 
 5.12 Maximum Charges. Notwithstanding any contrary provision of this Agreement or any other Loan Document, the interest rate, fees and other
charges under the Loan Documents shall not exceed the maximum amount permitted by Applicable Law. If any interest, fee or other charge is finally determined by a court of competent jurisdiction to exceed the maximum amount permitted by Applicable
Law, the interest, fee or other charge shall be reduced to the maximum permitted by Applicable Law and Agent, acting on behalf of the Lenders, may credit any excess amount previously collected against the principal balance of the Loans or other
amounts owing by Borrower or refund such excess to Borrower. 
 5.13 Additional Payments. The Lenders shall have no obligation
whatsoever, and they have no present intention, to make any Loan after the Expiration Date or which would cause the principal amount outstanding under this Agreement to exceed any of the limitations stated in this Agreement. Notwithstanding the
foregoing, Borrower is and shall be and remain unconditionally liable to the Lenders for, and Borrower hereby promises to pay to Agent for the account of the Lenders the amount of all Loans and other Obligations hereunder, including without
limitation Loans in excess of the limitations set forth herein and Loans made after the Expiration Date. Borrower shall promptly pay to Agent upon demand (and Agent shall promptly demand payment of) the amount of: (a) any Loans and LC
Obligations in excess of any limitation contained in this Agreement; and (b) any Loans and LC Obligations made after the Expiration Date; together with interest on the principal amount of such Loans and LC Obligations, as set forth herein.

 5.14 Extension of Expiration Date. If Borrower wishes to extend the Expiration Date then in effect, Borrower shall deliver to the
Agent a written notice requesting the Lenders to extend the Expiration Date for an additional year past the then current Expiration Date (an “Extension Request”). Such notice shall be given no more than 24 months and no less than 18 months
prior to the then current Expiration Date. Such notice shall include Borrower’s certification that as of the date thereof, all representations and warranties in this Agreement are true and correct in all material respects, except to the extent
they relate to another date or as previously disclosed to and accepted by Agent in writing, and that no Default then exists. If 
  

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Borrower makes a timely Extension Request, Agent will notify all of the Lenders of such Extension Request and will notify Borrower no less than three months
after receipt of the request whether all Lenders have agreed to extend the Expiration Date for an additional year; provided, however, that if Agent does not so notify Borrower or if all Lenders do not agree to such extension, the Expiration Date
shall not be extended. In connection with any Extension Request, Borrower shall provide to Agent any financial or other information requested by Agent or any Lender. 
 5.15 Authorization. Borrower authorizes Agent and the Lenders (a) to furnish information about the Loans to each manufacturer or distributor of Vehicles, and (b) to advise each such manufacturer or
distributor of any change or termination which may occur with respect to the Loans. 
 5.16 Voluntary Reduction or Termination of
Commitments. Borrower may from time to time on at least ten (10) Business Day’s prior written notice to the Agent (which shall promptly advise each Lender thereof) permanently reduce the Total Revolving Loan Commitment to an amount not
less than the then outstanding principal balance of the Revolving Loans and Swingline Loans plus the LC Outstandings. Concurrently with any reduction of the Total Revolving Loan Commitment to zero, (a) no further Revolving Loans or Swingline
Loans will be made and no further Letters of Credit will be issued, (b) Borrower shall pay all principal and interest on the Revolving Loans and Swingline Loans and all fees and other amounts owing to Agent and the Lenders, and
(c) Borrower shall grant to Agent a security interest in cash collateral in an amount equal to the LC Outstandings at such time. All reductions of the Total Revolving Loan Commitment shall reduce the Revolving Loan Commitments pro rata among
the Lenders according to their respective Pro Rata Shares and the Swingline Commitment shall be reduced in proportion to the reduction of the Total Revolving Loan Commitment; provided, however, that the Swingline Commitment shall not be reduced to
less than $20,000,000.00. 
 ARTICLE 6. 
 TAXES, YIELD PROTECTION AND ILLEGALITY 
 6.1 Taxes. 
 6.1.1 No Deductions. All payments (including fees) in respect of the Loans and Letters of Credit shall be made free and clear of
and without any deduction for or on account of any present and future income, excise, stamp or franchise taxes and other taxes, fees, duties, levies, withholdings or other charges imposed by any Governmental Body, excluding franchise taxes or net
income taxes imposed on Agent or any Lender (all such non-excluded items are collectively “Taxes”). If any Taxes are imposed and required by law to be paid or withheld from any amount payable to any Lender, then Borrower shall
(a) increase the amount of such payment so that such Lender will receive a net amount (after deduction of all Taxes) equal to the amount due hereunder, (b) pay such Taxes to the appropriate taxing authority for the account of such Lender
in a timely manner, and (c) as promptly as possible thereafter, send Agent evidence showing payment thereof, together with such additional documentary evidence as Agent may from time to time require. If Borrower fails to perform its obligations
under (a) or (b) above, Borrower shall indemnify Agent and the Lenders for any incremental taxes, interest or penalties that may become payable as a result of any such failure. 
  

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 6.1.2 Non-U.S. Lenders. Each Lender (including any Assignee) which is not
incorporated under the laws of the United States of America or a state thereof shall, on the Closing Date or before becoming a Lender, as applicable, and from time to time when requested by Agent, deliver to Borrower and Agent two duly completed
copies of United States Internal Revenue Service Form W8BEN or W8ECI (or other applicable form), as the case may be, certifying in each case that such Lender is entitled to receive payments under this Agreement without deduction or withholding of
any United States federal income taxes, together with such other documentation as Agent may from time to time require. Borrower shall not be required to pay additional amounts to any Lender pursuant to Section 6.1 to the extent that the
obligation to pay such additional amounts would not have arisen if the Lender had complied with the requirements of this Section 6.1.2. 
 6.2 Increased Costs. If at any time after the date hereof (a) any revision in or adoption of any Applicable Law, rule, or regulation or in the interpretation or administration thereof (i) shall subject any Lender or its
Eurodollar lending office to any tax, duty, or other charge, or change the basis of taxation of payments to any Lender with respect to any Loans or Obligations bearing interest based on the LIBOR Rate, or (ii) shall impose, modify or deem
applicable any Reserve Requirements or other reserve, insurance, special deposit, or similar requirements against assets of, deposits with or for the account of, credit extended by any Lender or its Eurodollar lending office (other than any Reserve
Requirement reflected in the LIBOR Rate), or impose on Lender or its Eurodollar lending office any other condition affecting any Loans or Letters of Credit, and (b) the result of any of the foregoing is (i) to increase the cost to any
Lender of making or maintaining any Loans or Letters of Credit, or (ii) to reduce the amount of any sum receivable by any Lender or its Eurodollar lending office, Borrower shall pay to Agent for the account of the affected Lender within 15 days
after demand by Agent such additional amount as will compensate such Lender for such increased cost or reduction. The determination hereunder by Agent or any Lender of such additional amount shall be conclusive in the absence of manifest error.

 6.3 Unavailability or Illegality. If at any time Agent determines that the LIBOR Rate is unascertainable or unavailable or if,
because of the introduction of or any change in, or because of any judicial, administrative or other governmental interpretation of, any law or regulation, it becomes unlawful for any Lender to make, fund or maintain Loans based on the LIBOR Rate,
then the Lenders’ obligation to make, fund or maintain any such loans at the Revolving Loan Borrowing Rate or Swingline Borrowing Rate shall terminate and the Loans shall, on the earlier of the date specified by Agent in a notice to Borrower or
on date the making, funding or maintaining of such Loans becomes unlawful, be converted to Loans bearing interest at a variable rate equal to the Prime Rate. 
 6.4 Capital Adequacy. If after the date hereof, any revision in or adoption of any Applicable Law, rule or regulation or in the interpretation or administration thereof (whether or not having the force of law)
imposes, modifies or deems applicable any capital adequacy, capital maintenance or similar requirement or has the effect thereof (including a request or requirement which affects the manner in which any Lender (or its parent holding company)
allocates capital resources to any of its loans or commitments, including its Loans, Letters of Credit, and Commitments hereunder, and as a result thereof, in the opinion of any Lender in its sole and absolute discretion, the rate of return on such
Lender’s (or its parent holding company’s) capital as a consequence of its Loans, Letters of Credit, or Commitments hereunder is reduced to a level 
  

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below that which such Lender (or its parent holding company) could have achieved but for such circumstances (taking into consideration the Lender’s (or
its parent holding company’s) policies with respect to capital adequacy and capital maintenance) by an amount deemed by such Lender to be material, then and in each such case within fifteen days after receipt of notice from time to time by
Borrower from Agent, Borrower shall pay to the applicable Lender such additional amount or amounts as shall compensate such Lender for such reduction in rate of return. A statement of any Lender as to any such additional amount or amounts (including
calculations thereof in reasonable detail) shall, in the absence of manifest error, be conclusive and binding on Borrower. In determining such amount, each Lender may use any method of averaging and attribution as it in its reasonable discretion
shall deem applicable. 
 6.5 Request for Compensation. Failure or delay on the part of any Lender to demand compensation for any
amounts payable under this Article shall not constitute a waiver of such Lender’s right to demand such compensation; provided, that no Lender shall be entitled to compensation for any increased costs or reductions incurred or suffered with
respect to any date unless such Lender or the Issuing Lender, as the case may be, shall have notified the Borrower not more than 120 days after the later of (a) such date and (b) the date on which such Lender and shall have become aware of
such costs or reductions. 
 ARTICLE 7. 
 SECURITY AND GUARANTIES 
 7.1 Security. 
 7.1.1 Collateral. All present and future Loans, Letters of Credit, and Obligations of Borrower to Agent and the Lenders under this
Agreement, the Notes and the other Loan Documents shall be secured by a perfected security interest, subject only to Permitted Liens, in the property described in the Security Documents, including, without limitation, the following property of
Borrower and all of its present and future Collateral Subsidiaries, whether now owned or existing or hereafter acquired and wherever located, and all products and proceeds thereof (collectively, “Collateral”): 
 (a) All inventory (including, without limitation, all Vehicles, automobiles, trucks and other motor vehicles of whatever make, model and
description, trade ins, repossessions and inventory held for display or demonstration purposes); equipment other than fixtures; investment property (excluding the capital stock or other Equity Interests of the Dealerships and, to the extent
prohibited by any manufacturer of Vehicles, any Subsidiary of Borrower that is the holder of five percent (5%) or more of the Equity Interests of a Dealership); accounts; instruments; documents; chattel paper; general intangibles; deposit
accounts; contract rights and other rights to payment; leases, rebates, credits, factory holdbacks, incentive payments and other payments from any manufacturer, factory or distributor. 
 (b) All attachments, accessions, accessories, tools, parts, supplies, increases and additions to, and all replacements of, and
substitutions for any property described in this Section 7.1.1; all products, produce, and supporting obligations of any of the property described in this Section 7.1.1; all proceeds (including insurance proceeds) of any of the property
described in this Section 7.1.1; and all records and data relating to any of the property described in this Section 7.1.1, whether in the form of a writing, photograph, microfilm, microfiche, or 

  

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electronic media, together with Borrower’s and each Collateral Subsidiary’s right, title and interest in and to all computer software required to
utilize, create, maintain, and process any such records or data on electronic media. 
 7.1.2 Security Documents. The
security interests in the Collateral shall be evidenced by such security agreements, assignments, Uniform Commercial Code financing statements, Title Documents, trust deeds, mortgages, and other Security Documents covering the Collateral as Agent or
Required Lenders may at any time reasonably require. 
 7.1.3 Additional Acts. As a condition precedent to the
effectiveness of this Agreement, and from time to time at Agent’s or any Lender’s request, each Person granting Collateral shall execute and/or deliver to Agent such security agreements, assignments, pledge agreements, control agreements,
Title Documents, deeds of trust, landlord and owner consents, amendments to any of the foregoing documents and any other documents and instruments (endorsed or assigned to Agent as Agent may request), and shall take such other actions, as may be
required under Applicable Law or which Agent or any Lender may reasonably request to effectuate the transactions contemplated hereunder and to grant, preserve, protect, perfect and continue the validity and priority of their security interests
(subject to Permitted Liens). 
 7.1.4 Limitations. Notwithstanding any contrary provision of this Agreement or any
Security Document, unless Agent otherwise requires (which Agent may do at any time) (a) the security interest of Agent and the Lenders in any Loan Party’s patents, trademarks, copyrights, trade names and other intellectual property will
not be perfected by filing with the United States Patent and Trademark Office or any other agency of the United States government; (b) the security interest of Agent and the Lenders will not be noted on the Title Document for any Vehicle; and
(c) the security interest of Agent in deposit accounts maintained by any Loan Party with a bank other than U.S. Bank may not be perfected if Agent reasonably determines that the amounts generally maintained in such deposit accounts are not
material. 
 7.2 Guaranties. All present and future Loans, Letters of Credit, and Obligations of Borrower to Agent and the Lenders
shall be guaranteed by each of the Guarantors. 
 7.3 Joinder. Each Person which becomes a Subsidiary of Borrower shall execute
a Joinder Agreement substantially in the form attached hereto as Exhibit C and shall execute such other documents as Agent reasonably requires so that such Person becomes a Guarantor and grants a security interest in the Collateral owned by
such Person. Each such Person shall satisfy all requirements in Section 12.13(h), (j), (l), and (m) which are applicable to an Acquisition Subsidiary. 
 ARTICLE 8. 
 CONDITIONS PRECEDENT 
 8.1 Initial Conditions Precedent. The effectiveness of this Agreement and the obligation of the Lenders to make the initial Loans and issue the
initial Letters of Credit is subject to satisfaction of the following conditions (each, an “Initial Condition”): 
  

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 8.1.1 Agent has received the following: 
 (a) Such fully executed original Loan Documents as Agent or any Lender requires, including, without limitation, this Agreement, the Notes,
the Security Agreement, the Pledge Agreement, the Aircraft Security Agreement, other Security Documents, Guaranties of each Guarantor, any required LC Agreement, and each other Loan Document required by Agent or any Lender. 
 (b) Documentation satisfactory to the Agent to establish the due organization, valid existence and (if applicable) good standing of each
Loan Party, its qualification to engage in business in each jurisdiction in which it is engaged in business or required to be so qualified, its authority to execute, deliver and perform any Loan Documents to which it is a party and the identity,
authority and capacity of each Person authorized to act on its behalf, which shall, without limitation, include certified copies of articles or certificates of incorporation and amendments thereto, bylaws and amendments thereto, certificates of good
standing, existence and/or qualification to engage in business, corporate resolutions, incumbency certificates, and the like. 
 (c) A favorable opinion of acceptable independent counsel for each Loan Party covering such matters as Agent or any Lender may reasonably request, including without limitation the matters specified in Sections 9.1, 9.2, 9.4, 9.5 and 9.15.

 (d) A Borrowing Base Certificate, dated as of the last day of the calendar month preceding the Closing Date. 
 (e) A Compliance Certificate, dated as of the last day of the calendar month preceding the Closing Date. 
 (f)(i) One or more intercreditor agreements between Agent and each of the existing Floor Plan Lenders, in form and content satisfactory to
Agent and the Lenders, and (ii) any other subordination or intercreditor agreements required by Agent or the Lenders (including a subordination agreement from U.S. Bank as the counterparty to one or more Interest Rate Protection Agreements with
Borrower or its Subsidiaries), all in form and content satisfactory to Agent and the Lenders. 
 8.1.2 Agent has conducted
such audits of the Collateral as it requires, the results of which are satisfactory to Agent. 
 8.1.3 Agent has received
copies of any Seller Agreements which it has requested, other than those disclosure of which by Borrower or Borrower’s Subsidiary is prohibited by the relevant manufacturer or distributor, which must be reasonably satisfactory to Agent, and has
received such evidence as it requires that all Seller Agreements which are necessary for the conduct of Borrower’s business, are in full force and effect. 
 8.1.4 Agent shall have a valid and perfected security interest in the Collateral (subject to the limitation found in Section 7.1.4)
with a priority acceptable to Agent and the Required Lenders and subject only to Permitted Liens and Agent shall have received satisfactory evidence of perfection and the priority of such security interests, including without limitation such Uniform
Commercial Code and other searches, termination statements, and other filings as it deems appropriate. 
  

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 8.1.5 All required insurance shall be in full force and effect and Agent shall have
received such evidence thereof as it requires. 
 8.1.6 All indebtedness and obligations of Borrower and each Loan Party to
Daimler Chrysler Financial Services Americas LLC (“DCFS”) and Toyota Motor Credit Corporation pursuant to the Credit Agreement dated as of February 25, 2003 among Borrower, various financial institutions and Daimler Chrysler Services
North America LLC, the predecessor by merger to DCFS (the “DCFS Loan Agreement”) shall have been permanently repaid in full or will be paid in full with the proceeds of the Loans to be made on the Closing Date, all commitments to lend
pursuant to the DCFS Loan Agreement shall have been terminated, and all security interests securing the DCFS Loan Agreement shall have been terminated (or, if acceptable to Agent, in its sole discretion, Agent shall have received authority to
terminate such security interests). 
 8.1.7 All indebtedness and obligations of Borrower, Lithia Financial Corporation, and
Lithia Aircraft, Inc. to U.S. Bank pursuant to the Amended and Restated Loan Agreement dated as of December 28, 2001 among such parties (“LFC Loan Agreement”) shall have been permanently repaid in full or will be paid in full with the
proceeds of the Loans to be made on the Closing Date and all commitments to lend, pursuant to the LFC Loan Agreement shall have been terminated, and all security interests securing the LFC Loan Agreement (except to the extent such security interests
also secure the Interest Rate Protection Agreements) shall have been terminated (or, if acceptable to Agent, in its sole discretion, Agent shall have received authority to terminate such security interests). 
 8.1.8 The representations and warranties contained in this Agreement and in each Loan Document shall be correct, accurate and complete in
all material respects as of the Closing Date. 
 8.1.9 No Default shall have occurred and is continuing on the Closing Date or
will exist after giving effect to the making of the Loans to be made on the Closing Date, Existing Letters of Credit and Letters of Credit to be issued on the Closing Date. 
 8.1.10 All fees and Attorney Costs payable on or prior to the Closing Date shall have been paid. 
 8.1.11 Agent shall have received such additional documents, opinions, approvals, consents and information and each Loan Party shall have
satisfied such additional requirements as Agent or any Lender may reasonably require. 
 8.2 Conditions Precedent to Each Loan and Letter
of Credit. Except as otherwise set forth herein (including without limitation Section 3.7.4), all of the following conditions must be satisfied on the date any Loan is made or any Letter of Credit is issued: 
 8.2.1 Agent shall have received a request for the Loan or Letter of Credit as required by the provisions of this Agreement. 
 8.2.2 No Default shall have occurred and be continuing or will exist after giving effect to the making of such Loan or issuance of such
Letter of Credit. 

  

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 8.2.3 All representations and warranties in this Agreement and the other Loan Documents
shall be true and correct in all material respects as of such date, except to the extent they relate to another date, and except as previously disclosed to and accepted by Agent in writing. 
 8.2.4 All Initial Conditions have been satisfied at the time of the initial Loans. 
 8.2.5 Agent, and/or any Lender, as applicable, has received such documents and information as they reasonably require. 
 8.2.6 All conditions in any other provision of this Agreement or any other Loan Document have been satisfied as of the time required.

 ARTICLE 9. 
 REPRESENTATIONS AND WARRANTIES 
 Except as set forth in the Disclosure Schedule, Borrower hereby represents and warrants to
and agrees with Agent and the Lenders: 
 9.1 Existence and Power. Each Loan Party is duly qualified and in good standing or current
status, as applicable, in each jurisdiction where the conduct of its business or the ownership of its properties requires such qualification, and each Loan Party has full power, authority and legal right to carry on its business as presently
conducted, to own and operate its properties and assets, and to execute, deliver and perform the Loan Documents to be executed and delivered by it. 
 9.2 Power and Authority. The execution, delivery and performance of the Loan Documents by each Loan Party has been duly authorized by any necessary corporate, limited liability company, partnership, trust or other entity action, and
does not and will not (a) require any consent or approval of stockholders, members, partners or other holders of Equity Interests in any Loan Party (except for such consents and approvals as have been obtained and are in full force and effect);
(b) contravene the charter, bylaws, operating agreement, partnership agreement, trust agreement or other governing documents of any Loan Party; (c) violate any applicable provision of any law, rule, regulation (including, without
limitation, Regulations G, T, U and X of the Board of Governors of the Federal Reserve System), order, writ, judgment, injunction, decree, determination, or award presently in effect; (d) result in a breach of or constitute a default under any
indenture or loan or loan agreement or any other agreement, lease, or instrument to which any Loan Party is a party or by which any Loan Party or its properties may be bound or affected; (e) result in, or require, the creation or imposition of
any Lien upon or with respect to any of the properties now owned or hereafter acquired by any Loan Party except Liens in favor of Swap Provider and in favor of Agent under the Loan Documents; or (f) cause any Loan Party to be in default under
any such law, rule, regulation, order, writ, judgment, injunction, decree, determination, or award or any such indenture, agreement, lease, or instrument. 
 9.3 Operation of Business. Each Loan Party possesses all licenses, permits, franchises, patents, copyrights, trademarks, trade names, or rights thereto, material to the conduct of its business substantially as
now conducted and as presently proposed to be conducted and 
  

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none of the Loan Parties are in material violation of any valid rights of others with respect to any of the foregoing. 
 9.4 Governmental Approval. No Governmental Approval of any Governmental Body is required for the due execution, delivery and performance of the
Loan Documents except such as have been obtained and are in full force and effect. 
 9.5 Litigation. (a) As of the Closing Date,
there are no actions, proceedings, investigations, or claims pending against any Loan Party, or to Borrower’s knowledge, threatened against or affecting any Loan Party, before any Governmental Body which would be likely to result in one or more
judgments or orders against any Loan Party (in excess of insurance coverage) for more than $5,000,000.00 individually or in the aggregate; and (b) there are no actions, proceedings, investigations, or claims pending against any Loan Party, or
to Borrower’s knowledge, threatened against or affecting any Loan Party, before any Governmental Body which purport to affect or relate to the Loan Documents or the transactions contemplated thereby or if determined adversely would materially
impair the ability of any Loan Party to perform its obligations under the Loan Documents. 
 9.6 Financial Condition. The financial
statements that have heretofore been delivered to Agent or any Lender, and all schedules and notes included in such financial statements, are true and correct in all material respects and present fairly (a) the financial position of Borrower
and its Subsidiaries as of the date of such statements and (b) the results of its operations for the periods covered thereby; and with respect to the consolidated financial statements of Borrower and its Subsidiaries, there are not any material
liabilities that should have been reflected in the financial statements or the notes thereto under GAAP, contingent or otherwise, including liabilities for taxes or any unusual forward or long-term commitments, that are not disclosed or reserved
against in the statements referred to above or in the notes thereto or that are not disclosed herein. The consolidated financial statements of Borrower and its Subsidiaries have been prepared in accordance with GAAP, except, as to interim financial
statements, for the absence of footnotes and subject to year-end adjustments. Since the date of the most recent financial statements, no event or circumstance has occurred which has had a Material Adverse Effect. 
 9.7 Taxes. Each Loan Party has filed all tax returns (federal, state, and local) required to be filed and has paid all taxes, assessments, and
governmental charges and levies, including interest and penalties, except such taxes, if any, as are being contested in good faith and by proper proceedings and as to which adequate reserves have been maintained in accordance with GAAP. 

