Document:

EX-10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”) is entered into between Group 1 Automotive, Inc.
(“Employer”), and Darryl M. Burman (“Employee”), as of December 1, 2006 (the “Effective Date”).

RECITALS

WHEREAS, Employer and Employee desire to enter into an employment relationship under the
following terms.

WHEREAS, Employer and Employee acknowledge that this Agreement will supersede and replace any
other written and/or oral agreement entered into by Employee concerning Employee’s employment
relationship, including any documents executed in the application process.

WHEREAS, Employee has made the following representations to Employer, and Employer is relying
upon such representations: (i) Employee is not subject to any non-compete or other provision in any
other agreement to which he is a party that would restrict his ability to perform his obligations
under this Agreement; and (ii) Employee is not bound by the terms of any other employment agreement
that would prevent him from performing his obligations under this Agreement.

WHEREAS, simultaneously with the execution of this Agreement, Employer and Employee executed
the Incentive Compensation and Non-Compete Agreement (“Incentive Compensation Agreement”) governing
the terms and conditions of Employer’s grant of restricted stock or restricted stock units
(collectively “Restricted Stock”) to Employee and the terms and conditions of Employee’s
non-competition obligations to Employer.

AGREEMENT

For and in consideration of the mutual promises, covenants, and obligations contained
herein, Employer and Employee agree as follows:

	1.	 	EMPLOYMENT AND DUTIES

1.1. Agreement to Employ. Employer shall employ Employee, and Employee shall be employed by
Employer, beginning December 1, 2006 (the “Start Date”) and continuing throughout the Term (as
defined below) of this Agreement, subject to the terms and conditions of this Agreement and the
Incentive Compensation Agreement.

1.2. Position and Responsibilities. Employee shall serve as Vice President, General Counsel
and Corporate Secretary of Employer. Employee shall perform diligently the duties and services
appertaining to such position as reasonably determined by Employer, as well as such additional
duties and services appropriate to such position which Employee from time to time may be reasonably
directed to perform by Employer. Employee shall at all times comply with and be subject to such
reasonable policies and procedures as Employer may establish from time to time, which shall not be
contrary to the terms of this Agreement. Employee shall devote Employee’s full business time,
energy, and best efforts to the business and affairs of Employer. Employee shall not engage,
directly or indirectly, in any other business, investment, or activity that interferes with
Employee’s performance of Employee’s duties hereunder, is contrary to the interests of Employer or
any of its subsidiaries or affiliates, or requires any significant portion of Employee’s business
time; provided, however, that Employee may engage in passive personal investments that do not
conflict with the business and affairs of Employer or any of its subsidiaries or affiliates or
interfere with Employee’s performance of his duties hereunder.

1.3. Fiduciary Duties. Employee acknowledges and agrees that Employee owes a fiduciary duty
of loyalty, fidelity and allegiance to act at all times in the best interests of Employer or any of
its subsidiaries or affiliates and to do no act which would be inconsistent with those duties. In
keeping with these duties, Employee shall make full disclosure to Employer of all business
opportunities pertaining to Employer’s business and shall not appropriate for Employee’s own
benefit business opportunities concerning the subject matter of the fiduciary relationship.

1.4. Conflicts of Interest. Any direct or indirect interest of Employee in connection with,
or benefit received by the Employee from, any outside activities, particularly commercial
activities, which might in any way adversely affect Employer, or any of its affiliates, shall be
deemed to be a conflict of interest. In keeping with Employee’s fiduciary duties to Employer,
Employee shall not knowingly become involved in a conflict of interest with Employer, or its
affiliates, or upon discovery thereof, allow such a conflict to continue. Moreover, Employee
agrees that Employee shall disclose to Employer’s Chief Executive Officer and the audit committee
of the Employer’s board of directors (the “Board”) any facts which might involve such a conflict of
interest that has not been approved by Employer’s Board. The Employer’s determination as to whether
a conflict of interest exists shall be conclusive absent manifest error; but this standard shall
not apply to, nor shall any determination under this Section 1.4 affect, any issue that may arise
as to the existence of “cause” under Section 3.2(i). Employer reserves the right to take such
action as, in its judgment, will resolve the conflict, as long as such action is not contrary to
the terms of this Agreement.

	2.	 	COMPENSATION AND BENEFITS

2.1. Base Salary. Employee’s base salary shall be $325,000.00 per annum and shall be paid in
semi-monthly installments in accordance with Employer’s standard payroll practice. Employee’s base
salary may be increased from time to time by Employer and, after any such increase, Employee’s new
level of base salary shall be Employee’s base salary for purposes of this Agreement until the
effective date of any subsequent change. Employee’s base salary shall not be reduced at any time
during the first twelve months of the Term. At any time after the first anniversary of the Start
Date, Employee’s base salary shall not be reduced other than pursuant to a reduction that is
applied to substantially all other executive officers of Employer and that is no greater than the
percentage applied to substantially all other executive officers.

2.2. Signing Bonus. Employer shall pay Employee a one-time signing bonus of $75,000.00.

2.3. Annual Incentive Compensation Program. Employee’s bonus shall be determined by the
compensation committee of the Board (the “Compensation Committee”) in their sole discretion in
accordance with the terms of Employer’s Annual Incentive Compensation Program.

2.4. Benefits and Vacation. While employed by Employer, Employee shall be allowed to
participate, on the same basis generally as other executive level employees of Employer, in all
general and executive level employee benefit plans and programs, including improvements or
modifications of the same, which on the Effective Date or thereafter are made available by Employer
to all or substantially all of Employer’s employees. Such benefits, plans, and programs may
include, without limitation, medical, health, vision and dental care, life insurance, disability
protection, deferred compensation and retirement plans. Employer will provide a vehicle allowance
totaling $941.66 per month. Additional perquisites must be approved by the Board and the
Compensation Committee. Nothing in this Agreement is to be construed or interpreted to provide
greater rights, participation, coverage, or benefits under such benefit plans or programs than
provided to similarly situated employees pursuant to the terms and conditions of such benefit plans
and programs. In addition, Employer may furnish to Employee benefit plans and programs that are
not generally available to other employees, including, without limitation, Employer’s Deferred
Compensation Plan, Executive Long-Term Disability Plan, Employee Stock Purchase Plan, 401(k) and
life insurance programs.

2.5. Business Expenses. Employee shall be entitled to incur, and be reimbursed for, all
reasonable out-of-pocket business expenses incurred in the performance of Employee’s duties on
behalf of Employer. Employer shall reimburse Employee for such expenses, in accordance with
Employer’s policies regarding reimbursement of expenses, subject to the Employee presenting
appropriate supporting documents regarding such expenses as required by Employer’s policies.

2.6. Benefit Obligations. Employer shall not by reason of this Section 2 be obligated to
institute, maintain, or refrain from changing, amending, or discontinuing, any incentive
compensation or employee benefit program or plan, so long as such actions are similarly applicable
to other covered employees generally. Moreover, unless specifically provided for in a written plan
document adopted by the Board or the Compensation Committee, none of the benefits or arrangements
described in this Section 2 shall be secured or funded in any way, and each shall instead
constitute an unfunded and unsecured promise to pay money in the future exclusively from the
general assets of Employer and its subsidiaries and affiliates.

