10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2012

or

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to             

Commission file number 1-12297

Penske Automotive Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware	22-3086739
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2555 Telegraph Road, Bloomfield Hills, Michigan	48302-0954
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:

(248) 648-2500

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  þ    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  þ    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act (Check one):

Large accelerated filer	þ	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  þ

As of April 15, 2012, there were 90,322,045 shares of voting common stock outstanding.

TABLE OF CONTENTS

	Page
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Condensed Balance Sheets as of March 31, 2012 and December 31, 2011		3
Consolidated Condensed Statements of Income for the three months ended March 31, 2012 and 2011		4
Consolidated Condensed Statements of Comprehensive Income for the three months ended March  31, 2012 and 2011		5
Consolidated Condensed Statements of Cash Flows for the three months ended March 31, 2012 and 2011		6
Consolidated Condensed Statement of Equity for the three months ended March 31, 2012		7
Notes to Consolidated Condensed Financial Statements		8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		22
Item 3. Quantitative & Qualitative Disclosures About Market Risk		36
Item 4. Controls and Procedures		37
PART II — OTHER INFORMATION
Item 1. Legal Proceedings		37
Item 1A. Risk Factors		38
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		38
Item 5. Other Information		39
Item 6. Exhibits		40

2

PENSKE AUTOMOTIVE GROUP, INC.

CONSOLIDATED CONDENSED BALANCE SHEETS

	March 31,			December 31,
	2012			2011
	(Unaudited)
	(In thousands, except
	per share amounts)
ASSETS
Cash and cash equivalents	$	31,768		$	28,490
Accounts receivable, net of allowance for doubtful accounts of $2,171 and $2,161		492,653			440,273
Inventories		1,770,235			1,581,586
Other current assets		91,869			80,269
Assets held for sale		29,075			67,776
Total current assets		2,415,600			2,198,394
Property and equipment, net		915,081			857,587
Goodwill		947,108			905,721
Franchise value		254,458			228,459
Equity method investments		288,242			298,640
Other long-term assets		14,276			13,498
Total assets	$	4,834,765		$	4,502,299
LIABILITIES AND EQUITY
Floor plan notes payable	$	1,114,070		$	977,548
Floor plan notes payable — non-trade		701,242			700,571
Accounts payable		297,705			220,708
Accrued expenses		258,455			201,579
Current portion of long-term debt		13,264			3,414
Liabilities held for sale		29,928			45,852
Total current liabilities		2,414,664			2,149,672
Long-term debt		848,630			846,777
Deferred tax liabilities		222,409			217,902
Other long-term liabilities		166,865			147,535
Total liabilities		3,652,568			3,361,886
Commitments and contingent liabilities
Equity
Penske Automotive Group stockholders’ equity:
Preferred Stock, $0.0001 par value; 100 shares authorized; none issued and outstanding		—			—
Common Stock, $0.0001 par value, 240,000 shares authorized; 90,322 shares issued and outstanding at March 31, 2012; 90,277 shares issued and outstanding at December 31, 2011		9			9
Non-voting Common Stock, $0.0001 par value, 7,125 shares authorized; none issued and outstanding		—			—
Class C Common Stock, $0.0001 par value, 20,000 shares authorized; none issued and outstanding		—			—
Additional paid-in-capital		695,582			702,335
Retained earnings		497,220			459,375
Accumulated other comprehensive loss		(15,033	)		(25,734	)
Total Penske Automotive Group stockholders’ equity		1,177,778			1,135,985
Non-controlling interest		4,419			4,428
Total equity		1,182,197			1,140,413
Total liabilities and equity	$	4,834,765		$	4,502,299

See Notes to Consolidated Condensed Financial Statements

3

PENSKE AUTOMOTIVE GROUP, INC.

CONSOLIDATED CONDENSED STATEMENTS OF INCOME

	Three Months Ended
	March 31,
	2012			2011
	(Unaudited)
	(In thousands, except per share amounts)
Revenue:
New vehicle	$	1,578,319		$	1,385,556
Used vehicle		969,732			791,734
Finance and insurance, net		79,894			66,463
Service and parts		369,727			341,542
Fleet and wholesale vehicle		244,616			165,741
Total revenues		3,242,288			2,751,036
Cost of sales:
New vehicle		1,446,281			1,275,804
Used vehicle		891,327			726,619
Service and parts		156,525			146,649
Fleet and wholesale		241,562			162,719
Total cost of sales		2,735,695			2,311,791
Gross profit		506,593			439,245
Selling, general and administrative expenses		398,637			355,391
Depreciation		13,349			11,798
Operating income		94,607			72,056
Floor plan interest expense		(9,725	)		(6,925	)
Other interest expense		(12,210	)		(11,285	)
Debt discount amortization		—			(1,718	)
Equity in earnings of affiliates		4,410			22
Income from continuing operations before income taxes		77,082			52,150
Income taxes		(26,902	)		(15,670	)
Income from continuing operations		50,180			36,480
Loss from discontinued operations, net of tax		(3,174	)		(2,483	)
Net income		47,006			33,997
Less: Income attributable to non-controlling interests		188			70
Net income attributable to Penske Automotive Group common stockholders	$	46,818		$	33,927
Basic earnings per share attributable to Penske Automotive Group common stockholders:
Continuing operations	$	0.56		$	0.39
Discontinued operations		(0.04	)		(0.03	)
Net income attributable to	$	0.52		$	0.37
Penske Automotive Group common stockholders
Shares used in determining basic earnings per share		90,306			92,472
Diluted earnings per share attributable to Penske Automotive Group common stockholders:
Continuing operations	$	0.55		$	0.39
Discontinued operations		(0.04	)		(0.03	)
Net income attributable to Penske Automotive Group common stockholders	$	0.52		$	0.37
Shares used in determining diluted earnings per share		90,338			92,554
Amounts attributable to Penske Automotive Group common stockholders:
Income from continuing operations	$	50,180		$	36,480
Less: Income attributable to non-controlling interests		188			70
Income from continuing operations, net of tax		49,992			36,410
Loss from discontinued operations, net of tax		(3,174	)		(2,483	)
Net income attributable to Penske Automotive Group common stockholders	$	46,818		$	33,927

See Notes to Consolidated Condensed Financial Statements

4

PENSKE AUTOMOTIVE GROUP, INC.

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

	Three Months Ended
	March 31,
	2012			2011
	(Unaudited)
	(In thousands, except per share amounts)
Net Income	$	47,006		$	33,997
Other Comprehensive Income:
Foreign currency translation adjustment		9,926			16,852
Unrealized gain (loss) on interest rate swaps:
Unrealized gain(loss) arising during the period, net of tax benefit(provision) of $822 and ($139), respectively		(1,257	)		212
Reclassification adjustment for loss included in floor plan interest expense, net of tax provision of $669, and $46, respectively		1,023			70
Unrealized gain (loss) on interest rate swaps, net of tax		(234	)		282
Other adjustments to Comprehensive Income, net		1,009			(612	)
Other Comprehensive Income, Net of Taxes		10,701			16,522
Comprehensive Income	$	57,707		$	50,519
Less: Net income attributable to non-controlling interest		188			70
Comprehensive income attributable to Penske Automotive Group common stockholders	$	57,519		$	50,449

See Notes to Consolidated Condensed Financial Statements

5

PENSKE AUTOMOTIVE GROUP, INC.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS

	Three Months Ended
	March 31,
	2012			2011
	(Unaudited)
	(In thousands)
Operating Activities:
Net income	$	47,006		$	33,997
Adjustments to reconcile net income to net cash from continuing operating activities:
Depreciation		13,349			11,798
Debt discount amortization		—			1,718
Earnings of equity method investments		(4,410	)		(22	)
Loss from discontinued operations, net of tax		3,174			2,483
Deferred income taxes		4,880			6,358
Changes in operating assets and liabilities:
Accounts receivable		(35,364	)		(29,178	)
Inventories		(108,999	)		(38,497	)
Floor plan notes payable		136,522			34,352
Accounts payable and accrued expenses		83,160			(2,993	)
Other		(14,014	)		(10,204	)
Net cash from continuing operating activities		125,304			9,812
Investing Activities:
Purchase of equipment and improvements		(26,466	)		(20,843	)
Dealership acquisitions net, including repayment of sellers’ floor plan notes payable of $36,906 and $5,862, respectively		(108,106	)		(14,011	)
Other		—			3,490
Net cash from continuing investing activities		(134,572	)		(31,364	)
Financing Activities:
Proceeds from borrowings under U.S. credit agreement revolving credit line		194,300			16,500
Repayments under U.S. credit agreement revolving credit line		(219,300	)		(16,500	)
Net borrowings of other long-term debt		34,766			6,711
Net borrowings of floor plan notes payable — non-trade		671			29,419
Repurchase of common stock		(8,522	)		—
Dividends		(8,973	)		—
Proceeds from exercises of options, including excess tax benefit		—			1,645
Net cash from continuing financing activities		(7,058	)		37,775
Discontinued operations:
Net cash from discontinued operating activities		(3,638	)		3,522
Net cash from discontinued investing activities		34,769			2,265
Net cash from discontinued financing activities		(11,527	)		(1,280	)
Net cash from discontinued operations		19,604			4,507
Net change in cash and cash equivalents		3,278			20,730
Cash and cash equivalents, beginning of period		28,490			19,705
Cash and cash equivalents, end of period	$	31,768		$	40,435
Supplemental disclosures of cash flow information:
Cash paid for:
Interest	$	14,061		$	11,079
Income taxes		7,740			9,093
Seller financed/assumed debt		—			4,865

See Notes to Consolidated Condensed Financial Statements

6

PENSKE AUTOMOTIVE GROUP, INC.

CONSOLIDATED CONDENSED STATEMENT OF EQUITY

												Accumulated			Total
	Common Stock					Additional						Other			Stockholders’ Equity
	Issued					Paid-in			Retained			Comprehensive			Attributable to Penske			Non-controlling			Total
	Shares			Amount		Capital			Earnings			Income (Loss)			Automotive Group			Interest			Equity
												(Unaudited)
												(Dollars in thousands)
Balance, January 1, 2012		90,277,356		$	9	$	702,335		$	459,375		$	(25,734	)	$	1,135,985		$	4,428		$	1,140,413
Equity compensation		394,689			—		1,769			—			—			1,769			—			1,769
Distributions to non-controlling interests		—			—		—			—			—			—			(197	)		(197	)
Foreign currency translation		—			—		—			—			9,926			9,926			—			9,926
Repurchase of common stock		(350,000	)				(8,522	)								(8,522	)		—			(8,522	)
Dividends		—			—		—			(8,973	)		—			(8,973	)		—			(8,973	)
Other		—			—		—			—			775			775			—			775
Net income		—			—		—			46,818			—			46,818			188			47,006
Balance, March 31, 2012		90,322,045		$	9	$	695,582		$	497,220		$	(15,033	)	$	1,177,778		$	4,419		$	1,182,197

See Notes to Consolidated Condensed Financial Statements

7

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

(Unaudited)

(In thousands, except per share amounts)

1. Interim Financial Statements

Business Overview

Penske Automotive Group, Inc. (the “Company”) is the second largest automotive retailer headquartered in the U.S. as measured by total revenue. As of March 31, 2012, the Company operated 335 retail franchises, of which 168 franchises are located in the U.S. and 167 franchises are located outside of the U.S. The franchises outside the U.S. are located primarily in the U.K. Each of the Company’s dealerships offers a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, the Company generates higher-margin revenue at each of its dealerships through maintenance and repair services and the sale and placement of higher-margin products, such as third-party finance and insurance products, third-party extended service contracts and replacement and aftermarket automotive products. The Company also holds a 9.0% limited partnership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading transportation services provider.

During the three months ended March 31, 2012, we acquired the Agnew Group in the United Kingdom, representing thirteen franchises, and two other franchises. We also were awarded three franchises, including Nissan/Infiniti in San Francisco and Mini in Marin, CA, and disposed of three franchises, including Jaguar Land Rover in Gatwick, England and Lexus in Scottsdale, Arizona.

In April 2012, we acquired a 7% interest in NPA Holdco, LLC, an auctioneer of powersport vehicles for $3,000. Transportation Resource Partners, a related party, recently acquired a controlling interest in this company on the same financial terms as our investment.

Basis of Presentation

The following unaudited consolidated condensed financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in the Company’s annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of March 31, 2012 and December 31, 2011 and for the three month periods ended March 31, 2012 and 2011 is unaudited, but includes all adjustments which the management of the Company believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities which have been treated as discontinued operations through March 31, 2012, and the results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2011, which are included as part of the Company’s Annual Report on Form 10-K.