9.8 Franchise Agreements; Material Business Relationships. As of the Closing Date, neither Borrower nor any of its Subsidiaries is a party to
any dealer franchise agreement, dealer agreement, dealer sales and service agreement or similar agreement (each, a “Franchise Agreement”) other than those specifically listed in the Disclosure Schedule, which schedule shows the applicable
manufacturer or distributor and Borrower or Subsidiary, as the case may be, that is a party to each such agreement, the date such agreement was entered into and the expiration date of such agreement. Each of such Franchise Agreements is currently in
full force and effect, and neither the Borrower nor any Subsidiary has received any notice of termination with respect to any such agreement; and, except as disclosed on the Disclosure Schedule, neither 
  

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the Borrower nor any Subsidiary is aware of any event that with notice, lapse of time or both would allow any manufacturer or distributor that is a party of
any Franchise Agreement to terminate any such agreement. There exists no actual or threatened termination, cancellation or limitation of, or any modification or change in, the business relationship between Borrower or any of its Subsidiaries and any
customer or any group of customers or with any manufacturer or distributor that, in any case, could reasonably be expected to have a Material Adverse Effect with respect to Borrower or the Borrower and its Subsidiaries as a whole. 
 9.9 Other Agreements. Each Loan Party which is a Dealership is in material compliance with all Seller Agreements. No Loan Party is in breach of or
in default under any agreement to which it is a party or which is binding on it or any of its assets, which such breach or default has or may have a Material Adverse Effect. 
 9.10 Burdensome Obligations. No Loan Party is a party to any agreement or contract or subject to any corporate, limited liability, partnership or
other restriction which might reasonably be expected to have a Material Adverse Effect. 
 9.11 Security Interest. The Liens created
or to be created in favor of Agent and the Lenders under the Security Documents do and will at all times on and after the Closing Date, constitute perfected priority security interests (subject to Section 7.1.4), subject only to the Permitted
Liens, in the Collateral as security for the Obligations of Borrower under the Loan Documents. 
 9.12 Compliance with Laws. Each Loan
Party is in compliance in all material respects with all Applicable Laws, including without limitation all environmental permits, Environmental Laws, Access Laws, and the FLSA. 
 9.13 ERISA. Each Loan Party is in compliance in all material respects with all applicable provisions of ERISA; (b) neither a Reportable Event
nor a Prohibited Transaction has occurred and is continuing with respect to any Plan; (c) no notice of intent to terminate a Plan has been filed nor has any Plan been terminated; (d) no circumstances exist which constitute grounds
entitling the PBGC to institute proceedings to terminate, or appoint a trustee to administer, a Plan, nor has the PBGC instituted any such proceedings; (e) neither any Loan Party nor any ERISA Affiliate has completely or partially withdrawn
from a Multiemployer Plan; (f) each Loan Party and each ERISA Affiliate have met their minimum funding requirements under ERISA with respect to all of their Plans and the present value of all vested benefits under each Plan does not exceed the
fair market value of all Plan assets allocable to such benefits, as determined on the most recent valuation date of the Plan and in accordance with the provisions of ERISA; and (g) neither any Loan Party nor any ERISA Affiliate has incurred any
liability to the PBGC under ERISA except for payment of PBGC premiums. 
 9.14 Information. All reports, financial statements,
representations, and other information heretofore or contemporaneously herewith furnished in writing by any Loan Party to Agent or any Lender in connection with or relating to this Agreement and the transactions contemplated hereby is, and all
information hereafter furnished by or on behalf of any Loan Party to the Agent or any Lender pursuant hereto or in connection herewith will be, true and accurate in every material respect on the date as of which such information is dated or
certified, and none of such information is or will be incomplete by omitting to state any material fact 
  

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necessary to make such information not misleading in light of the circumstances under which made. 
 9.15 Enforceability. This Agreement constitutes, and each other Loan Document to which any Loan Party is a party when executed and delivered to
Agent will constitute a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, except to the extent that such enforcement may be limited by applicable bankruptcy, insolvency, moratorium, fraudulent transfer
and other similar laws affecting creditors’ rights generally. 
 9.16 Ownership and Liens. Each Loan Party is the true and lawful
owner of and has good title to, or valid leasehold interests in, all properties and assets material to its business, real and personal, intangible and tangible which it now owns or leases and it will have good title to or a leasehold interest in,
all Collateral and other property acquired hereafter, free of any liens and encumbrances, except Permitted Liens. 
 9.17 Ownership of
Equity Interests. Set forth in the Disclosure Schedule is a complete and accurate list as of the Closing Date of the Subsidiaries of the Borrower and its Subsidiaries and Affiliates excluding, as to Affiliates, (i) persons included in
clause (c) of the definition of Affiliate, and (ii) Persons holding 5% or more of the Borrower’s Class A Common Stock who have filed required reports under Sections 13(d), 13(g) or 16 of the Securities Exchange Act of 1934, as
amended, or are not required to file such reports, showing the jurisdiction of incorporation of each and showing the percentage of the Borrower’s ownership of the outstanding stock of each Subsidiary and Affiliate. All of the outstanding
capital stock or other Equity Interests of each such Subsidiary and Affiliate has been validly issued, is fully paid and nonassessable, and is owned directly or indirectly by the Borrower free and clear of all Liens, other than those to be released
to comply with Sections 8.1.6 and 8.1.7 hereof. 
 9.18 Labor Disputes and Acts of God. Neither the business nor the properties of any
Loan Party are affected by any fire, explosion, accident, strike, lockout, or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy, or other casualty (whether or not covered by insurance), that have or
could reasonably be expected to have a Material Adverse Effect. 
 9.19 Regulated Entities. No Loan Party, any Person Controlling any
Loan Party, or any Subsidiary is an “Investment Company” within the meaning of the Investment Company Act of 1940. No Loan Party is subject to regulation under the Public Utility Holding Company Act of 1935, the Federal Power Act, any
state public utilities code, or any other federal or state statute or regulation limiting its ability to incur indebtedness. 
 9.20
Solvency. Each Loan Party is Solvent and, after the execution and delivery of the Loan Documents and the consummation of the transactions contemplated thereby, including any Loan or Letter of Credit and the use of the proceeds thereof, will be
Solvent. 
 9.21 Continuing Representations and Warranties. Each request by Borrower for a Loan or Letter of Credit shall be deemed to
be the Borrower’s representation and warranty that (a) such Loan may be made or Letter of Credit issued without exceeding the applicable maximum amount determined in accordance with the provisions of this Agreement, (b) no Default has
occurred, or will exist after giving effect to the making such Loan or issuance of 
  

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such Letter of Credit, and (c) all representations and warranties set forth in this Agreement, the Security Documents and the other Loan Documents are
true, accurate and complete in all material respects as of the date of such request with the same effect as if made on each date, except as previously disclosed to and accepted by Agent in writing, and except for representations and warranties which
specifically refer only to another date. 
 ARTICLE 10. 
 FINANCIAL COVENANTS AND INFORMATION 
 10.1 Financial Covenants. 
 10.1.1 Total Net Worth. The Total Net Worth for Borrower and its Subsidiaries, on a consolidated basis, shall not be less than
$300,000,000.00 as of the last day of any fiscal quarter. 
 As used herein, “Total Net Worth” means for any Person
(a) the net book value of all of such Person’s assets; minus (b) all of such Person’s liabilities. 
 10.1.2 Current Ratio. The Current Ratio for Borrower and its Subsidiaries on a consolidated basis, shall not be less than 1.20 to 1.0 as of the last day of any fiscal quarter. 
 As used herein, 
 “Current Assets” means the total assets of any Person that may properly be classified as current assets in accordance with GAAP, but excluding all loans to and notes and receivables from officers, employees, directors, owners and
affiliates of such Person; provided, however, that at the election of Borrower given by written notice to Agent, delivered with any quarterly Compliance Certificate (a “Current Assets Election”), Current Assets shall be deemed to include
the Current Assets Commitment Amount at any time while such Current Assets Election is in effect. 
 “Current
Liabilities” means the total liabilities of any Person that may properly be classified as current liabilities in accordance with GAAP; provided that at any time during which a Current Assets Election is in effect, if the Expiration Date is
within one year, Current Liabilities shall be deemed to include the Current Assets Commitment Amount at such time. 
 “Current Ratio” means, for any Person at any time, the ratio at such time of such Person’s Current Assets to such Person’s Current Liabilities. 
 10.1.3 Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio for Borrower and its Subsidiaries, on a consolidated basis,
shall not be less than 1.30 to 1.0 as of the last day of any fiscal quarter, for the period of four consecutive fiscal quarters ending on such date. 
 As used herein, 
 “EBITDAR” means, for any Person, for any time period, such
Person’s net income (or loss) for such time period excluding extraordinary gains or losses plus, without duplication, the amounts which in determining net income or loss have been deducted for interest 

  

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expense, income tax expense, and depreciation, amortization, and other non-cash charges (less non-cash gains) and rental or lease expense 
 “Fixed Charge Coverage Ratio” means, as of the last day of any fiscal quarter, the ratio for the period of four consecutive
fiscal quarters ending on such date of (a) (i) EBITDAR, (ii) minus dividends and other distributions in respect of Equity Interests, (iii) minus income tax expense to the extent paid in cash, (iv) minus an allowance for
maintenance capital expenditures in an amount equal to $110,000 for each Dealership location for such four consecutive fiscal quarters; (v) plus, if a Permitted Acquisition has occurred during such time period, EBITDA attributable to any new
Acquisition Subsidiary or business acquired on a pro forma basis, calculated as if such Permitted Acquisition had occurred on the first day of such time period (it being understood and agreed that pro forma EBITDA may not be included in this
calculation to the extent that it results in an annualized increase of more than 10% in Borrower’s consolidated EBITDA prior to such adjustment, unless the Borrower provides to the Agent and the Required Lenders the supporting calculations for
such adjustment and such other information as they may reasonably request to determine the accuracy of such calculations); to (b) the sum of (i) cash interest, plus (ii) required principal payments on Debt, plus (iii) rental or
lease expense, for such four consecutive fiscal quarters. 
 10.1.4 Cash Flow Leverage Ratio. The Cash Flow Leverage
Ratio for Borrower and its Subsidiaries, on a consolidated basis, shall not be more than 3.75 to 1.0 as of the last day of any fiscal quarter for the period of four consecutive fiscal quarters ending on such date. 
 As used herein: 
 “Adjusted Funded Debt” means (a) all Funded Debt excluding Subordinated Debt and Debt consisting of Floor Plan Financing, plus (b) at any time during which a Current Assets Election is in effect, the Current Assets
Commitment Amount. 
 “Cash Flow Leverage Ratio” means, for any Person, as of any date of determination, the ratio
of (a) the principal balance of Adjusted Funded Debt as of such date to (b) EBITDA for the period of four consecutive fiscal quarters ending on such date, minus interest expense for Floor Plan Financing for such period. 
 “EBITDA” means, for any Person, for any time period, such Person’s net income (or loss) for such time period excluding
extraordinary gains or losses plus, without duplication, the amounts which in determining net income or loss have been deducted for interest expense, income tax expense, and depreciation, amortization, and other non-cash charges (less non-cash
gains); provided, however, that if a Permitted Acquisition has occurred during any time period, EBITDA may include EBITDA attributable to any new Acquisition Subsidiary or business acquired on a pro forma basis, calculated as if such
Permitted Acquisition had occurred on the first day of such time period (it being understood and agreed that any pro forma adjustment of EBITDA may not be included in this calculation to the extent that it results in an annualized increase of more
than 10% in Borrower’s consolidated EBITDA prior to such adjustment, unless the Borrower provides to the Agent and the Required Lenders the supporting calculations for such adjustment and such other information as they may reasonably request to
determine the accuracy of such calculations). 
  

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 10.2 Financial Information. Borrower shall provide to Agent and each Lender: 
 10.2.1 As soon as available and in any event 120 days after the end of each fiscal year of the Borrower: (a) the Form 10(k) for
Borrower and its Subsidiaries as filed with the Securities and Exchange Commission, reported on by independent public accountants of recognized national standing which are reasonably acceptable to Agent (without a “going concern” or like
qualification or exception and without any qualification or exception as to the scope of such audit and without any other material qualification or exception) to the effect that such financial statements present fairly in all material respects the
financial condition and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied; and (b) a consolidating balance sheet and income statement for Borrower and its
Subsidiaries for such fiscal year. 
 10.2.2 As soon as available and in any event within 45 days after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower, the Form 10-Q for Borrower and its Subsidiaries, as filed with the Securities and Exchange Commission certified by Borrower’s chief financial officer or other officer acceptable
to Agent as presenting fairly in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit
adjustments and the absence of footnotes. 
 10.2.3 As soon as available and in any event within 45 days after the end of each
month which is not the last day of a fiscal quarter, the internally prepared consolidated balance sheet and statement of operations for Borrower and its Subsidiaries for such month and for the fiscal year to date, certified by Borrower’s chief
financial officer or other officer acceptable to Agent as presenting fairly in all material respects the financial condition and results of operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, subject to normal year-end audit adjustments and the absence of footnotes. 
 10.2.4 Within 10 days following
delivery thereof, copies of all financial statements, proxy statements, and all material written reports and information provided to its shareholders generally, and copies of all registration statements, regular, periodic or special reports, and
other documents of Borrower or any Subsidiary filed with the Securities and Exchange Commission (or any successor agency), any other national securities exchange, or any other governmental securities regulatory authority having jurisdiction over
Borrower or its Subsidiaries. 
 10.2.5 Within 45 days after the end of each fiscal quarter, a Compliance Certificate
substantially in the form attached hereto as Exhibit D, signed by Borrower’s chief financial officer or other officer acceptable to Agent. 
 10.2.6 Within 20 days after the end of each month (or more frequently if required by Agent or Required Lenders during the existence of a Default), a Borrowing Base Certificate, prepared as of the last day of such
month, showing the calculation of the Borrowing Base, substantially in the form attached hereto as Exhibit E. 
 10.2.7
Promptly following Agent’s or any Lender’s reasonable request, a projected consolidated balance sheet for Borrower and its Subsidiaries and related statements of 

  

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income and cash flows for the time period requested by Agent or any Lender, signed by Borrower’s chief financial officer or other officer acceptable to
Agent, acknowledging his or her review of such projections. 
 10.2.8 Promptly following any request therefor, such other
information regarding the operations, business affairs and financial condition of the Borrower or any Subsidiary, or compliance with the terms of this Agreement, as the Agent or any Lender may reasonably request. 
 ARTICLE 11. 
 AFFIRMATIVE COVENANTS

 Until termination of the availability of Loans and Letters of Credit and payment and performance in full of all Obligations of each
Loan Party under the Loan Documents, Borrower agrees that: 
 11.1 Maintenance of Existence and Permits. Except as permitted by
Section 12.1.2, Borrower will, and will cause each Loan Party to, preserve and maintain its corporate, limited liability, partnership, trust or other existence and good standing or current status in the jurisdiction of its incorporation or
organization and qualify and remain qualified, as a foreign corporation, limited liability company or other entity in each jurisdiction in which such qualification is required, and to maintain all patents, trademarks, copyrights, trade names,
intellectual property, franchises, licenses, and permits necessary for the conduct of its business and the transactions contemplated by the Loan Documents. 
 11.2 ERISA Compliance. Borrower will, and will cause each Loan Party to, maintain each Plan in substantial compliance with all statutes, orders, rules and regulations, including but not limited to ERISA and the
Code, applicable to such Plan; administer and enforce each Plan substantially in accordance with its terms; and ensure that no Reportable Event, Prohibited Transaction, or “accumulated funding deficiency”, as such term is used in
Section 412 or Section 4971 of the Code (whether or not such accumulated funding deficiency has been waived) shall occur. 
 11.3 Inspection Rights. Borrower will, and will cause each Loan Party to, permit representatives of Agent and the Lenders to visit and inspect any of its properties, audit and inspect any of the Collateral and examine any of its
books and records (and make copies at Borrower’s expense) wherever located, including, but not limited to, all manufacturers’ statements of origin, titles, demonstrator agreements, factory invoices, purchase orders, buy-back agreements and
other agreements with manufacturers, distributors or other sellers of Vehicles (excluding agreements between Borrower and American Honda Motors or Toyota Motor Sales, to the extent that disclosure is specifically prohibited by the terms of such
agreements), and all other instruments, documents and records at any reasonable time and as often as Agent or any Lender may reasonably desire; and Borrower shall assist Agent and the Lenders in so doing. 
 11.4 Collateral Audits. Borrower will, and will cause each Collateral Subsidiary to, permit Agent by or through any of Agent’s
representatives, third party inspectors, independent contractors, attorneys or accountants, at such intervals as may be required by Agent in its sole discretion, to conduct audits of and to verify, the Collateral. Collateral audits shall, prior to
the 
  

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occurrence of an Event of Default be at Agent’s expense, and thereafter shall be at Borrower’s expense. 
 11.5 Keeping of Books and Records. Borrower will keep adequate records and books of account in which complete entries will be made reflecting all
material financial transactions. Borrower will prepare all financial statements, computations and information required hereunder for Borrower and its Subsidiaries consolidated in accordance with GAAP. 
 11.6 Maintenance of Properties, Etc. Borrower will, and will cause each Loan Party to, maintain, repair, and preserve all of such Loan
Party’s properties (whether owned, leased or subleased) that are used or useful in the conduct of the business of the Loan Parties, or where any Collateral is located (“Properties”) in good working order and condition, ordinary wear
and tear excepted, and will from time to time make or cause to be made all necessary and proper replacements, repairs, renewals, and improvements so that the efficiency and value of its Properties and facilities shall not be materially impaired.

 11.7 Other Obligations. Borrower will, and will cause each Loan Party to, file all required tax returns and reports and shall pay
and discharge before the same become delinquent all indebtedness, taxes and other obligations for which it is liable or to which its income or property is subject and all claims for labor and materials or supplies which, if unpaid, might become by
law a lien upon its assets, unless it is contesting the indebtedness, taxes, or other obligations in good faith and provision has been made for the payment thereof through setting aside on its books appropriate reserves with respect thereto in
accordance with GAAP. 
 11.8 Insurance. 
 11.8.1 Maintenance of Insurance. Borrower will, and will cause each Loan Party to, maintain policies of insurance upon all of the insurable Collateral, and on its properties and operations, carried with
companies reasonably acceptable to Agent, in such form and amounts and covering such risks as Agent may reasonably require and as are required by Applicable Law. Without limiting the foregoing, each Loan Party shall maintain, with financially sound
and reputable independent insurers, insurance with respect to its properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business, of such types and in such amounts as are
customarily carried under similar circumstances by such other Persons. 
 11.8.2 Form of Policies. All policies shall
be written in form, amounts, coverages and basis reasonably acceptable to Agent and shall be issued by a company or companies reasonably acceptable to Agent. Agent shall be designated as loss payee with a “Lender’s Loss Payable” or
mortgagee endorsement on casualty policies covering the Collateral and as an additional insured on liability policies. All policies shall include a provision that such policies will not be cancelled or materially amended, which term shall include
any reduction in the scope or limits of coverage, without at least thirty (30) days prior written notice to Agent. Each policy also shall include an endorsement providing that coverage in favor of Agent will not be impaired in any way by any
act, omission or default of any Loan Party. 
 11.8.3 Delivery of Certificates. Borrower shall furnish to Agent a
certificate of insurance in a form reasonably acceptable to Agent evidencing such insurance coverage. At 

  

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least thirty (30) days prior to the expiration date of each policy, Borrower shall furnish Agent a renewal certificate, together with evidence that the
renewal premium has been paid. Agent will provide copies of all insurance certificates and renewal policies (or certificates) to the Lenders promptly after Agent’s receipt of the same. 
 11.9 Compliance with Laws. Borrower shall, and shall cause each Loan Party to, comply in all material respects with all Applicable Laws (including
but not limited to all Environmental Laws, Access Laws and the FLSA) and promptly provide written notice to Agent of the receipt of any notice of violation thereof from any Governmental Body which violation, alone or together with any other such
violations, could reasonably be expected to have a Material Adverse Effect. 
 11.10 Agreements with Sellers. Borrower shall, and
shall cause each Loan Party to, comply with Franchise Agreements, other Seller Agreements, and all other agreements between such Person and any manufacturer or distributor of New Vehicles in all material respects and shall maintain all such
agreements in full force and effect, except in accordance with the disposition of a Dealership or Subsidiary in accordance with Section 12.1.2, and except as a result of termination or cessation of business not restricted by Section 12.8.

 11.11 Management. Borrower will, maintain and will cause each Loan Party to, maintain a Chief Executive Officer, President,
Executive Vice President and Chief Financial Officer with qualifications and experience at least comparable to those currently holding such positions. 
 11.12 Landlord’s Consents. If required by Agent or Required Lenders, Borrower shall and shall cause each Loan Party to, use its best efforts to obtain and deliver to Agent from time to time an agreement,
release and consent to the security interest of Agent and the Lenders in the Collateral, in form and substance reasonably acceptable to Agent from any owner or landlord of any real property leased by a Borrower as lessee (each a
“Landlord’s Consent”). 
 11.13 Notification. Promptly after learning thereof, Borrower will notify Agent in writing
of: 
 11.13.1 The occurrence of any Default, and if such Default is then continuing, deliver to Agent a certificate of its
chief financial officer or other authorized officer setting forth the details thereof and the action which it is taking or proposes to take with respect thereto. 
 11.13.2 The occurrence of any of the following that could reasonably be expected to have a Material Adverse Effect: (i) the release
of any Hazardous Substances on, under, about, from, or affecting any of the Properties, any adjacent property as a result of contamination, release or activity on the Properties, or any Collateral, (ii) or any other condition threatened or
asserted with respect to any such property arising under any Environmental Laws. 
 11.13.3 The details of any lien,
litigation, administrative proceeding or judgment involving $5,000,000.00 or more individually or in the aggregate threatened, instituted or completed against Borrower, any Loan Party, any Collateral, or any assets of any Loan Party (or involving
$25,000,000.00 or more in the aggregate with respect to the Loan Parties taken as a 

  

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whole), including but not limited to any and all enforcement, cleanup, removal or other governmental or regulatory proceedings pursuant to any Environmental
Laws. 
 11.13.4 Any citation, order to show cause, or other legal process or order that has or could reasonably be expected
to have a Material Adverse Effect, directing Borrower or any Loan Party to become a party to or to appear at any proceeding or hearing by or before any Governmental Body that has granted to it any Governmental Approval, and include with such notice
a copy of any such citation, order to show cause, or other legal process or order. 
 11.13.5 Any (a) refusal, denial,
threatened denial, or failure by any Governmental Body to grant, issue, renew, or extend any material Governmental Approval; (b) proposed or actual revocation, termination, or modification (whether favorable or adverse) of any material
Governmental Approval by any Governmental Body; (c) dispute or other adverse action with regard to any material Governmental Approval by any Governmental Body; (d) notice from any Governmental Body of the imposition of any material fines
or penalties or forfeitures; or (e) written threats or written notice with respect to any of the foregoing or with respect to any proceeding or hearing that might result in any of the foregoing. 
 11.13.6 Any dispute concerning or any threatened nonrenewal or modification of any material lease for real or personal property to which
it is a party. 
 11.13.7 Any material change in the relationship between any Dealership and any Vehicle manufacturer or
distributor including, without limitation, the loss or cancellation, or threatened loss or cancellation, of a franchise, or any notice of the existence of a default under any Franchise Agreement or other Seller Agreement. 
 11.13.8 Any other event or circumstance which has or could reasonably be expected to have a Material Adverse Effect. 
 11.13.9 Copies of any material notices (including notices of default or acceleration) received from any holder or trustee of, under or
with respect to any Subordinated Debt. 
 11.14 Further Assurances. From time to time, when requested by Agent or any Lender, it shall
duly execute and deliver or cause to be duly executed and delivered to Agent such further instruments, agreements, and documents and do or cause to be done such further acts as Agent or any Lender deems reasonably necessary to carry out more
effectively the provisions and purpose of this Agreement and the other Loan Documents. 
 11.15 Deposit Accounts. Except as consented
to in writing by Agent and Required Lenders, Borrower shall and shall cause each Subsidiary to, maintain its primary operating deposit accounts with U.S. Bank. Except as provided in Subsection (c) of Section 7.1.4, all such deposit
accounts other than trust accounts shall be subject to a control agreement (in form and content satisfactory to the Agent and the Required Lenders) between U.S. Bank, Agent, the Borrower, and all account holding Subsidiaries of Borrower, which
control agreement shall establish a perfected priority security interest (subject only to the Permitted Liens) in favor of Agent, for the benefit of the Lenders, in all such deposit accounts. 
  

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 ARTICLE 12. 
 NEGATIVE COVENANTS 
 Until termination of the availability of Loans and Letters of Credit and payment
and performance in full of all Obligations of each Loan Party under the Loan Documents, Borrower agrees that: 
 12.1 Mergers, Etc.