2.7. Taxes. Employer may withhold from any compensation, benefits, or amounts payable under
this Agreement all federal, state, city, or other taxes as may be required pursuant to any law or
governmental regulation or ruling.

	3.	 	TERM OF THIS AGREEMENT, EFFECT OF EXPIRATION OF TERM, AND TERMINATION PRIOR TO
EXPIRATION OF TERM AND EFFECTS OF SUCH TERMINATION	 

3.1. Term. The term of this Agreement shall be from December 1, 2006 through November 30,
2009 (the “Term”), unless earlier terminated as provided for herein. The Term shall be
automatically renewed for successive one-year terms (unless earlier terminated as provided for
herein) unless either party notifies the other party in writing, not less than thirty (30) days
prior to expiration of the Term, of that party’s intent to not renew this Agreement.

3.2. Termination by Employer. Notwithstanding any other provisions of this Agreement,
Employer shall have the right to terminate Employee’s employment under this Agreement at any time,
including during the Term, for any of the following reasons:

	 	(i)	 	For “cause,” which, as used in this Section 3.2(i), shall mean any of the
following; (a) the Employee’s conviction or plea of nolo contendere to a felony or a
crime involving moral turpitude; (b) the Employee’s breach of any material provision of
either this Agreement, the Employee Handbook, Employer’s Code of Conduct, or the Code
of Ethics for Specified Officers of Employer signed by Employee; (c) the Employee’s
using for his own benefit any confidential or proprietary information of Employer, or
willfully divulging for his benefit such information; (d) the Employee’s (1) fraud or
(2) misappropriation or theft of any of the Employer’s funds or property; or (e) the
Employee’s willful refusal to perform his duties or gross negligence, provided that
Employer, before terminating the Employee under subsection (b) or (e) must first give
written notice to the Employee of the nature of the alleged breach or refusal and must
provide the Employee with a minimum of fifteen (15) days to correct the problem and,
provided further, before terminating Employee for purported gross negligence Employer
must give written notice that explains the alleged gross negligence in detail and must
provide Employee with a minimum of twenty (20) days to correct the problem, unless
correction is inherently impossible;

	 	(ii)	 	For any other reason whatsoever, including termination without cause, in the
sole discretion of Employer’s Board of Directors;

	 	(iii)	 	Upon Employee’s death; or

	 	(iv)	 	Upon Employee’s becoming incapacitated by accident, sickness, or other
circumstance which in the reasonable opinion of a qualified doctor approved by the
Board renders him mentally or physically incapable of performing the essential
functions of Employee’s position, with or without reasonable accommodation, and which
will continue in the reasonable opinion of such doctor for a period of not less than
180 days. If the Employee disagrees with the determination, the Employee may appoint a
doctor of his own choosing and if that doctor reaches a determination different than
that of the first doctor, the two doctors shall mutually select a third doctor within
ten (10) days and such third doctor’s determination shall be deemed conclusive.

The termination of Employee’s employment shall constitute a “Termination for Cause” if made
pursuant to Section 3.2(i); the effect of such termination is specified in Section 3.4.

The termination of Employee’s employment shall constitute an “Involuntary Termination” if made
pursuant to Section 3.2(ii); the effect of such termination is specified in Section 3.5.

The effect of the employment relationship being terminated pursuant to Section 3.2(iii) as a result
of Employee’s death is specified in Section 3.7.

The effect of the employment relationship being terminated pursuant to Section 3.2(iv) as a result
of the Employee’s inability to perform the essential functions of the position is specified in
Section 3.8.

3.3. Termination by Employee. Notwithstanding any other provisions of this Agreement,
Employee shall have the right to terminate the employment relationship under this Agreement at any
time for any of the following reasons:

	 	(i)	 	A breach by Employer of any material provision of this Agreement or the
occurrence of a “Constructive Termination Event,” which shall be defined as the failure
by the Employer to pay the Employee’s compensation as provided in this Agreement,
relocation without the Employee’s consent of the Employee’s primary employment location
to a location that is more than 50 miles from the location to which he will be required
to report on his first day of employment, a material diminution in the Employee’s
position, duties, responsibilities, reporting status, or authority, or if the Employee
is requested to perform any illegal activity or to sign-off on any inappropriate
financial statement or acknowledgement, except that before exercising his right to
terminate the employment relationship pursuant to any of the provisions of this
subsection (i), the Employee must first give written notice to the Employer’s Board of
Directors of the circumstances purportedly giving rise to his right to so terminate and
must provide the Employer with a minimum fifteen (15) days to correct the problem,
unless correction is inherently impossible;

	 	(ii)	 	The involuntary reduction of Employee’s base salary or incentive compensation
targets (other than a reduction in such targets applied consistently to the Company’s
other executive officers that is designed to account for changes in relative EPS
projections as a result of such Corporate Change) within six (6) months after the
occurrence of any Corporate Change (defined below) that is not cured by Employer or its
successor, as applicable, within thirty (30) days of receiving detailed written notice
of such event from Employee. A “Corporate Change” shall mean the first to occur of any
of the following events: (1) an acquisition by any individual, entity or group (within
the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) (each, a “Person”) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of either: (i)
the then outstanding shares of common stock of Employer (the “Outstanding Common
Stock”) or (ii) the combined voting power of the then outstanding voting securities of
Employer entitled to vote generally in the election of directors (the “Outstanding
Voting Securities”); excluding, however, the following: (A) any acquisition directly
from Employer (including without limitation any public offering), other than an
acquisition by virtue of the exercise of a conversion privilege unless the security
being so converted was itself acquired directly from Employer; (B) any acquisition by
Employer; (C) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by Employer or any Person controlled by Employer; or (D) any acquisition
by any Person pursuant to a transaction which complies with clauses (A), (B) and (C) of
subsection (1) of this definition of “Corporate Change”); (2) within any period of 24
consecutive months, a change in the composition of the board of directors of Employer
(the “Board”) such that the individuals who, immediately prior to such period,
constituted the Board (such Board will be hereinafter referred to as the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board; provided,
however, for purposes of this definition of “Corporate Change” that any individual who
becomes a member of the Board during such period, whose election, or nomination for
election by the Company’s stockholders, was approved by a vote of at least a majority
of those individuals who are members of the Board and who were also members of the
Incumbent Board (or deemed to be such pursuant to this proviso) will be considered as
though such individual were a member of the Incumbent Board; but, provided further,
that any such individual whose initial assumption of office occurs as a result of
either an actual or threatened election contest (as such terms are used in Rule 14a-11
of Regulation 14A promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the Board
will not be so considered as a member of the Incumbent Board; provided further that any
individual who voluntarily resigns from the Board in connection with the reduction in
size of the Board will not be deemed to be a member of the Incumbent Board; (3) the
consummation of a reorganization, merger or consolidation or sale or other disposition
of all or substantially all of the assets of Employer (a “Corporate Transaction”);
excluding, however, such a Corporate Transaction pursuant to which (i) all or
substantially all of the individuals and entities who are the beneficial owners,
respectively, of the Outstanding Common Stock and Outstanding Voting Securities
immediately prior to such Corporate Transaction will beneficially own, directly or
indirectly, more than 50% of, respectively, the outstanding shares of common stock and
the combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the entity resulting
from such Corporate Transaction (including, without limitation, an entity which as a
result of such transaction owns Employer or all or substantially all of the Employer’s
assets, either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such Corporate Transaction, of the
Outstanding Common Stock and Outstanding Voting Securities, as the case may be, (ii) no
Person (other than Employer, any employee benefit plan (or related trust) sponsored or
maintained by Employer, by any entity controlled by Employer, or by such entity
resulting from such Corporate Transaction) will beneficially own, directly or
indirectly, more than 50% of, respectively, the outstanding shares of common stock of
the entity resulting from such Corporate Transaction or the combined voting power of
the outstanding voting securities of such corporation entitled to vote generally in the
election of directors, except to the extent that such ownership existed with respect to
Employer prior to the Corporate Transaction, and (iii) individuals who were members of
the Board immediately prior to the approval by the stockholders of Employer of such
Corporate Transaction will constitute at least a majority of the members of the board
of directors of the entity resulting from such Corporate Transaction (it is intended
that this subsection (3) include Corporate Transactions that result in entities other
than corporations that are governed by bodies other than a board of directors,
including without limitation, limited liability companies that are governed by a board
of managers); or (4) the approval by the stockholders of Employer of a complete
liquidation or dissolution of Employer, other than to a corporation pursuant to a
transaction which would comply with clauses (i), (ii) and (iii) of subsection (3) of
this definition of “Corporate Change,” assuming for this purpose that such transaction
were a Corporate Transaction. Any such Corporate Change must also constitute a change
in control as such phrase is defined in section 409A(a)(2)(A)(v) of the Internal
Revenue Code of 1986, as amended (the “Code”) and the guidance issued thereunder,
including consideration of all applicable attribution of ownership rules under section
318 of the Code to the extent required by any guidance under section 409 A of the Code;
or