In June 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-05, Presentation of Comprehensive Income, which requires the presentation of components of other comprehensive income with the components of net income. The adoption of this pronouncement on January 1, 2012 had no impact on our consolidated financial position or results of operations.

Discontinued Operations

The Company accounts for dispositions in its retail operations as discontinued operations when it is evident that the operations and cash flows of a franchise being disposed of will be eliminated from on-going operations and that the Company will not have any significant continuing involvement in its operations.

In evaluating whether the cash flows of a dealership in its Retail reportable segment will be eliminated from ongoing operations, the Company considers whether it is likely that customers will migrate to similar franchises that it owns in the same geographic market. The Company’s consideration includes an evaluation of the brands sold at other dealerships it operates in the market and their proximity to the disposed dealership. When the Company disposes of franchises, it typically does not have continuing brand representation in that market. If the franchise being disposed of is located in a complex of Company owned dealerships, the Company does not treat the disposition as a discontinued operation if it believes that the cash flows previously generated by the disposed franchise will be replaced by expanded operations of the remaining or replacement franchises.

8

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

Combined financial information regarding entities accounted for as discontinued operations follows:

	Three Months Ended March 31,
	2012			2011
Revenues	$	45,942		$	129,462
Pre-tax loss		(11,458	)		(5,147	)
Gain on disposal		10,160			1,071
	March 31,			December 31,
	2012			2011
Inventories	$	24,052		$	39,185
Other assets		5,023			28,591
Total assets	$	29,075		$	67,776
Floor plan notes payable (including non-trade)	$	22,730		$	36,186
Other liabilities		7,198			9,666
Total liabilities	$	29,928		$	45,852

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves.

Fair Value of Financial Instruments

Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, debt, floor plan notes payable, and interest rate swaps used to hedge future cash flows. Other than our subordinated notes, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. A summary of the fair value of the subordinated notes, based on quoted, level one market data, follows:

	March 31, 2012
	Carrying Value		Fair Value
7.75% senior subordinated notes due 2016	$	375,000	$	393,075
3.5% senior subordinated convertible notes due 2026		63,324		68,889

2. Inventories

Inventories consisted of the following:

	March 31,		December 31,
	2012		2011
New vehicles	$	1,206,234	$	1,058,371
Used vehicles		480,910		442,991
Parts, accessories and other		83,091		80,224
Total inventories	$	1,770,235	$	1,581,586

The Company receives non-refundable credits from certain vehicle manufacturers that reduce cost of sales when the vehicles are sold. Such credits amounted to $6,201 and $7,927 during the three months ended March 31, 2012 and 2011, respectively.

9

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

3. Business Combinations

The Company acquired thirteen and three franchises during the three months ended March 31, 2012 and 2011, respectively, in its retail operations. The Company’s financial statements include the results of operations of the acquired dealerships from the date of acquisition. The fair value of the assets acquired and liabilities assumed have been recorded in the Company’s consolidated condensed financial statements, and may be subject to adjustment pending completion of final valuation. A summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed for the three months ended March 31, 2012 and 2011 follows:

	March 31,
	2012			2011
Accounts receivable	$	16,976		$	953
Inventory		79,650			7,923
Property and equipment		32,593			1,671
Goodwill		31,566			7,038
Franchise Value		23,426			—
Other assets		—			628
Current liabilities		(49,290	)		(2,491	)
Non-current liabilities		(26,815	)		—
Total consideration		108,106			15,722
Seller financed/assumed debt		—			(1,711	)
Cash used in dealership acquisitions	$	108,106		$	14,011

In addition, in March 2012 the Company formed a joint venture which acquired a BMW/Mini dealership in Monza, Italy, a suburb of Milan.

The following unaudited consolidated pro forma results of operations of the Company for the three months ended March 31, 2012 and 2011 give effect to acquisitions consummated during 2012 and 2011 as if they had occurred on January 1, 2011:

	Three Months Ended March 31,
	2012		2011
Revenues	$	3,258,179	$	2,908,036
Income from continuing operations		49,878		39,347
Net income		46,704		36,842
Income from continuing operations per diluted common share	$	0.55	$	0.43
Net income per diluted common share	$	0.52	$	0.40

4. Intangible Assets

Following is a summary of the changes in the carrying amount of goodwill and franchise value during the three months ended March 31, 2012:

			Franchise
	Goodwill		Value
Balance, January 1, 2012	$	905,721	$	228,459
Additions		31,566		23,426
Foreign currency translation		9,821		2,573
Balance, March 31, 2012	$	947,108	$	254,458

10

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

5. Floor Plan Notes Payable — Trade and Non-trade

The Company finances substantially all of its new and a portion of its used vehicle inventories under revolving floor plan arrangements with various lenders, including the captive finance companies associated with automotive manufacturers. In the U.S., substantially all of our floor plan arrangements are due on demand; however, the Company has not historically been required to repay floor plan advances prior to the sale of the vehicles that have been financed. The Company typically makes monthly interest payments on the amount financed. Outside of the U.S., substantially all of the floor plan arrangements are payable on demand or have an original maturity of 90 days or less and the Company is generally required to repay floor plan advances at the earlier of the sale of the vehicles that have been financed or the stated maturity.

The floor plan agreements grant a security interest in substantially all of the assets of the Company’s dealership subsidiaries, and in the U.S. are guaranteed by the Company. Interest rates under the floor plan arrangements are variable and increase or decrease based on changes in the prime rate, defined London Interbank Offered Rate (“LIBOR”), the Finance House Bank Rate, or the Euro Interbank Offer Rate. The Company classifies floor plan notes payable to a party other than the manufacturer of a particular new vehicle, and all floor plan notes payable relating to pre-owned vehicles, as floor plan notes payable — non-trade on its consolidated condensed balance sheets and classifies related cash flows as a financing activity on its consolidated condensed statements of cash flows.

6. Earnings Per Share

Basic earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, including outstanding unvested restricted stock awards which contain rights to non-forfeitable dividends. Diluted earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, adjusted for any dilutive effects. The Company has senior subordinated convertible notes outstanding which, under certain circumstances discussed in Note 7, may be converted to voting common stock. As of March 31, 2012 and March 31, 2011, no shares related to the senior subordinated convertible notes were included in the calculation of diluted earnings per share because the effect of such securities was anti-dilutive. A reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three months ended March 31, 2012 and 2011 follows:

	Three Months Ended
	March 31,
	2012		2011
Weighted average number of common shares outstanding		90,306		92,472
Effect of non-participatory equity compensation		32		82
Weighted average number of common shares outstanding,including effect of dilutive securities		90,338		92,554

7. Long-Term Debt

Long-term debt consisted of the following:

	March 31,			December 31,
	2012			2011
U.S. credit agreement—revolving credit line	$	107,000		$	132,000
U.S. credit agreement—term loan		127,000			127,000
U.K. credit agreement—revolving credit line		63,832			59,060
U.K. credit agreement—term loan		45,480			—
U.K. credit agreement—overdraft line of credit		—			13,333
7.75% senior subordinated notes due 2016		375,000			375,000
3.5% senior subordinated convertible notes due 2026, net of debt discount		63,324			63,324
Mortgage facilities		74,831			75,684
Other		5,427			4,790
Total long-term debt		861,894			850,191
Less: current portion		(13,264	)		(3,414	)
Net long-term debt	$	848,630		$	846,777

11

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

U.S. Credit Agreement

The Company is party to a credit agreement with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, as amended (the “U.S. Credit Agreement”), which provides for up to $375,000 in revolving loans for working capital, acquisitions, capital expenditures, investments and other general corporate purposes, a non-amortizing term loan with a remaining balance of $127,000, and for an additional $10,000 of availability for letters of credit, through September 2014. The revolving loans bear interest at a defined LIBOR plus 2.50%, subject to an incremental 1.00% for uncollateralized borrowings in excess of a defined borrowing base. The term loan, which bears interest at defined LIBOR plus 2.50%, may be prepaid at any time, but then may not be re-borrowed.

The U.S. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by the Company’s domestic subsidiaries and contains a number of significant covenants that, among other things, restrict the Company’s ability to dispose of assets, incur additional indebtedness, repay other indebtedness, pay dividends, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. The Company is also required to comply with specified financial and other tests and ratios, each as defined in the U.S. Credit Agreement including: a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders’ equity and a ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of the amounts owed. As of March 31, 2012, the Company was in compliance with all covenants under the U.S. Credit Agreement.

The U.S. Credit Agreement also contains typical events of default, including change of control, non-payment of obligations and cross-defaults to the Company’s other material indebtedness. Substantially all of the Company’s domestic assets are subject to security interests granted to lenders under the U.S. Credit Agreement. As of March 31, 2012, $127,000 of term loans, and $500 of letters of credit and $107,000 of revolver borrowings were outstanding under the U.S. Credit Agreement.

U.K. Credit Agreement

The Company’s subsidiaries in the U.K. (the “U.K. subsidiaries”) are party to a £100,000 revolving credit agreement with the Royal Bank of Scotland plc (RBS) and BMW Financial Services (GB) Limited, and an additional £10,000 demand overdraft line of credit with RBS (collectively, the “U.K. credit agreement”) to be used for working capital, acquisitions, capital expenditures, investments and general corporate purposes through November 2015. The revolving loans bear interest between defined LIBOR plus 1.35% and defined LIBOR plus 3.0% and the demand overdraft line of credit bears interest at the Bank of England Base Rate plus 1.75%. As of March 31, 2012, outstanding loans under the U.K. credit agreement amounted to £40,000 ($63,824).

The U.K. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by our U.K. subsidiaries, and contains a number of significant covenants that, among other things, restrict the ability of our U.K. subsidiaries to pay dividends, dispose of assets, incur additional indebtedness, repay other indebtedness, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. In addition, our U.K. subsidiaries are required to comply with defined ratios and tests, including: a ratio of earnings before interest, taxes, amortization, and rental payments (“EBITAR”) to interest plus rental payments, a measurement of maximum capital expenditures, and a debt to EBITDA ratio. A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. As of March 31, 2012, our U.K. subsidiaries were in compliance with all covenants under the U.K. credit agreement.

The U.K. credit agreement also contains typical events of default, including change of control and non-payment of obligations and cross-defaults to other material indebtedness of our U.K. subsidiaries. Substantially all of our U.K. subsidiaries’ assets are subject to security interests granted to lenders under the U.K. credit agreement.

In January 2012, our U.K. subsidiaries entered into a separate agreement with RBS, as agent for National Westminster Bank plc, providing for a £30,000 term loan which was used for working capital and an acquisition. The term loan is repayable in £1,500 quarterly installments through 2015 with a final payment of £7,500 due December 31, 2015. The term loan bears interest between 2.675% and 4.325%, depending on the U.K. subsidiaries’ ratio of net borrowings to earnings before interest, taxes, depreciation and amortization (as defined). As of March 31, 2012, the amount outstanding under the U.K. term loan was £28,500 ($45,480).

12

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

7.75% Senior Subordinated Notes

In December 2006, the Company issued $375,000 aggregate principal amount of 7.75% senior subordinated notes (the “7.75% Notes”) due 2016. The 7.75% Notes are unsecured senior subordinated notes and are subordinate to all existing and future senior debt, including debt under the Company’s credit agreements, mortgages and floor plan indebtedness. The 7.75% Notes are guaranteed by substantially all of the Company’s wholly-owned domestic subsidiaries on an unsecured senior subordinated basis. Those guarantees are full and unconditional and joint and several. The Company can redeem all or some of the 7.75% Notes at its option at specified redemption prices (currently 103.875% of the principal amount of the notes). Upon certain sales of assets or specific kinds of changes of control the Company is required to make an offer to purchase the 7.75% Notes. The 7.75% Notes also contain customary negative covenants and events of default. As of March 31, 2012, the Company was in compliance with all negative covenants and there were no events of default.

Senior Subordinated Convertible Notes

The Company currently has $63,324 of Convertible Notes outstanding. The Company issued the Convertible Notes in January 2006, and the notes mature on April 1, 2026, unless earlier converted, redeemed or purchased, as discussed below. The Convertible Notes are unsecured senior subordinated obligations and are subordinate to all future and existing debt under the Company’s credit agreements, mortgages and floor plan indebtedness. The Convertible Notes are guaranteed on an unsecured senior subordinated basis by substantially all of the Company’s wholly-owned domestic subsidiaries. The guarantees are full and unconditional and joint and several. The Convertible Notes also contain customary negative covenants and events of default. As of March 31, 2012, the Company was in compliance with all negative covenants and there were no events of default.