 12.1.1 Borrower will not, and will not permit any Loan Party to, wind up, liquidate or dissolve or reorganize, merge into
or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or convey, sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions) all or any substantial part of its
assets (except, with respect to sales of less than substantially all of its assets, for sales of inventory, chattel paper and equipment in the ordinary course of business), or all or substantially all of the stock or other Equity Interests of any of
its Subsidiaries (in each case, whether now owned or hereafter acquired), or wind up, liquidate or dissolve or take any action to authorize winding up, dissolution, or liquidation, except that, if at the time thereof and after giving effect thereto
no Default shall have occurred and be continuing (a) any Subsidiary may merge into Borrower in a transaction in which Borrower is the surviving corporation, (b) any wholly owned Subsidiary may merge into another wholly-owned Collateral
Subsidiary in a transaction in which the surviving entity is a Collateral Subsidiary, and (c) any wholly-owned Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the Borrower or to another wholly-owned Collateral
Subsidiary, so long as Agent and the Lenders shall continue to have a perfected security interest in the transferred assets, subject to no Liens other than Permitted Liens existing on the date of the transfer. 
 12.1.2 Notwithstanding the foregoing, (a) Borrower or any Subsidiary may sell all or substantially all of the assets (including
Equity Interests) of any Dealership or other Subsidiary (or of any business unit or franchise of a Dealership or other Subsidiary) for not less than fair market value, if (i) (A) the sales price (excluding real property and Vehicle
inventory) for any individual Subsidiary is not more than $10,000,000.00 and the sale price (excluding real property and Vehicle inventory) for all sales pursuant to this Section 12.1.2 does not exceed $25,000,000.00 in any period of twelve
consecutive months, and (B) no Default shall exist immediately prior to or upon giving effect to any such sale, or (ii) Required Lenders have consented in writing to the sale and, if any Default exists, such Default is one that can be
waived by the Required Lenders; and (b) any Subsidiary that no longer has assets (or that has assets with an aggregate book value less than $25,000.00) may discontinue operations and dissolve or liquidate unless such action would constitute a
Material Adverse Effect or any Default shall exist immediately prior to or upon giving effect thereto. 
 12.2 Guaranties, Etc.
Borrower shall not and shall not, permit any Loan Party to, enter into or permit to exist any Contingent Obligations, except Contingent Obligations permitted by Section 12.10. 
 12.3 Liens. Borrower shall not, and shall not permit any Loan Party to, grant or permit to exist a security interest in or Lien on its presently
owned or hereafter acquired real or personal property except: 
  

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 (a) Liens in favor of Agent and the Lenders which secure the Obligations. 
 (b) Liens for taxes, assessments or other government charges or levies not yet due and payable or, if due and payable, if they are being
contested in good faith by appropriate proceedings and for which appropriate reserves are maintained. 
 (c) Liens imposed by
law, such as mechanics’, materialmen’s, landlords’, warehousemen’s, and carriers’ Liens, and other similar Liens, securing obligations incurred in the ordinary course of business which are not past due for more than 30 days
or which are being contested in good faith by appropriate proceedings and for which appropriate reserves have been established. 
 (d) Liens under workers’ compensation, unemployment insurance, Social Security, or similar legislation (excluding, however, Liens arising under ERISA) which are not past due for more than 30 days or which are being contested in good
faith by appropriate proceedings and for which appropriate reserves have been established. 
 (e) Liens, deposits, or pledges
to secure the performance of bids, tenders, contracts (other than contracts for the payment of money), leases (permitted under the terms of this Agreement), public or statutory obligations, surety, stay, appeal, indemnity, performance or other
similar bonds, or other similar obligations arising in the ordinary course of business which are not past due for more than 30 days or which are being contested in good faith by appropriate proceedings and for which appropriate reserves have been
established. 
 (f) Judgment and other similar Liens arising in connection with court proceedings, in an aggregate amount not
in excess of $5,000,000.00 for any Loan Party or in excess of $25,000,000.00 in the aggregate for the Loan Parties taken as a whole; provided the execution or other enforcement of such Liens is effectively stayed and the claims secured thereby are
being actively contested in good faith and by appropriate proceedings, and the existence thereof does not constitute a Default hereunder. 
 (g) Easements, rights-of-way, zoning restrictions, and other similar encumbrances in existence on the date of this Agreement or which, in the aggregate, do not materially interfere with the occupation, use, and
enjoyment by any Loan Party of the property or assets encumbered thereby in the normal course of its business or materially impair the value of the property subject thereto. 
 (h) Liens on the assets of a Dealership securing Floor Plan Financing permitted by Section 12.10(f), and which are, only as to liens
in existence on the Closing Date, listed on the Disclosure Schedule; provided that the Floor Plan Lender providing such financing has entered into an intercreditor agreement with Agent in form and content reasonably satisfactory to Agent and the
Required Lenders. 
 (i) Purchase money Liens hereafter created by any Borrower or any Collateral Subsidiary to secure the
purchase price of equipment acquired after the Closing Date, so long as (i) such equipment is acquired in the ordinary course of such Person’s business, (ii) such Lien attaches to such equipment no later than 10 days after the
acquisition thereof; (iii) such Lien does not extend to any equipment other than the equipment acquired, (iv) such Lien secures only the 

  

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obligation to pay the purchase price of such equipment, and (v) the Debt secured is permitted by Section 12.10(k) hereof. 
 (j) Liens in existence on the Closing Date securing Debt permitted by Section 12.10 hereof (if such Debt is permitted to be secured),
which are consented to by Agent and listed on the Disclosure Schedule. 
 (k) Liens securing obligations in respect of Capital
Leases provided that such Capital Leases are otherwise permitted under this Agreement, and such Liens attach only to the property being leased. 
 (l) Liens in favor of U.S. Bank or another Lender to secure such Lender’s exposure under Interest Rate Protection Agreements, provided that such Liens are fully subordinated to the Liens in favor of Agent and the
Lenders which secure the Obligations, pursuant to a subordination agreement in form and content satisfactory to Agent and the Required Lenders. 
 (m) Liens arising solely by virtue of any statutory or common law provision relating to banker’s liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a
creditor depository institution (provided that such deposit accounts are permitted) and, if such deposit accounts are with U.S. Bank (or with another financial institution, if required by Agent), such liens are subordinated to the Liens in favor of
Agent and the Lenders which secure the Obligations pursuant to the control agreement required under Section 11.15). 
 (n) Liens on property (excluding Collateral) acquired after the Closing Date which are in existence at the time such property is acquired, which were not incurred in contemplation of the acquisition, and which secure Debt permitted by this
Agreement. 
 (o) Liens on assets owned by LRE which secures Debt permitted by this Agreement. 
 (p) Liens consented to in writing by the Required Lenders. 
 Notwithstanding the foregoing, except for Liens in favor of Agent, there shall not be any Liens on any of the capital stock or other
Equity Interests of Borrower or any Subsidiary. 
 12.4 Restricted Payments. Borrower will not, and will not permit any Loan Party to
(a) declare or pay, or agree to declare or pay, or set aside funds for the payment, directly or indirectly of, any Restricted Payment, or (b) pay or agree to pay or set aside funds to pay any management fees or similar fees in the case of
Borrower, to any direct or indirect Affiliate thereof, or in the case of any other Loan Party, to any direct or indirect owner of its Equity Interests or any direct or indirect Affiliate thereof, except (c) Subsidiaries of Borrower may make
Restricted Payments or payments of such fees to Borrower or to any Subsidiary of Borrower which is a Guarantor or Collateral Subsidiary. Notwithstanding the foregoing, so long as no Default or Event of Default has occurred and is continuing or would
exist after giving effect thereto, (i) Borrower may pay dividends on its capital stock in an aggregate amount not to exceed $15,000,000.00 in any fiscal year, and (ii) Borrower may repurchase shares of its capital stock in an aggregate
amount, for all such repurchases, not to exceed $20,000,000.00 in any 
  

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fiscal year, provided that any funds not expended for repurchase in any fiscal year may not be carried forward to any subsequent fiscal year. 
 12.5 Subordinated Debt. Borrower will not and will not permit any Loan Party to, make any redemption, prepayment, defeasance or repurchase of any
Subordinated Debt, or agree to modify the terms of any Subordinated Debt, except that Borrower or any Loan Party may take any of the foregoing actions so long as no Event of Default has occurred or will exist after giving effect to such action.

 12.6 Loans and Investments. Borrower will not, and will not permit any Subsidiary to, (a) make or contract to make any loan or
advance to any Person (other than short term trade advances in the ordinary course of business), or incur Contingent Obligations with respect to the obligations of any Person; (b) purchase or otherwise acquire, any capital stock, obligations,
or other securities of, make any capital contributions to, or otherwise invest in or acquire any interest in any Person, or participate as a partner or joint venturer with any other Person (the matters described in clause (a) and (b) are
collectively, “Investments”), except: 
 (a) Investments by Borrower in any Subsidiary or Affiliate or by any
Subsidiary in any of its Subsidiaries or Affiliates, in each case, which exist as of the Closing Date; 
 (b) contributions by
the Borrower to the capital of any of its Collateral Subsidiaries, or by any such Collateral Subsidiary to the capital of any of its Collateral Subsidiaries; 
 (c) in the ordinary course of business, Investments by Borrower in any Collateral Subsidiary or by any Subsidiary in Borrower, or by any
Subsidiary in any Collateral Subsidiary, by way of intercompany loans, advances or guaranties, to the extent permitted by this Agreement; 
 (d) Contingent Obligations permitted by Section 12.10. 
 (e) Cash Equivalent
Investments; 
 (f) Bank deposits in the ordinary course of business; 
 (g) Investments in securities of account debtors received pursuant to any plan of reorganization or similar arrangement upon the
bankruptcy or insolvency of such account debtors; 
 (h) Investments pursuant to an acquisition permitted by
Section 12.13; 
 (i) Investments, in an aggregate amount for Borrower and its Subsidiaries not to exceed $5,000,000.00,
in equity securities of companies which are not Affiliates of Borrower; 
 (j) Investments listed on the Disclosure Schedule;

 (k) Extensions of credit to customers made in the ordinary course of business and in connection with the sale or lease of
inventory in the ordinary course of business; 
  

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 (l) Investments not exceeding $20,000,000 in the aggregate in equity interests
representing up to 49% ownership in minority owned automobile dealers in accordance with the guidelines of the National Association of Minority Automobile Dealers (“Minority Dealer Affiliates”) (it being understood that any entities in
which such investments are made shall not be considered Subsidiaries for the purposes of the Agreement and shall not be included as Subsidiaries in any of the financial statements of the Borrower and its Subsidiaries that are required under
Section 10.2); and 
 (m) Such other Investments as are consented to by the Required Lenders in their sole discretion;

 provided that (x) any Investment which when made complies with the requirements of the definition of the term “Cash Equivalent Investment”
may continue to be held notwithstanding that such Investment if made thereafter would not comply with such requirements; (y) no Investment otherwise permitted by clause (b), (d), (h), (i), or (l) shall be permitted to be made if,
immediately before or after giving effect hereto, any Default or Event of Default exists; and (z) the Borrower shall not, and shall not permit any Subsidiary to, create or acquire, or make any Investment in any Subsidiary, not organized under
the laws of a State of the United States. 
 12.7 Transactions with Affiliates. Borrower will not, and will not permit any Loan Party
to, enter into any transaction with any Affiliate, except a wholly-owned Subsidiary which is a Guarantor or a Collateral Subsidiary, including without limitation, the purchase, sale, or exchange of property or the rendering of any service, except in
the ordinary course of business and upon fair and reasonable terms no less favorable to it than those that would prevail in a comparable arm’s-length transaction with a Person not an Affiliate. 
 12.8 Type of Business. Borrower will not, and will not permit any Loan Party to, make any material change in the type, character or nature of its
business activities, engage in any new type of business activity unrelated to its existing business or, interrupt or cease to engage in, for a time deemed material by Agent, any portion of its business activities or operations that would represent a
reduction in annual revenues of $175,000,000.00 or more. 
 12.9 Structure. Borrower will not, and will not permit any Loan Party to,
make any material change in its organizational structure or capital structure, or make any material modification in its Articles of Organization or Incorporation, Partnership Agreement, Operating Agreement, Bylaws, or other organizational documents.

 12.10 Debt. Borrower will not, and will not permit Loan Party to, incur or permit to exist any Debt to any Person except:

 (a) Debt (including Contingent Obligations) incurred pursuant to this Agreement and the Loan Documents. 
 (b) Short-term unsecured trade obligations incurred in the ordinary course of business which are not past due. 
 (c) Debt in respect of Interest Rate Protection Agreements. 
  

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 (d) Funded Debt of LRE which is secured primarily by real estate owned by LRE.

 (e) Funded Debt of the Dealerships with respect to Floor Plan Financing provided by DCFS, General Motors Acceptance
Corporation, Ford Motor Credit Corporation, Toyota Motor Credit Corporation, VW Credit, Inc. or other Floor Plan Lenders approved by Agent and the Lenders which have satisfied the requirements of Section 12.3(h). 
 (f) Subordinated Debt. 
 (g) Unsecured guarantees by Borrower of (i) Floor Plan Financing obligations of Dealerships to Floor Plan Lenders, (ii) debt of LRE which is permitted under Subsection 12.10(d), (iii) operating leases
of its Subsidiaries and Minority Dealer Affiliates, and (iv) extensions of credit to a Minority Dealer Affiliate, all proceeds of which are used to purchase New Vehicles, Service Loaner Vehicles, or Program Vehicles to be held by the Minority
Dealer Affiliate for sale and/or lease in the ordinary course of business, which notwithstanding any contrary provisions hereof shall be the only guarantees by Borrower. 
 (h) Unsecured Debt of Borrower to any Collateral Subsidiary. 
 (i) Unsecured Debt of any Subsidiary to Borrower or to any Collateral Subsidiary. 
 (j) Debt existing on the Closing Date and set forth on the Disclosure Schedule, provided that such Debt shall not be increased and that no
additional collateral shall be provided for such Debt. 
 (k) Funded Debt in an aggregate principal amount not to exceed for
Borrower and all Subsidiaries $5,000,000.00 at any time outstanding, provided that such indebtedness is either unsecured or is purchase money indebtedness incurred to acquire equipment which is secured only by the equipment acquired and such
equipment secures only the obligation to pay the purchase price. 
 (l) Unsecured guaranties by a Subsidiary of the
obligations of LRE on (i) real estate leases between LRE and an owner of real estate which has been subleased by LRE to such Subsidiary, and (ii) debt incurred by LRE which is permitted under Subsection 12.10(d) and which is obtained to
finance real estate leased by LRE to such Subsidiary. 
 (m) Additional Funded Debt, which together with all other Funded Debt
permitted by this Section 12.10, excluding Debt described in Sections 12.10(a) and 12.10(e) (“Excluded Funded Debt”), does not at any time for Borrower and all Subsidiaries exceed an aggregate outstanding principal amount of
$375,000,000.00; provided that any such Debt incurred after the Closing Date, shall be unsecured, unless permitted to be secured by the terms of this Agreement. Notwithstanding any contrary provision hereof, the Funded Debt of Borrower and its
Subsidiaries (excluding Excluded Funded Debt, but including all other Funded Debt described in this Section 12.10) shall not at any time exceed an aggregate principal amount of $375,000,000.00. 
  

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 12.11 Margin Stock; Speculation. Borrower will not, and will not permit any Loan Party to, use any
part of the proceeds of any Loan, either directly or indirectly, for the purpose, whether immediate, incidental, or ultimate, of purchasing or carrying any margin stock (within the meaning of Regulation U of the Board of Governors of the Federal
Reserve System as amended from time to time) or extending credit to others for the purpose of purchasing or carrying any margin stock or for any purpose which violates any applicable provision of any regulation of the Board of Governors of the
Federal Reserve System. Neither Borrower nor any Loan Party shall be engaged principally or as one of its important activities in the business of extending credit for the purpose of purchasing or conveying any margin stock. No part of the proceeds
of any Loan will be used for speculative investment purposes, including without limitation speculating or hedging in the commodities and/or futures market. 
 12.12 Restrictive Agreements. Except for Permitted Restrictions and the provisions of this Agreement and the other Loan Documents, Borrower will not, nor will it permit any Loan Party to (a) enter into or
permit to exist any arrangement, contract, or agreement which directly or indirectly prohibits Borrower or any Loan Party from or imposes any restrictions on creating, assuming or incurring any Lien upon all or any portion of its properties,
revenues or assets or those of any of its Subsidiaries whether now owned or hereafter acquired, or (b) enter into or permit to exist any agreement, contract or arrangement restricting the ability of any Subsidiary to pay or make dividends or
distributions in cash or kind to Borrower or any other Subsidiary, to make loans, advances or other payments of whatsoever nature to Borrower or any other Subsidiary, to make transfers or distributions of all or any part of its assets to the
Borrower or any other Subsidiary, or to borrow money from Borrower or any other Subsidiary, (c) enter into or permit to exist any agreement, contract or arrangement which directly or indirectly prohibits any Subsidiary from guarantying or
imposes restrictions on the ability of any Subsidiary to guaranty, the Obligations, or (d) enter into or permit to exist any agreement or arrangement which would be violated by the extensions of credit contemplated hereunder or the performance
by any Loan Party of its obligations under the Loan Documents. 
 12.13 Permitted Acquisitions. Except as otherwise permitted by
Section 12.6 and except for acquisitions of real estate by LRE, Borrower shall not, and shall not permit any Subsidiary to, acquire Control of any Person or acquire all or substantially all of the assets of any Person or of any business unit or
line of business of any Person (an “Acquisition”) except upon satisfaction of the following requirements: 
 (a) The
Acquisition consists of the acquisition by Borrower, directly or indirectly, of (i) 100% of the Equity Interests of a Person that following the Acquisition will be a Dealership (“New Dealership”) or, in the case of a Majority
Acquisition, at least 80% of the Equity Interests, or (ii) all or substantially all of the assets of a dealership, or of a business unit or line of business of a dealership. 
 (b) Borrower shall give Agent at least 30 days prior written notice of the proposed Acquisition, and if the aggregate consideration paid
for the assets acquired (other than real property and New Vehicles, Service Loaner Vehicles and Program Vehicles financed with a Floor Plan Lender) or for the Equity Interests acquired, exceeds $25,000,000.00, Required Lenders shall have consented
to such Acquisition. 
  

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 (c) The Board of Directors (or other Persons exercising similar functions) of the seller
have not disapproved the transaction or recommended that such transaction be disapproved. 
 (d) Upon consummation of the
Acquisition, the Person being acquired (or the Person acquiring the assets in an asset purchase) shall be a wholly owned (or in the case of a Majority Acquisition, at least 80% owned), direct or indirect, Subsidiary of Borrower (an “Acquisition
Subsidiary”) or shall be merged into Borrower. 
 (e) Each Acquisition Subsidiary (including Subsidiaries acquired in
Majority Acquisitions) shall execute a Joinder Agreement and any other documents reasonably required by Agent or any Lender so that such Acquisition Subsidiary becomes a Guarantor and grants a security interest in the Collateral of such Acquisition
Subsidiary. 
 (f) All representations and warranties in this Agreement shall be true and correct in all material respects as
of the date of any Acquisition unless such representation or warranty refers to another date and except as previously disclosed to and accepted by Agent in writing, and no Default shall have occurred and be continuing or will exist after giving
effect to the Acquisition. For purposes of this determination, all requirements applicable to any Guarantor, Collateral Subsidiary, or Subsidiary shall be deemed to apply to any Acquisition Subsidiary. 
 (g) Borrower shall deliver to Agent (i), in the case of an Acquisition representing aggregate consideration paid for the assets acquired
(other than real property and New Vehicles, Service Loaner Vehicles and Program Vehicles financed with a Floor Plan Lender) or for the Equity Interests acquired exceeding $25,000,000.00, a Compliance Certificate, together with all supporting
documentation reasonably required by Agent or any Lender, prepared on a pro forma basis as of the most recent date for which a Compliance Certificate was furnished to Agent, demonstrating that Borrower and its Subsidiaries would have been in
compliance with the requirements of Section 10.1 if the Acquisition had occurred on the first day of the period covered by the Compliance Certificate; and (ii) if obtained by Borrower and requested by Agent or any Lender, copies of the
seller’s financial statements. 
 (h) Agent shall have received the organizational documents, status or good standing
certificates and resolutions, or other authorizations demonstrating the due organization, valid existence, qualification to do business and (where applicable) good standing of any Acquisition Subsidiary, and the authority of the Acquisition
Subsidiary to become a Loan Party. 
 (i) Agent shall have received copies of the purchase agreement and lease, if any,
relating to that Acquisition. 
 (j) Agent shall have priority security interests in the Collateral owned by the Acquisition
Subsidiary as security for all of the Obligations, subject only to the Permitted Liens, and shall have received satisfactory evidence of perfection and the priority of such security interests, including without limitation such Uniform Commercial
Code and other searches, signed termination statements or payoff letters and other filings as Agent or any Lender deems appropriate, which shall include evidence of the termination of, or reasonably satisfactory 

  

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arrangements for the termination of, all security interests of any secured party in any of the assets acquired or of the Acquisition Subsidiary. 

(k) Agent shall have conducted such audits of any Collateral being acquired or which is owned by any Acquisition Subsidiary as is
desired by Agent, the results of which shall be satisfactory to Agent. 
 (l) Borrower or any Acquisition Subsidiary shall
have received approval of all material Seller Agreements (including without limitation Franchise Agreements), between any Acquisition Subsidiary and any manufacturer or distributor of Vehicles for which the Acquisition Subsidiary will act as a
dealer as may be necessary for Acquisition Subsidiary to conduct its intended business following the Acquisition. Borrower or the Acquisition Subsidiary shall deliver to Agent copies of all such Seller Agreements promptly upon receipt, if requested
by Agent or any Lender. 
 (m) All insurance required under Section 11.8.2 shall have been obtained and Agent shall have
received evidence thereof in the form of a certificate of insurance as required under Section 11.8.3. 
 (n) Borrower has
delivered to Agent a certificate in a form acceptable to Agent and signed by Borrower’s chief financial officer or other officer acceptable to Agent, certifying that all conditions in Section 12.13(a), (c), (d), (f) and (l) have
been satisfied or will be satisfied as of the date of the Acquisition. 
 (o) Agent has received such additional documents,
approvals, consents and information and Borrower has satisfied such additional requirements as Agent or any Lender reasonably requests. 
 12.14 Fiscal Year. Borrower will not, and will not permit any Subsidiary to, change its fiscal year. 
 12.15 Lithia Real
Estate, Inc. LRE shall not own any assets other than real estate, cash, and assets incidental to the operation of specific real estate; provided, however that LRE shall in no event own any equipment (except fixtures attached to real estate) or
inventory. 
 ARTICLE 13. 
 DEFAULT AND REMEDIES 
 13.1 Events of Default. The occurrence of any of the following shall constitute an Event of
Default under this Agreement and each of the Loan Documents: 
 13.1.1 Any Loan Party shall fail to pay (a) when due, any
principal owing under this Agreement, any Note, Letter of Credit, LC Agreement, or any other Loan Document, or (b) within 3 days after it is due, any interest or fee payable under this Agreement, any Note, Letter of Credit, LC Agreement, or any
other Loan Document or (c) when due and uncured within 5 days after notice from Agent that such amount remains unpaid, any other amount payable under this Agreement, any Note, Letter of Credit, LC Agreement, or any other Loan Document.

  

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 13.1.2 Any default under or any failure of any Loan Party to perform or comply with any
term, condition, covenant or obligation (a) set forth in Section 10.1, 11.1, 11.10 or Article 12 of this Agreement or (b) set forth in any provision of this Agreement (except an Event of Default specified in Section 13.1.1,
13.1.2(a) or elsewhere in Section 13.1), any other Loan Document or any other Agreement between Agent or any Lender and any Loan Party, and such default or failure is not cured within 30 days after the earlier of the date any Loan Party knows
or reasonably should know thereof or the date on which Agent gives written notice thereof to Borrower (provided, however, that such cure period is available only if the applicable default or failure is reasonably capable of being cured). 

13.1.3 Any default occurs in the payment or performance of any material provisions of any agreement or condition relating to the
Subordinated Debt or any other Debt in an aggregate amount outstanding for such Debt for all Loan Parties that is in excess of $5,000,000.00 (other than Debt owing under the Loan Documents) and the period of grace, if any, to cure such default shall
have passed, and the default constitutes (a) nonpayment, or (b) any event or condition, the effect of which is to cause or permit the holder of such Debt to cause such Debt to become due prior to its maturity date. 
 13.1.4 Any default occurs under or any Loan Party fails to pay, perform or comply with any material terms, conditions or obligations in
any security instrument securing the Obligations or any Lien created or purported to be created by any Security Document shall cease to be, or shall be asserted by any Person not to be, a valid, perfected Lien with a priority that is subject only to
the Permitted Liens. 
 13.1.5 Any Guaranty or other Loan Document ceases to be, or shall be asserted by Borrower or any
Guarantor not to be, in full force and effect, or any Guarantor shall attempt to revoke or repudiate any Guaranty. 
 13.1.6
Any warranty, representation, statement, or information made or furnished to Lender by or on behalf of any Loan Party proves to have been false or misleading in any material respect when made, furnished, or certified, or when deemed made, furnished,
or certified. 
 13.1.7 Custody or control of any substantial part of the property of any Loan Party is assumed by any
Governmental Body or any Governmental Body takes any final action, the effect of which would be a Material Adverse Effect. 
 13.1.8 (a) Any Loan Party shall commence any case, proceeding, or other action (i) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, or relief of debtors,
seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition, or other relief with respect
to it or its debts, or (ii) seeking appointment of a receiver, trustee, custodian, or other similar official for it or for all or any substantial part of its assets, or any Loan Party shall make a general assignment for the benefit of its
creditors; or (b) there shall be commenced against any Loan Party any case, proceeding, or other action of a nature referred to in clause (a) above which (iii) results in the entry of an order for relief or any such adjudication or
appointment or (iv) remains undismissed, undischarged, unstayed, or unbonded for a period of 
  

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30 days; or (c) there shall be commenced against any Loan Party any case, proceeding, or other action seeking issuance of a warrant of attachment,
execution, distraint, or similar process against all or any substantial part of its assets that results in the entry of an order for any such relief which shall not have been vacated, discharged, stayed, or bonded pending appeal within 30 days from
the entry thereof; or (d) any Loan Party shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in any of the acts set forth in clauses (a), (b), or (c) above; (e) any Loan Party shall
admit in writing its inability to pay its debts as they become due or shall, within the meaning of the United States Bankruptcy Code (11 U.S.C. §101 et seq.), generally not pay its debts as they become due; or (f) any Loan Party is not
Solvent. 
 13.1.9 Except as permitted by Section 12.1, (a) any Loan Party which is a corporation, partnership,
limited liability company or other type of entity is dissolved or liquidated or takes any action to authorize a dissolution or liquidation; or (b) any Loan Party which is a trust (or trustee acting with respect to property held in trust) is
revoked, amended or terminated. 
 13.1.10 Any refusal or failure by any Governmental Body to issue, renew, or extend any
material lease or Governmental Approval with respect to the operation of the business of any Loan Party or its Subsidiaries, or any denial, forfeiture or revocation by any Governmental Body of any Governmental Approval that could reasonably be
expected to have a Material Adverse Effect. 
 13.1.11 One or more judgments, writs of attachment, or similar process, in an
aggregate amount in excess of $5,000,000.00 (in excess of insurance coverage) shall be entered or filed against any Loan Party or any property of any Loan Party and remains unpaid, unvacated, unbonded or unstayed for a period of 30 days or more.

