Exhibit 10.42
[Sonic Automotive Letterhead]
March 12, 2009
Mr. Thomas Eckert
Capital Automotive Real Estate Services, Inc.
8270 Greensboro Drive
McLean, VA 22102
| RE: | Amendment of lease renewal terms relating to those certain Lease Agreements and the corresponding Landlords, Properties, Tenants and Guarantors between affiliates of Capital Automotive Real Estate Services, Inc. (“Capital Automotive”) and affiliates of the Sonic Automotive, Inc. (“Sonic”) as listed on the attachedExhibit A (collectively, the “Leases”). All capitalized terms not defined herein shall have the meanings attributed to such terms as in the Leases. |
Dear Tom,
Sonic and Capital Automotive have agreed to extend the existing lease Renewal Terms listed in certain of the Leases from five (5) year to ten (10) year terms. This letter will confirm Sonic and Capital Automotive’s agreement to have their respective subsidiaries execute amendments evidencing the respective changes for each Lease as specifically noted on the attachedExhibit A. The parties agree that time is of the essence in this matter, and that the parties will execute, or cause the applicable affiliate to execute, these amendments within two (2) weeks after Capital Automotive delivers to Sonic the amendments for execution. If the lease amendments are not executed within such time frame (unless otherwise extended in writing by the parties), then the changes outlined on Exhibit A are deemed to have automatically taken effect as if each lease amendment had been executed.
Except as set forth above, nothing in this letter nor any conversations we may have shall constitute an amendment to or modification of the parties’ obligations under the Leases and other documents unless formally approved by the parties and agreed to in writing.
If the foregoing is acceptable to you, please execute a copy of this letter below. If you have any questions, please let us know.
| Sincerely, | ||
| Sonic Automotive, Inc. | ||
/s/ David P. Cosper | ||
| By: David P. Cosper | ||
| Its: Vice Chairman and CFO | ||
| [signatures continue on next page] | ||
Page 2
March 12, 2009
Seen and Agreed:
Capital Automotive Real Estate Services, Inc.
/s/ Thomas Eckert | ||
| By: Thomas Eckert | ||
| Its: President and Chief Executive Officer | ||
| cc: | Michael Dickerson |
Stacey Barnet
Chris Sokira
Linda Nguyen
Jay M. Ferriero
Exhibit A
CARS Term Dates and Renewal Options
Dealership | Property ID | Title of Next Lease Amendment | Landlord Entity | Original Tenant Entity | Lease Date | Guaranty Date | Lease | Remaining | FMV | Lease Amendment re: Renewal to: (6 different colors for the 6 different scenarios) | Additional Lease Amendment to: | |||||||||||
| Clearwater Toyota | SON-001, 002 | 1st | CARS-DB4, L.P. | Sonic Automotive, Inc. | 9/18/1998 | NO GUARANTY, Sonic is the Tenant | 12/31/2012 | One 5 yr option | n/a | 1st option exercised; change remaining 5-yr option to one 10-yr option | Sonic Automotive, Inc. is Tenant, so there is no Guaranty, but there are no financial covenants in the lease. Need to add covenants to lease amendment. | |||||||||||
| Toyota West | SON-013 | 2nd | MMR Holdings, LLC | Sonic Automotive-1500 Automall Drive, Columbus, Inc. | 8/13/1999 | 8/13/1999 | 1/31/2014 | One 5 yr option | n/a | 1st option exercised; change remaining 5-yr option to one 10-yr option | ||||||||||||