	 	(iii)	 	For any other reason whatsoever, in the sole discretion of Employee.

The termination of Employee’s employment by Employee shall constitute an “Involuntary Termination”
if made pursuant to Section 3.3(i) or 3.3(ii); the effect of such termination is specified in
Section 3.5. The termination of Employee’s employment by Employee shall constitute a “Voluntary
Termination” if made pursuant to Section 3.3(iii); the effect of such termination is specified in
Section 3.4.

3.4. Payments Upon Voluntary Termination and Termination for Cause. Upon a “Voluntary
Termination” of the employment relationship during the Term by Employee pursuant to Section
3.3(iii), or for “cause” by Employer pursuant to Section 3.2(i), all compensation and benefits for
Employee shall cease and terminate as of the date of termination. Employee shall be entitled to
pro rata salary through the date of such termination, but Employee shall not be entitled to any
bonuses with respect to the operations of Employer, its subsidiaries and/or affiliates for the
calendar year in which Employee’s employment with Employer is terminated.

3.5. Payments Upon Involuntary Termination. Upon an Involuntary Termination of the employment
relationship during the Term by Employer pursuant to Section 3.2(ii), or by Employee pursuant to
Section 3.3(i), Employee shall be entitled, in consideration of Employee’s continuing obligations
hereunder after such termination (including, without limitation, Employee’s non-competition
obligations as set forth in the Incentive Compensation Agreement), to receive the compensation
specified in Section 2.1 for the lesser of (i) one year or (ii) the remainder of the Term, payable
semi-monthly, as if Employee’s employment (which shall cease on the date of such Involuntary
Termination) had continued for the period of such payments, in either case less any payments made
pursuant to the provision in Section 2.2 (unless Employee has served as Vice President, General
Counsel and Corporate Secretary of Employer since such payments were made). Employee shall also be
entitled to a pro-rated bonus (based on termination date), calculated in accordance with the
Employer’s Incentive Compensation Plan and paid in the next year following the release of earnings
for the year in which termination occurred.

Upon an Involuntary Termination of the employment relationship by Employee pursuant to Section
3.3(ii), Employee shall be entitled, in consideration of Employee’s continuing obligations
hereunder after such termination (including, without limitation, Employee’s non-competition
obligations as set forth in the Incentive Compensation Agreement), to receive in a lump sum payment
the compensation specified in Section 2.1 for the lesser of (i) one year or (ii) the remainder of
the Term. In the event of an Involuntary Termination pursuant to Sections 3.2(ii), 3.3(i) or
3.3(ii), all Restricted Stock and stock options granted to Employee under the Incentive
Compensation Agreement shall become 100% vested, the exercise of which shall continue to be
permitted as if Employee’s employment had continued for the full Term of this Agreement. Employee
will be entitled to a pro-rated bonus (based on termination date), calculated in accordance with
the Employer’s Incentive Compensation Plan and paid in the next year following the release of
earnings for the year in which such termination occurred. Employee shall not be under any duty or
obligation to seek or accept other employment following Involuntary Termination and the amounts due
Employee hereunder shall not be reduced or suspended if Employee accepts subsequent employment. As
noted in the Incentive Compensation Agreement, the rights and liabilities of Employer and Employee
regarding entitlement to vesting of all Restricted Stock and stock options, shall be conditioned
and dependent on the Employee’s consent and agreement to the promises set forth therein and to the
enforceability of such covenants stated therein. If it shall be determined that any payment or
distribution by the Employer to or for the benefit of the Employee, whether paid or payable or
distributed or distributable pursuant to the terms of this Agreement or otherwise, would be subject
to the excise tax imposed by the Section 4999 of the Internal Revenue Code of 1986, as amended, or
any interest or penalties are incurred by the Employee with respect to such excise tax (such excise
tax, together with any such interest and penalties, are hereinafter collectively referred to as the
“Excise Tax”), then the Employer shall pay to the Employee an amount equal to the Excise Tax;
provided, Employer shall not be required to pay taxes that result from such Excise Tax payment.
Employee’s rights and remedies under this Section 3.5 shall be Employee’s sole and exclusive rights
and remedies against Employer or its subsidiaries or affiliates concerning Employee’s employment
and termination from Employer, and Employer’s and its subsidiaries’ and affiliates’ sole and
exclusive liability to Employee under this Agreement, in contract, tort, or otherwise, for any
Involuntary Termination of the employment relationship or concerning Employee’s employment and
termination from Employer.

3.6. Covenant Not to Sue. Employee shall not sue or lodge any claim, demand or cause of
action against Employer based on Involuntary Termination for any monies other than those specified
in Section 3.5. If Employee breaches this covenant, Employer, and its subsidiaries and affiliates
shall be entitled to recover from Employee all sums expended by Employer, and its subsidiaries and
affiliates (including costs and attorneys’ fees) in connection with such suit, claim, demand or
cause of action. Employer and its subsidiaries and affiliates shall not be entitled to offset any
of the amounts specified in the immediately preceding sentence against amounts otherwise owing by
Employer and its subsidiaries and affiliates to Employee prior to a final determination under the
terms of the arbitration provisions of this Agreement that Employee has breached the covenant
contained in this Section 3.6.