Holders of the Convertible Notes may convert them based on a conversion rate of 42.7796 shares of the Company’s common stock per $1,000 principal amount of the Convertible Notes (which is equal to a conversion price of approximately $23.38 per share), subject to adjustment, only under the following circumstances: (1) in any quarterly period, if the closing price of our common stock for twenty of the last thirty trading days in the prior quarter exceeds $28.05 (subject to adjustment), (2) for specified periods, if the trading price of the Convertible Notes falls below specific thresholds, (3) if the Convertible Notes are called for redemption, (4) if specified distributions to holders of our common stock are made or specified corporate transactions occur, (5) if a fundamental change (as defined) occurs, or (6) during the ten trading days prior to, but excluding, the maturity date.

Upon conversion of the Convertible Notes, for each $1,000 principal amount of the Convertible Notes, a holder will receive an amount in cash, equal to the lesser of (i) $1,000 or (ii) the conversion value, determined in the manner set forth in the indenture covering the Convertible Notes, of the number of shares of common stock equal to the conversion rate. If the conversion value exceeds $1,000, the Company will also deliver, at its election, cash, common stock or a combination of cash and common stock with respect to the remaining value deliverable upon conversion. The Company will pay additional cash interest commencing with six-month periods beginning on April 1, 2011, if the average trading price of a Convertible Note for certain periods in the prior six-month period equals 120% or more of the principal amount of the Convertible Notes.

The Company may redeem the Convertible Notes, in whole or in part at any time or from time to time, for cash at a redemption price of 100% of the principal amount of the Convertible Notes to be redeemed, plus any accrued and unpaid interest to the applicable redemption date, plus any applicable conversion premium.

On issuance of the Convertible Notes, the Company recorded a debt discount which was amortized as additional interest expense through March 31, 2011. The annual effective interest rate on the liability component was 8.25% through March 31, 2011. Beginning April 1, 2011, the annual effective interest rate was 3.5%.

Mortgage Facilities

The Company is party to several mortgages which bear interest at defined rates and require monthly principal and interest payments. These mortgage facilities also contain typical events of default, including non-payment of obligations, cross-defaults to the Company’s other material indebtedness, certain change of control events, and the loss or sale of certain franchises operated at the properties. Substantially all of the buildings and improvements on the properties financed pursuant to the mortgage facilities are subject to security interests granted to the lender. As of March 31, 2012, the Company owed $74,831 of principal under our mortgage facilities.

13

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

8. Interest Rate Swaps

The Company periodically uses interest rate swaps to manage interest rate risk associated with the Company’s variable rate floor plan debt. The Company is party to interest rate swap agreements through December 2014 pursuant to which the LIBOR portion of $300,000 of the Company’s floating rate floor plan debt is fixed at 2.135% and $100,000 of the Company’s floating rate floor plan debt is fixed at a rate of 1.55%. The Company may terminate these agreements at any time, subject to the settlement of the then current fair value of the swap arrangements.

Through January 2011, the Company was party to interest rate swap agreements pursuant to which the LIBOR portion of $300,000 of the Company’s floating rate floor plan debt was fixed at 3.67%.

The Company used Level 2 inputs to estimate the fair value of the interest rate swap agreements. As of March 31, 2012 and 2011, the fair value of the swaps designated as hedging instruments was estimated to be a liability of $16,322 and an asset of $351, respectively.

During the three months ended March 31, 2012 and 2011, there was no hedge ineffectiveness recorded on the Company’s income statement. During the three months ended March 31, 2012, the swaps increased the weighted average interest rate on the Company’s floor plan borrowings by approximately 40 basis points. The impact of the swaps on the weighted average interest rate of the Company’s floor plan borrowings during the three months ended March 31, 2011 was insignificant.

9. Commitments and Contingent Liabilities

The Company is involved in litigation which may relate to claims brought by governmental authorities, issues with customers, and employment related matters, including class action claims and purported class action claims. As of March 31, 2012, the Company is not party to any legal proceedings, including class action lawsuits, that, individually or in the aggregate, are reasonably expected to have a material adverse effect on the Company’s results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on the Company’s results of operations, financial condition or cash flows.

The Company has historically structured its operations so as to minimize ownership of real property. As a result, the Company leases or subleases substantially all of its facilities. These leases are generally for a period between five and 20 years, and are typically structured to include renewal options at the Company’s election. Pursuant to the leases for some of the Company’s larger facilities, the Company is required to comply with specified financial ratios, including a “rent coverage” ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require the Company to post collateral in the form of a letter of credit. A breach of the other lease covenants gives rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. As of March 31, 2012, the Company was in compliance with all covenants under these leases.

The Company has sold a number of dealerships to third parties and, as a condition to certain of those sales, remains liable for the lease payments relating to the properties on which those businesses operate in the event of non-payment by the buyer. The Company is also party to lease agreements on properties that it no longer uses in its retail operations that it has sublet to third parties. The Company relies on subtenants to pay the rent and maintain the property at these locations. In the event the subtenant does not perform as expected, the Company may not be able to recover amounts owed to it and the Company could be required to fulfill these obligations.

The Company holds a 9.0% limited partnership interest in PTL. In April and May 2012, PTL refinanced a significant amount of its indebtedness. As part of that refinancing, the Company and the other PTL partners created a new company (“Holdings”), which, together with General Electric Capital Corporation (“GECC”), co-issued $700,000 of 3.8% senior unsecured notes due 2019 to certain investors through an offering pursuant to Rule 144A of the Securities Act of 1933, as amended (the “Holdings Bonds”). A wholly-owned subsidiary of Holdings contributed $700,000 derived from the net proceeds from the offering of the Holdings Bonds and a portion of its cash on hand to PTL in exchange for a 21.5% limited partner interest in PTL. PTL used the $700,000 of funds to reduce its outstanding debt owed to GECC. GECC agreed to be a co-obligor of the Holdings Bonds in order to achieve lower interest rates on the Holdings Bonds.

Additional capital contributions from the members may be required to fund interest and principal payments on the Holdings Bonds. In addition, the Company has agreed to indemnify GECC for 9.0% of any principal or interest that GECC is required to pay as co-obligor, and pay GECC an annual fee of approximately $950 for acting as co-obligor. The maximum amount of the Company’s potential obligations to GECC under this agreement are 9% of the required principal repayment due in 2019 (which is expected to be $63,100) and 9% of interest payments under the Holdings Bonds, plus fees and default interest, if any.

14

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

The Company has $19,072 of letters of credit outstanding as of March 31, 2012, and has posted $13,718 of surety bonds in the ordinary course of business.

10. Equity

Share Repurchase

During the first quarter of 2012, the Company repurchased 350,000 shares of our outstanding common stock for $8,522, or an average of $24.35, under a program approved by the Company’s Board of Directors.

11. Segment Information

The Company’s operations are organized by management into operating segments by line of business and geography. The Company has determined it has two reportable segments as defined in generally accepted accounting principles for segment reporting, including: (i) Retail, consisting of our automotive retail operations and (ii) PAG Investments, consisting of our investments in businesses other than automotive retail operations. The Retail reportable segment includes all automotive dealerships and all departments relevant to the operation of the dealerships and the retail automotive joint ventures. The individual dealership operations included in the Retail reportable segment have been grouped into four geographic operating segments, which have been aggregated into one reportable segment as their operations (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and used vehicles, service, parts and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals) and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions).

Three Months Ended March 31

			PAG
	Retail		Investments		Total
Revenues
2012	$	3,242,288	$	—	$	3,242,288
2011		2,751,036		—		2,751,036
Segment income
2012		73,248		3,834		77,082
2011		51,026		1,124		52,150

15

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

12. Consolidating Condensed Financial Information

The following tables include condensed consolidating financial information as of March 31, 2012 and December 31, 2011 and for the three month periods ended March 31, 2012 and 2011 for Penske Automotive Group, Inc. (as the issuer of the Convertible Notes and the 7.75% Notes), guarantor subsidiaries and non-guarantor subsidiaries (primarily representing foreign entities). The condensed consolidating financial information includes certain allocations of balance sheet, income statement and cash flow items which are not necessarily indicative of the financial position, results of operations and cash flows of these entities on a stand-alone basis.

CONDENSED CONSOLIDATING BALANCE SHEET

March 31, 2012

	Total Company		Eliminations			Penske Automotive Group		Guarantor Subsidiaries			Non-Guarantor Subsidiaries
	(In thousands)
Cash and cash equivalents	$	31,768	$	—		$	—	$	9,975		$	21,793
Accounts receivable, net		492,653		(318,778	)		318,778		253,077			239,576
Inventories		1,770,235		—			—		975,050			795,185
Other current assets		91,869		—			2,395		41,248			48,226
Assets held for sale		29,075		—			—		1,434			27,641
Total current assets		2,415,600		(318,778	)		321,173		1,280,784			1,132,421
Property and equipment, net		915,081		—			4,853		561,108			349,120
Intangible assets		1,201,566		—			—		705,484			496,082
Equity method investments		288,242		—			240,655		—			47,587
Other long-term assets		14,276		(1,367,480	)		1,377,436		(2,400	)		6,720
Total assets	$	4,834,765	$	(1,686,258	)	$	1,944,117	$	2,544,976		$	2,031,930
Floor plan notes payable	$	1,114,070	$	—		$	—	$	589,517		$	524,553
Floor plan notes payable — non-trade		701,242		—			89,049		328,378			283,815
Accounts payable		297,705		—			462		109,964			187,279
Accrued expenses		258,455		(318,778	)		85		142,818			434,330
Current portion of long-term debt		13,264		—			—		3,689			9,575
Liabilities held for sale		29,928		—			—		524			29,404
Total current liabilities		2,414,664		(318,778	)		89,596		1,174,890			1,468,956
Long-term debt		848,630		(37,026	)		672,324		74,774			138,558
Deferred tax liabilities		222,409		—			—		195,710			26,699
Other long-term liabilities		166,865		—			—		96,985			69,880
Total liabilities		3,652,568		(355,804	)		761,920		1,542,359			1,704,093
Total equity		1,182,197		(1,330,454	)		1,182,197		1,002,617			327,837
Total liabilities and equity	$	4,834,765	$	(1,686,258	)	$	1,944,117	$	2,544,976		$	2,031,930

16

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2011

						Penske
	Total					Automotive		Guarantor		Non-Guarantor
	Company		Eliminations			Group		Subsidiaries		Subsidiaries
	(In thousands)
Cash and cash equivalents	$	28,490	$	—		$	—	$	27,063	$	1,427
Accounts receivable, net		440,273		(297,782	)		305,386		283,193		149,476
Inventories		1,581,586		—			—		903,264		678,322
Other current assets		80,269		—			2,306		40,411		37,552
Assets held for sale		67,776		—			—		23,296		44,480
Total current assets		2,198,394		(297,782	)		307,692		1,277,227		911,257
Property and equipment, net		857,587		—			6,730		548,644		302,213
Intangible assets		1,134,180		—			—		701,452		432,728
Equity method investments		298,640		—			246,658		—		51,982
Other long-term assets		13,498		(1,360,808	)		1,369,182		3,389		1,735
Total assets	$	4,502,299	$	(1,658,590	)	$	1,930,262	$	2,530,712	$	1,699,915
Floor plan notes payable	$	977,548	$	—		$	—	$	560,999	$	416,549
Floor plan notes payable — non-trade		700,571		—			90,892		344,304		265,375
Accounts payable		220,708		—			1,633		112,975		106,100
Accrued expenses		201,579		(297,782	)		—		99,492		399,869
Current portion of long-term debt		3,414		—			—		3,414		—
Liabilities held for sale		45,852		—			—		7,850		38,002
Total current liabilities		2,149,672		(297,782	)		92,525		1,129,034		1,225,895
Long-term debt		846,777		(38,073	)		697,324		77,060		110,466
Deferred tax liabilities		217,902		—			—		198,348		19,554
Other long-term liabilities		147,535		—			—		93,328		54,207
Total liabilities		3,361,886		(335,855	)		789,849		1,497,770		1,410,122
Total equity		1,140,413		(1,322,735	)		1,140,413		1,032,942		289,793
Total liabilities and equity	$	4,502,299	$	(1,658,590	)	$	1,930,262	$	2,530,712	$	1,699,915