| Hatfield Hyundai | SON-014 | 2nd | MMR Holdings, LLC | Sonic Automotive-1400 Automall Drive, Columbus, Inc. | 8/13/1999 | NO GUARANTY on network, most likely 8/13/99 | 1/31/2014 | One 5 yr option | n/a | 1st option exercised; change remaining 5-yr option to one 10-yr option | ||||||||||||
| Mercedes Benz of Daytona Beach | SON-023 | 2nd | MMR Holdings, LLC | Sonic Automotive-1720 Mason Ave., DB, LLC | 8/13/1999 | 8/13/1999 | 10/14/2013 | One 5 yr option | n/a | 1st option exercised; change remaining 5-yr option to one 10-yr option | ||||||||||||
| Capitol Chevrolet, SC | SON-099 | 2nd | CAR SON NEWSOME II L.L.C. | Sonic-Newsome Chevrolet World, Inc. | 12/23/2003 | 12/23/03 | 6/24/2019 | Four 5 yr options | YES | change all four 5-yr options to 10-yr options | ||||||||||||
| Town & Country Toyota | SON-005 | 5th | MMR Holdings, LLC | Marcus David Corporation | 8/13/1999 | 8/13/1999 | 5/31/2022 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Infiniti of Charlotte—dealership | SON-006 | 5th | MMR Holdings, LLC | Sonic Automotive-9103 E. Independence,NC, LLC | 8/13/1999 | 8/13/1999 | 12/30/2019 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Hatfield VW—Improvements | SON-015 | 3rd | CARS CNI-2 L.P. | Sonic Automotive-1495 Automall Drive, Columbus, Inc. | 8/13/1999 | 8/13/1999 | 12/28/2019 | Two 5 yr options | n/a | change both 5-yr options to 10-yr options | ||||||||||||
| Hatfield Kia/VW | SON-016 | 3rd | MMR Holdings, LLC | Sonic Automotive-1455 Automall Drive, Columbus, Inc. | 8/13/1999 | 8/13/1999 | 1/31/2016 | Two 5 yr options | n/a | change both 5-yr options to 10-yr options | ||||||||||||
| Lute Riley Honda | SON-019 | 3rd | CAR SON TX LUTE L.L.C. | Sonic-Lute Riley, L.P. | 8/13/1999 | 8/13/1999 | 7/1/2019 | Two 5 yr options | n/a | change both 5-yr options to 10-yr options | ||||||||||||
| Pensacola Honda—dealership | SON-030, 069 | 5th | MMR Holdings, LLC | Sonic-Shottenkirk, Inc. | 9/01/1999 | 9/1/1999 | 12/22/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Global BMW—dealership | SON-032 | 5th | CARS-DB4, L.P. | Sonic-Global Imports, L.P. | 8/13/1999 | 8/13/1999 | 11/6/2021 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Century BMW—dealership | SON-049 | 3rd | MMR Holdings, LLC | Sonic Automotive 2752 Laurens Rd., Greenville, Inc. | 8/13/1999 | 8/13/1999 | 12/22/2017 | Two 5 yr options | n/a | change both 5-yr options to 10-yr options | ||||||||||||
| BMW of Fairfax—2008 Image Upgrade | SON-055, 056 | 6th | MMR Holdings, LLC | Sonic-Manhattan Fairfax, Inc. | 8/13/1999 | 8/13/1999 | 9/25/2016 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Fort Myers | SON-062, 063, 064, 068 | 5th | CAR SONFREE, LLC | Sonic-FM Automotive, LLC, Sonic FM, Inc., Sonic Freeland, Inc. and Sonic-FM Nissan, Inc. | 11/04/1999 | 11/4/1999 | 12/22/2017 | Two 5 yr options | n/a | change both 5-yr options to 10-yr options | Amend lease to add Mini & VW new tenants, delete Nissan tenant: SAI Fort Myers B, LLC (dba MINI of Fort Myers) and Sonic-FM VW, Inc (dba VW of Fort Myers) | |||||||||||