 13.1.12 Any of the following events shall occur or exist with respect to any Loan Party or any ERISA Affiliate:
(a) any Reportable Event shall occur; (b) any Prohibited Transaction shall occur; (c) complete or partial withdrawal from any Multiemployer Plan shall take place; a notice of intent to terminate a Plan shall be filed, or a Plan shall
be terminated, the result of which is to result in a liability or obligation in excess of $5,000,000; or (d) circumstances shall exist which constitute grounds entitling the PBGC to institute proceedings to terminate a Plan, or the PBGC shall
institute such proceedings. 
 13.1.13 Borrower or any Collateral Subsidiary fails to pay, perform or comply with any material
term, condition or obligation in any Seller Agreement, or any such agreement ceases to be, or is asserted by any Person not to be, in full force and effect, or the other party to such agreement gives notice of default to Borrower or any Collateral
Subsidiary, and the result of such failure, cessation, or notice of default has, or might reasonably be expected to have, a Material Adverse Effect. 
 13.1.14 There is any Change in Control. 
 13.2 Consequences of Default; Rights and Remedies.
Time is of the essence of this Agreement.  
  

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 13.2.1 Upon the occurrence or existence of any Event of Default (other than an Event of
Default referred to in Section 13.1.8 and at any time thereafter during the continuance of such Event of Default, Agent shall have the right, by written notice to Borrower, to: (a) terminate the commitments to make Loans and issue Letters
of Credit; (b) declare all outstanding Obligations payable by Borrower to be immediately due and payable without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein
or in the Loan Documents to the contrary notwithstanding; and/or (c) direct Borrower to deliver to Agent funds in an amount equal to the aggregate stated amount of all outstanding Letters of Credit. Borrower immediately shall deliver to Agent
all such funds required by Agent and Agent shall hold such funds in a non-interest bearing account as collateral for the Obligations. Borrower hereby grants to Agent, for the benefit of the Agent, Issuing Lender and the Lenders, a security interest
in such funds and such account. 
 13.2.2 Upon the occurrence or existence of any Event of Default described in
Section 13.1.8, immediately and without notice, (a) the Commitments and the availability of Loans and Letters of Credit shall automatically terminate, (b) all outstanding Obligations payable by Borrower hereunder shall automatically
become immediately due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived, anything contained herein or in the Loan Documents to the contrary notwithstanding, and
(c) Borrower shall automatically become obligated to deliver to the Agent funds in an amount equal to the aggregate stated amount of all outstanding Letters of Credit, which funds shall be held by the Agent in a non-interest bearing account as
collateral for the Obligations. Borrower hereby grants to Agent, for the benefit of the Agent, Issuing Lender and the Lenders, a security interest in such funds and such account. 
 13.2.3 In addition to the foregoing remedies, upon the occurrence or existence of any Event of Default, Agent and the Lenders shall have
the right to exercise any right, power or remedy available under this Agreement, any of the other Loan Documents, or otherwise available at law or in equity. 
 13.2.4 The Agent shall promptly inform the Lenders of the occurrence of any Default or Event of Default of which it is deemed to have
knowledge or notice pursuant to Section 15.7 and will promptly provide the Lenders with copies of any and all notices that Agent has received with respect thereto. After such notification, the Lenders shall meet to determine the desired course
of action and the Agent shall take such course of action, and pursue such rights and remedies under the Loan Documents, as the Required Lenders shall determine. If the Required Lenders have not agreed upon a course of action within 90 days after the
date that the Lenders have received a notice from the Agent of the occurrence of a Default or Event of Default, the Agent shall (and shall be obligated to) terminate the Commitments, accelerate all of the Obligations, and apply all amounts collected
from the Borrower, the Subsidiaries of Borrower, any Guarantors and the Collateral as set forth in Section 5.8 and pursue such other rights and remedies as are prudent under the circumstances. During the time frame between the Agent’s
giving notice of the occurrence of a Default or Event of Default to the Lenders and the earlier of (a) the Required Lender’s agreement on a course of action or (b) the expiration of the 90 day decision period, the Agent shall take
such actions on behalf of the Lenders as the Agent deems prudent. This Section shall not apply to any Event of Default referred to in Section 13.1.8. Any Event of Default referred to in Section 13.1.8 shall be governed by Section 13.2.2. However,
decisions as to how to handle, vote, or compromise the Agent’s claims on behalf of the 
  

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Lenders in any bankruptcy or insolvency proceeding shall be governed by this Section. This Section confers no rights upon any Loan Party. 
 ARTICLE 14. 
 HAZARDOUS SUBSTANCES

 14.1 Representations and Warranties. Borrower represents and warrants that to Borrower’s knowledge, the Properties
identified in the Disclosure Schedule are the only Properties requiring remedial action under applicable Environmental Laws, resulting from the use, generation, manufacture, storage, treatment, disposal, release, or threatened release of any
Hazardous Substances on, under, about or from any of the Properties. The performance of such remedial actions will not have a Material Adverse Effect on Borrower or its businesses. 
 14.2 Activities. Borrower agrees that it will require any other Loan Party to use, generate, manufacture, store, treat, release or dispose of
Hazardous Substances on, under, about or from the Properties only as is reasonable and necessary in the operation of Borrower’s businesses, and in substantial compliance with all applicable Environmental Laws. 
 14.3 Inspections. Borrower will permit and will cause each Loan Party to permit representatives of Agent and the Lenders to enter upon the
Properties to make such inspections and tests as they may deem appropriate to determine compliance of the Properties with this Article. Any such inspections or tests shall be at the expense of Borrower and for Agents’ and the Lenders’
purposes only, and shall not be construed to create any responsibility or liability on the part of Agent or any Lender to Borrower, any Loan Party or any other Person. 
 14.4 Release and Indemnity. Borrower hereby (a) releases and waives any future claims against Agent and each Lender for indemnity or contribution in the event any Loan Party becomes liable for cleanup or other
costs under any Environmental Laws, and (b) agrees to indemnify and hold harmless Agent and each Lender and their respective officers, directors, employees, agent, attorneys and advisors (the “Indemnified Persons”) against any and all
claims, losses, liabilities, damages, penalties, and expenses which such Person may directly or indirectly sustain or suffer resulting from a breach of this Article by any Loan Party or as a consequence of any use, generation, manufacture, storage,
disposal, release or threatened release of a Hazardous Substance on the Properties, except to the extent arising from the gross negligence or willful misconduct of the Indemnified Persons. 
 14.5 Survival. The provisions of this Article, including the obligation to indemnify, shall survive the repayment of the Notes and Letters of
Credit and other liabilities and Obligations of Borrower under this Agreement, and the termination or expiration of this Agreement, and, if applicable, shall not be affected by Lender’s acquisition of any interest in any of the Properties,
whether by foreclosure or otherwise. 
 ARTICLE 15. 
 AGENCY PROVISIONS 
 15.1 Authorization. Each Lender hereby appoints and authorizes Agent to
take such action as Agent on its behalf and to exercise such powers as are delegated to Agent by the terms 
  

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of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto. Agent shall have no duties or responsibilities
except those expressly set forth hereunder and in the other Loan Documents. The duties of Agent shall be mechanical and administrative in nature; Agent shall not have by reason of any Loan Document a fiduciary relationship with any Lender; and
nothing in any Loan Document, shall be construed to impose upon Agent any obligations with respect to the Loan Documents except as expressly set forth herein. The term “Agent” is not intended to connote any fiduciary relationship or other
obligations arising under any agency doctrine, but is used merely as a matter of market custom and is intended to reflect only an administrative relationship between independent contracting parties. As to any matters not expressly provided for by
this Agreement, including enforcement or collection of the Loans or other Obligations, Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in
so acting or refraining) upon the instructions of Required Lenders, and such instructions shall be binding upon all Lenders, provided that Agent shall not be required to take any action which exposes Agent to personal liability or which is contrary
to the Loan Documents or Applicable Law. In the absence of instructions from Required Lenders, Agent shall have authority, in its sole discretion, to take or not to take any actions or make any decisions regarding (a) decisions pursuant to
Section 4.1.2 and (b) any other matters that are not specifically reserved to (i) the Required Lenders or (ii) the Agent and the Required Lenders or (iii) the Agent and the Lenders, all without the consent of any Lender, and
any such action or failure to act shall be binding on Lenders and on all holders of the Notes. Each Lender and each holder of any Notes shall execute and deliver such additional instruments, including powers of attorney in favor of the Agent, as may
be necessary or desirable to enable Agent to exercise its powers hereunder and under the other Loan Documents. Agent shall take no action with respect to any decisions, consents, determinations, and other matters that are reserved to (A) the
Required Lenders or (B) the Agent and the Required Lenders or (C) the Agent and the Lenders under this Agreement or any other Loan Document without the consent of, or specific direction from, the Required Lenders, except as set forth in
Section 13.2.4. In addition, Agent shall take no action with respect to any decisions, consents, determinations, and other matters that are reserved to all of the Lender’s under Section 16.9 without the consent of or specific
direction by all of the Lenders. 
 15.2 Duties and Obligations. Neither Agent nor any of its directors, officers, agents, or employees
shall be liable for any action taken or omitted to be taken by any of them in good faith under or in connection with this Agreement or any other Loan Document except for its or their own gross negligence or willful misconduct. Without
limiting the generality of the foregoing, Agent (a) may treat each Lender which is a party hereto as the party entitled to receive payments hereunder until Agent receives written notice of the assignment of such Lender’s interest in
accordance with Section 16.4; (b) may consult with legal counsel, independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with
the advice of such experts; (c) makes no warranty or representation to any Lender and shall not be responsible to any Lender for any statements, warranties, or representations made in or in connection with this Agreement, any other Loan
Document, or in any instrument or document furnished pursuant hereto or thereto; (d) shall not have any duty to ascertain or to inquire as to the performance of any of the terms, covenants, or conditions of the Loan Documents on the part of any
Loan Party, as to the use of the proceeds of any Loan, or as to the existence or possible existence of any Default or Event of Default; (e) shall not be responsible to any Lender for the due execution, legality, validity, enforceability,
genuineness, effectiveness, or value of this Agreement, of any 

  

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other Loan Document, or of any instrument or document furnished pursuant hereto or thereto; and (f) shall incur no liability under or with respect to
this Agreement or any other Loan Document by acting upon any oral or written notice, consent, certificate, or other instrument or writing (which may be by telegram, facsimile transmission, cable, or telex) believed by it to be genuine and signed,
sent or made by the proper party or parties or by acting upon any representation or warranty of any Loan Party made or deemed to be made herein or in any other Loan Document. 
 15.3 Agent in Individual Capacity. With respect to its Commitments, Loans and participation in Swingline Loans and Letters of Credit, Agent, in
its individual capacity as a Lender and not as Agent, shall have the same rights hereunder and otherwise as any other Lender and may exercise the same as though it were not Agent and the term “Lender” or “Lenders” shall include
the Agent in its individual capacity and as Swingline Lender and Issuing Lender. The Agent and its affiliates may accept deposits from, lend money to, act as trustee under indentures of, and generally engage in any kind of business with, Borrower,
any Loan Party or any of their Subsidiaries and Affiliates, all as if the Agent were not the Agent and without notice to or consent of the Lenders. 
 15.4 Independent Credit Decisions. Each Lender acknowledges that it has, independently and without reliance upon Agent or any other Lender and based upon such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan Documents and to extend credit to Borrower hereunder. Each Lender also acknowledges that it will, independently and without reliance upon Agent or any other Lender and
based upon such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement and the other Loan Documents. Except for notices, reports and other
documents and information expressly required to be furnished to the Lenders by the Agent, the Agent shall have no duty or responsibility to provide any Lender with any credit or other information concerning the affairs, financial condition or
business of any Loan Party which may come into the possession of the Agent or any of its affiliates. 
 15.5 Indemnification. The Lenders
agree to indemnify Agent and its officers, directors, employees, agents, attorneys and advisors (collectively, “Agent-Related Persons”) (to the extent not reimbursed by Borrower) ratably according to their respective Pro Rata Shares from
and against any and all claims, liabilities, obligations, losses, damages, penalties, actions, judgments. suits, costs, expenses, or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against the
Agent-Related Persons in any way relating to or arising out of this Agreement or any other Loan Document or any action taken or omitted by Agent under this Agreement or any other Loan Document, except any such as result from Agent’s gross
negligence or willful misconduct. Without limiting the foregoing, each Lender agrees to reimburse Agent promptly on demand in proportion to its Pro Rata Share for any out-of-pocket expenses, including Attorney Costs, incurred by Agent in connection
with the syndication, negotiation, preparation, execution, delivery, modification, administration, enforcement, preservation of the Loans and Loan Documents (to the extent that Agent is not reimbursed for such expenses by Borrower). The agreements
in this Section 15.5, shall survive repayment of the Obligations and termination of this Agreement. 
  

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 15.6 Successor Agent. Agent may resign as Agent upon 30 days prior written notice to the Lenders
and to Borrower. Required Lenders shall thereupon have the right to appoint a successor Agent. Unless a Default exists, such successor Agent shall be reasonably satisfactory to Borrower. If no successor agent is appointed prior to the effective date
of the resignation, then Agent may appoint a new agent from among the Lenders. Upon the acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights,
powers, privileges, and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations under this Agreement, other than from liabilities to Lenders for Agent’s gross negligence or willful misconduct
arising prior to the date of such discharge. Until the acceptance by such a successor Agent, the retiring Agent shall continue as Agent hereunder. After any retiring Agent’s resignation as Agent shall become effective, the provisions of this
Agreement shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement. 
 15.7
Notice of Default. The Agent shall not be deemed to have knowledge or notice of the occurrence of any Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Agent, unless the Agent
shall have received written notice from a Lender or Borrower referring to this Agreement, describing such Default and stating that such notice is a “notice of default.” The Agent will take actions with respect to a Default as set forth in
Section 13.2.4. 
 15.8 Defaulting Lenders. Notwithstanding anything to the contrary contained in this Loan Agreement or any of
the other Loan Documents, any Lender that fails to pay any amount required hereunder, including failure (a) to make available to the Agent its Pro Rata Share of any Loan, or LC Outstandings, or to fund any participation in any Swingline Loan or
LC Outstandings, or (b) to comply with the provisions of Section 16.7, in each case as, when and to the full extent required by the provisions of this Agreement, shall be deemed a “Defaulting Lender” until such time as such
delinquency is satisfied. A Defaulting Lender shall be deemed to have assigned to the remaining nondefaulting Lenders (a) any and all payments due to it from Borrower, whether on account of outstanding Loans, interest, fees or otherwise, for
application to, and reduction of, their respective Pro Rata Shares of the outstanding Loans, and each Lender hereby authorizes the Agent to distribute such payments to the nondefaulting Lenders in proportion to their respective Pro Rata Shares of
the applicable outstanding Obligations and LC Outstandings; and (b) its right to vote on any matters requiring the consent of the Lenders, in proportion to their respective Pro Rata Shares of the aggregate Revolving Loan Exposure of all
Lenders. A Defaulting Lender shall be deemed to have satisfied in full a delinquency when and if, as a result of application of the assigned payments to all outstanding Obligations and LC Outstandings of the nondefaulting Lenders, the Lenders’
respective Pro Rata Shares of all outstanding Obligations and LC Outstandings have returned to those in effect immediately prior to such delinquency and without giving effect to the nonpayment causing such delinquency. 
 15.9 U.S. Bank Deposit Accounts. 
 15.9.1 Agent will provide to each Lender, copies of all Amendments to the Blocked Account Control Agreement or Schedule 1 thereto between Agent, U.S. Bank as a party to the Interest Rate Protection Agreements, and
U.S. Bank as depositary bank (“U.S. Bank Control Agreement”). 
  

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 15.9.2 Agent shall give written notice under Section 4 of the U.S. Bank Control
Agreement to U.S. Bank, as depositary bank, when Agent is required to do so pursuant to Section 13.2.4 or any other provision of this Agreement. 
 ARTICLE 16. 
 MISCELLANEOUS 
 16.1 Payment of Expenses and Taxes. Borrower hereby agrees: 
 (a) to pay or reimburse Agent on demand for all reasonable costs and expenses (including reasonable Attorney Costs of Agent’s
counsel) incurred in connection with the syndication, negotiation, preparation, execution, delivery, administration, enforcement of the Loan Documents and the transactions contemplated thereby, and any amendment, supplement or modification to, the
Loan Documents and any other documents prepared in connection therewith, whether or not the transactions contemplated hereby are consummated, including all recording costs, filing fees, costs of appraisals, environmental audits and reviews,
collateral audits (subject to Section 11.4), title insurance, lien searches, and costs of perfecting, continuing, monitoring, preserving and protecting security interests in the Collateral; 
 (b) to pay or reimburse Agent and each Lender for all their reasonable costs and expenses incurred in connection with, and to pay,
indemnify, and hold the Indemnified Persons harmless from and against any and all claims, liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses, disbursements, and Attorney Costs of every kind and nature
arising out of or in connection with, the enforcement or protection of any rights and remedies under the Loan Documents and any other documents prepared in connection therewith (including without limitation in connection with negotiations or workout
or restructuring affecting the Loan Documents or Obligations and any bankruptcy, or similar proceeding or other legal proceeding involving any Loan Party); 
 (c) to pay, indemnify, and to hold the Indemnified Persons harmless from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any failure or delay in paying, stamp, excise and other taxes (other than income and gross revenue taxes), if any, which may be payable or determined to be payable in connection with the execution and
delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, any Loan Document and any such other documents including reasonable Attorney
Costs of counsel to Agent and each Lender in connection with the foregoing and in connection with advising Agent with respect to its rights and responsibility under any Loan Document; and 
 (d) to pay, indemnify, and hold the Indemnified Persons harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature (including reasonable Attorney Costs) which may be incurred by or asserted against any Indemnified Person arising out of or in connection with the
Loan Documents, the transactions contemplated by the Loan Documents, or the use of the proceeds of the Loans (including, without limitation, in connection with any investigation, litigation, or proceeding or 

  

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preparation of defense in connection therewith), whether or not any of the indemnified Persons is a party thereto, or by reason of or in connection with
the execution and delivery or transfer of, or payment or failure to make payments under, Letters of Credit (it being agreed that nothing in this Section 16.1 is intended to limit Borrower’s obligations pursuant to Section 4.9). 

 Notwithstanding the foregoing, Borrower shall have no obligation to indemnify any Indemnified Person with respect to any costs of the
matters described in subsections (a), (b), (c) and (d) of this Section 16.1 which arise from the gross negligence or willful misconduct of such Indemnified Person. The agreements in this Section 16.1 shall survive repayment of
the Obligations and termination of this Agreement. 
 16.2 Successors and Assigns. This Agreement and the other Loan Documents
shall be binding upon and inure to the benefit of Borrower, Lenders, Agent, all future holders of the Notes and the Obligations and any of their respective successors and assigns, except that Borrower may not assign or transfer any of its rights or
obligations under any Loan Document without the prior written consent of each Lender. 
 16.3 Participations. 
 16.3.1 Any Lender may, in accordance with Applicable Law, at any time sell to one or more banks or other entities (each, a
“Participant”) participating interests (or with respect to Swingline Loans and Letters of Credit, sub-participating interests) in its Loans, Notes, Letters of Credit, and other interests hereunder. 
 16.3.2 In the event of any such sale by a Lender of participating interests to a Participant, such Lender’s obligations under this
Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain the holder of its Notes and participating interests in Swingline Loans and Letters of Credit for all purposes under
this Agreement, Borrower and Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement, and such Participant shall have no voting rights as a Lender hereunder;
provided, however, that any agreement pursuant to which any Lender sells a participating interest may require the Lender to obtain Participant’s consent to any amendment of the type described in Sections 16.9(a) through 16.9(h). 
 16.3.3 Borrower agrees that if amounts outstanding under this Agreement and the Notes, Letters of Credit, LC Agreement, and other Loan
Documents are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of setoff in respect of its participating or
sub-participating interest in amounts owing under this Agreement or any Note to the same extent it would have such rights under Section 16.8 if the amount of its participating interest were owing directly to it under this Agreement, any Note,
or any other Loan Document; provided that such right of setoff shall be subject to the obligation of such Participant to share with Lenders, and Lenders agree to share with such Participant, as provided in Section 16.7 hereof. In addition,
Borrower agrees that each Participant shall be entitled to the benefits of Sections 6.2 and 6.4 hereof with respect to its participation or sub-participation in the Obligations outstanding from time to time; provided that no Participant shall be
entitled to 

  

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receive any greater amount than the selling Lender would have been entitled to receive with respect to the amount transferred if no such transfer occurred.

 16.4 Assignments. 
 16.4.1 Any Lender may, in the ordinary course of its commercial lending business and in accordance with Applicable Law, at any time sell to any Lender and, with the consent of the Agent (and, if no Event of Default
then exists, Borrower), which consent shall not be unreasonably withheld, may sell to one or more other banks or financial institutions reasonably acceptable to Agent (each an “Assignee”) all or a ratable part of its Loans, Notes, and
participations in Swingline Loans and Letters of Credit and other interests under this Agreement and the Loan Documents; provided, however, that (a) each assignment shall be in a minimum amount of $25,000,000.00; (b) after giving effect to
any Assignment, the Revolving Loan Exposure of the transferor Lender shall be at least $35,000,000.00 or shall be $0; and (c) each assignment shall be of a constant and not a varying, percentage of all of the interests of such Lender in all
Commitments, Loans and Letters of Credit. Notwithstanding the foregoing, no consent shall be required from Agent or Borrower (and no fee will be payable to Agent under Section 16.4.2) with respect to any assignment by a Lender of all (but not
less than all) of its rights, Commitments, and other obligations hereunder and under the other Loan Documents to an Affiliate of such Lender or to a successor by merger to such Lender. 
 16.4.2 Any assignment shall be pursuant to an agreement substantially in the form attached hereto as Exhibit F (an “Assignment
Agreement”), executed by the Assignee, transferor Lender (and, in the case of a Assignee that is not then a Lender, by Agent), which Assignment Agreement shall be delivered to Agent for its acceptance and recording in the Register, together
with a transfer fee for the account of Agent in the amount of $3,500.00. Upon such execution, delivery, acceptance and recording, from and after the effective date specified in such Assignment Agreement, (a) the Assignee shall be a party hereto
and, to the extent provided in such Assignment Agreement, have the rights and obligations of a Lender hereunder with the interests as set forth therein, and (b) the transferor thereunder shall, to the extent provided in such Assignment
Agreement, be released from its obligations under this Agreement (and, in the case of an assignment covering all or the remaining portion of a transferor Lender’s rights and obligations under this Agreement, such transferor Lender shall cease
to be a party hereto). Such Assignment Agreement shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of the Assignee and the resulting adjustment of Pro Rata Shares, Commitments, and
Revolving Loan Exposure, arising from the purchase by such Assignee of the rights and obligations of the transferor Lender. 
 16.4.3 On or prior to the effective date specified in the Assignment Agreement, Borrower, at its own expense, shall execute and deliver to Agent new Notes to the order of such Assignee equal to the Loans assumed by it pursuant to such
Assignment Agreement and, unless the transferor Lender has not retained any obligations hereunder, new Notes to the order of the transferor Lender in an amount equal to the Commitments and Loans retained by it hereunder. Each new Note shall be
substantially in the form of the Note replaced thereby. The Note surrendered by the transferor Lender shall be promptly returned by Agent to Borrower marked “replaced.” 
  