3.7. Payments Upon Employee’s Death. Upon termination of the employment relationship as a
result of Employee’s death (i) Employee’s heirs, administrators, or legatees shall be entitled to
Employee’s pro rata salary through the date of such termination, and Employee’s heirs,
administrators, or legatees shall be entitled to a pro-rated bonus (based on date of death),
calculated in accordance with the Employer’s Incentive Compensation Plan and paid in the next year
following the release of earnings for the year in which such termination occurred; and (ii) all
Restricted Stock and stock options granted to Employee pursuant to the Incentive Compensation
Agreement shall become 100% vested.

3.8. Payments Upon Employee’s Incapacity. Upon termination of the employment relationship as
a result of Employee’s incapacity pursuant to Section 3.2(iv): (i) Employee shall be entitled to
his pro rata salary through the date of such termination, and Employee shall be entitled to a
pro-rated bonus (based on date of death), calculated in accordance with the Employer’s Incentive
Compensation Plan and paid in the next year following the release of earnings for the year in which
such termination occurred; and (ii) all Restricted Stock and stock options granted to Employee
under the Incentive Compensation Agreement shall become 100% vested.

3.9. Right of Set-Off. In all cases, the compensation and benefits payable to Employee under
this Agreement upon termination of the employment relationship shall be reduced and offset by any
amounts to which Employee may otherwise be entitled under any and all severance plans (excluding
any pension, retirement and profit sharing plans of Employer that may be in effect from time to
time) or policies of Employer or its subsidiaries or affiliates or any successor to all or a
portion of the business or assets of Employer.

3.10. Continuation of Certain Obligations. Termination of the employment relationship shall
not terminate those obligations imposed by this Agreement which are continuing in nature,
including, without limitation, Employee’s obligations of confidentiality, non-competition and
Employee’s continuing obligations with respect to business opportunities that had been entrusted to
Employee by Employer during the employment relationship.

3.11. Scope of Agreement. This Agreement shall govern the rights and obligations of Employer
and Employee with respect to Employee’s salary and other perquisites of employment.

	4.	 	UNITED STATES FOREIGN CORRUPT PRACTICES ACT AND OTHER LAWS

4.1. Compliance with Foreign Corrupt Practices Act. Employee shall at all times comply with
United States laws applicable to Employee’s actions on behalf of Employer and its subsidiaries and
affiliates, including specifically, without limitation, the United States Foreign Corrupt Practices
Act, generally codified in 15 USC 78 (“FCPA”), as the FCPA may hereafter be amended, and/or its
successor statutes. If Employee pleads guilty to or nolo contendere or admits civil or criminal
liability under the FCPA or other applicable United States law, or if a court finds that Employee
has personal civil or criminal liability under the FCPA or other applicable United States law, or
if a court finds that Employee committed an action resulting in Employer or any of its subsidiaries
having civil or criminal liability or responsibility under the FCPA or other applicable United
States law, such action or finding shall constitute “cause” for termination under this Agreement in
accordance with Section 3.2(i) unless the Board determines that the actions found to be in
violation of the FCPA or other applicable United States law were taken in good faith and in
compliance with all applicable policies of Employer. The rights afforded Employer under this
provision are in addition to any and all rights and remedies otherwise afforded by the law.

	5.	 	OWNERSHIP AND PROTECTION OF INFORMATION; COPYRIGHTS

5.1. Provision of Confidential and Proprietary Information. Employer owns certain
confidential and proprietary information and trade secrets to which Employee will be given access
for the purpose of carrying out his employment responsibilities hereunder. Furthermore, Employer
shall provide Employee with confidential and proprietary information and trade secrets regarding
Employer and its subsidiaries and affiliates, in order to assist Employee in satisfying his
obligations hereunder. Employer shall provide Employee with specialized training including
orientation, sales and financial information, and computer and systems training.

5.2. Return of Proprietary Material. All information, ideas, concepts, improvements,
discoveries, and inventions, whether patentable or not, which are conceived, made, developed or
acquired by Employee, individually or in conjunction with others, during Employee’s employment by
Employer (whether during business hours or otherwise and whether on Employer’s premises or
otherwise) which relate to Employer’s or any of its subsidiaries’ or affiliates’ businesses,
products or services (including, without limitation, all such information relating to corporate
opportunities, research, financial and sales data, pricing and trading terms, evaluations,
opinions, interpretations, acquisition prospects, the identity of customers or their requirements,
the identity of key contacts within the customer’s organizations or within the organization of
acquisition prospects, or marketing and merchandising techniques, prospective names, and marks)
shall be disclosed to Employer and are and shall be the sole and exclusive property of Employer.
Upon termination of Employee’s employment, for any reason, Employee promptly shall deliver the
same, and all copies thereof, to Employer.

5.3. Nondisclosure of Confidential Information. Except as required by law or process,
Employee will not, at any time during or after his employment by Employer, make any unauthorized
disclosure of any confidential business information or trade secrets of Employer or its
subsidiaries or affiliates, or make any use thereof, except in the carrying out of his employment
responsibilities hereunder. As a result of Employee’s employment by Employer, Employee may also
from time to time have access to, or knowledge of, confidential business information or trade
secrets of third parties, such as customers, suppliers, partners, joint venturers, and the like, of
Employer and its subsidiaries and affiliates. Employee also agrees to preserve and protect the
confidentiality of such third party confidential information and trade secrets to the same extent,
and on the same basis, as Employer’s or any of its subsidiaries’ or affiliates’ confidential
business information and trade secrets.

5.4. Ownership of Copyrighted Works. If, during Employee’s employment by Employer, Employee
creates any original work of authorship fixed in any tangible medium of expression which is the
subject matter of copyright (such as videotapes, written presentations on acquisitions, computer
programs, E-mail, voice mail, electronic databases, drawings, maps, architectural renditions,
models, manuals, brochures, or the like) relating to Employer’s, or any of its subsidiaries’ or
affiliates’ businesses, products, or services, whether such work is created solely by Employee or
jointly with others (whether during business hours or otherwise and whether on Employer’s or any of
its subsidiaries’ or affiliates’ premises or otherwise), Employer shall be deemed the author of
such work if the work is prepared by Employee in the scope of his employment; or, if the work is
not prepared by Employee within the scope of his employment, but is specially ordered by Employer
or any of its subsidiaries or affiliates as a contribution to a collective work, as a part of a
motion picture or other audiovisual work, as a translation, as a supplementary work, as a
compilation, or as an instructional text, then the work shall be considered to be work made for
hire and Employer or any of its subsidiaries or affiliates shall be the author of the work. If
such work is neither prepared by Employee within the scope of his employment, nor a work specially
ordered that is deemed to be a work made for hire, then Employee hereby agrees to assign, and by
these presents does assign, to Employer all of Employee’s worldwide right, title, and interest in
and to such work and all rights of copyright therein.