| Capital Chevrolet, AL—dealership | SON-070 | 3rd | CAR SON CAP CHVY L.L.C. | Capitol Chevrolet and Imports, Inc. | 9/28/2000 | 9/28/2000 | 9/25/2016 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Fort Mill Ford | SON-073-Lease1 | 2nd | SRE SOUTH CAROLINA-1, LLC | Fort Mill Ford, Inc. | 12/19/2000 | 12/19/2000 | 12/18/2015 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Toyota of Ft Worth—used cars | SON-074 | 3rd | SON MCKNY II L.P. | Sonic-Fort Worth T, L.P. | 1/23/2001 | 1/22/2001 | 12/22/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| City Chevrolet | SON-075 | 2nd | CARS CNI-2 L.P. | Sonic - West Reno Chevrolet, Inc. | 10/16/2001 | 10/16/2001 | 10/15/2016 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Lone Star Chevrolet | SON-076 | 2nd | CARS-DB4, L.P. | Lawrence Marshall Chevrolet, L.P. | 10/31/2001 | 10/29/2001 | 10/31/2025 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Don Massey Cadillac-Plymouth | SON-077 | 1st | CAR SON MAS, L.P. | Sonic-Plymouth Cadillac, Inc. | 3/29/2002 | 3/29/2009 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Capital Hummer—Lansing | SON-078 | 2nd | CAR SON MAS, L.P. | Sonic-Capitol Cadillac, Inc. | 3/29/2002 | 03/29/09 | 3/29/2020 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Crest Cadillac-Nashville | SON-080 | 2nd | CARS CNI-2 L.P. | Sonic-Crest Cadillac, LLC | 3/29/2002 | 03/29/09 | 12/20/2020 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Crest Honda | SON-081 | 1st | CAR SON MAS TN II L.L.C. | Sonic-Crest H, LLC | 5/20/2002 | 05/20/02 | 12/19/2022 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Massey Cadillac-Orlando | SON-082 | 1st | CAR SON MAS, L.P. | Sonic-North Cadillac, Inc. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Massey Cadillac-Orlando satellite | SON-083 | 1st | CAR SON MAS, L.P. | Sonic-North Cadillac, Inc. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Massey Cadillac-Sanford | SON-084 | 1st | CAR SON MAS, L.P. | Sonic-Sanford Cadillac, Inc. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Massey Cadillac-Detroit | SON-085 | 1st | CAR SON MAS, L.P. | Massey Cadillac, Inc. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Massey Cadillac-Detroit B/S | SON-086 | 1st | CAR SON MAS, L.P. | Massey Cadillac, Inc. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Arnold Palmer Cadillac-Pineville | SON-087 | 1st | CAR SON MAS, L.P. | Arngar, Inc. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Massey Cadillac-Garland | SON-088 | 1st | CAR SON MAS GAR, L.P. | Sonic-Cadillac D, L.P. | 6/28/2002 | 06/28/02 | 6/27/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Honda West | SON-089 | 1st | CARS CNI-2 L.P. | FAA Las Vegas H, Inc. | 3/29/2002 | 03/29/09 | 9/28/2022 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Volvo of Houston | SON-090, 091 | 1st | CAR SON NSV II, L.P. | Sonic-Houston V, L.P. | 3/29/2002 | 03/29/09 | 3/28/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Frank Parra Autoplex | SON-092, 093, 094 | 1st | CAR SON PARR L.P. | Sonic-Frank Parra Autoplex, L.P. | 7/02/2002 | 07/02/02 | 8/01/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Acura 101 West | SON-095 | 1st | CARS CNI-2 L.P. | Sonic-Calabasas A, Inc. | 7/16/2002 | 07/??/02 | 8/15/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Toyota of Ft Worth—dealership | SON-096 | 1st | CAR SON MCKNY II L.P. | Sonic-Fort Worth T, L.P. | 12/23/2002 | 12/23/02 | 12/22/2017 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Baytown Ford | SON-072-Lease1 | 2nd | CAR SON BAY L.P. | Sonic Automotive - 4701 I-10 East, TX, L.P. | 12/19/2000 | 12/19/2000 | 12/18/2020 | One 5 yr option | n/a | Change one 5-year option to 10-year option. | ||||||||||||