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 16.4.4 Each Assignee which was not previously a Lender and which is not incorporated
under the laws of the United States of America or a state thereof shall, before becoming a Lender, and from time to time when requested by Agent, comply with the requirements of Section 6.1.2. 
 16.5 Register. The Agent shall maintain a copy of each Assignment Agreement delivered to it and a Register (the “Register”) for the
recordation of the names and addresses of Lenders and the Commitments, Pro Rata Shares and principal amount of the Obligations owing to, each Lender from time to time. The entries in the Register shall be conclusive, in the absence of manifest
error, and Borrower, Agent, and Lenders may treat each Person whose name is recorded in the Register as the owner of the Loans and recorded therein for all purposes of this Agreement. The Register shall be available for inspection by Borrower or
Lender at any reasonable time and from time to time upon reasonable prior notice. 
 16.6 Information. Borrower, for itself and its
Subsidiaries, authorizes each Lender to disclose to any Participant or Assignee and prospective Participant or Assignee any and all financial or other information in such Lender’s possession concerning Borrower or any other Loan Party, subject
to the confidentiality requirements of Section 16.21 of this Agreement. 
 16.7 Sharing of Payments. If any Lender shall obtain
any payment (whether voluntary, involuntary, through the exercise of any right of setoff, or otherwise) on account of the Obligations in excess of its ratable share of payments on account of the Obligations obtained by all the Lenders, such Lender
shall purchase from the other Lenders such participations or sub-participations in the Notes, Letters of Credit, and other Obligations held by them as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each
of the other Lenders, provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Lender, such purchase from each other Lender shall be rescinded and each other Lender shall repay to the
purchasing Lender the purchase price to the extent of such recovery, together with an amount equal to such Lender’s ratable share of any interest or other amount paid or payable by the purchasing Lender with respect to the total amount so
recovered. Borrower agrees that any Lender purchasing a participation from another Lender pursuant to Section 16.3 of this Agreement may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of setoff)
with respect to such participation as fully as if such Lender were the direct creditor of Borrower in the amount of such participation. 
 16.8 Setoff; Security Interest. In addition to any rights and remedies of the Lenders provided by law, each Lender shall have the right, without prior notice to Borrower, any such notice being expressly waived by Borrower, to the
extent permitted by Applicable Law, upon the occurrence and during the continuance of an Event of Default, to set-off and apply any and all deposits, funds or assets at any time held and other indebtedness at any time owing by such Lender to or for
the credit or account of Borrower, against any indebtedness or Obligations, whether matured or unmatured, of Borrower to such Lender. As security for such indebtedness and the other Obligations, Borrower hereby grants to Agent and each Lender a
continuing security interest in any and all deposits, accounts or moneys of Borrower maintained at any time with Agent or such Lender. The aforesaid right of set-off may be exercised by Agent or such Lender against Borrower or against any trustee in
bankruptcy, debtor in possession, assignee for the benefit of creditors, receiver or execution, judgment or attachment creditor of Borrower or 
  

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against anyone else claiming through or against Borrower or such trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors,
receiver, or execution, judgment or attachment creditor, notwithstanding the fact that such right of set-off shall not have been exercised by Agent or such Lender prior to the occurrence of an Event of Default. 
 16.9 Amendments and Waivers. Except as otherwise specifically set forth herein, or as otherwise specifically provided in any Loan Document, no
amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent with respect to any material departure by Borrower or any other Loan Party therefrom, shall be effective unless the same shall be in writing and signed
by the Required Lenders (or by the Agent at the written request of the Required Lenders), and, with respect to amendments, by each Loan Party which is a party thereto, and acknowledged by the Agent, and then any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which given; provided, however, that no such waiver, amendment, or consent shall, unless in writing and signed by all the Lenders and, in the case of amendments, the applicable
Loan Parties, and acknowledged by the Agent, do any of the following: 
 (a) increase any Commitment (other than increases in
the Letter of Credit Commitment in accordance with Section 4.1.2), Revolving Loan Exposure of any Lender, or increase the Total Revolving Loan Commitment; 
 (b) extend the Expiration Date; 
 (c) postpone or delay any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees or other amounts due to any Lender hereunder or under any other Loan Document; 

(d) reduce the principal of, or the rate of interest on any Obligations, including any Loan or the LC Outstandings, or any fees or
other amounts payable by Borrower hereunder or under any other Loan Document; 
 (e) change the definition of Required Lenders
or the Pro Rata Shares which are required to take any action hereunder; 
 (f) amend this Section 16.9 or any provision
herein which requires consent or other action by all Lenders; 
 (g) release all or a substantial part of the Collateral for
the Obligations; or 
 (h) release any Guarantor; 
 and, provided further, that (v) no amendment, waiver or consent shall, unless in writing and signed by the Agent in addition to the Required Lenders or all the Lenders, as the case may be, affect the rights or
duties of the Agent under this Agreement or any other Loan Document, (x) notwithstanding clause (d) above, (i) any fee or other amount payable by Borrower solely to the Agent, the Swingline Lender or the Issuing Lender, may be changed
with the consent of only Borrower and the Agent and, if applicable, the affected Swingline Lender or Issuing Lender, and (ii) any fee or other amount payable by any Lender solely to Agent, may be changed with the consent of only such Lender and
Agent, (y) no amendment, waiver or consent shall, unless in 

  

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writing and signed by Swingline Lender, affect the rights or duties of the Swingline Lender; and (z) no amendment, waiver or consent shall, unless in
writing and signed by Issuing Lender affect the rights or duties of the Issuing Lender. 
 16.10 Waiver; Cumulative Remedies. No
failure or delay on the part of Agent or any Lender in exercising any right, power, remedy or privilege hereunder or under any of the other Loan Documents and no course of dealing between Borrower or any other Loan Party and Agent or any Lender will
operate as a waiver of such right, power, remedy or privilege, nor will any single or partial exercise of any right, power or privilege hereunder preclude other or further exercise thereof or the exercise of any other right, power, remedy or
privilege. Waiver of any Default shall not be a waiver of any other subsequent or prior Default. No waiver of any Default (whether or not Agent or any Lender knows or should have known of such Default) shall be deemed to have occurred unless Agent
(to the extent authorized under Section 13.2.4) or the Required Lenders has expressly agreed in writing specifying such waiver. No amendment, modification or waiver of, or consent with respect to, any provision of this Agreement shall in any
event be effective unless the same shall be in writing and signed and delivered by Agent, the Required Lenders, or all of the Lenders, as otherwise set forth in this Agreement. Any waiver of any provision of this Agreement, and any consent to any
departure by any Loan Party from the terms of any provision of this Agreement, shall be effective only in the specific instance and for the specific purpose for which given. No notice to or demand on any Loan Party not required hereunder shall in
any event entitle any Loan Party to any other or further notice or demand in similar or other circumstances or constitute a waiver of the right of Agent or any Lender to any other or further action in any circumstances without notice or demand. The
rights and remedies herein specified are cumulative and are not exclusive of any rights or remedies which Agent or any Lender would otherwise have at law or in equity or otherwise by agreement. 
 16.11 Notices. Except as otherwise specifically set forth in any Loan Document, all notices, requests and demands hereunder or under any Loan
Document shall be in writing, and shall be deemed to have been given when hand-delivered, delivered by a recognized overnight courier service, three (3) days after being deposited in the mail as first class, registered or certified mail,
postage prepaid, or upon confirmation of receipt of a facsimile transmission (fax), addressed to the Loan Parties as set forth below and to the Agent and Lenders at the address set forth on the signature pages hereof or on any Assignment Agreement
executed by any Assignee and delivered to Agent and Borrower; provided, however, that any request by a Borrower to Agent for a Loan or Letter of Credit shall not be effective until received by Agent. Any party may at any time change its address for
notices by giving notice of such change to the other parties: 
 To any Loan Party: 
 c/o Lithia Motors, Inc. 
 360 E. Jackson St.

 Medford, OR 97501 
 Attn: Chief
Financial Officer 
 with a copy to: 
 Foster Pepper Tooze LLP 
  

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 601 SW Second Avenue, Suite 1800 
 Portland, OR 97204 
 Attn: Kenneth E. Roberts

 16.12 Integration; Conflicting Terms. This Agreement (including the exhibits and schedules) together with the other Loan Documents
comprises the entire agreement of the parties on the subject matter hereof and supersedes and replaces all prior agreements, oral and written, on such subject matter. If any term of any of the other Loan Documents expressly conflicts with the
provisions of this Agreement, the provisions of this Agreement shall control; provided, however, that the inclusion of additional, greater or supplemental rights and remedies of Agent and Lenders or the inclusion of additional or greater obligations
and responsibilities of the Loan Parties, in any of the other Loan Documents shall not be deemed a conflict with this Agreement. 
 16.13
Governing Law. Except to the extent that Agent or any Lender has greater rights and remedies under federal law, this Agreement and the other Loan Documents shall be governed by and construed and enforced in accordance with the laws of the State
of Oregon without regard to conflicts of law principles, except that matters concerning the validity and perfection of security interests covered thereby shall be governed by the conflicts of law provisions of the applicable Uniform Commercial Code.

 16.14 Jurisdiction and Venue. To the fullest extent permitted by Applicable Law, Borrower hereby irrevocably submits to the
jurisdiction of any state court or any United States federal court located in or with jurisdiction over Portland, Oregon over any suit, action or proceeding arising out of or relating to the Obligations or the Loan Documents. Borrower hereby
irrevocably waives, to the fullest extent permitted by Applicable Law, any objection that Agent may now or hereafter have to the laying of venue in any such court including any objection based on the doctrine of forum non conveniens. Nothing
herein shall affect the right of Agent or the Lenders to bring proceedings against Borrower or any other Loan Party in any other court or jurisdiction. 
 16.15 Documents Satisfactory to Agent and Required Lenders. All information, documents and instruments required to be executed or delivered to Agent shall be in form and substance reasonably satisfactory to
Agent and the Required Lenders. 
 16.16 Exhibits. All exhibits and schedules referred to herein are attached hereto and hereby
incorporated by reference as if fully set forth herein. 
 16.17 Counterparts. This Agreement may be executed in any number of
counterparts. Each signed counterpart shall be deemed an original, and all of said counterparts taken together shall be deemed to constitute but one document. 
 16.18 Severability. Whenever possible, each provision of this Agreement and each of the other Loan Documents shall be interpreted in such a manner as to be valid and effective under Applicable Law. If any
provision of this Agreement or any of the Loan Documents is held invalid under any Applicable Law, such invalidity shall not affect any other provision of this Agreement that can be given effect without the invalid provision. 
  

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 16.19 Construction. This Agreement and the other Loan Documents are the result of negotiations
among, and have been reviewed by, each Loan Party, each Lender, the Agent and their respective counsel (or, if any party has not had the Loan Documents reviewed by its counsel, such party has had the opportunity to do so and has voluntarily chosen
not to do so). Accordingly, the Loan Documents shall be deemed to be the product of all parties hereto, and no ambiguity shall be construed in favor of or against Borrower, the Agent, or any Lender. 
 16.20 USA Patriot Act Notice. Each Lender that is subject to the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), and the Agent (for itself and not on behalf of any Lender) hereby notifies Borrower that pursuant to the requirements of the Act, it is required to obtain, verify and record information that identifies Borrower, which
information includes the name and address of the Borrower and other information that will allow such Lender or the Agent, as applicable, to identify the Borrower in accordance with the Act. 
 16.21 Confidentiality. Agent and each Lender agree to take reasonable precautions, in accordance with customary procedures, to maintain the
confidentiality of all non-public information provided to it by any Loan Party under this Agreement or any other Loan Document, which is identified as confidential at the time such Person provides the information, and agrees that it shall not use
any such information other than in connection with or in enforcement of this Agreement and the other Loan Documents or in connection with other business now or hereafter existing or contemplated with any Loan Party, except to the extent such
information (a) was or becomes generally available to the public other than as a result of disclosure by the Agent or Lender, or (b) was or becomes available on a non-confidential basis from a source other than a Loan Party, provided that
such source is not bound by a confidentiality agreement with a Loan Party known to Agent or such Lender; provided, however, that Agent or any Lender may disclose such confidential information (q) at the request or pursuant to any requirement of
any Governmental Body to which it is subject or in connection with an examination of Agent or such Lender by any such authority; (r) pursuant to subpoena or other court process; (s) when required to do so in accordance with the provisions
of any Applicable Law; (t) to the extent reasonably required in connection with any litigation or proceeding to which the Agent, any Lender or their respective affiliates may be party; (u) to the extent reasonably required in connection
with the exercise of any remedy hereunder or under any other Loan Document; (v) to Agent’s or such Lender’s and its affiliates, directors, officers, employees and agents, including accountants, attorneys and other professional
advisors; (w) to any Participant or Assignee, actual or potential, provided that such Person agrees in writing to keep such information confidential to the same extent required of the Lenders hereunder; (x) as to Agent or any Lender or its
affiliates, as expressly permitted under the terms of any other document or agreement regarding confidentiality to which any Loan Party is party or is deemed party with Agent or such Lender or affiliate; and (y) to its affiliates; provided,
that with respect to disclosures under clauses (r), (s) and (t), such Lender shall use commercially reasonable efforts to notify the Borrower (unless such notification is prohibited by any Applicable Law) of the proposed disclosure before such
disclosure is made to reasonably afford Borrower the opportunity to seek to prevent such disclosure. 
 16.22 Waiver of Jury Trial. EXCEPT
TO THE EXTENT PROHIBITED BY APPLICABLE LAW, EACH PARTY HERETO WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING RELATING TO ANY OF THE 
  

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LOAN DOCUMENTS, THE OBLIGATIONS THEREUNDER, ANY COLLATERAL SECURING THE OBLIGATIONS, OR ANY TRANSACTION ARISING THEREFROM OR CONNECTED THERETO. EACH PARTY
REPRESENTS TO THE OTHER PARTIES THAT THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY GIVEN. 
  

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 16.23 Disclosure. Under Oregon law, most agreements promises and commitments made by Bank
concerning loans and other credit extensions which are not for personal, family or household purposes or secured solely by the borrower’s residence must be in writing, express consideration and be signed by the Bank to be enforceable. 

  

									
	LITHIA MOTORS, INC.	 		 	U.S. BANK NATIONAL ASSOCIATION, as Agent, Lender, Swingline Lender, and Issuing Lender
					
	By:	 	/s/ Jeffrey B. DeBoer	 		 	By:	 	/s/ Andrew Hein
	Name:	 	Jeffrey B. DeBoer	 		 	Name:	 	Andrew Hein
	Title:	 	SVP & CFO	 		 	Title:	 	Vice President
		 	 360 E. Jackson Street
 Medford, OR 97501
 Fax: (541) 858-3279
	 		 		 	 13010 SW 68th Parkway
 Portland, OR 97223
 Fax: (503) 872-7562

  

									
	 DAIMLERCHRYSLER FINANCIAL
 SERVICES AMERICAS
LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	/s/ Janet B. Toronski	 		 	By:	 	/s/ David Pelliccioni
	Name:	 	Janet B. Toronski	 		 	Name:	 	David Pelliccioni
	Title:	 	V.P. Credit	 		 	Title:	 	Group Vice President
		 	 27777 Inkster Road
 Farmington Hills, MI
48334-5326
 Fax: (248) 427-6550
	 		 		 	 19001 S. Western Avenue
 Torrance, CA 90501

Fax: (310) 381-7794

  

 Page 70 

 SCHEDULE 1 
  

							
	 Name of Financial Institution
	  	Pro Rata Share
of Revolving Loans	 	 	Revolving Loan
Commitment
	U.S. Bank National Association	  	33.3333333333	%	 	$	75,000,000.00
			
	DaimlerChrysler Financial Services Americas LLC	  	33.3333333333	%	 	$	75,000,000.00
			
	Toyota Motor Credit Corporation	  	33.3333333333	%	 	$	75,000,000.00
			
	 TOTAL
	  	100	%	 	$	225,000,000.00

 AMENDMENT TO LOAN AGREEMENT 
 This Agreement dated effective as of June 29, 2007, is entered into among Lithia Motors, Inc., an Oregon corporation (“Borrower”); the lenders which are from time to time parties to the Loan Agreement
(each a “Lender” and any two or more “Lenders”); and U.S. Bank National Association, as agent for the Lenders (in such capacity, “Agent”). 
 RECITALS: 
 A. Borrower, the Lenders and Agent have entered into a Loan Agreement dated as of
August 31, 2006 (the “Loan Agreement”). 
 B. The parties wish to modify the terms and conditions of the Loan Agreement, as
set forth below. 
 For valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

 1. Amendments to Loan Agreement. 
 1.1. Requests for Revolving Loans. Section 2.4 of the Loan Agreement is deleted and replaced with the following: 
 2.4 Requests for Revolving Loans. Whenever Borrower wishes to obtain Revolving Loans, Borrower shall give Agent irrevocable notice
thereof no later than 11:00 a.m. (Pacific Time) at least one Business Day prior to the date of the requested borrowing. Such notice shall specify the requested borrowing date (which must be a Business Day), the amount of the Revolving Loan
Borrowing, and include any other information and documentation reasonably requested by Agent. 
 1.2. Settlement of
Swingline Loans. Sections 3.7.1(a), (b), and (c) of the Loan Agreement are deleted and replaced with the following: 
 3.7.1 Refunding of Loans. 
 (a) Upon the request of the Swingline Lender, the Agent from time to time shall,
on behalf of Borrower (and Borrower hereby irrevocably authorizes the Agent to so act on its behalf) request each Lender (including Swingline Lender in its capacity as a Lender) to make a Revolving Loan to the Borrower, in accordance with the
provisions of this Section 3.7.1, which shall be applied to repay all or a portion of the outstanding principal balance of the Swingline Loans (each such Revolving Loan, a “Refunding Revolving Loan”), in an amount equal to that
Lender’s Revolving Loan Pro Rata Share of all or a portion of the then outstanding principal balance of the Swingline Loans. 
 (b) (Intentionally blank.) 
 (c) Without limiting the foregoing, each Lender agrees that Agent may request the
Lenders to make Refunding Revolving Loans at any time if (i) a Default has occurred and is continuing, or (ii) in the judgment of Swingline Lender, taking into account the outstanding principal balance of the Swingline Loans, the
anticipated usage of the Swingline Loans and 

  

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the operation of the Credit Sweep pursuant to Section 3.8, such Refunding Revolving Loans are reasonably necessary to ensure that the outstanding
principal balance of the Swingline Loans will not at any time exceed the Swingline Commitment or such lesser amount as is permitted to be outstanding on the Swingline Loans at such time (it being understood that in order to attain such objective,
Swingline Lender may request repayment of the Swingline Loans even though the principal balance of the Swingline Loans at the time of such request is less than the Swingline Commitment or the amount permitted to be outstanding on the Swingline
Loans). 
 1.3. Financial Covenants. Section 10.1.3 and 10.1.4 of the Loan Agreement are deleted and replaced with
the following: 
 10.1.3 Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio for Borrower and its
Subsidiaries, on a consolidated basis, shall not be less than 1.20 to 1.0 as of the last day of any fiscal quarter, for the period of four consecutive fiscal quarters ending on such date. 
 As used herein, 
 “EBITDAR” means, for any Person, for any time period, (a) such Person’s net income (or loss) for such time period (excluding extraordinary gains or losses but including net income or loss from discontinued operations);
(b) plus, without duplication, the amounts which in determining net income or loss have been deducted for (i) interest expense, (ii) income tax expense, (iii) depreciation, amortization, goodwill impairment charges and other
non-cash charges (less non-cash gains) and (iv) rental or lease expense. 
 “Fixed Charge Coverage Ratio”
means, as of the last day of any fiscal quarter, the ratio for the period of four consecutive fiscal quarters ending on such date of (a) (i) EBITDAR, (ii) minus dividends and other distributions in respect of Equity Interests,
(iii) minus income tax expense to the extent paid in cash, (iv) minus an allowance for maintenance capital expenditures in an amount equal to $110,000 for each Dealership location for such four consecutive fiscal quarters; (v) plus,
if a Permitted Acquisition has occurred during such time period, EBITDA attributable to any new Acquisition Subsidiary or business acquired on a pro forma basis, calculated as if such Permitted Acquisition had occurred on the first day
of such time period (it being understood and agreed that pro forma EBITDA may not be included in this calculation to the extent that it results in an annualized increase of more than 10% in Borrower’s consolidated EBITDA prior to such
adjustment, unless the Borrower provides to the Agent and the Required Lenders the supporting calculations for such adjustment and such other information as they may reasonably request to determine the accuracy of such calculations); to (b) the
sum of (i) cash interest, plus (ii) required principal payments on Debt, plus (iii) rental or lease expense, for such four consecutive fiscal quarters, 
 10.1.4 Cash Flow Leverage Ratio. The Cash Flow Leverage Ratio for Borrower and its Subsidiaries, on a consolidated basis, shall not be
more than 3.00 to 1.0 as of the last day of any fiscal quarter for the period of four consecutive fiscal quarters ending on such date. 
  

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 As used herein: 
 “Adjusted Funded Debt” means (a) all Funded Debt excluding (i) Subordinated Debt, (ii) Debt consisting of Floor
Plan Financing, and (iii) Funded Debt of LRE which is secured primarily by real estate owned by LRE (“Real Estate Debt”), plus (b) at any time during which a Current Assets Election is in effect, the Current Assets Commitment
Amount. 
 “Cash Flow Leverage Ratio” means, for any Person, as of any date of determination, the ratio of
(a) the principal balance of Adjusted Funded Debt as of such date to (b) EBITDA for the period of four consecutive fiscal quarters ending on such date, minus interest expense for Floor Plan Financing and Real Estate Debt for such period,
minus required principal payments on Real Estate Debt for such time period. 
 “EBITDA” means, for any Person, for
any time period, (a) such Person’s net income (or loss) for such time period (excluding extraordinary gains or losses but including net income or loss from discontinued operations); (b) plus, without duplication, the amounts which in
determining net income or loss have been deducted for (i) interest expense, (ii) income tax expense, and (iii) depreciation, amortization, goodwill impairment charges and other non-cash charges (less non-cash gains); provided,
however, that if a Permitted Acquisition has occurred during any time period, EBITDA may include EBITDA attributable to any new Acquisition Subsidiary or business acquired on a pro forma basis, calculated as if such Permitted Acquisition had
occurred on the first day of such time period (it being understood and agreed that any pro forma adjustment of EBITDA may not be included in this calculation to the extent that it results in an annualized increase of more than 10% in
Borrower’s consolidated EBITDA prior to such adjustment, unless the Borrower provides to the Agent and the Required Lenders the supporting calculations for such adjustment and such other information as they may reasonably request to determine
the accuracy of such calculations). 
 1.4. Financial Information. Section 10.2.6 of the Loan Agreement is deleted
and replaced with the following: 
 10.2.6 Within 30 days after the end of each month (or more frequently if required by Agent
or Required Lenders during the existence of a Default), a Borrowing Base Certificate, prepared as of the last day of such month, showing the calculation of the Borrowing Base, substantially in the form attached hereto as Exhibit E.

 1.5. Debt. Section 12.10 of the Loan Agreement is deleted and replaced with the following: 
 12.10 Debt. Borrower will not, and will not permit any Loan Party to, incur or permit to exist any Debt to any Person except: 

(a) Debt (including Contingent Obligations) incurred pursuant to this Agreement and the Loan Documents. 
 (b) Short-term unsecured trade obligations incurred in the ordinary course of business which are not past due. 
  