5.5. Protection of Proprietary Material. Both during the period of Employee’s employment by
Employer and thereafter, Employee shall assist Employer, or any of its subsidiaries or affiliates
and their nominees, at any time, in the protection of Employer’s or any of its subsidiaries’ or
affiliates’ worldwide right, title, and interest in and to information, ideas, concepts,
improvements, discoveries, and inventions, and its copyrighted works, including without limitation,
the execution of all formal assignment documents requested by Employer or any of its subsidiaries
or affiliates or their nominees and the execution of all lawful oaths and applications for patents
and registration of copyright in the United States and foreign countries.

	6.	 	MISCELLANEOUS

6.1. Definition of “Affiliates” and “Affiliated.” For purposes of this Agreement the terms
“affiliates” or “affiliated” means an entity who directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with Employer.

6.2. Prohibition of Publication of Certain Information. Except as required by law or process,
Employee shall refrain, both during the employment relationship and after the employment
relationship terminates, from publishing any oral or written statements about Employer at any of
its subsidiaries’ or affiliates’ directors, officers, employees, agents or representatives that are
slanderous, libelous, or defamatory; or that disclose private or confidential information about
Employer or any of its subsidiaries’ or affiliates’ business affairs, officers, employees, agents,
or representatives; or that constitute an intrusion into the seclusion or private lives of Employer
or any of its subsidiaries’ or affiliates’ directors, officers, employees, agents, or
representatives; or that give rise to unreasonable publicity about the private lives of Employer or
any of its subsidiaries’ or affiliates’ officers, employees, agents, or representatives; or that
place Employer or its subsidiaries’ or affiliates’ officers, employees, agents, or representatives
in a false light before the public; or that constitute a misappropriation of the name or likeness
of Employer or any of its subsidiaries’ or affiliates’ or its officers, employees, agents, or
representatives. Except as required by law or process, the Employer shall refrain, and shall
assure that its directors, officers, employees, agents and representatives, and its subsidiaries
and affiliates and their directors, officers, employees, agents and representatives, shall refrain,
both during the employment relationship and after the employment relationship terminates, from
publishing any untrue oral or written statements about the Employee that are slanderous, libelous,
or defamatory; or that disclose private or confidential information about the Employee; or that
constitute an intrusion into the seclusion or private life of the Employee; or that give rise to
unreasonable publicity about the private life of the Employee; or that place the Employee in a
false light before the public.

6.3. Notice. For purposes of this Agreement, notices and all other communications provided
for herein shall be in writing and shall be deemed to have been duly given when personally
delivered or when mailed by United States registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

If to Employer to:

Group 1 Automotive, Inc.

950 Echo Lane, Suite 100

Houston, TX 77024

Attn: Presiding Director of the Board

With a copy to:

Fisher & Phillips LLP

18400 Von Karman Avenue, Suite 400

Irvine, CA 92612

Attn: John M. Polson, Esq.; and

Group 1 Automotive, Inc.

950 Echo Lane, Suite 100

Houston, TX 77024

Attn: Chief Executive Officer

If to Employee:

Darryl M. Burman

401 Bunker Hill Road

Houston, Texas 77024

Either Employer or Employee may furnish a change of address to the other in writing in accordance
herewith, except that notices of changes of address shall be effective only upon receipt.

6.4. Governing Law. This Agreement shall be governed in all respects by the law of the State
of Texas, excluding any conflict-of-law rule or principle that might refer the construction of the
Agreement to the laws of another State or country.

6.5. No Waiver. No failure by either party hereto at anytime to give notice of any breach by
the other party of, or to require compliance with, any condition or provision of this Agreement
shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time.

6.6. Severability. It is a desire and intent of the parties that the terms, provisions,
covenants, and remedies contained in this Agreement shall be enforceable to the fullest extent
permitted by law. If any such term, provision, covenant, or remedy of this Agreement or the
application thereof to any person, association, or entity or circumstances shall, to any extent, be
construed to be invalid or unenforceable in whole or in part, then such term, provision, covenant,
or remedy shall be construed in a manner so as to permit its enforceability under the applicable
law to the fullest extent permitted by law. In any case, the remaining provisions of this
Agreement or the application thereof to any person, association, or entity or circumstances other
than those to which they have been held invalid or unenforceable, shall remain in full force and
effect.

6.7. Arbitration. The Parties agree that any claim, dispute, and/or controversy that they may
have arising from, related to, or having any relationship or connection whatsoever with this
Agreement, Employee’s employment, or other association with the Company, shall be submitted to and
determined exclusively by binding arbitration under the Federal Arbitration Act. In addition to
any other requirements imposed by law, the arbitrator selected shall be a retired Judge, or
otherwise qualified individual to whom the parties mutually agree, and shall be subject to
disqualification on the same grounds as would apply to a Judge. The arbitrator shall apply the
Federal Rules of Civil Procedure and Evidence, including all rules of pleading, discovery, evidence
and all rights to resolution of the dispute by means of motions for summary judgment and judgment
on the pleadings. Resolution of the dispute shall be based solely upon the law governing the
claims and defenses pleaded, and the arbitrator may not invoke any basis (including but not limited
to, notions of “just cause”) other than such controlling law. The arbitrator shall have the
immunity of a judicial officer from civil liability when acting in the capacity of an arbitrator,
which immunity supplements any other existing immunity. Likewise, all communications during or in
connection with the arbitration proceedings are privileged. Awards shall include the arbitrator’s
written reasoned opinion.

6.8. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of
Employer, its subsidiaries and affiliates and any other person, association, or entity which may
hereafter acquire or succeed to all or a portion of the business or assets of Employer by any means
whether direct or indirect, by purchase, merger, consolidation, or otherwise. Employee’s rights
and obligations under this Agreement are personal and such rights, benefits, and obligations of
Employee shall not be voluntarily or involuntarily assigned, alienated, or transferred, whether by
operation of law or otherwise, by Employee without the prior written consent of Employer.
Notwithstanding anything to the contrary in this Section 6.8 or elsewhere in the Agreement, in the
event of the Employee’s death after becoming entitled to receipt of any payment or benefit, but
before receiving all such payments or benefits, the remaining payments shall be made to the
Employee’s survivors or estate and the remaining benefits shall be provided to his widow or other
survivors to the same extent and in the same manner as if he were still alive.

6.9. Entire Agreement. Except as provided in (1) written company policies promulgated by
Employer dealing with issues such as securities trading, business ethics, governmental affairs and
political contributions, consulting fees, commissions and other payments, compliance with law,
investments and outside business interests as officers and employees, reporting responsibilities,
administrative compliance, and the like, (2) the written benefits, plans, and programs referenced
in Section 2.5, or (3) any signed written agreements contemporaneously or hereafter executed by
Employer and Employee (including, but not limited to, the Incentive Compensation Agreement), this
Agreement constitutes the entire agreement of the parties with regard to such subject matters, and
contains all of the covenants, promises, representations, warranties, and agreements between the
parties with respect to such subject matters and replaces and merges previous agreements and
discussions pertaining to the employment relationship between Employer and Employee.