| Ron Craft Chevrolet/Olds/Cadillac | SON-072-Lease2 | 2nd | CAR SON BAY L.P. | Sonic Automotive - 3401 N. Main, TX, L.P. | 12/19/2000 | 12/19/2000 | 12/18/2020 | One 5 yr option | n/a | Change one 5-year option to 10-year option. | ||||||||||||
| Lone Star Ford | SON-020 | 2nd | MMR Viking Investment Associates, LP | Sonic Automotive of Texas, L.P. | 8/13/1999 | 8/13/1999 | 8/12/2009 | Two 5 yr options | n/a | Renew 10-years after initial term ends in Aug '08, change 2nd option to 10 yrs | ||||||||||||
| Town & Country Ford | SON-003 | 3rd | MMR Holdings, LLC | Town and Country Ford, Incorporated | 8/13/1999 | 8/13/1999 | 8/12/2009 | Two 5 yr options | n/a | Renew 5-years after initial term ends in Aug '08, change 2nd option to 10 yrs | ||||||||||||
| Newsome Auto (Florence Cvy/BMW/MB) | SON-051 | 2nd | MMR Holdings, LLC | Sonic-Newsome of Florence, Inc | 8/13/1999 | 8/13/1999 | 5/17/2009 | Two 5 yr options | n/a | Renew 5-years after initial term ends in Aug '08, change 2nd option to 10 yrs | Extend lease expiration date out 9 months to Feb 17, 2010 (lease nonrenewal notice deadline date is to be July 18, 2009) | |||||||||||
| Capitol Hyundai | SON-066 | 3rd | CAR BSC L.L.C. | Capitol Chevrolet and Imports, Inc. | 3/03/2000 | 3/3/2000 | 12/20/2020 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Lute Riley Honda Body Shop | SON-105 | 2nd | CAR SON LRB L.P. | SONIC-LUTE RILEY, L.P. | 4/30/2007 | 4/30/07 | 7/01/2019 | Two 5 yr options | YES | change both 5-yr options to 10-yr options | ||||||||||||
| Baytown Chrysler Jeep Dodge | SON-017 | MMR Viking Investment Associates, LP | Sonic Automotive-5221 I-10 East, TX, L.P. | 8/13/1999 | 8/13/1999 | 1/27/2014 | One 5 yr option | n/a | No modification of terms | |||||||||||||
| BMW-Volvo of Chattanooga | SON-035 | 3rd | MMR Tennessee, LLC | Sonic Automotive of Chattanooga, LLC | 8/13/1999 | 8/13/1999 | 9/24/2016 | Two 5 yr options | YES | No modification of terms | ||||||||||||
| Infiniti of Charlotte Parking Lot | SON-101 | CAR SON CHAR L.L.C. | Sonic Automotive-9103 E. Independence, NC, LLC | 12/30/2004 | 12/30/04 | 12/29/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Lonestar Chevrolet Parking Lot | SON-102 | CAR SON STAR L.P. | SONIC-LS CHEVROLET, L.P. | 12/30/2004 | 12/30/04 | 10/31/2025 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Riverside Toyota | SON-103 | CAR SON OK TOY L.L.C. | SONIC - OKLAHOMA T, INC. | 12/28/2005 | 12/??/05 | 12/27/2020 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Honda of Tysons Corner | ROS-001-Lease1 | CARS-DB1, LLC | Sonic Tysons Corner H, Inc. | 2/19/1998 | 1/9/2006 | 2/18/2018 | One 10 yr option | n/a | No modification of terms. 1st option already exercised | |||||||||||||
| Honda of Tysons Corner (storage lot) | ROS-001-Lease3 | CARS-DB1, LLC | Sonic Tysons Corner H, Inc. | 2/19/1998 | 1/9/2006 | 2/18/2018 | One 10 yr option | n/a | No modification of terms. 1st option already exercised | |||||||||||||