 Page 3 

 (c) Debt in respect of Interest Rate Protection Agreements. 
 (d) Funded Debt of LRE which is secured primarily by real estate owned by LRE. 
 (e) Subject to satisfaction of the requirements of Section 12.3(h) by each Floor Plan Lender, Funded Debt of the Dealerships with
respect to Floor Plan Financing provided by DCFS, General Motors Acceptance Corporation, Ford Motor Credit Corporation, Toyota Motor Credit Corporation, VW Credit, Inc., BMW Financial Services NA, LLC, DCFS USA LLC, or other Floor Plan Lenders
approved by Agent and the Lenders. 
 (f) Subordinated Debt. 
 (g) Unsecured guarantees by Borrower of (i) Floor Plan Financing obligations of Dealerships to Floor Plan Lenders, (ii) debt of
LRE which is permitted under Subsection 12.10(d), (iii) operating leases of its Subsidiaries and Minority Dealer Affiliates, and (iv) extensions of credit to a Minority Dealer Affiliate, all proceeds of which are used to purchase New
Vehicles, Service Loaner Vehicles, or Program Vehicles to be held by the Minority Dealer Affiliate for sale and/or lease in the ordinary course of business, which notwithstanding any contrary provisions hereof shall be the only guarantees by
Borrower. 
 (h) Unsecured Debt of Borrower to any Collateral Subsidiary. 
 (i) Unsecured Debt of any Subsidiary to Borrower or to any Collateral Subsidiary. 
 (j) Debt existing on the Closing Date and set forth on the Disclosure Schedule, provided that such Debt shall not be increased and that no
additional collateral shall be provided for such Debt. 
 (k) Funded Debt in an aggregate principal amount not to exceed for
Borrower and all Subsidiaries $5,000,000.00 at any time outstanding, provided that such indebtedness is either unsecured or is purchase money indebtedness incurred to acquire equipment which is secured only by the equipment acquired and such
equipment secures only the obligation to pay the purchase price. 
 (l) Unsecured guaranties by a Subsidiary of the
obligations of LRE on (i) real estate leases between LRE and an owner of real estate which has been subleased by LRE to such Subsidiary, and (ii) debt incurred by LRE which is permitted under Subsection 12.10(d) and which is obtained to
finance real estate leased by LRE to such Subsidiary. 
 (m) Additional Funded Debt, which together with all other Funded Debt
permitted by this Section 12.10, excluding Debt described in Sections 12.10(a), 12.10(e), and 12.10(f) (“Excluded Funded Debt”), does not at any time for Borrower and all Subsidiaries exceed an aggregate outstanding principal amount
of $300,000,000.00; provided that any such Debt incurred after the Closing Date, shall be unsecured, unless permitted to be secured by the terms of this Agreement. Notwithstanding any contrary 

  

 Page 4 

 
provision hereof, the Funded Debt of Borrower and its Subsidiaries (excluding Excluded Funded Debt, but including all other Funded Debt described in this
Section 12.10) shall not at any time exceed an aggregate principal amount of $300,000,000.00. 
 2. Conditions Precedent. The
effectiveness of this Agreement is subject to satisfaction of each of the following conditions: 
 2.1. Agent has received
executed originals of this Agreement and such other Loan Documents as Agent requires and Borrower and each Guarantor has provided such information and satisfied such requirements as Agent reasonably requires. 
 2.2. No Default has occurred and is continuing. 
 2.3. All representations and warranties in the Loan Agreement are true and correct as of the date of this Agreement. 
 3. Defined Terms. Capitalized terms not otherwise defined herein shall have the meanings given to such terms in the Loan Agreement. 
 4. Reaffirmation. By signing this Agreement or the attached Acknowledgment, Borrower and each Guarantor reaffirm the representations and
warranties in each of the existing Loan Documents and agree that (a) except as amended previously or in connection herewith, each Loan Document is and shall remain valid and enforceable in accordance with its terms and (b) such Borrower or
Guarantor has no claims, defenses, setoffs, counterclaims or claims for recoupment against Agent, the Lenders, or the indebtedness and obligations represented by the Notes, Guaranties, Security Documents and other Loan Documents. 
 5. References. On and after the effective date of this Agreement, all references in the Loan Agreement and the other Loan Documents to the Loan
Agreement shall be deemed to refer to the Loan Agreement as amended hereby. 
 6. Authorization. Each Loan Party represents and
warrants to Agent and the Lenders that its execution, delivery and performance of this Agreement and the other Loan Documents and all documents to be executed, delivered or performed by it have been duly authorized by all necessary entity action, do
not require the approval of any governmental agency or other Person, do not contravene any law, regulation, rule, order, or restriction binding on it or its articles of incorporation or other organizational documents, and do not contravene the
provisions of or constitute a default under any agreement or instrument to which it is a party or by which it may be bound or affected. 
 7.
Expenses. Borrower shall pay all costs, fees and expenses incurred by Agent in connection with the preparation, negotiation, execution, and delivery of this Agreement and any other document required to be furnished herewith, including without
limitation the charges of Agent’s legal counsel. 
 8. Recitals. The Recitals are hereby incorporated herein. 
 9. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of said
counterparts taken together shall be deemed to constitute but one document. 
 [Signature pages follow] 
  

 Page 5 

									
	LITHIA MOTORS, INC.	 		 	U.S. BANK NATIONAL ASSOCIATION, as Agent, Lender, Swingline Lender, and Issuing Lender
					
	By:	 	/s/ Bryan B. DeBoer	 		 	By:	 	 
	Name:	 	    Bryan B. DeBoer	 		 	Name:	 	
	Title:	 	    President and COO	 		 	Title:	 	
			
	 DAIMLERCHRYSLER FINANCIAL
 SERVICES AMERICAS
LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	 	 		 	By:	 	 
	Name:	 		 		 	Name:	 	
	Title:	 		 		 	Title:	 	

  

									
	LITHIA MOTORS, INC.	 		 	U.S. BANK NATIONAL ASSOCIATION, as Agent, Lender, Swingline Lender, and Issuing Lender
					
	By:	 	 	 		 	By:	 	 
	Name:	 		 		 	Name:	 	
	Title:	 		 		 	Title:	 	
			
	 DAIMLERCHRYSLER FINANCIAL
 SERVICES AMERICAS
LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	/s/ Michele Nowak	 		 	By:	 	 
	Name:	 	    Michele Nowak	 		 	Name:	 	
	Title:	 	    Credit Director, National Accounts	 		 	Title:	 	

  

									
	LITHIA MOTORS, INC.	 		 	U.S. BANK NATIONAL ASSOCIATION, as Agent, Lender, Swingline Lender, and Issuing Lender
					
	By:	 	 	 		 	By:	 	/s/ Andrew Hein
	Name:	 		 		 	Name:	 	    Andrew Hein
	Title:	 		 		 	Title:	 	    Senior Vice President
			
	 DAIMLERCHRYSLER FINANCIAL
 SERVICES AMERICAS
LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	 	 		 	By:	 	 
	Name:	 		 		 	Name:	 	
	Title:	 		 		 	Title:	 	

  

									
	LITHIA MOTORS, INC.	 		 	U.S. BANK NATIONAL ASSOCIATION, as Agent, Lender, Swingline Lender, and Issuing Lender
					
	By:	 	 	 		 	By:	 	 
	Name:	 		 		 	Name:	 	
	Title:	 		 		 	Title:	 	
			
	 DAIMLERCHRYSLER FINANCIAL
 SERVICES AMERICAS
LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	 	 		 	By:	 	/s/ Mark Doi
	Name:	 		 		 	Name:	 	    Mark Doi
	Title:	 		 		 	Title:	 	    National Dealer Credit Manager

  

 Page 6 

 ACKNOWLEDGMENT AND CONSENT OF GUARANTORS 
 Each Guarantor hereby acknowledges, consents, and agrees to all terms and conditions of the foregoing amendment. 
 Hutchins Eugene Nissan, Inc. 
 Hutchins
Imported Motors, Inc. 
 LAD Advertising, Inc. 
 LGPAC, Inc. 
 Lithia Auto Services, Inc. 
 Lithia BNM, Inc. 
 Lithia DE, Inc. 

Lithia DM, Inc. 
 Lithia Financial
Corporation 
 Lithia Aircraft, Inc. 
 Lithia HPI, Inc. 
 Lithia Klamath, Inc. 
 L2 Auto, Inc., fka Lithia LAC, Inc. 
 Lithia Medford Hon, Inc. 
 Lithia Medford LM, Inc. 
 Lithia Motors
Support Services, Inc. 
 Lithia MTLM, Inc. 
 Lithia of Roseburg, Inc. 
 Lithia Real Estate, Inc. 
 Lithia Rentals, Inc. 
 Lithia Rose-FT, Inc.

 Lithia SOC, Inc. 
 Lithia TKF,
Inc. 
 Saturn of Southwest Oregon, Inc. 
 Lithia Chrysler Jeep of Anchorage, Inc. 
 Lithia Imports of Anchorage, Inc. 
 Lithia NA, Inc. 
 Lithia of Anchorage, Inc.

 Lithia of Fairbanks, Inc. 
 Lithia of South Central AK, Inc. 
 Lithia CIMR, Inc. 
 Lithia CJDB, Inc. 
 Lithia CS, Inc. 
 Lithia DC, Inc. 
 Lithia FMF, Inc. 

Lithia JEF, Inc. 
 Lithia MMF, Inc.

 Lithia NF, Inc. 
 Lithia of
California, Inc. 
 Lithia of Clovis, Inc. 
 Lithia of Eureka, Inc. 
 Lithia of Fairfield, Inc. 
 Lithia CA Acquisition Corp 1, Inc. 
 Lithia
Seaside, Inc. 
 Lithia Sea P, Inc. 
 Lithia of Santa Rosa, Inc. 
 Lithia TKV, Inc. 
  

 Page 7 

 Lithia TR, Inc. 
 Lithia Centennial Chrysler Plymouth Jeep, Inc. 
 Lithia Cherry Creek Dodge, Inc. 
 Lithia Colorado Jeep, Inc. 
 Lithia Colorado
Springs Jeep Chrysler Plymouth, Inc. 
 Lithia Foothills Chrysler, Inc. 
 Lithia of Thornton, Inc. 
 Lithia CB, Inc.

 Lithia CCTF, Inc. 
 Lithia DB,
Inc. 
 Lithia Ford of Boise, Inc. 
 Lithia IB, Inc. 
 Lithia LMB, Inc. 
 Lithia of Caldwell, Inc. 
 Lithia of Pocatello, Inc. 
 Lithia Poca-Hon, Inc. 
 Lithia of TF, Inc.

 Lithia MBDM, Inc. 
 Lithia of
Des Moines, Inc. 
 Lithia LRDM, Inc. 
 Lithia CDH, Inc. 
 Lithia HGF, Inc. 
 Lithia of Billings, Inc. 
 Lithia of Butte, Inc. 
 Lithia of Great Falls, Inc. 
 Lithia of
Helena, Inc. 
 Lithia of Missoula, Inc. 
 Lithia CJD of Omaha, Inc. 
 Lithia MBO, Inc. 
 Lithia of Omaha, Inc. 
 Lithia CJDSF, Inc. 
 Lithia of Santa Fe, Inc. 
 Lithia of Reno,
Inc. 
 Lithia Reno Sub-Hyun, Inc. 
 Lithia SALMIR, Inc. 
 Lithia ND Acquisition Corp. #1 
 Lithia ND Acquisition Corp. #2 
 Lithia ND Acquisition Corp. #3 
 Lithia ND Acquisition Corp. #4 
 Lithia
Automotive, Inc. 
 Lithia of Sioux Falls, Inc. 
 Camp Automotive, Inc. 
 Lithia BC, Inc. 
 Lithia DC of Renton, Inc. 
 Lithia Dodge of
Tri-Cities, Inc. 
 Lithia FTC, Inc. 
 Lithia HyR, Inc. 
 Lithia IC, Inc. 
 Lithia of Seattle, Inc. 
 Lithia of Spokane, Inc. 
 Lithia of Wenatchee, Inc. 
 TC Hon, Inc.

  

 Page 8 

 Lithia of La Crosse, Inc. 
 L2 Real Estate, Inc. 
 Lithia of Cedar Rapids #1, Inc. 
 Lithia of Cedar Rapids #2, Inc. 
 Lithia of
Cedar Rapids #3, Inc. 
 Lithia AcDM, Inc. 
 Lithia HDM, Inc. 
 Lithia IDM, Inc. 
 Lithia NDM, Inc. 
 Lithia VAuDM, Inc.

  

									
					
		 		 		 	By:	 	/s/ Bryan B. DeBoer
		 		 		 	Name: 	 	Bryan B. DeBoer
		 		 		 	Title:	 	Authorized Agent

  

 Page 9 

 Lithia Bryan Texas, L. P. 
 Lithia CJDO, L.P. 
 Lithia CJDSA, L.P. 
 Lithia CM, L.P. 
 Lithia CO, L.P. 

Lithia CSA, L.P. 
 Lithia DMID, L.P.

 Lithia HMID, L.P. 
 Lithia NSA,
L.P. 
 Lithia of Abilene, L.P. 
 Lithia of Corpus Christi, L.P. 
 Lithia of Grapevine, LP 
 Lithia of Midland, L.P. 
 Lithia TA, L.P.

 Lithia TO, L.P. 
  

							
		 		 	By:	 	Lithia GP of Texas, LLC, General Partner
				
		 		 	By:	 	/s/ Bryan B. DeBoer
		 		 	Name: 	 	Bryan B. DeBoer
		 		 	Title:	 	Authorized Agent

  

	
	 SOE, LLC
 Lynnwood Properties, LLC
 Lithia LP of Texas, LLC
 Lithia GP of Texas, LLC

  

							
				
		 		 	By:	 	/s/ Bryan B. DeBoer
		 		 	Name: 	 	Bryan B. DeBoer
		 		 	Title:	 	Authorized Agent

  

 Page 10 

 SECOND AMENDMENT TO LOAN AGREEMENT 
 This Second Amendment to Loan Agreement (this “Agreement”) dated as of February 13, 2008, is entered into among Lithia Motors, Inc., an
Oregon corporation (“Borrower”); the lenders which are from time to time parties to the Loan Agreement (each a “Lender” and any two or more “Lenders”); and U.S. Bank National Association, as agent for the Lenders (in
such capacity, “Agent”). 
 R E C I T A L S 
 A. Borrower, the Lenders and Agent have entered into a Loan Agreement dated as of August 31, 2006, which has been amended by amendment dated as of June 29, 2007 (collectively, the “Loan
Agreement”). 
 B. The parties have agreed to admit DCFS USA LLC as a Lender and to modify the terms and conditions of the Loan
Agreement, as set forth below. 
 For valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree
as follows: 
 1. Amendments to Loan Agreement. 
 1.1 Changed Definitions. The following defined terms in Section 1.1 of the Loan Agreement are deleted and replaced with the
following: 
 “Current Assets Commitment Amount” means, with respect to any Current Assets Election, the lesser of
(a) (i) the Maximum Amount minus the sum of the then outstanding principal balance of the Revolving Loans, Swingline. Loans, and LC Outstandings or (ii) if less, the maximum aggregate principal balance of the Revolving Loans,
Swingline Loans, and LC Outstandings permitted to be outstanding at any time in accordance with Section 5.18, minus the sum of the then outstanding principal balance of the Revolving Loans, Swingline Loans, and LC Outstandings; or (b) the
Specified Current Assets Commitment Amount. 
 “Expiration Date” means August 31, 2010, or such earlier date as may be
applicable due to acceleration of Obligations in accordance with the terms of this Agreement. 
 “Maximum Amount” means, as
of any date of determination, the least of (a) the Total Revolving Loan Commitment, (b) the Borrowing Base plus $50,000,000.00, or (c) the Total Borrowing Base Assets. 
 “Required Lenders” means Lenders holding 66% or more of the sum of the Revolving Loan Exposure of all Lenders; provided, however,
that so long as U.S. Bank, Toyota Motor Credit Corporation, DaimlerChrysler Financial Services Americas LLC, and DCFS USA LLC are the only Lenders, Required Lenders shall mean all Lenders. 
 “Total Revolving Loan Commitment” means an amount equal to $300,000,000.00. 
  

 Page 1 

 1.2 New Definition. The following defined term is hereby added to Section 1.1
of the Loan Agreement: 
 “Total Borrowing Base Assets” means, as of any date of determination, the sum, without duplication,
on such date of: 
 (a) 100% of Vehicle Equity. 
 (b) 100% of the amount of Eligible Receivables. 
 (c) 100% of the difference between (i) the net book
value of Service Loaner Vehicles owned by the Collateral Subsidiaries and (ii) the sum of (A) the aggregate outstanding principal balance of the Floor Plan Financing owed to all Floor Plan Lenders which is secured by such Service Loaners
and (B) the principal amount of any other indebtedness or obligations to any Person (other than the Obligations) which is secured by the Service Loaner Vehicles. 
 (d) 100% of the difference between (i) the net book value of the inventory of Borrower and its Subsidiaries consisting of new parts and accessories and materials in which Agent has a perfected first priority
security interest, and (ii) the unpaid acquisition cost owed to sellers or financers of such inventory. 
 (e) 100% of the net book value
of aircraft owned by Lithia Aircraft, Inc., in which Agent has a perfected first priority security interest. 
 (f) 100% of the net book value
of equipment (excluding fixtures and aircraft) of Borrower and the Collateral Subsidiaries in which Agent has a perfected first priority security interest. 
 Notwithstanding any contrary provision of this definition, the Total Borrowing Base Assets shall in no event include any property owned by LRE, except cash to the extent included in clause (a) (iii) of the
definition of Vehicle Equity. 
 1.3 Maximum Revolving Loan Amount. Section 2.1.1 of the Loan Agreement is deleted
and replaced with the following: 
 2.1.1 Maximum Amount. Subject to the terms and conditions of this Agreement, each Lender severally
and not jointly agrees to make loans (each a “Revolving Loan” and collectively, the “Revolving Loans”) to Borrower on a revolving credit basis during the period from the Closing Date to but not including the Expiration Date;
provided that (a) the aggregate outstanding principal balance of the Revolving Loans made by each Lender, plus the outstanding principal balance of such Lender’s participating interest in the Swingline Loans and Letters of Credit shall not
at any time exceed an amount equal to such Lender’s Revolving Loan Commitment; (b) the outstanding principal balance of all Revolving Loans shall not at any time exceed, in the aggregate, as to all Lenders, the Maximum Amount, or if
applicable, the amount permitted to be outstanding at such time in accordance with Section 5.18(a) (“Reduced Maximum Amount”), and (c) the outstanding principal balance of all Revolving Loans, plus the outstanding principal

  

 Page 2 

 
balance of all Swingline Loans, plus the LC Outstandings shall not at any time exceed, in the aggregate, as to all Lenders, the Maximum Amount or, if
applicable, the Reduced Maximum Amount. 
 1.4 Revolving Loan Fee. Section 2.6 of the Loan Agreement is deleted
and replaced with the following: 
 2.6 Revolving Loan Fee. Borrower shall pay to Agent, for the account of the Lenders, a fee (the
“Loan Fee”): equal to the sum of the following: (a) for the Swingline Loans, an amount equal to ___% per annum on the amount, calculated on a daily basis, by which the Swingline Commitment exceeds the actual aggregate outstanding
principal balance of the Swingline Loans on each day (it being understood that any portion of the outstanding principal balance of the Swingline Loans ceases to be outstanding under the Swingline Loans and commences being a portion of the
outstanding principal balance under the Revolving Loans on the date that the Revolving Loans are funded to repay such portion of the outstanding principal balance of the Swingline Loans); and (b) for the Revolving Loans, an amount equal to ___%
per annum on the amount, calculated on a daily basis, by which $265,000,000 exceeds the sum of the actual aggregate outstanding principal balance of the Revolving Loans plus the LC Outstandings on each day. The accrued Loan Fee shall be due and
payable in arrears on the first Monthly Payment Date in each fiscal quarter (and on the Expiration Date) for the three month period or other time period ending on the last day of the preceding fiscal quarter or on the Expiration Date. One hundred
percent (100%) of the fee for the Swingline Loans (as set forth in Section 2.6(a)) shall be paid by Agent to the Swingline Lender. The fee for the Revolving Loans (as set forth in Section 2.6(b)) shall be paid (i) to each Lender
other than the Swingline Lender based upon a percentage determined by dividing such Lender’s Revolving Loan Commitment by $265,000,000 and (ii) to Swingline Lender based upon a percentage determined by dividing (A) the product of
Swingline Lender’s Revolving Loan Commitment minus $35,000,000, by (B) $265,000,000. 
 1.5 Overadvance Fee.
The following is hereby added to the Loan Agreement as Section 2.7 thereof: 
 2.7 Overadvance Fee. 
 2.7.1 Borrower shall pay to Agent, for the account of the Lenders in accordance with their Revolving Loan Pro Rata Shares, a fee
(“Overadvance Fee”) in an amount equal to ___% per annum on the amount, calculated on a daily basis, by which the sum of the aggregate outstanding principal balance of the Revolving Loans and the Swingline Loans, plus the LC Outstandings
exceeds the Borrowing Base. Any Overadvance Fee accrued for any calendar month shall be paid on the next Monthly Payment Date. 
 2.7.2 The Borrowing Base used in calculating the Overadvance Fee for any month shall be the Borrowing Base in effect as of the last day of the prior month, as reflected in the Borrowing Base Certificate submitted for such prior month, or if
applicable, in an updated Borrowing Base Certificate (“Interim Borrowing Base Certificate”) submitted by Borrower during the current month. Notwithstanding the foregoing, Interim Borrowing 

  

 Page 3 

 
Base Certificates may be submitted by Borrower pursuant to this Section 2.7 no more than once in any week or twice in any month and must be submitted
and prepared as of a date during the current month. Each Interim Borrowing Base Certificate shall be effective upon receipt by Agent. 
 1.6 Maximum Swingline Loan Amount. Section 3.1.1 of the Loan Agreement is deleted and replaced with the following: 
 3.1.1 Maximum Amount. Subject to the terms and conditions of this Agreement, the Swingline Lender agrees to make loans (each, a “Swingline Loan” and collectively, the Swingline Loans”) to
Borrower on a revolving credit basis during the period from the Closing Date to but not including the Expiration Date; provided that (a) the aggregate outstanding principal balance of the Swingline Loans shall not at any time exceed the
Swingline Commitment; and (b) the outstanding principal balance of all Revolving Loans made by all Lenders plus the outstanding principal balance of all Swingline Loans, plus the LC Outstandings, shall not at any time exceed the Maximum Amount
or, if applicable, the Reduced Maximum Amount. 
 1.7 Maximum Amount of LC Outstandings. Section 4.1.1 of the Loan
Agreement is deleted and replaced with the following: 
 4.1.1 Maximum Amount. Subject to and upon the terms and conditions of this
Agreement, Issuing Lender may from time to time during the period from the Closing Date to the date which is 30 days prior to the Expiration issue one or more standby letters of credit for the account of Borrower; provided that (a) the LC
Outstandings shall not exceed at any time the Letter of Credit Commitment; and (b) the outstanding principal balance of all Revolving Loans made by all Lenders, plus the outstanding principal balance of all Swingline Loans, plus the LC
Outstandings shall not at any time exceed the Maximum Amount or, if applicable, the Reduced Maximum Amount. 
 1.8 Increase
in Revolving Loan Commitments. The following is hereby added to the Loan Agreement as Section 5.17 thereof: 
 5.17 Increase in
Total Revolving Loan Commitment. 
 5.17.1 Request. Borrower may ask the Lenders to increase the Total Revolving
Loan Commitment by $50,000,000.00. To request an increase, Borrower shall deliver notice thereof to the Agent in writing, in a form acceptable to Agent (a “Commitment Increase Request”). 
 5.17.2 Pro Rata Increase. Agent will inform each of the Lenders of the Commitment Increase Request and ask each Lender whether it
is willing (a) to agree to the increase in the Total Revolving Loan Commitment and (b) to increase its Revolving Loan Commitment by an amount equal to its Revolving Loan Pro Rata Share of the requested increase (for each Lender, its
“Proportionate Amount”). If each Lender agrees, in accordance with the notice from Agent, to such increases in the Total Revolving Loan Commitment and its Revolving Loan Commitment, the Total Revolving Loan 

  

 Page 4 

 
Commitment shall be increased to $350,000,000.00, and the Revolving Loan Commitment of each Lender shall be increased accordingly. 
 5.17.3 Non-Pro Rata Increase. If each Lender agrees to increase the Total Revolving Loan Commitment, but one or more of the Lenders
declines to increase its Revolving Loan Commitment by its Proportionate Amount, Agent shall, at Borrower’s option, (a) notify the Lenders that the Total Revolving Loan Commitment will be increased by an amount equal to the sum of the
increases agreed to by the consenting Lenders, or (b) ask any one or more of the existing Lenders to increase or further increase its Revolving Loan Commitment by the amount of all or a portion of the unaccepted portion of the requested
increase. 
 5.17.4 New Lenders. If the total of the increases agreed to by the existing Lenders pursuant to
Section 5.17.2 and 5.17.3 is less than $50,000,000.00, Borrower may ask another bank or financial institution to become a Lender with a Revolving Loan Commitment in an amount equal to all or part of the shortfall (but not less than
$25,000,000.00 for any new Lender); provided, however, that each existing Lender must consent to the addition of such new Lender. 
 5.17.5 Minimum Increase. Notwithstanding any contrary provision of Section 5.17, any increase in the Total Revolving Loan Commitment pursuant to Section 5.17.3 or Section 5.17.4 shall be at least $25,000,000.00.

 5.17.6 Discretionary Increase, Notwithstanding any contrary provision of this Section 5.17, no Lender shall
have any obligation to agree to an increase in the Total Revolving Loan Commitment or in its Revolving Loan Commitment unless it, in its sole discretion, agrees to do so. 
 5.17.7 Conditions Precedent. The effectiveness of any increase in the Revolving Loan Commitment of any Lender shall be subject to
satisfaction of such conditions as Agent or any Lender reasonably requires, including without limitation the following: 
 a.
All Lenders have agreed to the increase in the Total Revolving Loan Commitment and the addition of any new Lender and any Lender whose Revolving Loan Commitment is being increased has agreed to the amount of the increase in its Revolving Loan
Commitment. 
 b. No. Default has occurred and is continuing or will exist after giving effect to the increase. 

c. Borrower has executed such new Notes as are required to reflect the increases in the Revolving Loan Commitments of the Lenders, and
each Loan Party has executed such new documents and/or amendments to this Agreement and the other Loan Documents and has provided such information and satisfied such requirements as Agent or any Lender requires. 
  