6.10. Headings. The headings contained in this Agreement are for reference only and shall not
affect the meaning or interpretation of any provision of this Agreement.

6.11. Amendment. No amendments or additions to this Agreement shall be binding unless in
writing and signed by both parties hereto.

6.12. Counterparts. This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but both of which together will constitute one and the same instrument

IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement in multiple
originals to be effective on the date first stated above.

	 	 	 	 	 	 	 
	DATE:

	 	12-01-06
	 	 	 	GROUP 1 AUTOMOTIVE, INC.
	
 
	 	 
	 	

	 	

	 
	 	 	 	 	 	 
	
 
	 	 	 	By:
	 	/s/ Earl J. Hesterberg
	
 
	 	 	 	 	 	 
	
 
	 	 	 	Name:
	 	Earl J. Hesterberg
	
 
	 	 	 	 	 	 
	
 
	 	 	 	Title:
	 	President & Chief Executive Officer
	
 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	DATE:

	 	12-01-06
	 	 	 	/s/ Darryl M. Burman
	
 
	 	 
	 	 	 	 
	
 
	 	 	 	 	 	Darryl M. BurmanEX-10.2

INCENTIVE COMPENSATION

AND NON-COMPETE AGREEMENT

This Incentive Compensation and Non-Compete Agreement (“Agreement”) is entered into
between Group 1 Automotive, Inc. (“Employer”), and Darryl M. Burman (“Employee”), as of December 1,
2006 (the “Effective Date”).

RECITALS

WHEREAS, simultaneously with the execution of this Agreement, Employer and Employee
executed an Employment Agreement governing the terms and conditions of their employment
relationship.

WHEREAS, Employer desires to grant to Employee shares of restricted stock or restricted stock
units (collectively “Restricted Stock”) as part of an incentive compensation plan to encourage
Employee’s loyalty, future performance and continued employment with Employer.

WHEREAS, in exchange for Employer granting to Employee shares of restricted stock or
restricted stock units and providing Employee with certain confidential and proprietary information
and trade secrets for the purpose of carrying out his employment responsibilities (as set forth in
Section 5.1 of the Employment Agreement), Employee agrees to the non-competition provisions of
Section 2 of this Agreement.

AGREEMENT

For and in consideration of the mutual promises, covenants, and obligations contained
herein, Employer and Employee agree as follows:

	1.	 	INCENTIVE COMPENSATION

1.1. Initial Grant. Employer hereby grants to Employee 5,000 shares of Restricted Stock in
accordance with the terms and conditions of Employer’s 1996 Stock Incentive Plan. Such shares of
Restricted Stock shall vest as follows: (i) 2,000 shares (or units) shall vest on December 1,
2008; (ii) 1,000 shares (or units) shall vest on December 1, 2009; (iii) 1,000 shares (or units)
shall vest on December 1, 2010; and (iv) 1,000 shares (or units) shall vest on December 1, 2011.

1.2. Additional Grants. Employee shall be eligible to receive additional grants under
Employer’s 1996 Stock Incentive Plan in such amounts as determined in the sole discretion of the
Compensation Committee, including grants of options or Restricted Stock.

1.3. Options. If Employee is granted stock options, Employee shall enter into a separate
written stock option agreement pursuant to which Employee shall be granted the option to acquire
common stock of Employer subject to the terms and conditions of Employer’s 1996 Stock Incentive
Plan, or any successor plan, and the stock option agreement entered into thereunder. The number of
shares, exercise price per share and other terms of the options shall be as specified in such other
written agreement, unless modified specifically herein.

1.4. Condition of Grants. The rights and liabilities of Employer and Employee regarding
entitlement to, and vesting of, any incentive compensation granted pursuant to this Agreement shall
be conditioned and dependent on the Employee’s consent and agreement to the promises set forth in
Section 2 of this Agreement. In the event that any provision set forth in Section 2 is violated,
Employer shall have the right, among other remedies, to demand forfeiture of any cash or equity
award realized during the twelve (12) months prior to such violation or declaration.

	2.	 	POST-EMPLOYMENT NON-COMPETITION OBLIGATIONS

2.1. Non-Competition Obligations. In consideration for Employer’s promises contained in
Section 5.1 of the Employment Agreement, and as part of the consideration for the compensation and
benefits to be paid and extended to Employee under the Employment Agreement, and as an additional
incentive for Employer to enter into this Agreement, Employer and Employee agree to the
non-competition provisions of this Section 2.1.

(a) Except as provided in Section 2.1(b) below, Employee agrees that during the period of
Employee’s non-competition obligations hereunder, Employee will not, directly or indirectly for
Employee or for others, in any geographic area or market where Employer or any of its subsidiaries
or affiliated companies are conducting any business as of the date of termination of the employment
relationship or have during the previous twelve (12) months conducted any business:

	 	(i)	 	engage in any business competitive with any line of business conducted by
Employer or any of its subsidiaries or affiliates (including without limitation any
public or private auto retailer);

	 	(ii)	 	render advice or services to, or otherwise assist, any other person,
association, or entity who is engaged, directly or indirectly, in any business
competitive with any line of business conducted by Employer or any of its subsidiaries
or affiliates (including without limitation any public or private auto retailer);

	 	(iii)	 	solicit or accept the business of, or call upon, any customer or client of
Employer for the purpose of conducting competitive business or otherwise seeking profit
from a competitive activity;

	 	(iv)	 	encourage or induce any current or former employee of Employer or any of its
subsidiaries or affiliates to leave the employment of Employer or any of its
subsidiaries or affiliates or proselytize, offer employment, retain, hire or assist in
the hiring of any such employee by any person, association, or entity not affiliated
with Employer or any of its subsidiaries or affiliates for a period of 24 months from
date of termination; provided, however, that nothing in this subsection (iv) shall
prohibit Employee from offering employment to any prior employee of Employer or any of
its subsidiaries or affiliates who was not employed by Employer or any of its
subsidiaries or affiliates at any time in the twelve (12) months prior to the
termination of Employee’s employment; or

	 	(v)	 	divulge any of the confidential, proprietary or trade secret information that
was provided to Employee pursuant to Section 5 of this Agreement to any third party or
individual or entity other than Employer or any of its subsidiaries or affiliates.

The non-competition obligations set forth in subsections (i) through (v) of this Section 2.1 shall
apply during Employee’s employment and for a period of one (1) year after termination of
employment, if Employee is terminated with cause or upon a voluntary termination. If Employee is
terminated without cause or upon an involuntary termination, then the non-competition obligation
shall continue to apply for a period equal to the lesser of (i) one (1) year or (ii) the reminder
of the Term (as defined in Section 3.1 of the Employment Agreement). If Employer or any of its
subsidiaries or affiliates abandons a particular aspect of its business, that is, ceases such
aspect of its business with the intention to permanently refrain from such aspect of its business,
then this post-employment non-competition covenant shall not apply to such former aspect of that
business.