17

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended March 31, 2012

							Penske
	Total						Automotive			Guarantor			Non-Guarantor
	Company			Eliminations			Group			Subsidiaries			Subsidiaries
	(In thousands)
Revenues	$	3,242,288		$	—		$	—		$	1,842,665		$	1,399,623
Cost of sales		2,735,695			—			—			1,545,231			1,190,464
Gross profit		506,593			—			—			297,434			209,159
Selling, general and administrative expenses		398,637			—			4,595			239,699			154,343
Depreciation		13,349			—			362			7,146			5,841
Operating income (loss)		94,607			—			(4,957	)		50,589			48,975
Floor plan interest expense		(9,725	)		—			(2,198	)		(3,866	)		(3,661	)
Other interest expense		(12,210	)		—			(7,563	)		(910	)		(3,737	)
Equity in earnings of affiliates		4,410						3,760						650
Equity in earnings of subsidiaries		—			(87,852	)		87,852			—			—
Income (loss) from continuing operations before income taxes		77,082			(87,852	)		76,894			45,813			42,227
Income taxes		(26,902	)		30,736			(26,902	)		(20,557	)		(10,179	)
Income (loss) from continuing operations		50,180			(57,116	)		49,992			25,256			32,048
(Loss) income from discontinued operations, net of tax		(3,174	)		3,174			(3,174	)		(1,622	)		(1,552	)
Net income (loss)		47,006			(53,942	)		46,818			23,634			30,496
Less: Income attributable to the non-controlling interests		188			—			—			—			188
Net income (loss) attributable to Penske Automotive Group common stockholders		46,818			(53,942	)		46,818			23,634			30,308
Other comprehensive income (loss), net of tax		10,701			—			1,009			(234	)		9,926
Comprehensive income attributable to Penske Automotive Group common stockholders	$	57,519		$	(53,942	)	$	47,827		$	23,400		$	40,234

18

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended March 31, 2011

							Penske
	Total						Automotive			Guarantor			Non-Guarantor
	Company			Eliminations			Group			Subsidiaries			Subsidiaries
	(In thousands)
Revenues	$	2,751,036		$	—		$	—		$	1,564,740		$	1,186,296
Cost of sales		2,311,791			—			—			1,303,486			1,008,305
Gross profit		439,245			—			—			261,254			177,991
Selling, general and administrative expenses		355,391			—			4,949			215,973			134,469
Depreciation		11,798			—			285			6,324			5,189
Operating income (loss)		72,056			—			(5,234	)		38,957			38,333
Floor plan interest expense		(6,925	)		—			(133	)		(3,919	)		(2,873	)
Other interest expense		(11,285	)		—			(6,416	)		(611	)		(4,258	)
Debt discount amortization		(1,718	)		—			(1,718	)		—			—
Equity in earnings (losses) of affiliates		22			—			1,231			—			(1,209	)
Equity in earnings of subsidiaries		—			(64,350	)		64,350			—			—
Income (loss) from continuing operations before income taxes		52,150			(64,350	)		52,080			34,427			29,993
Income taxes		(15,670	)		19,362			(15,670	)		(10,989	)		(8,373	)
Income (loss) from continuing operations		36,480			(44,988	)		36,410			23,438			21,620
(Loss) income from discontinued operations, net of tax		(2,483	)		2,483			(2,483	)		(2,301	)		(182	)
Net income (loss)		33,997			(42,505	)		33,927			21,137			21,438
Less: Income attributable to the non-controlling interests		70			—			—			—			70
Net income (loss) attributable to Penske Automotive Group common stockholders		33,927			(42,505	)		33,927			21,137			21,368
Other comprehensive income (loss), net of tax		16,522			—			(663	)		282			16,903
Comprehensive income attributable to Penske Automotive Group common stockholders	$	50,449		$	(42,505	)	$	33,264		$	21,419		$	38,271

19

PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2012

				Penske
	Total			Automotive			Guarantor			Non-Guarantor
	Company			Group			Subsidiaries			Subsidiaries
				(In thousands)
Net cash from continuing operating activities	$	125,304		$	44,856		$	5,903		$	74,545
Investing activities:
Purchase of equipment and improvements		(26,466	)		(518	)		(18,101	)		(7,847	)
Dealership acquisitions, net		(108,106	)		—			—			(108,106	)
Net cash from continuing investing activities		(134,572	)		(518	)		(18,101	)		(115,953	)
Financing activities:
Net borrowings (repayments) of other long-term debt		9,766			(25,000	)		(963	)		35,729
Net borrowings (repayments) of floor plan notes payable — non-trade		671			(1,843	)		(15,926	)		18,440
Repurchase of common stock		(8,522	)		(8,522	)		—			—
Dividends		(8,973	)		(8,973	)		—			—
Distributions from (to) parent		—			—			636			(636	)
Net cash from continuing financing activities		(7,058	)		(44,338	)		(16,253	)		53,533
Net cash from discontinued operations		19,604			—			11,363			8,241
Net change in cash and cash equivalents		3,278			—			(17,088	)		20,366
Cash and cash equivalents, beginning of period		28,490			—			27,063			1,427
Cash and cash equivalents, end of period	$	31,768		$	—		$	9,975		$	21,793

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PENSKE AUTOMOTIVE GROUP, INC.

NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2011

				Penske
	Total			Automotive			Guarantor			Non-Guarantor
	Company			Group			Subsidiaries			Subsidiaries
				(In thousands)
Net cash from continuing operating activities	$	9,812		$	(1,050	)	$	64,251		$	(53,389	)
Investing activities:
Purchase of equipment and improvements		(20,843	)		(595	)		(7,641	)		(12,607	)
Dealership acquisitions, net		(14,011	)		—			(12,331	)		(1,680	)
Other		3,490			—			—			3,490
Net cash from continuing investing activities		(31,364	)		(595	)		(19,972	)		(10,797	)
Financing activities:
Net borrowings (repayments) of other long-term debt		6,711			—			(11,469	)		18,180
Net borrowings (repayments) of floor plan notes payable — non-trade		29,419			—			(38,324	)		67,743
Proceeds from exercises of options, including excess tax benefit		1,645			1,645			—			—
Distributions from (to) parent		—			—			3,899			(3,899	)
Net cash from continuing financing activities		37,775			1,645			(45,894	)		82,024
Net cash from discontinued operations		4,507			—			20,360			(15,853	)
Net change in cash and cash equivalents		20,730			—			18,745			1,985
Cash and cash equivalents, beginning of period		19,705			—			15,212			4,493
Cash and cash equivalents, end of period	$	40,435		$	—		$	33,957		$	6,478

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in the forward-looking statements as a result of various factors, including those discussed in “Forward Looking Statements.” We have acquired and initiated a number of businesses during the periods presented and addressed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations. Our financial statements include the results of operations of those businesses from the date acquired or when they commenced operations. This Management’s Discussion and Analysis of Financial Condition and Results of Operations has also been updated to reflect the revision of our financial statements for entities which have been treated as discontinued operations through March 31, 2012.

Overview

We are the second largest automotive retailer headquartered in the U.S. as measured by the $11.6 billion in total revenue we generated in 2011. As of March 31, 2012, we operated 335 retail automotive franchises, of which 168 franchises are located in the U.S. and 167 franchises are located outside of the U.S. The franchises outside the U.S. are located primarily in the U.K. In 2011, we retailed and wholesaled more than 348,000 vehicles. We are diversified geographically, with 61% of our total revenues in 2012 generated in the U.S. and Puerto Rico and 39% generated outside the U.S. We offer approximately 40 brands with 96% of our total retail revenue in 2012 generated from brands of non-U.S. based manufacturers, and 68% generated from premium brands, such as Audi, BMW, Mercedes-Benz and Porsche. Each of our dealerships offers a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, we generate higher-margin revenue at each of our dealerships through maintenance and repair services and the sale and placement of higher-margin products, such as third-party finance and insurance products, third-party extended service contracts and replacement and aftermarket automotive products.

We also hold a 9.0% limited partnership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading transportation services provider. PTL leases, rents or maintains more than 200,000 vehicles and serves customers in North America, South America, Europe and Asia and is one of the largest purchasers of commercial trucks in North America through its approximately 1,000 corporate and 1,900 agent locations. Product lines include full-service leasing, contract maintenance, commercial and consumer truck rentals, used truck sales, transportation and warehousing management and supply chain management solutions. The general partner of PTL is Penske Truck Leasing Corporation, a wholly-owned subsidiary of Penske Corporation, which, together with other wholly-owned subsidiaries of Penske Corporation, owns 41.1% of PTL. The remaining 49.9% of PTL is owned by General Electric Capital Corporation.

Outlook

The level of new automotive unit sales in our markets impacts our results. The new vehicle market and the amount of customer traffic visiting our dealerships have improved during the past few years, but the level of automotive sales in the U.S. remains below the last 10 years average sales level. There are market expectations for continued improvement in the automotive market in the U.S. over the next several years, although the level of such improvement is uncertain. During 2011, 12.8 million cars and light trucks were sold in the U.S., representing a 10% improvement over the 11.6 million cars and light trucks sold during the same period last year. We believe the U.S. automotive market will continue to recover based upon industry forecasts from companies such as JD Power, coupled with demand in the marketplace, an aging vehicle population, increased availability, lower cost of credit for consumers, and the planned introduction of new models by many different vehicle brands.

Vehicle registrations in the U.K were 1.94 million in 2011 compared to 2.03 million in 2010, representing a decline of 4.4%. According to the Society of Motor Manufacturers and Traders (www.smmt.co.uk), the U.K. market is expected to be challenging in 2012 as the economic outlook remains uncertain, however, in 2011, vehicle registrations of premium brands such as Audi, Bentley, BMW, Jaguar, Land Rover, Lexus, Mercedes-Benz, MINI and Porsche increased, indicating that registrations of premium/luxury vehicles have been more resilient than the market as a whole.

Operating Overview

New and used vehicle revenues include sales to retail customers and to leasing companies providing consumer automobile leasing. We generate finance and insurance revenues from sales of third-party extended service contracts, sales of third-party insurance policies, commissions relating to the sale of finance and lease contracts to third parties and the sales of certain other products. Service and parts revenues include fees paid for repair, maintenance and collision services, and the sale of replacement parts and other aftermarket accessories.

Our gross profit tends to vary with the mix of revenues we derive from the sale of new vehicles, used vehicles, finance and insurance products, and service and parts transactions. Our gross profit varies across product lines, with vehicle sales usually resulting in lower gross profit margins and our other revenues resulting in higher gross profit margins. Factors such as inventory and vehicle availability, customer demand, consumer confidence, unemployment, general economic conditions, seasonality, weather, credit availability, fuel prices and manufacturers’ advertising and incentives also impact the mix of our revenues, and therefore influence our gross profit margin. Aggregate gross profit increased $67 million, or 15.3%, during the three months ended March 31, 2012 compared to the same period in prior year. The increase in gross profit is largely attributable to same-store increases in new and used unit sales and service and parts revenues. Our retail gross margin percentage declined from 16.9% during the three months ended March 31, 2011 to 16.8% during the three months ended March 31, 2012, due primarily to an increase in the percentage of our revenues generated by vehicle sales which carry a lower gross margin than other parts of our business.

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Our selling expenses consist of advertising and compensation for sales personnel, including commissions and related bonuses. General and administrative expenses include compensation for administration, finance, legal and general management personnel, rent, insurance, utilities, and other expenses. As the majority of our selling expenses are variable, and we believe a significant portion of our general and administrative expenses are subject to our control, we believe our expenses can be adjusted over time to reflect economic trends.

Floor plan interest expense relates to financing incurred in connection with the acquisition of new and used vehicle inventories that is secured by those vehicles. Other interest expense consists of interest charges on all of our interest-bearing debt, other than interest relating to floor plan financing. The cost of our variable rate indebtedness is based on the prime rate, defined London Interbank Offered Rate (“LIBOR”), the Bank of England Base Rate, the Finance House Base Rate, or the Euro Interbank Offered Rate. Our floor plan interest expense has increased during the three months ended March 31, 2012 as a result of higher applicable interest rates, due to the impact of interest rate swap transactions, as well as an increase in the amounts outstanding under floor plan arrangements. Our other interest expense has increased during the three months ended March 31, 2012 due the increase in borrowings under our revolving credit agreements in the U.S. and U.K. following acquisitions in 2011 and the first quarter of 2012.

Equity in earnings of affiliates represents our share of the earnings from our investments in joint ventures and other non-consolidated investments, including PTL. It is our expectation that operating conditions as outlined above in the Outlook section will similarly impact these businesses throughout 2012. However, because PTL is engaged in different businesses than we are, its operating performance may vary significantly from ours.

The future success of our business is dependent upon, among other things, general economic and industry conditions, our ability to consummate and integrate acquisitions, the level of vehicle sales in the markets where we operate, our ability to increase sales of higher margin products, especially service and parts services, our ability to realize returns on our significant capital investment in new and upgraded dealership facilities, and the return realized from our investments in various joint ventures and other non-consolidated investments. See Item 1A — “Risk Factors” and “Forward-Looking Statements.”

Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires the application of accounting policies that often involve making estimates and employing judgments. Such judgments influence the assets, liabilities, revenues and expenses recognized in our financial statements. Management, on an ongoing basis, reviews these estimates and assumptions. Management may determine that modifications in assumptions and estimates are required, which may result in a material change in our results of operations or financial position.