 Page 5 

 d. Each New Lender has executed a New Lender Agreement substantially in the form
attached hereto as Exhibit J and has provided such information and satisfied such requirements as Agent requires. 
 e. All
representations and warranties in this Agreement and the other Loan Documents shall be true and correct in all material respects as of the effective date of the increase. 
 1.9 Additional Limitations. The following is hereby added to the Loan Agreement as Section 5.18 thereof: 
 5.18 Additional Limitations on Loans. In addition to the limitations in Sections 2.1.1, 3.1.1 and 4.1.1 of this Agreement, (a) the aggregate
outstanding principal balance of the Revolving Loans and the Swingline Loans, plus the LC Outstandings shall not exceed the Borrowing Base (determined in accordance with Section 2.7.1) for more than 180 consecutive days; and (b) if after
giving effect to the making of any Loan, the aggregate outstanding principal balance of the Revolving Loans and the Swingline Loans, plus the LC Outstandings exceeds or will exceed the Borrowing Base, Borrower may not use the proceeds of such Loan
to repurchase shares of its capital stock. 
 1.10 Current Ratio. Section 10.1.2 of the Loan Agreement is deleted
and replaced with the following: 
 10.1.2 Current Ratio. The Current Ratio for Borrower and its Subsidiaries on a consolidated basis,
shall not be less than 1.20 to 1.0 as of the last day of any fiscal quarter. 
 As used herein, 
 “Current Assets” means the total assets of any Person that may properly be classified as current assets in accordance with GAAP,
but excluding all loans to and notes and receivables from officers, employees, directors, owners and affiliates of such Person; provided, however, that at the election of Borrower given by written notice to Agent, delivered with any quarterly
Compliance Certificate (a “Current Assets Election”), Current Assets shall be deemed to include the Current Assets Commitment Amount at any time while such Current Assets Election is in effect. 
 “Current Liabilities” means the total liabilities of any Person that may properly be classified as current liabilities in
accordance with GAAP; provided that at any time during which a Current Assets Election is in effect, if the Expiration Date is within one year, Current Liabilities shall be deemed to include the Current Assets Commitment Amount at such time; and
provided further that Current Liabilities shall not include any portion of the Senior Subordinated Notes which is not then due and payable. 
 “Current Ratio” means, for any Person at any time, the ratio at such time of such Person’s Current Assets to such Person’s Current Liabilities. 
 1.11 Amendments and Waivers. The following is hereby added to the end of 16.9 of the Loan Agreement: 

  

 Page 6 

 
Notwithstanding any contrary provisions of this Section 16.9 (but subject to the requirement that all Lenders must approve any increase in the Total
Revolving Loan Commitment), increases in the Revolving Loan Commitment of any one or more of the Lenders made pursuant to Section 5.17, shall not require the consent of Required Lenders or all Lenders, but may be made with the written consent
of only Borrower, Agent and the Lenders whose Revolving Loan Commitments are being increased. 
 2. Schedule 1. Schedule 1 to the Loan
Agreement is deleted and replaced with the Schedule 1 attached hereto. 
 3. New Lender. The parties have agreed to admit DCFS USA LLC
(“DCFS USA”) as a Lender with a Revolving Loan Commitment of $75,000,000.00. Upon (a) execution and delivery by DCFS USA to Agent of a New Lender Agreement in the form attached as Exhibit J hereto (appropriately completed and accepted
by Agent and Borrower), and satisfaction by DCFS USA of such other requirements as Agent requires; and (b) execution and delivery by Borrower of a Revolving Note payable to its order, DCFS USA shall become a party hereto with the rights and
obligations of a Lender hereunder. 
 4. Conditions Precedent. The effectiveness of this Agreement is subject to satisfaction of each
of the following conditions: 
 (a) Agent has received executed originals of this Agreement and such other Loan Documents as
Agent requires and Borrower and each Guarantor has provided such information and satisfied such requirements as Agent reasonably requires. 
 (b) All conditions in Section 3 hereof have been satisfied. 
 (c) No Default has
occurred and is continuing. 
 (d) All representations and warranties in the Loan Agreement are true and correct as of the
date of this Agreement. 
 5. Defined Terms. Capitalized terms not otherwise defined herein shall have the meanings given to such
terms in the Loan Agreement. 
 6. Reaffirmation. By signing this Agreement or the attached Acknowledgment, Borrower and each
Guarantor reaffirm the representations and warranties in each of the existing Loan Documents and agree that (a) except as amended previously or in connection herewith, each Loan Document is and shall remain valid and enforceable in accordance
with its terms and (b) such Borrower or Guarantor has no claims, defenses, setoffs, counterclaims or claims for recoupment against Agent, the Lenders, or the indebtedness and obligations represented by the Notes, Guaranties, Security Documents
and other Loan Documents. Without limiting the foregoing, (a) Borrower and each Collateral Subsidiary agree that the Secured Obligations (as defined in the Commercial Security Agreement and Commercial Pledge and Security Agreement, each
executed by Borrower and Collateral Subsidiaries and dated August 31, 2006) which are secured by the Collateral include the Obligations of Borrower and Guarantors to Bank as increased by this Agreement; and (b) each Guarantor agrees that
the Obligations (as defined in the Commercial Guaranty executed by Guarantors dated August 31, 2006) which are guaranteed by the Guarantors include the Obligations as increased by this Agreement. 
  

 Page 7 

 7. References. On and after the effective date of this Agreement, all references in the Loan
Agreement and the other Loan Documents to the Loan Agreement shall be deemed to refer to the Loan Agreement as amended hereby. 
 8.
Authorization. Each Loan Party represents and warrants to Agent and the Lenders that its execution, delivery and performance of this Agreement and the other Loan Documents and all documents to be executed, delivered or performed by it have
been duly authorized by all necessary entity action, do not require the approval of any governmental agency or other Person, do not contravene any law, regulation, rule, order, or restriction binding on it or its articles of incorporation or other
organizational documents, and do not contravene the provisions of or constitute a default under any agreement or instrument to which it is a party or by which it may be bound or affected. 
 9. Expenses. Borrower shall pay all costs, fees and expenses incurred by Agent in connection with the preparation, negotiation, execution, and
delivery of this Agreement and any other document required to be furnished herewith, including without limitation the charges of Agent’s legal counsel. 
 10. Recitals. The Recitals are hereby incorporated herein. 
 11. Counterparts. This Agreement
may be executed in any number of counterparts, each of which shall be deemed to be an original, and all of said counterparts taken together shall be deemed to constitute but one document. 
 [Signature page follows] 
  

 Page 8 

									
	LITHIA MOTORS, INC.	 		 	 U.S. BANK NATIONAL ASSOCIATION, as
 Agent,
Lender, Swingline Lender, and Issuing
 Lender

					
	By:	 	/s/ Jeffrey B. DeBoer	 		 	By:	 	/s/ Silvia K. Boulger
	Name:	 	Jeffrey B. DeBoer	 		 	Name:	 	Silvia K. Boulger
	Title:	 	SVP & CFO	 		 	Title:	 	Vice President

  

									
	 DAIMLERCHRYSLER FINANCIAL
 SERVICES AMERICAS
LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	/s/ Judy C. Johnson	 		 	By:	 	/s/ Mark Doi
	Name:	 	Judy C. Johnson	 		 	Name:	 	Mark Doi
	Title:	 	Credit Director, National Accounts	 		 	Title:	 	National Dealer, Credit Manager

  

			
	DCFS USA LLC, as Lender
		
	By:	 	/s/ Michele Nowak
	Name:	 	Michele Nowak
	Title:	 	Credit Director, National Accounts

  

 Page 9 

 ACKNOWLEDGMENT AND CONSENT OF GUARANTORS 
 Each Guarantor hereby acknowledges, consents, and agrees to all terms and conditions of the foregoing amendment. 
 Hutchins Eugene Nissan, Inc. 
 Hutchins Imported Motors, Inc. 
 LAD Advertising, Inc. 
 LGPAC, Inc. 
 Lithia Auto Services, Inc. 
 Lithia BNM, Inc. 
 Lithia DE, Inc. 
 Lithia DM, Inc. 
 Lithia Financial Corporation 
 Lithia Aircraft, Inc. 
 Lithia HPI, Inc. 
 Lithia Klamath, Inc. 
 L2 Auto, Inc., fka Lithia LAC, Inc. 
 Lithia Medford Hon, Inc. 
 Lithia Medford LM, Inc. 
 Lithia Motors Support Services, Inc. 
 Lithia MTLM, Inc. 
 Lithia of Roseburg, Inc. 
 Lithia Real Estate, Inc. 
 Lithia Rentals, Inc. 
 Lithia Rose-FT, Inc. 
 Lithia SOC, Inc. 
 Lithia TKF, Inc. 
 Saturn of Southwest Oregon, Inc. 
 Lithia Chrysler Jeep of Anchorage, Inc. 
 Lithia Imports of Anchorage, Inc.

 Lithia NA, Inc. 
 Lithia of Anchorage, Inc. 
 Lithia of Fairbanks, Inc. 
 Lithia of South Central AK, Inc. 
 Lithia CIMR, Inc. 
 Lithia CJDB, Inc. 
 Lithia CS, Inc. 
 Lithia DC, Inc. 
 Lithia FMF, Inc. 
 Lithia JEF, Inc. 
 Lithia MMF, Inc. 
 Lithia NF, Inc. 
 Lithia of California, Inc. 
 Lithia of Clovis, Inc. 
 Lithia of Eureka, Inc. 
  

 Page 10 

 Lithia of Fairfield, Inc. 
 Lithia CA Acquisition Corp 1, Inc. 
 Lithia Seaside, Inc. 
 Lithia Sea P, Inc. 
 Lithia of Santa Rosa, Inc. 
 Lithia
TKV, Inc. 
 Lithia TR, Inc. 
 Lithia Centennial Chrysler Plymouth
Jeep, Inc. 
 Lithia Cherry Creek Dodge, Inc. 
 Lithia Colorado
Jeep, Inc. 
 Lithia Colorado Springs Jeep Chrysler Plymouth, Inc. 
 Lithia Foothills Chrysler, Inc. 
 Lithia of Thornton, Inc. 
 Lithia CB, Inc. 
 Lithia CCTF, Inc. 
 Lithia DB, Inc.

 Lithia Ford of Boise, Inc. 
 Lithia IB, Inc. 
 Lithia LMB, Inc. 
 Lithia of Caldwell, Inc. 
 Lithia of Pocatello, Inc. 
 Lithia Poca-Hon, Inc. 
 Lithia of TF, Inc. 
 Lithia MBDM, Inc. 
 Lithia of Des Moines, Inc. 
 Lithia LRDM, Inc. 
 Lithia CDH, Inc. 
 Lithia HGF, Inc. 
 Lithia of Billings, Inc. 
 Lithia of Butte, Inc. 
 Lithia of Great Falls, Inc. 
 Lithia of Helena, Inc. 
 Lithia of Missoula, Inc. 
 Lithia CJD of Omaha, Inc. 
 Lithia MBO, Inc. 
 Lithia of Omaha, Inc. 
 Lithia CJDSF, Inc. 
 Lithia of Santa Fe, Inc. 
 Lithia of Reno, Inc. 
 Lithia Reno Sub-Hyun, Inc. 
 Lithia SALMIR, Inc. 
 Lithia ND Acquisition Corp. #1 
 Lithia ND Acquisition Corp. #2 
 Lithia ND Acquisition Corp. #3 
 Lithia ND Acquisition Corp. #4 
 Lithia Automotive, Inc. 
 Lithia of Sioux Falls, Inc. 
  

 Page 11 

 Camp Automotive, Inc. 
 Lithia BC, Inc. 
 Lithia DC of Renton, Inc. 
 Lithia
Dodge of Tri-Cities, Inc. 
 Lithia FTC, Inc. 
 Lithia HyR, Inc.

 Lithia IC, Inc. 
 Lithia of Seattle, Inc. 
 Lithia of Spokane, Inc. 
 Lithia of Wenatchee, Inc. 
 TC Hon, Inc. 
 Lithia of La Crosse, Inc. 
 L2 Real Estate, Inc. 
 Lithia of Cedar Rapids #1, Inc. 
 Lithia of Cedar Rapids #2, Inc. 
 Lithia of Cedar Rapids #3, Inc. 

Lithia AcDM, Inc. 
 Lithia HDM, Inc. 
 Lithia IDM, Inc. 
 Lithia NDM, Inc. 
 Lithia VAuDM, Inc. 
 Lithia Bryan Texas, Inc. 
 Lithia CJDO, Inc. 
 Lithia CJDSA, Inc. 
 Lithia CM, Inc. 
 Lithia CO, Inc. 
 Lithia CSA, Inc. 
 Lithia DMID, Inc. 
 Lithia HMID, Inc. 
 Lithia NSA, Inc. 
 Lithia of Abilene, Inc. 
 Lithia of Corpus Christi, Inc. 
 Lithia of Midland, Inc. 
 Lithia TA, Inc. 
 Lithia TO, Inc. 
 L2 Auto of Iowa, Inc. 
 Lithia VaUB, Inc. 
 Lithia AcNY, Inc. 
 Lithia BNY, Inc. 
 Lithia HNY, Inc. 
 Lithia MBNY, Inc. 
  

 Page 12 

			
	Lithia of Rochester, Inc.
	NorCal Acquisitions, Inc.
	CMJ Investment Properties, Inc.
		
	By:	 	/s/ J. DeBoer
	Name:	 	J. DeBoer
	Title:	 	Authorized Agent

  

			
	SOE, LLC
	Lynnwood Properties, LLC
	Lithia LP of Texas, LLC
	Lithia GP of Texas, LLC
	PRE Properties, LLC
	BBD Investment Properties, LLC
		
	By:	 	/s/ J. DeBoer
	Name:	 	J. DeBoer
	Title:	 	Authorized Agent

  

 Page 13 

 SCHEDULE 1 
  

							
	 Name of Financial Institution
	  	Pro Rata Share of Revolving
Loans	 	 	Revolving Loan
Commitment
	 U.S. Bank National Association
	  	25.0	%	 	$	75,000,000.00
	 DaimlerChrysler Financial Services Americas LLC
	  	25.0	%	 	$	75,000,000.00
	 Toyota Motor Credit Corporation
	  	25.0	%	 	$	75,000,000.00
	 DCFS USA LLC
	  	25.0	%	 	$	75,000,000.00
	 TOTAL
	  	100	%	 	$	300,000,000.00

  

 Page 14 

 EXHIBIT J 
 NEW LENDER AGREEMENT 
 Reference is made to the Loan Agreement dated as of August 31, 2006 as
amended from time to time, “Loan Agreement”), among Lithia Motors, Inc., an Oregon corporation, the Lenders party thereto and U.S. Bank National Association, as Agent for the Lenders (in such capacity, “Agent”). Unless otherwise
defined herein, terms defined in the Loan Agreement are used herein with the same meanings. 
 _______________________ (the “New
Lender”) agrees as follows: 
 1. The New Lender (a) represents and warrants that it is legally authorized to enter into this
Agreement; (b) confirms that it has received a copy of the Loan Agreement and Loan Documents and all amendments thereto, together with copies of the most recent financial statements delivered pursuant thereto, and such other documents and
information as it has deemed appropriate to make its own credit analysis and decision to enter into this New Lender Agreement (“Agreement”); (c) agrees that it will, independently and without reliance upon the Agent or any other
Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Agreement; (d) appoints and authorizes the Agent to take such
actions on its behalf and to exercise such powers under the Loan Documents as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (e) agrees that it will become a party to the Loan
Agreement as of the Effective Date and perform in accordance with their terms all of the obligations which by the terms of the Loan Agreement are required to be performed by a Lender; and (f) specifies as its address for notices the address set
forth beneath its name on the signature pages hereof. 
 2. The effective date for this Agreement shall be ____________________ (the
“Effective Date”). As of the Effective Date, the New Lender’s Revolving Loan Commitment is $___________ and its Pro Rata Share of the Revolving Loans is _________%. Following the execution of this Agreement, it will be delivered to
the Agent, for acceptance and recording by the Agent. 
 3. Upon such acceptance and recording as of the Effective Date, the New Lender shall
be a party to the Loan Agreement and shall have the rights and obligations of a Lender thereunder and under the Loan Documents. 
 4. This
Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall constitute one agreement. 
  

 Page 15 

 5. This New Lender Agreement shall be governed by and construed in accordance with the laws of the State
of Oregon. 
  

			
	[NEW LENDER]
		
	By:	 	 
	Name:	 	 
	Title:	 	 

  

			
	 ACCEPTED AND AGREED TO:
  

	U.S. Bank National Association, as Agent
		
	By:	 	 
	Title:	 	 
	Date:	 	 

  

			
	LITHIA MOTORS, INC.
		
	By:	 	 
	Title:	 	 
	Date:	 	 

  

 Page 16 

 THIRD AMENDMENT TO LOAN AGREEMENT 
 This Third Amendment to Loan Agreement (this “Agreement”) dated as of March _____, 2008, is entered into among Lithia Motors, Inc., an Oregon
corporation (“Borrower”); the lenders which are from time to time parties to the Loan Agreement (each a “Lender” and any two or more “Lenders”); and U.S. Bank National Association, as agent for the Lenders (in such
capacity, “Agent”). 
 R E C I T A L S 
 A. Borrower, the Lenders and Agent have entered into a Loan Agreement dated as of August 31, 2006, which has been amended by amendments dated as of June 29, 2007 and February 13, 2008 (collectively, the
“Loan Agreement”). 
 B. The parties wish to modify the terms and conditions of the Loan Agreement, as set forth below. 

For valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows: 
 ARTICLE 17. Amendments to Loan Agreement. 
 17.1 Changed Definitions. The following defined terms in Section 1.1 of the Loan Agreement are deleted and replaced with the following: 
 “Current Assets Commitment Amount” means, with respect to any Current Assets Election, the lesser of (a) the Maximum Amount, minus
the sum of the then outstanding principal balance of the Revolving Loans, Swingline Loans, and LC Outstandings; or (b) the Specified Current Assets Commitment Amount. 
 “Maximum Amount” means, as of any date of determination, the lesser of (a) the Total Revolving Loan Commitment; and (b) the Borrowing Base at such time. 
 17.2 Deleted Definition. The defined term “Total Borrowing Base Assets” is hereby deleted from Section 1.1 of the Loan
Agreement. 
 17.3 Maximum Revolving Loan Amount. Section 2.1.1 of the Loan Agreement is deleted and replaced with
the following: 
 2.1.1 Maximum Amount. Subject to the terms and conditions of this Agreement, each Lender severally and not
jointly agrees to make loans (each a “Revolving Loan” and collectively, the “Revolving Loans”) to Borrower on a revolving credit basis during the period from the Closing Date to but not including the Expiration Date; provided
that (a) the aggregate outstanding principal balance of the Revolving Loans made by each Lender, plus the outstanding principal balance of such Lender’s participating interest in the Swingline Loans and Letters of Credit shall not at any
time exceed an amount equal to such Lender’s Revolving Loan Commitment; (b) the outstanding 

  

 Page 1 

 
principal balance of all Revolving Loans shall not at any time exceed, in the aggregate, as to all Lenders, the Maximum Amount, and (c) the outstanding
principal balance of all Revolving Loans, plus the outstanding principal balance of all Swingline Loans, plus the LC Outstandings shall not at any time exceed, in the aggregate, as to all Lenders, the Maximum Amount. 
 17.4 Deletion of Overadvance Fee. Section 2.7 of the Loan Agreement is hereby deleted. 
 17.5 Maximum Swingline Loan Amount. Section 3.1.1 of the Loan Agreement is deleted and replaced with the following:

 3.1.1 Maximum Amount. Subject to the terms and conditions of this Agreement, the Swingline Lender agrees to make loans (each, a
“Swingline Loan” and collectively, the Swingline Loans”) to Borrower on a revolving credit basis during the period from the Closing Date to but not including the Expiration Date; provided that (a) the aggregate outstanding
principal balance of the Swingline Loans shall not at any time exceed the Swingline Commitment; and (b) the outstanding principal balance of all Revolving Loans made by all Lenders plus the outstanding principal balance of all Swingline Loans,
plus the LC Outstandings, shall not at any time exceed the Maximum Amount. 
 17.6 Maximum Amount of LC Outstandings.
Section 4.1.1 of the Loan Agreement is deleted and replaced with the following: 
 4.1.1 Maximum Amount. Subject to and upon
the terms and conditions of this Agreement, Issuing Lender may from time to time during the period from the Closing Date to the date which is 30 days prior to the Expiration Date issue one or more standby letters of credit for the account of
Borrower; provided that (a) the LC Outstandings shall not exceed at any time the Letter of Credit Commitment; and (b) the outstanding principal balance of all Revolving Loans made by all Lenders, plus the outstanding principal balance of
all Swingline Loans, plus the LC Outstandings shall not at any time exceed the Maximum Amount. 
 17.7 Interest Rate.
Section 5.1.1 of the Loan Agreement is deleted and replaced with the following: 
 5.1.1 Interest Rate. Unless
the Default Rate is applicable, (a) the Revolving Loans shall bear interest at a variable per annum rate equal to the LIBOR Rate plus the Revolving Loan Margin (“Revolving Loan Borrowing Rate”); and (b) the Swingline Loans shall
bear interest at a variable per annum rate equal to the LIBOR Rate plus the Swingline Margin (“Swingline Borrowing Rate”), in each case adjusted without notice on the date of each change in the LIBOR Rate. 
 As used herein, 
 “Revolving Loan
Margin” means (a) ___% prior to May 1, 2008 and on and after May 1, 2009, and (b) at other times, the percentage per annum rate set forth below for the applicable date under the heading “Revolving Loan Margin”

  

 Page 2 

 
opposite the applicable Fixed Charge Coverage Ratio (“FCCR”) and Cash Flow Leverage Ratio (“CFLR”) 
 “Swingline Margin” means (a) ___ % prior to May 1, 2008 and on and after May 1, 2009, and (b), at other times, the percentage per
annum rate set forth below for the applicable date under the heading “Swingline Margin” opposite the applicable FCCR and CFLR. 
  

													
	 FIXED CHARGE COVERAGE RATIO (“FCCR”)
 AND CASH FLOW LEVERAGE RATIO (“CFLR”)
	  	SWINGLINE
MARGIN**	 	 	REVOLVING
LOAN
MARGIN**	 
	 	  	5/1/08
through
10/31/08	 	 	11/1/08
through
4/30/09	 	 	5/1/08
through
10/31/08	 	 	11/1/08
through
4/30/09	 
	 FCCR is equal to or greater than 1.20 and CFLR is equal to or less than 3.0
	  	___	%	 	___	%	 	___	%	 	___	%
	 FCCR is less than 1.20, but equal to or greater than 1.10 and CFLR is equal to or less than 3.0
	  	___	%	 	___	%	 	___	%	 	___	%
	 FCCR is equal to or greater than 1.20 and CFLR is greater than 3.0
	  	___	%	 	___	%*	 	___	%	 	___	%*
	 FCCR is less than 1.20, but equal to or greater than 1.10 and CFLR is greater than 3.0
	  	___	%	 	___	%*	 	___	%	 	___	%*
	 FCCR is less than 1.10 and CFLR is equal to or less than 3.0
	  	___	%	 	___	%	 	___	%	 	___	%
	 FCCR is less than 1.10 and CFLR is greater than 3.0
	  	___	%	 	___	%*	 	___	%	 	___	%*

  

	*	If the CFLR is greater than 3.0, an Event of Default will exist and Required Lenders may impose the Default Rate. 

  

	**	If an Event of Default exists at any time because Borrower is not in compliance with the required FCCR and/or CFLR requirement, Required Lenders may impose the Default Rate.