(b) Notwithstanding any of the prohibitions contained in Section 2.1(a) above to the contrary,
Employee shall not be prohibited from immediately engaging in the practice of law, independently or
with a law firm, and from performing legal services on behalf of Employer or any business
competitive with any line of business conducted by Employer or any of its subsidiaries or
affiliates (including, without limitation, any public or private auto retailer), regardless of
termination for cause, voluntary termination, involuntary termination, or expiration of the
Employment Agreement.

	 	 	 
	2.2.	 	Future Employment.
	
 
	 	For a period of one (1) year from the date of termination:

2.2.1. If Employee seeks or is offered employment, or any other position or capacity with a
company or entity other than a law firm engaged in the practice of law, Employee agrees to inform
each new employer or entity, before accepting employment, of the existence of the restrictions
contained in Section 2.1. Further, before taking any employment position with any person during the
non-competition period, Employee agrees to give prior written notice to Employer of the name of
such person or entity. Employer shall be entitled to advise such person or entity of the
provisions of Section 2.1 and to otherwise deal with such person or entity to ensure that the
provisions of this Section are enforced and duly discharged.

2.2.2. If Employee seeks or is offered employment with a company or entity other than a law
firm engaged in the practice of law, Employee may provide Employer with written notice stating the
name of the prospective employer, Employee’s prospective position, responsibilities and duties, and
the industry or industries in which the prospective employer operates. Employer shall have ten
(10) business days from receipt of such notice to notify Employee of its belief that such
prospective employment would be a violation of the provisions of Section 2.1. If Employer fails to
respond to Employee in writing within such ten (10) business day period, Employer shall be estopped
from asserting its rights, if any, arising from a violation of Section 2.1 by reason of such
employment as described in such notice.

2.3. Tolling of Restrictive Periods. If the Employee violates any of the restrictions
contained in Section 2.1, the restrictive periods shall be suspended and will not run in favor of
the Employee until such time as the Employee cures the violation to the satisfaction of Employer.

2.4. Acknowledgment. Employee understands that the foregoing restrictions may limit his
ability to engage in certain businesses in locations where the Employer conducts business during
the period provided for above, but acknowledges that Employee’s job duties during his employment
with Employer, receipt of Employer’s confidential and proprietary information and trade secrets (as
well as access to certain confidential and proprietary information and trade secrets) and
Employee’s receipt of sufficiently high remuneration and other benefits under the Employment
Agreement justifies such restriction. Employee acknowledges that money damages would not be
sufficient remedy for any breach of Section 2.1 by Employee, and Employer or any of its
subsidiaries or affiliates shall be entitled to enforce the provisions of this Section by
terminating any payments then owing to Employee under the Employment Agreement and/or to obtain
specific performance and injunctive relief as remedies for such breach or any threatened breach,
without any requirement for the securing or posting of any bond in connection with such remedies.
Such remedies shall not be deemed the exclusive remedies for a breach of Section 2.1, but shall be
in addition to all remedies available at law or in equity to Employer or any of its subsidiaries or
affiliates, including, without limitation, the recovery of damages from Employee and his agents
involved in such breach.

2.5. Materiality and Conditionality of Section. Section 2.1 is material to this Agreement.
Employee’s agreement to strictly comply with Section 2.1 is a precondition for Employee’s receipt
of payments and vesting of Restricted Stock and stock options pursuant to Section 1 of this
Agreement. In the event Employer, after conducting an investigation, has reasonably determined
that a violation of Section 2.1 has occurred, Employer shall be entitled to withhold future
payments owed under Section 1 above, pending determination of such violation by a court or other
authority of competent jurisdiction. Upon such finding by a court or other constituted legal
authority of competent jurisdiction that a violation of this Section or any portion thereof has
occurred, the Employee and Employer agree that (i) the Employee’s interest in the Restricted Stock
and stock options pursuant to Section 1 of this Agreement shall automatically lapse and be
forfeited; (ii) Employer shall have no obligation to make any further payments to Employee under
the terms of Section 1 of this Agreement; (iii) Employer shall be entitled to receive the full
value of any payments which were previously made to the Employee pursuant to Section 1 of this
Agreement in the previous twelve (12) months, as well as the value of any Restricted Stock or stock
options that may have vested during the past twelve (12) months from the date of the Employee’s
termination, for any reason, to the date on which a court or arbitration panel held or found the
non-compete article to have been violated; (iv) the Employee’s interest in post-termination payment
pursuant to Sections 2.3 and 3.5 of the Employment Agreement shall automatically lapse and be
forfeited; (v) Employer shall have no obligation to make any further payments to Employee under the
terms of Sections 2.3 and 3.5 of the Employment Agreement; and (vi) Employer shall be entitled to
receive the full value of any payments which were previously made to the Employee pursuant to
Sections 2.3 and 3.5 of the Employment Agreement in the previous twelve (12) months.

2.6. Survival of Section. The Employee and Employer agree that all of the covenants contained
in Section 2.1 shall survive the termination or expiration of this Agreement, and agree further
that in the event any of the covenants contained in Section 2.1 shall be held by any court to be
effective in any particular area or jurisdiction only if said covenant is modified to be limited in
its duration or scope, then, at the sole option of Employer, the provisions of Section 2.5 may be
deemed to have been triggered, and the rights, liabilities and obligations set forth therein shall
apply. In the event Employer does not elect to trigger application of Section 2.5, then the court
shall have such authority to so reform the covenants and the parties hereto shall consider such
covenants and/or other provisions of Section 2 to be amended and modified with respect to that
particular area or jurisdiction so as to comply with the order of such court and, as to all other
jurisdictions, the covenants contained herein shall remain in full force and effect as originally
written. Should any court hold that the covenants in Section 2.1 are void and otherwise
unenforceable in a particular area or jurisdiction, then notwithstanding the foregoing provisions
of this Section 2.6, the provisions of Section 2.5 shall be applicable and the rights, liabilities
and obligations of the parties set forth therein shall apply. Alternatively, at the sole option of
Employer, Employer may consider such covenants to be amended and modified so as to eliminate
therefrom the particular area or jurisdictions as to which such covenants are so held void or
otherwise unenforceable and, as to all other areas and jurisdictions covered herein, the covenants
contained herein shall remain in full force and effect as originally written.

	3.	 	MISCELLANEOUS

3.1. Definition of “Affiliates” and “Affiliated.” For purposes of this Agreement the terms
“affiliates” or “affiliated” means an entity who directly, or indirectly through one or more
intermediaries, controls, is controlled by, or is under common control with Employer.