The following are the accounting policies applied in the preparation of our financial statements that management believes are most dependent upon the use of estimates and assumptions.

Revenue Recognition

Vehicle, Parts and Service Sales

We record revenue when vehicles are delivered and title has passed to the customer, when vehicle service or repair work is completed and when parts are delivered to our customers. Sales promotions that we offer to customers are accounted for as a reduction of revenues at the time of sale. Rebates and other incentives offered directly to us by manufacturers are recognized as a reduction of cost of sales. Reimbursements of qualified advertising expenses are treated as a reduction of selling, general and administrative expenses. The amounts received under certain manufacturer rebate and incentive programs are based on the attainment of program objectives, and such earnings are recognized either upon the sale of the vehicle for which the award was received, or upon attainment of the particular program goals if not associated with individual vehicles. During the three months ended March 31, 2012 and 2011, we earned $108.0 million and $90.3 million, respectively, of rebates, incentives and reimbursements from manufacturers, of which $105.2 million and $87.9 million, respectively, was recorded as a reduction of cost of sales.

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Finance and Insurance Sales

Subsequent to the sale of a vehicle to a customer, we sell installment sale contracts to various financial institutions on a non-recourse basis (with specified exceptions) to mitigate the risk of default. We receive a commission from the lender equal to either the difference between the interest rate charged to the customer and the interest rate set by the financing institution or a flat fee. We also receive commissions for facilitating the sale of various third-party insurance products to customers, including credit and life insurance policies and extended service contracts. These commissions are recorded as revenue at the time the customer enters into the contract.

Impairment Testing

Franchise value impairment is assessed as of October 1 every year and upon the occurrence of an indicator of impairment through a comparison of its carrying amount and estimated fair value. An indicator of impairment exists if the carrying value of a franchise exceeds its estimated fair value and an impairment loss may be recognized up to that excess. The fair value of franchise value is determined using a discounted cash flow approach, which includes assumptions about revenue and profitability growth, franchise profit margins, and our cost of capital. We also evaluate our franchise agreements in connection with the annual impairment testing to determine whether events and circumstances continue to support our assessment that the franchise agreements have an indefinite life.

Goodwill impairment is assessed at the reporting unit level as of October 1 every year and upon the occurrence of an indicator of impairment. Our operations are organized by management into operating segments by line of business and geography. We have determined we have two reportable segments as defined in generally accepted accounting principles for segment reporting, including: (i) Retail, consisting of our automotive retail operations and (ii) PAG Investments, consisting of our investments in businesses other than automotive retail operations. We have determined that the dealerships in each of our operating segments within the Retail reportable segment are components that are aggregated into four geographical reporting units for the purpose of goodwill impairment testing, as they (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and used vehicles, service, parts and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals) and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions). There is no goodwill recorded in our PAG Investments reportable segment.

We prepare a qualitative assessment of the carrying value of goodwill in our reportable segments using the criteria in ASC 350-20-35-3 to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying value. If it were determined through the qualitative assessment that a reporting unit’s fair value is more likely than not greater than its carrying value, additional analysis would be unnecessary. During 2011, we concluded that it is not more likely than not that any of the four reporting unit’s fair value is less than their carrying amount.

If the additional impairment testing was necessary, we would have estimated the fair value of our reporting units using an “income” valuation approach. The “income” valuation approach estimates our enterprise value using a net present value model, which discounts projected free cash flows of our business using our weighted average cost of capital as the discount rate. This consideration would also include a control premium that represents the estimated amount an investor would pay for our equity securities to obtain a controlling interest and other significant assumptions including revenue and profitability growth, franchise profit margins, residual values and our cost of capital.

Investments

We account for each of our investments under the equity method, pursuant to which we record our proportionate share of the investee’s income each period. The net book value of our investments was $288.2 million and $298.6 million as of March 31, 2012 and December 31, 2011, respectively. Investments for which there is not a liquid, actively traded market are reviewed periodically by management for indicators of impairment. If an indicator of impairment is identified, management estimates the fair value of the investment using a discounted cash flow approach, which includes assumptions relating to revenue and profitability growth, profit margins, and our cost of capital. Declines in investment values that are deemed to be other than temporary may result in an impairment charge reducing the investments’ carrying value to fair value.

Self-Insurance

We retain risk relating to certain of our general liability insurance, workers’ compensation insurance, auto physical damage insurance, property insurance, employment practices liability insurance, directors and officers insurance and employee medical benefits in the U.S. As a result, we are likely to be responsible for a significant portion of the claims and losses incurred under these programs. The amount of risk we retain varies by program, and, for certain exposures, we have pre-determined maximum loss limits for certain individual claims and/or insurance periods. Losses, if any, above any such pre-determined loss limits are paid by third-party insurance carriers. Our estimate of future losses is prepared by management using our historical loss experience and industry-based development factors. Aggregate reserves relating to retained risk were $25.4 million and $25.9 million as of March 31, 2012 and December 31, 2011, respectively. Changes in the reserve estimate during 2012 relate primarily to our general liability and workers compensation programs.

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Income Taxes

Tax regulations may require items to be included in our tax returns at different times than the items are reflected in our financial statements. Some of these differences are permanent, such as expenses that are not deductible on our tax return, and some are temporary differences, such as the timing of depreciation expense. Temporary differences create deferred tax assets and liabilities. Deferred tax assets generally represent items that will be used as a tax deduction or credit in our tax returns in future years which we have already recorded in our financial statements. Deferred tax liabilities generally represent deductions taken on our tax returns that have not yet been recognized as expense in our financial statements. We establish valuation allowances for our deferred tax assets if the amount of expected future taxable income is not likely to allow for the use of the deduction or credit.

Classification in Continuing and Discontinued Operations

We classify the results of our operations in our consolidated financial statements based on generally accepted accounting principles relating to discontinued operations, which requires judgments, including whether a business will be divested, the period required to complete the divestiture, and the likelihood of changes to the divestiture plans. If we determine that a business should be either reclassified from continuing operations to discontinued operations or from discontinued operations to continuing operations, our consolidated financial statements for prior periods are revised to reflect such reclassification.

New Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-05, Presentation of Comprehensive Income, which requires the presentation of components of other comprehensive income with the components of net income in either a single continuous statement of comprehensive income or in two separate but consecutive statements. The adoption of this pronouncement on January 1, 2012 had no impact on our consolidated financial position or results of operations.

Results of Operations

The following tables present comparative financial data relating to our operating performance in the aggregate and on a “same-store” basis. Dealership results are included in same-store comparisons when we have consolidated the acquired entity during the entirety of both periods being compared. As an example, if a dealership was acquired on January 15, 2010, the results of the acquired entity would be included in annual same store comparisons beginning with the year ended December 31, 2012 and in quarterly same store comparisons beginning with the quarter ended June 30, 2011.

Three Months Ended March 31, 2012 Compared to Three Months Ended March 31, 2011

New Vehicle Data

Dollars in millions, except per unit amounts							2012 vs. 2011
	2012			2011			Change			% Change
New retail unit sales		43,099			38,668			4,431			11.5	%
Same store new retail unit sales		39,437			38,368			1,069			2.8	%
New retail sales revenue	$	1,578.3		$	1,385.6			192.7			13.9	%
Same store new retail sales revenue	$	1,447.6		$	1,376.8			70.8			5.1	%
New retail sales revenue per unit	$	36,621		$	35,832			789			2.2	%
Same store new retail sales revenue per unit	$	36,706		$	35,883			823			2.3	%
Gross profit — new	$	132.0		$	109.8			22.2			20.2	%
Same store gross profit — new	$	120.2		$	108.9			11.3			10.4	%
Average gross profit per new vehicle retailed	$	3,064		$	2,838			226			7.9	%
Same store average gross profit per new vehicle retailed	$	3,048		$	2,839			209			7.4	%
Gross margin % — new		8.4	%		7.9	%		0.5	%		6.3	%
Same store gross margin % — new		8.3	%		7.9	%		0.4	%		5.1	%

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Units

Retail unit sales of new vehicles increased 4,431 units, or 11.5%, from 2011 to 2012. The increase is due to a 1,069 unit, or 2.8%, increase in same store retail unit sales during the period, coupled with a 3,362 unit increase from net dealership acquisitions. The same store increase was due primarily to unit sales increases in our premium brand stores in the U.K.

Revenues

New vehicle retail sales revenue increased $192.7 million, or 13.9%, from 2011 to 2012. The increase is due to a $70.8 million, or 5.1%, increase in same store revenues, coupled with a $121.9 million increase from net dealership acquisitions. The same store revenue increase is due primarily to the 2.8% increase in retail unit sales, which increased revenue by $39.2 million, coupled with an $823, or 2.3%, increase in average selling prices per unit which increased revenue by $31.6 million.

Gross Profit

Retail gross profit from new vehicle sales increased $22.2 million, or 20.2%, from 2011 to 2012. The increase is due to an $11.3 million, or 10.4%, increase in same store gross profit, coupled with a $10.9 million increase from net dealership acquisitions. The same store increase is due primarily to the 2.8% increase in retail unit sales, which increased gross profit by $3.3 million, coupled with a $209, or 7.4%, increase in the average gross profit per new vehicle retailed, which increased gross profit by $8.0 million.

Used Vehicle Data

Dollars in millions, except per unit amounts							2012 vs. 2011
	2012			2011			Change			% Change
Used retail unit sales		38,373			30,299			8,074			26.6	%
Same store used retail unit sales		35,556			30,117			5,439			18.1	%
Used retail sales revenue	$	969.7		$	791.7			178.0			22.5	%
Same store used retail sales revenue	$	897.7		$	787.3			110.4			14.0	%
Used retail sales revenue per unit	$	25,271		$	26,131			(860	)		-3.3	%
Same store used retail sales revenue per unit	$	25,248		$	26,142			(894	)		-3.4	%
Gross profit — used	$	78.4		$	65.1			13.3			20.4	%
Same store gross profit — used	$	73.6		$	64.8			8.8			13.6	%
Average gross profit per used vehicle retailed	$	2,043		$	2,149			(106	)		-4.9	%
Same store average gross profit per used vehicle retailed	$	2,069		$	2,150			(81	)		-3.8	%
Gross margin % — used		8.1	%		8.2	%		-0.1	%		-1.2	%
Same store gross margin % — used		8.2	%		8.2	%		0.0	%		0.0	%

Units

Retail unit sales of used vehicles increased 8,074 units, or 26.6%, from 2011 to 2012. The increase is due to a 5,439 unit, or 18.1%, increase in same store retail unit sales, coupled with a 2,635 unit increase from net dealership acquisitions. The same store increase was due primarily to unit sales increases in premium brand stores in the U.S. and U.K. and volume foreign brand stores in the U.S.

Revenues

Used vehicle retail sales revenue increased $178.0 million, or 22.5%, from 2011 to 2012. The increase is due to a $110.4 million, or 14.0%, increase in same store revenues, coupled with a $67.6 million increase from net dealership acquisitions. The same store revenue increase is due to the 18.1% increase in same store retail unit sales which increased revenue by $137.3 million, somewhat offset by a $894, or 3.4%, decrease in comparative average selling prices per unit, which decreased revenue by $26.9 million.

Gross Profit

Retail gross profit from used vehicle sales increased $13.3 million, or 20.4%, from 2011 to 2012. The increase is due to an $8.8 million, or 13.6%, increase in same store gross profit, coupled with a $4.5 million increase from net dealership acquisitions. The increase in same store gross profit is due to the 18.1% increase in used retail unit sales, which increased gross profit by $11.2 million, somewhat offset by a $81, or 3.8%, decrease in average gross profit per used vehicle retailed, which decreased retail gross profit by $2.4 million.

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Finance and Insurance Data

Dollars in millions, except per unit amounts					2012 vs. 2011
	2012		2011		Change		% Change
Finance and insurance revenue	$	79.9	$	66.5	$	13.4		20.2	%
Same store finance and insurance revenue	$	75.4	$	66.0	$	9.4		14.2	%
Finance and insurance revenue per unit	$	981	$	964	$	17		1.8	%
Same store finance and insurance revenue per unit	$	1,006	$	964	$	42		4.4	%

Finance and insurance revenue increased $13.4 million, or 20.2%, from 2011 to 2012. The increase is due to a $9.4 million, or 14.2%, increase in same store revenues during the period, coupled with a $4.0 million increase from net dealership acquisitions. The same store revenue increase is due to a 9.5% increase in same store retail unit sales, which increased revenue by $6.5 million, coupled with a $42, or 4.4%, increase in comparative average finance and insurance revenue per unit which increased revenue by $2.9 million.