  

 Page 3 

 The Revolving Loan Margin and Swingline Margin (the “Interest Rate Margins”)
shall be automatically adjusted, effective as of the first day of the second month of each fiscal quarter, beginning May 1, 2008 (each, an “Adjustment Date”) based upon the FCCR and CFLR as of the last day of the preceding fiscal
quarter (beginning with the fiscal quarter ending March 31, 2008); provided, however, that if a Compliance Certificate is not timely provided to Agent, the Interest Rate Margins shall increase, effective as of each Adjustment Date, to the
highest Interest Rate Margins set forth above for such date. 
 Nothing set forth in this Section 5.1.1 (including the
establishment of Interest Rate Margins for Fixed Charge Coverage Ratios and Cash Flow Leverage Ratios which are not in compliance with the ratios required by the Loan Agreement) shall limit the right of Required Lenders to impose the Default Rate
upon the occurrence and during the continuance of an Event of Default. 
 17.8 Deletion of Additional Limitations.
Section 5.18 of the Loan Agreement is hereby deleted. 
 17.9 Financial Covenants. Sections 10.1.3 and 10.1.4 of
the Loan Agreement are deleted and replaced with the following: 
 10.1.3 Fixed Charge Coverage Ratio. The Fixed
Charge Coverage Ratio for Borrower and its Subsidiaries, on a consolidated basis, as of the last day of any fiscal quarter, for the period of four consecutive fiscal quarters ending on such date, shall not be less than (a) 1.20 to 1.0 as of the
last day of each fiscal quarter ending on or before December 31, 2007 or after December 31, 2008, and (b) 1.0 to 1.0 as of the last day of the fiscal quarters ending on March 31, June 30, September 30 and
December 31, 2008. 
 As used herein, 
 “EBITDAR” means, for any Person, for any time period, (a) such Person’s net income (or loss) for such time period
(excluding extraordinary gains or losses and Excluded Items, but including net income or loss from discontinued operations); (b) plus, without duplication, the amounts which in determining net income or loss have been deducted for
(i) interest expense, (ii) income tax expense, (iii) depreciation, amortization, goodwill impairment charges and other non-cash charges (less non-cash gains) and (iv) rental or lease expense. 
 “Excluded Items” means gain or loss from (a) the sale of real estate, or (b) the sale of all or substantially all of
the Equity Interests or assets of (i) a Dealership or other Subsidiary, (ii) a Dealership location, or (iii) any business unit or franchise of a Dealership or other Subsidiary or a Dealership location 
 “Fixed Charge Coverage Ratio” means, as of the last day of any fiscal quarter, the ratio for the period of four consecutive
fiscal quarters ending on such date of (a) (i) EBITDAR, (ii) minus dividends and other distributions in respect of Equity Interests, (iii) minus income tax expense to the extent paid in cash, (iv)

  

 Page 4 

 
minus an allowance for maintenance capital expenditures in an amount equal to $110,000 for each Dealership location for such four consecutive fiscal
quarters; (v) plus, if a Permitted Acquisition has occurred during such time period, EBITDA attributable to any new Acquisition Subsidiary or business acquired on a pro forma basis, calculated as if such Permitted Acquisition had
occurred on the first day of such time period (it being understood and agreed that pro forma EBITDA may not be included in this calculation to the extent that it results in an annualized increase of more than 10% in Borrower’s consolidated
EBITDA prior to such adjustment, unless the Borrower provides to the Agent and the Required Lenders the supporting calculations for such adjustment and such other information as they may reasonably request to determine the accuracy of such
calculations); to (b) the sum of (i) cash interest, plus (ii) required principal payments on Debt, plus (iii) rental or lease expense, for such four consecutive fiscal quarters. 
 10.1.4 Cash Flow Leverage Ratio. The Cash Flow Leverage Ratio for Borrower and its Subsidiaries, on a consolidated basis, as of the
last day of any fiscal quarter for the period of four consecutive fiscal quarters ending on such date, shall not be more than (a) 3.00 to 1.0 as of the last day of each fiscal quarter ending on or before December 31, 2007 or after
June 30, 2008, and (b) 3.25 to 1.0 as of the last day of the fiscal quarters ending on March 31 and June 30, 2008. 
 As used herein: 
 “Adjusted Funded Debt” means (a) all Funded Debt excluding
(i) Subordinated Debt, (ii) Debt consisting of Floor Plan Financing, and (iii) Funded Debt of LRE which is secured primarily by real estate owned by LRE (“Real Estate Debt”), plus (b) at any time during which a Current
Assets Election is in effect, the Current Assets Commitment Amount. 
 “Cash Flow Leverage Ratio” means, for any
Person, as of any date of determination, the ratio of (a) the principal balance of Adjusted Funded Debt as of such date to (b) EBITDA for the period of four consecutive fiscal quarters ending on such date, minus interest expense for Floor
Plan Financing and Real Estate Debt for such period, minus required principal payments on Real Estate Debt for such time period. 
 “EBITDA” means, for any Person, for any time period, (a) such Person’s net income (or loss) for such time period (excluding extraordinary gains or losses and Excluded Items (as defined in Section 10.1.3), but
including net income or loss from discontinued operations); (b) plus, without duplication, the amounts which in determining net income or loss have been deducted for (i) interest expense, (ii) income tax expense, and
(iii) depreciation, amortization, goodwill impairment charges and other non-cash charges (less non-cash gains); provided, however, that if a Permitted Acquisition has occurred during any time period, EBITDA may include EBITDA attributable to
any new Acquisition Subsidiary or business acquired on a pro forma basis, calculated as if such Permitted Acquisition had occurred on the first day of such time period (it being understood and agreed that any pro forma adjustment of EBITDA
may not be included in this calculation to the extent that it results in an annualized increase of more than 10% 

  

 Page 5 

 
in Borrower’s consolidated EBITDA prior to such adjustment, unless the Borrower provides to the Agent and the Required Lenders the supporting
calculations for such adjustment and such other information as they may reasonably request to determine the accuracy of such calculations). 
 17.10 Senior Subordinated Notes. The following is hereby added to the Loan Agreement as Section 11.16 thereof: 
 Senior Subordinated Notes. On or before May 15, 2008, Borrower shall submit to Agent a plan (the “Plan”) for the repayment, refinancing or extension of the call period of the Senior Subordinated
Notes. Such Plan must be reasonably acceptable to the Lenders and shall include such information and details and be accompanied by such supporting documentation as any Lender may reasonably require. The Plan must demonstrate that Borrower
(a) will have funds available from and after January 1, 2009 (the “Implementation Date”) to fully repay, refinance or extend the call period of the Senior Subordinated Notes on or before May 6, 2009, and (b) will fully
repay, refinance or extend the call period of the Senior Subordinated Notes on or before May 6, 2009. The Lenders may, in their sole discretion, agree to extend the Implementation Date. Without limiting the foregoing, the Plan must include a
reasonably detailed description of the material terms of the proposed repayment, refinancing or extension and a schedule for its implementation and shall describe all material steps to be taken to accomplish the repayment, refinancing or extension
and the dates upon which each such step will be completed. The Plan must also include information establishing that execution of the Plan will not constitute a Default and that no Default will exist prior to or after giving effect to the
implementation of the Plan. Borrower shall comply with all terms of the Plan and any failure of Borrower to comply with the terms of the Plan in a timely manner shall constitute a violation of this Agreement 
 ARTICLE 18. Exhibit D. The Exhibit D attached to the Loan Agreement is hereby amended and replaced by the Exhibit D attached hereto.

 ARTICLE 19. Conditions Precedent. The effectiveness of this Agreement is subject to satisfaction of each of the following
conditions: 
 19.1.1 Agent has received executed originals of this Agreement and such other Loan Documents as Agent
requires and Borrower and each Guarantor has provided such information and satisfied such requirements as Agent reasonably requires. 
 19.1.2 No Default has occurred and is continuing. 
 19.1.3 All representations and warranties in the Loan Agreement
and in this Agreement are true and correct as of the date of this Agreement. 
 19.1.4 Borrower has paid to Agent, for the
account of the Lenders in accordance with their Pro Rata Shares of the Revolving Loan Commitments, an amendment fee in the amount of $60,000.00. 
  

 Page 6 

 ARTICLE 20. Defined Terms. Capitalized terms not otherwise defined herein shall have the
meanings given to such terms in the Loan Agreement. 
 ARTICLE 21. Reaffirmation. By signing this Agreement or the attached
Acknowledgment, Borrower and each Guarantor affirm that the representations and warranties in each of the existing Loan Documents are and will be true, correct and complete as of the date hereof, and agree that (a) except as amended previously
or in connection herewith, each Loan Document is and shall remain valid and enforceable in accordance with its terms and (b) such Borrower or Guarantor has no claims, defenses, setoffs, counterclaims or claims for recoupment against Agent, the
Lenders, or the indebtedness and obligations represented by the Notes, Guaranties, Security Documents and other Loan Documents. 
 ARTICLE 22. References. On and after the effective date of this Agreement, all references in the Loan Agreement and the other Loan Documents to the Loan Agreement shall be deemed to refer to the Loan Agreement as amended
hereby. 
 ARTICLE 23. Representations and Warranties. Each Loan Party represents and warrants to Agent and the Lenders as
follows: 
 23.1 Authorization. (a) It has all requisite power and authority to enter into this
Agreement and to carry out the transactions contemplated by, and perform its obligations under, the Loan Agreement as amended by this Agreement (the “Amended Agreement”), (b) its execution, delivery and performance of this Agreement
and the other Loan Documents and all documents to be executed, delivered or performed by it have been duly authorized by all necessary entity action, do not require the approval of any governmental agency or other Person, do not contravene any law,
regulation, rule, order, or restriction binding on it or its articles of incorporation or other organizational documents, and do not contravene the provisions of or constitute a default under any agreement or instrument to which it is a party or by
which it may be bound or affected, and (c) this Agreement has been duly executed and delivered by each Loan Party and this Agreement and the Amended Agreement are the legally valid and binding obligations of each Loan party, enforceable against
such Loan Party in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to
enforceability. 
 23.2 Absence of Default. No event has occurred and is continuing or will result from the
consummation of the transactions contemplated by this Agreement that would constitute a Default or Event of Default. 
 23.3 Financial Statements. Subject only to execution of this Agreement by the parties hereto, its auditors will issue an unqualified audit report with respect to the Form 10(k) for Borrower and its Subsidiaries for the fiscal year ending
December 31, 2007. 
 ARTICLE 24. Expenses. Borrower shall pay all outside and/or third party costs, fees and expenses
(including without limitation, attorney fees) incurred by Agent and each 

  

 Page 7 

 
Lender in connection with the preparation, negotiation, execution, and delivery of this Agreement and any other document required to be furnished
herewith. 
 ARTICLE 25. Recitals. The Recitals are hereby incorporated herein. 
 ARTICLE 26. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, and
all of said counterparts taken together shall be deemed to constitute but one document. 
 [Signature page follows] 
  

 Page 8 

									
	LITHIA MOTORS, INC.	 		 	 U.S. BANK NATIONAL ASSOCIATION, as
 Agent,
Lender, Swingline Lender, and Issuing
 Lender

					
	By:	 	/s/ Jeff DeBoer	 		 	By:	 	/s/ Silvia K. Boulger
	Name: 	 	Jeff DeBoer	 		 	Name: 	 	Silvia K. Boulger
	Title:	 	SVP and CFO	 		 	Title:	 	Vice President
			
	 DAIMLERCHRYSLER FINANCIAL SERVICES
AMERICAS LLC, as Lender
	 		 	 TOYOTA MOTOR CREDIT
 CORPORATION, as Lender

					
	By:	 	/s/ Anne M. Kline	 		 	By:	 	/s/ Mark Doi
	Name: 	 	Anne M. Kline	 		 	Name: 	 	Mark Doi
	Title:	 	Senior Manager, National Accounts	 		 	Title:	 	National Dealer Credit Manager

  

			
	 DCFS USA LLC, as Lender

		
	By:	 	/s/ Michele Nowak
	Name: 	 	Michele Nowak
	Title:	 	Credit Director, National Accounts

  

 Page 9 

 ACKNOWLEDGMENT AND CONSENT OF GUARANTORS 
 Each Guarantor hereby acknowledges, consents, and agrees to all terms and conditions of the foregoing amendment. 
 Hutchins Eugene Nissan, Inc. 
 Hutchins Imported Motors, Inc. 
 LAD Advertising, Inc. 
 LGPAC, Inc. 
 Lithia Auto Services, Inc. 
 Lithia BNM, Inc. 
 Lithia DE, Inc. 
 Lithia DM, Inc. 
 Lithia Financial Corporation 
 Lithia Aircraft, Inc. 
 Lithia HPI, Inc. 
 Lithia Klamath, Inc. 
 L2 Auto, Inc. 
 Lithia Medford Hon, Inc. 
 Lithia Medford LM, Inc. 
 Lithia Motors Support Services, Inc. 
 Lithia MTLM, Inc. 
 Lithia of Roseburg, Inc. 
 Lithia Real Estate, Inc. 
 Lithia Rentals, Inc. 
 Lithia Rose-FT, Inc. 
 Lithia SOC, Inc. 
 Lithia TKF, Inc. 
 Saturn of Southwest Oregon, Inc. 
 Lithia Chrysler Jeep of Anchorage, Inc. 
 Lithia Imports of Anchorage, Inc.

 Lithia NA, Inc. 
 Lithia of Anchorage, Inc. 
 Lithia of Fairbanks, Inc. 
 Lithia of South Central AK, Inc. 
 Lithia CIMR, Inc. 
 Lithia CJDB, Inc. 
 Lithia DC, Inc. 
 Lithia FMF, Inc. 
 Lithia JEF, Inc. 
 Lithia MMF, Inc. 
 Lithia NF, Inc. 
 Lithia of California, Inc. 
 Lithia of Clovis, Inc. 
 Lithia of Eureka, Inc. 
 Lithia of Fairfield, Inc. 
  

 Page 10 

 Lithia CA Acquisition Corp 1, Inc. 
 Lithia Seaside, Inc. 
 Lithia Sea P, Inc. 
 Lithia of
Santa Rosa, Inc. 
 Lithia TKV, Inc. 
 Lithia TR, Inc. 

Lithia Centennial Chrysler Plymouth Jeep, Inc. 
 Lithia Cherry Creek Dodge,
Inc. 
 Lithia Colorado Jeep, Inc. 
 Lithia Colorado Springs Jeep
Chrysler Plymouth, Inc. 
 Lithia Foothills Chrysler, Inc. 
 Lithia of Thornton, Inc. 
 Lithia CB, Inc. 
 Lithia
CCTF, Inc. 
 Lithia DB, Inc. 
 Lithia Ford of Boise, Inc.

 Lithia of Caldwell, Inc. 
 Lithia of Pocatello, Inc.

 Lithia Poca-Hon, Inc. 
 Lithia of TF, Inc. 
 Lithia MBDM, Inc. 
 Lithia of Des Moines, Inc. 
 Lithia CDH, Inc. 
 Lithia HGF, Inc. 
 Lithia of Billings, Inc. 
 Lithia of Butte, Inc. 
 Lithia of Great Falls, Inc. 
 Lithia of Helena, Inc. 
 Lithia of Missoula, Inc. 
 Lithia CJD of Omaha, Inc. 
 Lithia MBO, Inc. 
 Lithia of Omaha, Inc. 
 Lithia CJDSF, Inc. 
 Lithia of Santa Fe, Inc. 
 Lithia Reno Sub-Hyun, Inc. 
 Lithia SALMIR, Inc. 
 Lithia ND Acquisition Corp. #1 
 Lithia ND Acquisition Corp. #2 
 Lithia ND Acquisition Corp. #3 
 Lithia ND Acquisition Corp. #4 
 Lithia Automotive, Inc. 
 Lithia of Sioux Falls, Inc. 
 Camp Automotive, Inc. 
 Lithia BC, Inc. 
 Lithia DC of Renton, Inc. 
 Lithia Dodge of Tri-Cities, Inc. 
  

 Page 11 

 Lithia FTC, Inc. 
 Lithia
HyR, Inc. 
 Lithia IC, Inc. 
 Lithia of Seattle, Inc. 

Lithia of Spokane, Inc. 
 Lithia of Wenatchee, Inc. 
 TC Hon, Inc. 
 Lithia of La Crosse, Inc. 
 L2 Real Estate, Inc. 
 Lithia of Cedar Rapids #1, Inc. 
 Lithia of Cedar Rapids #2, Inc. 
 Lithia of Cedar Rapids #3, Inc. 

Lithia AcDM, Inc. 
 Lithia HDM, Inc. 
 Lithia IDM, Inc. 
 Lithia NDM, Inc. 
 Lithia VAuDM, Inc. 
 Lithia Bryan Texas, Inc. 
 Lithia CJDO, Inc. 
 Lithia CJDSA, Inc. 
 Lithia CM, Inc. 
 Lithia CO, Inc. 
 Lithia CSA, Inc. 
 Lithia DMID, Inc. 
 Lithia HMID, Inc. 
 Lithia NSA, Inc. 
 Lithia of Abilene, Inc. 
 Lithia of Corpus Christi, Inc. 
 Lithia of Midland, Inc. 
 Lithia TA, Inc. 
 Lithia TO, Inc. 
 L2 Auto of Iowa, Inc. 
 Lithia VaUB, Inc. 
  

 Page 12 

 Lithia AcNY, Inc. 
 Lithia
BNY, Inc. 
 Lithia HNY, Inc. 
 Lithia MBNY, Inc. 
 Lithia of Rochester, Inc. 
 NorCal Acquisitions, Inc. 
 CMJ Investment Properties, Inc. 
 Lithia of Minnesota, Inc. 
 L2 Auto of California, Inc. 
 L2 Auto of Colorado, Inc. 
 L2 Auto of Texas, Inc. 
 WY-RE Acquisitions, LLC 
  

			
		
	By:	 	/s/ Jeff DeBoer
	Name:	 	Jeff DeBoer
	Title:	 	Authorized Agent

  

			
	 SOE, LLC
 Lynnwood Properties, LLC

Lithia GP of Texas, LLC
 PRE Properties, LLC
 BBD Investment Properties, LLC

		
	By:	 	/s/ Jeff DeBoer
	Name:	 	Jeff DeBoer
	Title:	 	Authorized Agent

  

 Page 13 

 EXHIBIT D 
 COMPLIANCE CERTIFICATE 
 This Compliance Certificate is executed and delivered by Lithia Motors, Inc.
(“Borrower”) to U.S. Bank National Association, as Agent (in such capacity, “Agent”) pursuant to the requirements of the Loan Agreement dated as of _______________________ between Borrower, the Lenders which are from time to time
parties thereto, and Agent (“Loan Agreement”). Any capitalized terms used herein and not defined herein shall have the meanings given to such terms in the Loan Agreement. This Compliance Certificate covers the four (4) consecutive
fiscal quarters ended __________________ with respect to Section 10.1.3 and 10.1.4 of the Loan Agreement and is prepared as of _______________ with respect to Sections 10.1.1 and 10.1.2 of the Loan Agreement. 
 1. A review of the activities of the Borrower during the fiscal period covered by this Compliance Certificate has been made under the supervision of the
undersigned with a view to determining whether during such fiscal period the Borrower performed and observed all of their obligations under the Loan Agreement. To the best knowledge of the undersigned, during such fiscal period all covenants and
conditions of the Borrower have been performed and observed and no Default has occurred and is continuing under the Loan Agreement [with the exceptions set forth below in response to which Borrower has taken or propose to take the following actions:
______________________________________________________________________________ ______________________________________________________________________________ ___________________________________________.] 
 2. To the best knowledge of the undersigned, no event or circumstance which has had or may have a Material Adverse Effect has occurred since the last
Compliance Certificate was delivered [with the exceptions set forth below:_________________________ ______________________________________________________________________________ ___________________________________________.] 
 3. Attached are the calculations showing whether Borrower was in compliance with Sections 10.1.1, 10.1.2, 10.1.3, and 10.1.4 of the Loan Agreement as of
the end of the fiscal period covered by this Compliance Certificate. Each such calculation is derived from the books and records of Borrower and correctly reflects whether Borrower is in compliance with the applicable Sections of the Loan Agreement.

  

	 ̈	4. Borrower hereby gives notice of a Current Assets Election in the Specified Current Assets Commitment Amount of
$            . 

 This Compliance
Certificate is executed on _________________________________________. 
  

			
	LITHIA MOTORS, INC.
		
	By:	 	 
	Title:	 	 

  

 Page 14 

 Calculation of Financial Covenants 
  

			
	 	  	 Amounts in Thousands

	10.1.1    Total Net Worth	  	
	 A. Net Book Value of Assets
	  	$                         
	 B. MINUS Total Liabilities
	  	$                         
	 C. Total Net Worth
	  	$                         
	 D. Minimum Requirement: $300,000,000
	  	$                         
		
	10.1.2    Current Ratio	  	
	 A. Borrowing Base Minus the Total Outstandings
	  	$                         
	 B. Specified Current Assets Commitment Amount
	  	$                         
	 C. Total Revolving Loan Commitment minus Total Outstandings
	  	$                         
	 D. Current Assets Commitment Amount (least of A, B and C)
	  	$                         
	 E. Consolidated Current Assets (including any Current Assets
	  	$                         
	 Commitment Amount specified above)
	  	$                         
	 F. MINUS Receivables from Related Parties
	  	$                         
	 G. Total Current Assets
	  	$                         
	 H. Total Current Liabilities (if the Expiration Date is within one year, including any Current Assets Commitment Amount specified
above)
	  	$                         
	 I. Permitted Ratio of G to H: Not less than 1.2:1.0.
	  	
	 RATIO:
	  	             to 1.0

  

 Page 15 

			
	10.1.3    Fixed Charge Coverage Ratio	  	
	 A. EBITDAR
	  	
	 1. Consolidated Net Income
	  	$                         
	 2. PLUS interest expense
	  	$                         
	 3. PLUS income tax expense
	  	$                         
	 4. PLUS depreciation expense
	  	$                         
	 5. PLUS amortization expense
	  	$                         
	 6. PLUS goodwill & non-cash asset impairment charges
	  	$                         
	 7. PLUS non-cash expense
	  	$                         
	 8. PLUS rental expense
	  	$                         
	 9. PLUS extraordinary losses (except discontinued operations)
	  	$                         
	 10. MINUS all extraordinary gains (except discontinued operations)
	  	$                         
	 11. PLUS or MINUS Excluded Items
	  	$                         
	 Total EBITDAR
	  	$                         
	 B.    PLUS pro forma Permitted Acquisitions EBITDA
	  	$                         
	 C.       1. MINUS Dividends paid in cash
	  	$                         
	 2. MINUS Income taxes paid in cash
	  	$                         
	 3. MINUS Maintenance capital expenditures
	  	$                         
	 TOTAL EBITDAR plus EBITDA from acquisitions minus Dividends paid in cash, Income Taxes paid in cash and Maintenance Capital Expenditures (“Total Adjusted
EBITDAR”)
	  	$                         

  

 Page 16 

			
	 D. Fixed Charges
	  	
	 1. Interest paid in cash
	  	$                         
	 2. PLUS Required principal payments on debt
	  	$                         
	 3. PLUS Rental expense
	  	$                         
	 TOTAL Fixed Charges
	  	$                         
	 E. Permitted Ratio of Total Adjusted EBITDAR to Total Fixed Charges: Not less than ____ to 1.0.
	  	
	 RATIO:
	  	             to 1.0
		
	 10.1.4 Cash Flow Leverage
	  	
	 A. Adjusted Funded Debt
	  	
	 1. Current Maturities of Long Term Debt
	  	$                         
	 2. PLUS Long Term Debt, less current maturities
	  	$                         
	 3. PLUS Flooring Notes Payable
	  	$                         
	 4. Total Funded Debt
	  	$                         
	 5. MINUS Subordinated Debt
	  	$                         
	 6. MINUS Flooring Notes Payable (New and Program Inventory)
	  	$                         
	 7. MINUS Service Loaner Vehicle Notes
	  	$                         
	 8. MINUS Real Estate Debt
	  	$                         
	 9. PLUS Current Asset Commitment Amount
	  	$                         
	 Total Adjusted Funded Debt
	  	$                         

  

 Page 17 

				
	 B. EBITDA
	  		
	 1. Consolidated Net Income
	  	$	                    
	 2. MINUS all extraordinary gains (or PLUS extraordinary losses)
	  	$	                    
	 3. PLUS or MINUS Excluded Items
	  	$	                    
	 4. PLUS interest expense
	  	$	                    
	 5. PLUS income tax expense
	  	$	                    
	 6. PLUS depreciation expense
	  	$	                    
	 7. PLUS amortization expense
	  	$	                    
	 8. PLUS goodwill & non-cash asset impairment charges
	  	$	                    
	 9. PLUS other non-cash expense
	  	$	                    
	 10. PLUS pro forma Permitted Acquisitions EBITDA
	  	$	                    
	 Total EBITDA
	  	$	                    
	 11. MINUS Floorplan Interest
	  	$	                    
	 12. MINUS Real Estate Debt Interest
	  	$	                    
	 13. MINUS Required Principal Payments on Real Estate Debt
	  	$	                    
	 Total EBITDA MINUS Floorplan Interest, Real Estate Debt Interest, and Required Principal Payments on Real Estate Debt (“Total Adjusted
EBITDA”)
	  	$	
                     

	 D. Permitted Ratio of Total Adjusted Funded Debt to Total Adjusted EBITDA: Not greater than _______ to 1.0.
	  		
	 RATIO:
	  	 	         to 1.0

  

 Page 18

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