3.2. Prohibition of Publication of Certain Information. Except as required by law or process,
Employee shall refrain, both during the employment relationship and after the employment
relationship terminates, from publishing any oral or written statements about Employer at any of
its subsidiaries’ or affiliates’ directors, officers, employees, agents or representatives that are
slanderous, libelous, or defamatory; or that disclose private or confidential information about
Employer or any of its subsidiaries’ or affiliates’ business affairs, officers, employees, agents,
or representatives; or that constitute an intrusion into the seclusion or private lives of Employer
or any of its subsidiaries’ or affiliates’ directors, officers, employees, agents, or
representatives; or that give rise to unreasonable publicity about the private lives of Employer or
any of its subsidiaries’ or affiliates’ officers, employees, agents, or representatives; or that
place Employer or its subsidiaries’ or affiliates’ officers, employees, agents, or representatives
in a false light before the public; or that constitute a misappropriation of the name or likeness
of Employer or any of its subsidiaries’ or affiliates’ or its officers, employees, agents, or
representatives. Except as required by law or process, the Employer shall refrain, and shall use
its best efforts to assure that its directors, officers, employees, agents and representatives, and
its subsidiaries and affiliates and their directors, officers, employees, agents and
representatives, shall refrain, both during the employment relationship and after the employment
relationship terminates, from publishing any oral or written statements about the Employee that are
slanderous, libelous, or defamatory; or that disclose private or confidential information about the
Employee; or that constitute an intrusion into the seclusion or private life of the Employee; or
that give rise to unreasonable publicity about the private life of the Employee; or that place the
Employee in a false light before the public.

3.3. Notice. For purposes of this Agreement, notices and all other communications provided
for herein shall be in writing and shall be deemed to have been duly given when personally
delivered or when mailed by United States registered or certified mail, return receipt requested,
postage prepaid, addressed as follows:

If to Employer to:

Group 1 Automotive, Inc.

950 Echo Lane, Suite 100

Houston, TX 77024

Attn: Presiding Director of the Board

With a copy to:

Fisher & Phillips LLP

18400 Von Karman Avenue, Suite 400

Irvine, CA 92612

Attn: John M. Polson, Esq.; and

Group 1 Automotive, Inc.

950 Echo Lane, Suite 100

Houston, TX 77024

Attn: Chief Executive Officer

If to Employee:

Darryl M. Burman

401 Bunker Hill Road

Houston, Texas 77024

Either Employer or Employee may furnish a change of address to the other in writing in accordance
herewith, except that notices of changes of address shall be effective only upon receipt.

3.4. Governing Law. This Agreement shall be governed in all respects by the law of the State
of Texas, excluding any conflict-of-law rule or principle that might refer the construction of the
Agreement to the laws of another State or country.

3.5. No Waiver. No failure by either party hereto at anytime to give notice of any breach by
the other party of, or to require compliance with, any condition or provision of this Agreement
shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time.

3.6. Severability. It is a desire and intent of the parties that the terms, provisions,
covenants, and remedies contained in this Agreement shall be enforceable to the fullest extent
permitted by law. If any such term, provision, covenant, or remedy of this Agreement or the
application thereof to any person, association, or entity or circumstances shall, to any extent, be
construed to be invalid or unenforceable in whole or in part, then such term, provision, covenant,
or remedy shall be construed in a manner so as to permit its enforceability under the applicable
law to the fullest extent permitted by law. In any case, the remaining provisions of this
Agreement or the application thereof to any person, association, or entity or circumstances other
than those to which they have been held invalid or unenforceable, shall remain in full force and
effect.

3.7. Arbitration. The parties agree that any claim, dispute, and/or controversy that they may
have arising from, related to, or having any relationship or connection whatsoever with this
Agreement, Employee’s employment, or other association with the Company, shall be submitted to and
determined exclusively by binding arbitration under the Federal Arbitration Act. In addition to
any other requirements imposed by law, the arbitrator selected shall be a retired Judge, or
otherwise qualified individual to whom the parties mutually agree, and shall be subject to
disqualification on the same grounds as would apply to a Judge. The arbitrator shall apply the
Federal Rules of Civil Procedure and Evidence, including all rules of pleading, discovery, evidence
and all rights to resolution of the dispute by means of motions for summary judgment and judgment
on the pleadings. Resolution of the dispute shall be based solely upon the law governing the
claims and defenses pleaded, and the arbitrator may not invoke any basis (including but not limited
to, notions of “just cause”) other than such controlling law. The arbitrator shall have the
immunity of a judicial officer from civil liability when acting in the capacity of an arbitrator,
which immunity supplements any other existing immunity. Likewise, all communications during or in
connection with the arbitration proceedings are privileged. Awards shall include the arbitrator’s
written reasoned opinion.

3.8. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of
Employer, its subsidiaries and affiliates and any other person, association, or entity which may
hereafter acquire or succeed to all or a portion of the business or assets of Employer by any means
whether direct or indirect, by purchase, merger, consolidation, or otherwise. Employee’s rights
and obligations under this Agreement are personal and such rights, benefits, and obligations of
Employee shall not be voluntarily or involuntarily assigned, alienated, or transferred, whether by
operation of law or otherwise, by Employee without the prior written consent of Employer.
Notwithstanding anything to the contrary in this Section 7.8 or elsewhere in the Agreement, in the
event of the Employee’s death after becoming entitled to receipt of any payment or benefit, but
before receiving all such payments or benefits, the remaining payments shall be made to the
Employee’s survivors or estate and the remaining benefits shall be provided to his widow or other
survivors to the same extent and in the same manner as if he were still alive.

3.9. Entire Agreement. Except as provided in (1) written company policies promulgated by
Employer dealing with issues such as securities trading, business ethics, governmental affairs and
political contributions, consulting fees, commissions and other payments, compliance with law,
investments and outside business interests as officers and employees, reporting responsibilities,
administrative compliance, and the like, (2) the written benefits, plans, and programs referenced
in Section 1.4 of this Agreement or (3) any signed written agreements contemporaneously or
hereafter executed by Employer and Employee (including, but not limited to, the Employment
Agreement), this Agreement constitutes the entire agreement of the parties with regard to such
subject matters, and contains all of the covenants, promises, representations, warranties, and
agreements between the parties with respect to such subject matters and replaces and merges
previous agreements and discussions pertaining to the employment relationship between Employer and
Employee.

3.10. Headings. The headings contained in this Agreement are for reference only and shall not
affect the meaning or interpretation of any provision of this Agreement.

3.11. Amendment. No amendments or additions to this Agreement shall be binding unless in
writing and signed by both parties hereto.

3.12. Counterparts. This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but both of which together will constitute one and the same instrument

1

IN WITNESS WHEREOF, Employer and Employee have duly executed this Agreement in multiple
originals to be effective on the date first stated above.

	 	 	 	 	 	 	 
	DATE:

	 	12-01-06
	 	 	 	GROUP 1 AUTOMOTIVE, INC.
	
 
	 	 
	 	

	 	

	 
	 	 	 	 	 	 
	
 
	 	 	 	By:
	 	/s/ Earl J. Hesterberg
	
 
	 	 	 	 	 	 
	
 
	 	 	 	Name:
	 	Earl J. Hesterberg
	
 
	 	 	 	 	 	 
	
 
	 	 	 	Title:
	 	President & Chief Executive Officer
	
 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	DATE:

	 	12-01-06
	 	 	 	/s/ Darryl M. Burman
	
 
	 	 
	 	 	 	 
	
 
	 	 	 	 	 	Darryl M. Burman
	 
	 	 	 	 	 	 

2

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