Service and Parts Data

Dollars in millions, except per unit amounts							2012 vs. 2011
	2012			2011			Change			% Change
Service and parts revenue	$	369.7		$	341.5			28.2			8.3	%
Same store service and parts revenue	$	342.0		$	339.5			2.5			0.7	%
Gross profit	$	213.2		$	194.9			18.3			9.4	%
Same store gross profit	$	197.1		$	193.9			3.2			1.7	%
Gross margin		57.7	%		57.1	%		0.6	%		1.1	%
Same store gross margin		57.6	%		57.1	%		0.5	%		0.9	%

Revenues

Service and parts revenue increased $28.2 million, or 8.3%, from 2011 to 2012. The increase is due to a $2.5 million, or 0.7%, increase in same store revenues during the period, coupled with a $25.7 million increase from net dealership acquisitions. The same store increase relates primarily to our U.S. operations.

Gross Profit

Service and parts gross profit increased $18.3 million, or 9.4%, from 2011 to 2012. The increase is due to a $3.2 million, or 1.7%, increase in same store gross profit during the period, coupled with a $15.1 million increase from net dealership acquisitions. The same store gross profit increase is due to the $2.5 million, or 0.7%, increase in same store revenues, which increased gross profit by $1.4 million, coupled with a 0.9% increase in gross margin, which increased gross profit by $1.8 million.

Selling, General and Administrative

Selling, general and administrative expenses (“SG&A”) increased $43.2 million, or 12.2%, from $355.4 million to $398.6 million. The aggregate increase is due to a $17.3 million, or 4.9%, increase in same store SG&A, coupled with a $25.9 million increase from net dealership acquisitions. The increase in same store SG&A is due to a net increase in variable selling expenses, including increases in variable compensation, as a result of a 7.5% increase in same store retail gross profit versus the prior year. SG&A expenses decreased as a percentage of gross profit from 80.9% to 78.7%.

Floor Plan Interest Expense

Floor plan interest expense, including the impact of swap transactions, increased $2.8 million, or 40.4%, from $6.9 million to $9.7 million due to an increase in same store floor plan interest expense. The same store increase is due primarily to increases in applicable interest rates due to the impact of swap transactions, as well as increased amounts outstanding under floor plan arrangements.

Other Interest Expense

Other interest expense increased $0.9 million, or 8.2%, from $11.3 million to $12.2 million. The increase is due primarily to incremental borrowings made during the latter part of 2011 in the U.S. and the first quarter of 2012 in the U.K. to finance acquisitions.

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Debt Discount Amortization

There was no debt discount amortization during the first quarter of 2012 as we completed the amortization of the debt discount related to our Convertible Notes in 2011.

Equity in Earnings of Affiliates

Equity in earnings of affiliates increased $4.4 million. The increase is due primarily to improved operating performance by PTL compared to the same period a year ago.

Income Taxes

Income taxes increased $11.2 million, or 71.7%, from $15.7 million to $26.9 million. The increase from 2011 to 2012 is due to an increase in our pre-tax income versus the prior year which is compounded by a benefit recorded in the prior year relating to expected realization of deferred tax assets, due in large part to our exit from the distribution business.

Liquidity and Capital Resources

Our cash requirements are primarily for working capital, inventory financing, the acquisition of new businesses, the improvement and expansion of existing facilities, the purchase or construction of new facilities, debt service and repayments, and potentially for dividends and repurchases of our outstanding securities under the program discussed below. Historically, these cash requirements have been met through cash flow from operations, borrowings under our credit agreements and floor plan arrangements, the issuance of debt securities, sale-leaseback transactions, mortgages, dividends and distributions from joint venture investments, or the issuance of equity securities.

We have historically expanded our retail automotive operations through organic growth and the acquisition of retail automotive dealerships. We believe that cash flow from operations, dividends and distributions from our joint venture investments and our existing capital resources, including the liquidity provided by our credit agreements and floor plan financing arrangements, will be sufficient to fund our operations and commitments for at least the next twelve months. In the event we pursue significant acquisitions, other expansion opportunities, significant repurchases of our outstanding securities; or refinance or repay existing debt, we may need to raise additional capital either through the public or private issuance of equity or debt securities or through additional borrowings, which sources of funds may not necessarily be available on terms acceptable to us, if at all. In addition, our liquidity could be negatively impacted in the event we fail to comply with the covenants under our various financing and operating agreements or in the event our floor plan financing is withdrawn.

As of March 31, 2012, we had $261.1 million and £70.0 million ($111.7 million) available for borrowing under our U.S. credit agreement and our U.K. credit agreement, respectively.

Securities Repurchases

From time to time, our Board of Directors has authorized securities repurchase programs pursuant to which we may, as market conditions warrant, purchase our outstanding common stock, debt or convertible debt on the open market, in privately negotiated transactions, via a tender offer, or through a pre-arranged trading plan. We have historically funded any such repurchases using cash flow from operations and borrowings under our U.S. credit facility. The decision to make repurchases will be based on factors such as the market price of the relevant security versus our view of its intrinsic value, the potential impact of such repurchases on our capital structure, and our consideration of any alternative uses of our capital, such as for strategic investments in our current businesses, in addition to any then-existing limits imposed by our finance agreements and securities trading policy. During the three months ended March 31, 2012, we repurchased 350,000 shares of our common stock for $8.5 million, or $24.35 per share. As of March 31, 2012, we have $98.3 million in authorization under the existing securities repurchase program.

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Dividends

We paid the following cash dividends on our common stock in 2011 and 2012:

Per Share Dividends
2011
Second Quarter	$	0.07
Third Quarter		0.08
Fourth Quarter		0.09

2012
First Quarter	$	0.10

We also have announced a cash dividend of $0.11 per share payable on June 1, 2012 to shareholders of record on May 10, 2012. Future quarterly or other cash dividends will depend upon a variety of factors considered relevant by our Board of Directors which may include our earnings, capital requirements, restrictions relating to any then-existing indebtedness, financial condition, and other factors.

Inventory Financing

We finance substantially all of our new and a portion of our used vehicle inventories under revolving floor plan arrangements with various lenders, including a majority through captive finance companies associated with automotive manufacturers. In the U.S., the floor plan arrangements are due on demand; however, we have not historically been required to repay floor plan advances prior to the sale of the vehicles that have been financed. We typically make monthly interest payments on the amount financed. Outside of the U.S., substantially all of our floor plan arrangements are payable on demand or have an original maturity of 90 days or less and we are generally required to repay floor plan advances at the earlier of the sale of the vehicles that have been financed or the stated maturity.

The floor plan agreements typically grant a security interest in substantially all of the assets of our dealership subsidiaries, and in the U.S. are guaranteed by us. Interest rates under the floor plan arrangements are variable and increase or decrease based on changes in the prime rate, defined LIBOR, Finance House Base Rate, or Euro Interbank Offered Rate. To date, we have not experienced any material limitation with respect to the amount or availability of financing from any institution providing us vehicle financing. We also receive non-refundable credits from certain of our vehicle manufacturers, which are treated as a reduction of cost of sales as vehicles are sold.

U.S. Credit Agreement

We are party to a credit agreement with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, as amended (the “U.S. credit agreement”), which provides for up to $375.0 million in revolving loans for working capital, acquisitions, capital expenditures, investments and other general corporate purposes, a non-amortizing term loan with a balance of $127.0 million, and for an additional $10.0 million of availability for letters of credit, through September 2014. The revolving loans bear interest at a defined LIBOR plus 2.50%, subject to an incremental 1.00% for uncollateralized borrowings in excess of a defined borrowing base. The term loan, which bears interest at defined LIBOR plus 2.50%, may be prepaid at any time, but then may not be re-borrowed.

The U.S. credit agreement is fully and unconditionally guaranteed on a joint and several basis by our domestic subsidiaries and contains a number of significant covenants that, among other things, restrict our ability to dispose of assets, incur additional indebtedness, repay other indebtedness, pay dividends, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. We are also required to comply with specified financial and other tests and ratios, each as defined in the U.S. credit agreement, including: a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders’ equity and a ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. As of March 31, 2012, we were in compliance with all covenants under the U.S. credit agreement, and we believe we will remain in compliance with such covenants for the next twelve months. In making such determination, we considered the current margin of compliance with the covenants and our expected future results of operations, working capital requirements, acquisitions, capital expenditures and investments. See “Forward Looking Statements.”

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The U.S. credit agreement also contains typical events of default, including change of control, non-payment of obligations and cross-defaults to our other material indebtedness. Substantially all of our domestic assets are subject to security interests granted to lenders under the U.S. credit agreement. As of March 31, 2012, $127.0 million of term loans, $0.5 million of letters of credit and $107.0 million of revolver borrowings were outstanding under the U.S. credit agreement.

U.K. Credit Agreement

Our subsidiaries in the U.K. (the “U.K. subsidiaries”) are party to a £100 million revolving credit agreement with the Royal Bank of Scotland plc (RBS) and BMW Financial Services (GB) Limited, and an additional £10 million demand overdraft line of credit with RBS (collectively, the “U.K. credit agreement”) to be used for working capital, acquisitions, capital expenditures, investments and general corporate purposes through November 2015. The revolving loans bear interest between defined LIBOR plus 1.35% and defined LIBOR plus 3.0% and the demand overdraft line of credit bears interest at the Bank of England Base Rate plus 1.75%. As of March 31, 2012, outstanding loans under the U.K. credit agreement amounted to £40.0 million ($63.8 million).

The U.K. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by our U.K. subsidiaries, and contains a number of significant covenants that, among other things, restrict the ability of our U.K. subsidiaries to pay dividends, dispose of assets, incur additional indebtedness, repay other indebtedness, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. In addition, our U.K. subsidiaries are required to comply with defined ratios and tests, including: a ratio of earnings before interest, taxes, amortization, and rental payments (“EBITAR”) to interest plus rental payments, a measurement of maximum capital expenditures, and a debt to EBITDA ratio. A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. As of March 31, 2012, our U.K. subsidiaries were in compliance with all covenants under the U.K. credit agreement and we believe they will remain in compliance with such covenants for the next twelve months. In making such determination, we considered the current margin of compliance with the covenants and our expected future results of operations, working capital requirements, acquisitions, capital expenditures and investments in the U.K. See “Forward Looking Statements”.

The U.K. credit agreement also contains typical events of default, including change of control and non-payment of obligations and cross-defaults to other material indebtedness of our U.K. subsidiaries. Substantially all of our U.K. subsidiaries’ assets are subject to security interests granted to lenders under the U.K. credit agreement.

In January 2012, our U.K. subsidiaries entered into a separate agreement with RBS, as agent for National Westminster Bank plc, providing for a £30 million term loan which was used for working capital and an acquisition. The term loan is repayable in £1.5 million quarterly installments through 2015 with a final payment of £7.5 million due December 31, 2015. The term loan bears interest between 2.675% and 4.325%, depending on the U.K. subsidiaries’ ratio of net borrowings to earnings before interest, taxes, depreciation and amortization (as defined). As of March 31, 2012, the amount outstanding under the U.K. term loan was £28.5 million ($45.5 million).

7.75% Senior Subordinated Notes

In December 2006, we issued $375.0 million aggregate principal amount of 7.75% senior subordinated notes due 2016 (the “7.75% Notes”). The 7.75% Notes are unsecured senior subordinated notes and are subordinate to all existing and future senior debt, including debt under our credit agreements, mortgages and floor plan indebtedness. The 7.75% Notes are guaranteed by substantially all of our wholly-owned domestic subsidiaries on an unsecured senior subordinated basis. Those guarantees are full and unconditional and joint and several. We can redeem all or some of the 7.75% Notes at our option at specified redemption prices (currently 103.875% of the principal amount of the notes). Upon certain sales of assets or specific kinds of changes of control, we are required to make an offer to purchase the 7.75% Notes. The 7.75% Notes also contain customary negative covenants and events of default. As of March 31, 2012, we were in compliance with all negative covenants and there were no events of default. We expect to remain in compliance during the next twelve months.

Senior Subordinated Convertible Notes

We currently have $63.3 million of Convertible Notes outstanding. We issued the Convertible Notes in January 2006. The Notes, which mature on April 1, 2026 unless earlier converted, redeemed or purchased by us, as discussed below. The Convertible Notes are unsecured senior subordinated obligations and are subordinate to all future and existing debt under our credit agreements, mortgages and floor plan indebtedness. The Convertible Notes are guaranteed on an unsecured senior subordinated basis by substantially all of our wholly-owned domestic subsidiaries. The guarantees are full and unconditional and joint and several. The Convertible Notes also contain customary negative covenants and events of default. As of March 31, 2012, we were in compliance with all negative covenants and there were no events of default. We expect to remain in compliance during the next twelve months.