| Honda of Tysons Corner (body shop) | ROS-006 | CARS-DB1, LLC | Sonic Tysons Corner H, Inc. | 2/19/1998 | 1/9/2006 | 2/18/2018 | One 10 yr option | n/a | No modification of terms. 1st option already exercised | |||||||||||||
| Volvo at Gwinnett Place | SON-031 | 2nd | MMR Holdings, LLC | Sonic Automotive 5260 Peachtree Industrial Blvd., LLC | 8/13/1999 | 8/13/1999 | 8/12/2009 | Two 5 yr options | n/a | Allow to terminate 8/12/2009 | ||||||||||||
| Lexus of Marin | FIR-002 | CAR FAA II L.L.C. | FAA SERRAMONTE L, INC. | 1/14/1999 | SEE COMMENTS | 1/14/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Volvo & Honda of Santa Monica | FIR-003, 004 | CARS-DB4, L.P. | FirstAmerica Automotive, Inc. | 11/10/1999 | SEE COMMENTS | 11/09/2014 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Momentum JVP (FFC) | MOM-001 | CARS CNI-2 L.P. | SONIC FFC 3, INC. | 9/01/1998 | 4/16/2004 | 4/15/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Momentum BMW | MOM-002 | CARS CNI-2 L.P. | Sonic Momentum B, L.P. | 1/22/1999 | 7/1/2004 | 6/30/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Momentum BMW B/S | MOM-004 | CARS CNI-2 L.P. | Sonic Momentum B, L.P. | 9/01/1998 | 7/1/2004 | 6/30/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Land Rover of Houston (dealership) | MOM-006 | Capital Automotive, L.P. | Sonic Houston LR, L.P. | 5/17/1999 | 4/16/2004 | 4/15/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Momentum Audi (FFC) | MOM-010 | CAR 2 MOM L.P. | SONIC FFC 2, INC. | 7/10/2002 | 4/16/2004 | 4/15/2019 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Advantage VW | MOM-011 | CAR 2 MOM L.P. | SONIC-JERSEY VILLAGE VOLKSWAGEN, L.P. | 6/28/2002 | 8/5/2003 | 5/31/2017 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Clearlake VW | MOM-012 | CARS-DB4, L.P. | SONIC-CLEAR LAKE VOLKSWAGEN, L.P. | 10/10/2002 | 8/5/2003 | 9/30/2017 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Halifax Chevy - New Smyrna | SON-028 | 4th | MMR Holdings, LLC | Sonic Automotive-1919 N. Dixie Hwy., NSB, Inc. | 8/13/1999 | 8/13/1999 | 8/1/2015 | Two 5 yr options | YES | No modification of terms | ||||||||||||
| Friendly Ford Lincoln Mercury (Blount) | SON-065 | 3rd | CAR BSC L.L.C. | Sonic-Montgomery FLM, Inc. | 3/03/2000 | 3/3/2000 | 3/02/2015 | Two 5 yr options | YES | No modification of terms | ||||||||||||
| Volvo of Dallas | SON-071 | 2nd | CAR SON NSV L.P. | Sonic-Carrollton V, L.P. | 10/06/2000 | 10/6/2000 | 10/05/2015 | Two 5 yr options | YES | No modification of terms | ||||||||||||
| Fort Mill Hyundai | SON-073-Lease2 | 2nd | SRE SOUTH CAROLINA-1, LLC | Town and Country Chrysler-Plymouth-Jeep of Rock Hill, Inc. | 12/19/2000 | 12/19/2000 | 12/18/2015 | Two 5 yr options | YES | No modification of terms | ||||||||||||
| BMW of Ann Arbor (Infiniti sublease) | SON-100 | SRE Michigan - 2, LLC | Sonic-Ann Arbor Imports, Inc. | 6/28/2004 | 6/28/04 | 12/20/2021 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Mercedes-Benz of Ann Arbor | SON-104 | SRE MICHIGAN - 1, LLC | Sonic–Ann Arbor Imports, Inc. | 6/30/2006 | 6/30/06 | 6/29/2021 | Two 10 yr options | YES | No modification of terms | |||||||||||||
| Altman LM (North Charleston) | SON-048 | 2nd | MMR Holdings, LLC | Sonic-North Charleston, Inc. | 8/17/1999 | 8/17/1999 | 8/16/2009 | Two 5 yr options | n/a | No modification of terms; allow to terminate Aug 2009 | ||||||||||||