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Holders of the Convertible Notes may convert them based on a conversion rate of 42.7796 shares of our common stock per $1,000 principal amount of the Convertible Notes (which is equal to a conversion price of approximately $23.38 per share), subject to adjustment, only under the following circumstances: (1) in any quarterly period, if the closing price of our common stock for twenty of the last thirty trading days in the prior quarter exceeds $28.05 (subject to adjustment), (2) for specified periods, if the trading price of the Convertible Notes falls below specific thresholds, (3) if the Convertible Notes are called for redemption, (4) if specified distributions to holders of our common stock are made or specified corporate transactions occur, (5) if a fundamental change (as defined) occurs, or (6) during the ten trading days prior to, but excluding, the maturity date.

Upon conversion of the Convertible Notes, for each $1,000 principal amount of the Convertible Notes, a holder will receive an amount in cash, equal to the lesser of (i) $1,000 or (ii) the conversion value, determined in the manner set forth in the indenture covering the Convertible Notes, of the number of shares of common stock equal to the conversion rate. If the conversion value exceeds $1,000, we will also deliver, at our election, cash, common stock or a combination of cash and common stock with respect to the remaining value deliverable upon conversion. We will pay additional cash interest commencing with six-month periods beginning on April 1, 2011, if the average trading price of a Convertible Note for certain periods in the prior six-month period equals 120% or more of the principal amount of the Convertible Notes.

We may redeem the Convertible Notes, in whole at any time or in part from time to time, for cash at a redemption price of 100% of the principal amount of the Convertible Notes to be redeemed, plus any accrued and unpaid interest to the applicable redemption date plus any applicable conversion premium. The decision to redeem any of the notes will be based on factors such as the market price of the notes and our common stock, the potential impact of any redemptions on our capital structure, and consideration of alternate uses of capital, such as for strategic investments in our current business, in addition to any then-existing limits imposed by our finance agreements. In addition, holders of the Convertible Notes have the right to require us to purchase all or a portion of their Convertible Notes for cash on each of April 1, 2016 or April 1, 2021 at a purchase price equal to 100% of the principal amount of the Convertible Notes to be purchased, plus accrued and unpaid interest, if any, to the applicable purchase date, plus any applicable conversion premium.

Mortgage Facilities

We are party to several mortgages, which bear interest at defined rates and require monthly principal and interest payments. These mortgage facilities also contain typical events of default, including non-payment of obligations, cross-defaults to our other material indebtedness, certain change of control events, and the loss or sale of certain franchises operated at the properties. Substantially all of the buildings and improvements on the properties financed pursuant to the mortgage facilities are subject to security interests granted to the lender. As of March 31, 2012, we owed $74.8 million of principal under our mortgage facilities.

Short-term Borrowings

We have three principal sources of short-term borrowing: the revolving portion of the U.S. credit agreement, the revolving portion of the U.K. credit agreement, and the floor plan agreements in place that we utilize to finance our vehicle inventories. All of the cash generated in our operations is initially used to pay down our floor plan indebtedness. Over time, we are able to access availability under the floor plan agreements to fund our cash needs, including payments made relating to our higher interest rate revolving credit agreements.

During the first quarter of 2012, outstanding revolving commitments varied between $107.0 and $188.5 million under the U.S. credit agreement and between £28.0 million and £92.0 million under the U.K. credit agreement’s revolving credit line (excluding the overdraft facility), and the amounts outstanding under our floor plan agreements varied based on the timing of the receipt and expenditure of cash in our operations, driven principally by the levels of our vehicle inventories.

Interest Rate Swaps

We periodically use interest rate swaps to manage interest rate risk associated with our variable rate floor plan debt. We are party to interest rate swap agreements through December 2014 pursuant to which the LIBOR portion of $300.0 million of our floating rate floor plan debt is fixed at 2.135% and $100.0 million of our floating rate floor plan debt is fixed at1.55%. We may terminate these agreements at any time, subject to the settlement of the then current fair value of the swap arrangements. During the three months ended March 31, 2012, the swaps increased the weighted average interest rate on our floor plan borrowing by 40 basis points.

PTL Dividends

We own a 9.0% limited partnership interest in Penske Truck Leasing. During the three months ended March 31, 2012 and 2011, respectively, we received $10.8 million and $7.8 million of pro rata cash distributions relating to this investment. We currently expect to continue to receive future distributions from PTL quarterly, subject to its financial performance.

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Operating Leases

We have historically structured our operations so as to minimize our ownership of real property. As a result, we lease or sublease substantially all of our facilities. These leases are generally for a period between five and 20 years, and are typically structured to include renewal options at our election. Pursuant to the leases for some of our larger facilities, we are required to comply with specified financial ratios, including a “rent coverage” ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require us to post collateral in the form of a letter of credit. A breach of our other lease covenants give rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. As of March 31, 2012, we were in compliance with all covenants under these leases, and we believe we will remain in compliance with such covenants for the next twelve months.

Sale/Leaseback Arrangements

We have in the past and may in the future enter into sale-leaseback transactions to finance certain property acquisitions and capital expenditures, pursuant to which we sell property and/or leasehold improvements to third parties and agree to lease those assets back for a certain period of time. Such sales generate proceeds which vary from period to period.

Off-Balance Sheet Arrangements

We have sold a number of dealerships to third parties and, as a condition to certain of those sales, remain liable for the lease payments relating to the properties on which those businesses operate in the event of non-payment by the buyer. We are also party to lease agreements on properties that we no longer use in our retail operations that we have sublet to third parties. We rely on subtenants to pay the rent and maintain the property at these locations. In the event a subtenant does not perform as expected, we may not be able to recover amounts owed to us and we could be required to fulfill these obligations. We believe we have made appropriate reserves relating to these locations.

We hold a 9.0% limited partnership interest in PTL. In April and May 2012, PTL refinanced a significant amount of its indebtedness. As part of that refinancing, we and the other PTL partners created a new company (“Holdings”), which, together with General Electric Capital Corporation (“GECC”), co-issued $700 million of 3.8% senior unsecured notes due 2019 to certain investors through an offering pursuant to Rule 144A of the Securities Act of 1933, as amended (the “Holdings Bonds”). A wholly-owned subsidiary of Holdings contributed $700 million derived from the net proceeds from the offering of the Holdings Bonds and a portion of its cash on hand to PTL in exchange for a 21.5% limited partner interest in PTL. PTL used the $700 million of funds to reduce its outstanding debt owed to GECC. GECC agreed to be a co-obligor of the Holdings Bonds in order to achieve lower interest rates on the Holdings Bonds.

Additional capital contributions from the members may be required to fund interest and principal payments on the Holdings Bonds. In addition, we have agreed to indemnify GECC for 9.0% of any principal or interest that GECC is required to pay as co-obligor, and pay GECC an annual fee of approximately $0.95 million for acting as co-obligor. The maximum amount of our potential obligations to GECC under this agreement are 9% of the required principal repayment due in 2019 (which is expected to be $63.1 million) and 9% of interest payments under the Holdings Bonds, plus fees and default interest, if any. Although we do not currently expect to make material payments to GECC under this agreement, this outcome cannot be predicted with certainty. See Part II – Item 1A –Risk Factors.

Cash Flows

Cash and cash equivalents increased by $3.3 million and $20.7 million during the three months ended March 31, 2012 and 2011, respectively. The major components of these changes are discussed below.

Cash Flows from Continuing Operating Activities

Cash provided by continuing operating activities was $125.3 million and $9.8 million during the three months ended March 31, 2012 and 2011, respectively. Cash flows from continuing operating activities includes net income, as adjusted for non-cash items and the effects of changes in working capital.

We finance substantially all of our new and a portion of our used vehicle inventories under revolving floor plan notes payable with various lenders. We retain the right to select which, if any, financing source to utilize in connection with the procurement of vehicle inventories. Many vehicle manufacturers provide vehicle financing for the dealers representing their brands, however, it is not a requirement that we utilize this financing. Historically, our floor plan finance source has been based on aggregate pricing considerations.

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In accordance with generally accepted accounting principles relating to the statement of cash flows, we report all cash flows arising in connection with floor plan notes payable with the manufacturer of a particular new vehicle as an operating activity in our statement of cash flows, and all cash flows arising in connection with floor plan notes payable to a party other than the manufacturer of a particular new vehicle and all floor plan notes payable relating to pre-owned vehicles as a financing activity in our statement of cash flows. Currently, the majority of our non-trade vehicle financing is with other manufacturer captive lenders. To date, we have not experienced any material limitation with respect to the amount or availability of financing from any institution providing us vehicle financing.

We believe that changes in aggregate floor plan liabilities are typically linked to changes in vehicle inventory and, therefore, are an integral part of understanding changes in our working capital and operating cash flow. As a result, we prepare the following reconciliation to highlight our operating cash flows with all changes in vehicle floor plan being classified as an operating activity for informational purposes:

	Three Months Ended March 31,
Dollars in millions	2012		2011
Net cash from continuing operating activities as reported	$	125.3	$	9.8
Floor plan notes payable — non-trade as reported		0.7		29.4
Net cash from continuing operating activities including all floor plan notes payable	$	126.0	$	39.2

Cash Flows from Continuing Investing Activities

Cash used in continuing investing activities was $134.6 million and $31.4 million during the three months ended March 31, 2012 and 2011, respectively. Cash flows from continuing investing activities consist primarily of cash used for capital expenditures and net expenditures for acquisitions and other investments. Capital expenditures were $26.5 million and $20.8 million during the three months ended March 31, 2012 and 2011, respectively. Capital expenditures relate primarily to improvements to our existing dealership facilities and the construction of new facilities. As of March 31, 2012, we do not have material commitments related to our planned or ongoing capital projects. We currently expect to finance our capital expenditures with operating cash flows or borrowings under our U.S. or U.K. credit facilities. Cash used in acquisitions and other investments, net of cash acquired, was $108.1 million and $14.0 million during the three months ended March 31, 2012 and 2011, respectively, and included cash used to repay sellers floor plan liabilities in such business acquisitions of $36.9 million and $5.9 million, respectively. Additionally, proceeds from other investing activities during the three months ended March 31, 2011 were $3.5 million.

Cash Flows from Continuing Financing Activities

Cash used in continuing financing activities was $7.1 million during the three months ended March 31, 2012. Cash provided by continuing financing activities was $37.8 million during the three months ended March 31, 2011. Cash flows from continuing financing activities include net borrowings or repayments of long-term debt, repurchases of securities, net borrowings or repayments of floor plan notes payable non-trade, proceeds from the issuance of common stock and the exercise of stock options, and dividends. We had net borrowings of long-term debt of $10.0 million and $6.7 million during the three months ended March 31, 2012 and 2011, respectively, including net borrowings under revolving credit facilities. We had net borrowings of floor plan notes payable non-trade of $0.7 million and $29.4 million during the three months ended March 31, 2012 and 2011, respectively. During the three months ended March 31, 2012, we acquired 350,000 shares of common stock for $8.5 million, and also paid cash dividends to our stockholders of $9.0 million.

Cash Flows from Discontinued Operations

Cash flows relating to discontinued operations are not currently considered, nor are they expected to be, material to our liquidity or our capital resources. Management does not believe that the net impact of upcoming cash transactions relating to discontinued operations will be material.

Related Party Transactions

Stockholders Agreement

Several of our directors and officers are affiliated with Penske Corporation or related entities. Roger S. Penske, our Chairman of the Board and Chief Executive Officer, is also Chairman of the Board and Chief Executive Officer of Penske Corporation, and through entities affiliated with Penske Corporation, our largest stockholder owning approximately 35% of our outstanding common stock. Mitsui & Co., Ltd. and Mitsui & Co. (USA), Inc. (collectively, “Mitsui”) own approximately 17% of our outstanding common stock. Mitsui, Penske Corporation and certain other affiliates of Penske Corporation are parties to a stockholders agreement pursuant to which the Penske affiliated companies agreed to vote their shares for one director who is a representative of Mitsui. In turn, Mitsui agreed to vote their shares for up to fourteen directors voted for by the Penske affiliated companies. This agreement terminates in March 2014, upon the mutual consent of the parties, or when either party no longer owns any of our common stock.

Other Related Party Interests and Transactions

Roger S. Penske is also a managing member of Transportation Resource Partners, an organization that invests in transportation-related industries. Richard J. Peters, one of our directors, is a managing director of Transportation Resource Partners and is a director of Penske Corporation. Robert H. Kurnick, Jr., our President and a director, is also the President and a director of Penske Corporation.

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We sometimes pay to and/or receive fees from Penske Corporation, its subsidiaries, and its affiliates for services rendered in the ordinary course of business, or to reimburse payments made to third parties on each other’s behalf. These transactions are reviewed periodically by our Audit Committee and reflect the provider’s cost or an amount mutually agreed upon by both parties.

As discussed above, we are a 9.0% limited partner of PTL, a leading global transportation services provider. The general partner of PTL is Penske Truck Leasing Corporation, a wholly-owned subsidiary of Penske Corporation, which together with other wholly-owned subsidiaries of Penske Corporation, owns 41.1% of PTL. The remaining 49.9% of PTL is owned by General Electric Capital Corporation. Among other things, the partnership agreement provides us with specified partner distribution and governance rights and restricts our ability to transfer our interests.

In April 2012, we acquired a 7% interest in NPA Holdco, LLC, an auctioneer of powersport vehicles in exchange for $3.0 million. Transportation Resource Partners, an organization discussed above, recently acquired a controlling interest in this company on the same financial terms as our investment.

We have also entered into other joint ventures with certain related parties as more fully discussed below.

Joint Venture Relationships

We are party to a number of joint ventures pursuant to which we own and operate automotive dealerships together with other investors. We may provide these dealerships with working capital and other debt financing at costs that are based on our incremental borrowing rate. As of March 31, 2012, our automotive retail joint venture relationships included:

		Ownership
Location	Dealerships	Interest
Fairfield, Connecticut	Audi, Mercedes-Benz, Porsche, smart		86.56	%(A) (B)
Las Vegas, Nevada	Ferrari, Maserati		50.00	%(C)
Frankfurt, Germany	Lexus, Toyota		50.00	%(C)
Aachen, Germany	Audi, Lexus, Skoda, Toyota, Volkswagen, Citroën		50.00	%(C)
Monza, Italy	BMW, Mini		70.00	%

(A) An entity controlled by one of our directors, Lucio A. Noto (the “Investor”), owns a 13.44% interest in this joint venture which entitles the Investor to 20% of the joint venture’s operating profits. In addition, the Investor has an option to purchase up to a 20% interest in the joint venture for specified amounts. In April 2012, the Investor puchased an additional 1.61% bringing its total ownership to 15.05%.

(B) Entity is consolidated in our financial statements.

(C) Entity is accounted for using the equity method of accounting.

In April 2011, we repurchased the remaining 30.0% interest in the Edison, New Jersey joint venture which is now a 100% owned subsidiary.

Cyclicality

Unit sales of motor vehicles, particularly new vehicles, have been cyclical historically, fluctuating with general economic cycles. During economic downturns, the automotive retailing industry tends to experience periods of decline and recession similar to those experienced by the general economy. We believe that the industry is influenced by general economic conditions and particularly by consumer confidence, the level of personal discretionary spending, fuel prices, interest rates and credit availability.

Seasonality

Our business is modestly seasonal overall. Our U.S. operations generally experience higher volumes of vehicle sales in the second and third quarters of each year due in part to consumer buying trends and the introduction of new vehicle models. Also, vehicle demand, and to a lesser extent demand for service and parts, is generally lower during the winter months than in other seasons, particularly in regions of the U.S. where dealerships may be subject to severe winters. Our U.K. operations generally experience higher volumes of vehicle sales in the first and third quarters of each year, due primarily to vehicle registration practices in the U.K.

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Effects of Inflation

We believe that inflation rates over the last few years have not had a significant impact on revenues or profitability. We do not expect inflation to have any near-term material effects on the sale of our products and services; however, we cannot be sure there will be no such effect in the future. We finance substantially all of our inventory through various revolving floor plan arrangements with interest rates that vary based on various benchmarks. Such rates have historically increased during periods of increasing inflation.

Forward Looking Statements

This quarterly report on Form 10-Q contains “forward-looking statements” which generally can be identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “believe,” “intend,” “plan,” “estimate,” “predict,” “potential,” “forecast,” “continue” or variations of such terms, or the use of these terms in the negative. Forward-looking statements include statements regarding our current plans, forecasts, estimates, beliefs or expectations, including, without limitation, statements with respect to:

• our future financial and operating performance;

• future acquisitions and dispositions;

• future potential capital expenditures and securities repurchases;

• our ability to realize cost savings and synergies;

• our ability to respond to economic cycles;

• trends in the automotive retail industry and in the general economy in the various countries in which we operate;

• our ability to access the remaining availability under our credit agreements;

• our liquidity;

• performance of joint ventures, including PTL;

• future foreign exchange rates;

• the outcome of various legal proceedings;

• trends affecting our future financial condition or results of operations; and

• our business strategy.

Forward-looking statements involve known and unknown risks and uncertainties and are not assurances of future performance. Actual results may differ materially from anticipated results due to a variety of factors, including the factors identified in our 2011 annual report on Form 10-K filed February 24, 2012. Important factors that could cause actual results to differ materially from our expectations include the following:

• our business and the automotive retail industry in general are susceptible to adverse economic conditions, including changes in interest rates, foreign exchange rates, consumer demand, consumer confidence, fuel prices, unemployment rates and credit availability;

• the number of new and used vehicles sold in our markets;

• automobile manufacturers exercise significant control over our operations, and we depend on them and continuation of our franchise agreements in order to operate our business;

• we depend on the success, popularity and availability of the brands we sell, and adverse conditions affecting one or more automobile manufacturers, including the adverse impact on the vehicle and parts supply chain due to natural disasters or other disruptions that interrupt the supply of vehicles and parts to us, may negatively impact our revenues and profitability;

• a restructuring of any significant automotive manufacturers or automotive suppliers;

• our dealership operations may be affected by severe weather or other periodic business interruptions;

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• we may not be able to satisfy our capital requirements for acquisitions, dealership renovation projects, financing the purchase of our inventory, or refinancing of our debt when it becomes due;

• our level of indebtedness may limit our ability to obtain financing generally and may require that a significant portion of our cash flow be used for debt service;

• non-compliance with the financial ratios and other covenants under our credit agreements and operating leases;

• our operations outside of the U.S. subject our profitability to fluctuations relating to changes in foreign currency valuations;

• import product restrictions and foreign trade risks that may impair our ability to sell foreign vehicles profitably;

• with respect to PTL, changes in the financial health of its customers, labor strikes or work stoppages by its employees, a reduction in PTL’s asset utilization rates and industry competition which could impact distributions to us;

• we are dependent on continued availability of our information technology systems;

• if we lose key personnel, especially our Chief Executive Officer, or are unable to attract additional qualified personnel;

• new or enhanced regulations relating to automobile dealerships;

• changes in tax, financial or regulatory rules or requirements;

• we are subject to numerous legal and administrative proceedings which, if the outcomes are adverse to us, could have a material adverse effect on our business;

• if state dealer laws in the U.S. are repealed or weakened, our automotive dealerships may be subject to increased competition and may be more susceptible to termination, non-renewal or renegotiation of their franchise agreements; and

• some of our directors and officers may have conflicts of interest with respect to certain related party transactions and other business interests.

In addition:

• the price of our common stock is subject to substantial fluctuation, which may be unrelated to our performance; and

• shares eligible for future sale, or issuable under the terms of our convertible notes, may cause the market price of our common stock to drop significantly, even if our business is doing well.

We urge you to carefully consider these risk factors and further information under Item 1A “Risk Factors” in evaluating all forward-looking statements regarding our business. Readers of this report are cautioned not to place undue reliance on the forward-looking statements contained in this report. All forward-looking statements attributable to us are qualified in their entirety by this cautionary statement. Except to the extent required by federal securities laws and the Securities and Exchange Commission’s rules and regulations, we have no intention or obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rates. We are exposed to market risk from changes in interest rates on a significant portion of our debt. Outstanding revolving balances under our credit agreements bear interest at variable rates based on a margin over defined LIBOR or the Bank of England Base Rate. Based on the amount outstanding under these facilities as of March 31, 2012, a 100 basis point change in interest rates would result in an approximate $3.0 million change to our annual other interest expense. Similarly, amounts outstanding under floor plan financing arrangements bear interest at a variable rate based on a margin over the prime rate, defined LIBOR, the Finance House Base Rate, or the Euro Interbank Offered Rate. In 2012, we are party to swap agreements pursuant to which a notional $400.0 million of our floating rate floor plan debt is exchanged for fixed rate debt through December 2014. Based on an average of the aggregate amounts outstanding under our floor plan financing arrangements subject to variable interest payments during the trailing twelve months ended March 31, 2012 considering the swap agreements, a 100 basis point change in interest rates would result in an approximate $14.5 million change to our annual floor plan interest expense.

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We evaluate our exposure to interest rate fluctuations and follow established policies and procedures to implement strategies designed to manage the amount of variable rate indebtedness outstanding at any point in time in an effort to mitigate the effect of interest rate fluctuations on our earnings and cash flows. These policies include:

• the maintenance of our overall debt portfolio with targeted fixed and variable rate components;

• the use of authorized derivative instruments;

• the prohibition of using derivatives for trading or other speculative purposes; and

• the prohibition of highly leveraged derivatives or derivatives which we are unable to reliably value, or for which we are unable to obtain a market quotation.

Interest rate fluctuations affect the fair market value of our fixed rate debt, including our swaps, mortgages, the 7.75% Notes, the Convertible Notes, and certain seller financed promissory notes, but, with respect to such fixed rate debt instruments, do not impact our earnings or cash flows.

Foreign Currency Exchange Rates. As of March 31, 2012, we had dealership operations in the U.K., Germany and Italy. In each of these markets, the local currency is the functional currency. Due to our intent to remain permanently invested in these foreign markets, we do not hedge against foreign currency fluctuations. In the event we change our intent with respect to the investment in any of our international operations, we would expect to implement strategies designed to manage those risks in an effort to mitigate the effect of foreign currency fluctuations on our earnings and cash flows. A ten percent change in average exchange rates versus the U.S. Dollar would have resulted in an approximate $127.8 million change to our revenues for the three months ended March 31, 2012.

In common with other automotive retailers, we purchase certain of our new vehicle and parts inventories from foreign manufacturers. Although we purchase the majority of our inventories in the local functional currency, our business is subject to certain risks, including, but not limited to, differing economic conditions, changes in political climate, differing tax structures, other regulations and restrictions, and foreign exchange rate volatility which may influence such manufacturers’ ability to provide their products at competitive prices in the local jurisdictions. Our future results could be materially and adversely impacted by changes in these or other factors.

Item 4. Controls and Procedures

Under the supervision and with the participation of our management, including the principal executive and financial officers, we conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of the end of the period covered by this report. Our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the reports we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our principal executive and financial officers, to allow timely discussions regarding required disclosure.

Based upon this evaluation, the Company’s principal executive and financial officers concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report. In addition, we maintain internal controls designed to provide us with the information required for accounting and financial reporting purposes. There were no changes in our internal control over financial reporting that occurred during the most recent quarter that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II — OTHER INFORMATION

Item 1. Legal Proceedings

We are involved in litigation which may relate to claims brought by governmental authorities, customers, vendors, or employees, including class action claims and purported class action claims. We are not a party to any legal proceedings, including class action lawsuits, that individually or in the aggregate, are reasonably expected to have a material adverse effect on us. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect.

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Item 1A. Risk Factors

In addition to the information set forth in this Form 10-Q, you should carefully consider the risk factors discussed in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2011, which could materially affect our business, financial condition, or future results. The following updates the risk factors included in our 2011 Form 10-K:

Restructuring, bankruptcy or other adverse conditions affecting a significant automotive manufacturer or supplier. Our success depends on the overall success of the automotive industry generally, and in particular on the success of the brands of vehicles that each of our dealerships sell. In 2011, revenue generated at our BMW/MINI, Audi/Volkswagen/Bentley, Toyota/Lexus/Scion, Honda/Acura, and Mercedes-Benz/Sprinter/smart dealerships represented 25%, 15%, 15%, 13%, and 10%, respectively, of our total revenues. Significant adverse events, such as natural disasters or other disruptions to the vehicle or parts supply chain, or other future events that interrupt vehicle or parts supply to our dealerships, would likely have a significant and adverse impact on the industry as a whole, including us, particularly if the events relate to any of the manufacturers whose franchises generate a significant percentage of our revenue. An explosion at an automotive supplier’s plant in March 2012 has led to a shortage of a type of nylon resin commonly used in vehicle production. We cannot predict at this time predict the effect of this shortage on the supply of vehicles or parts to us.

We may be required to make payments to General Electric Capital Corporation (“GECC”) under our agreement to indemnify them for nine percent of any payments by GECC under bonds co-issued by them in connection with Penske Truck Leasing (“PTL”).

We hold a 9.0% limited partnership interest in PTL. In May 2012, PTL refinanced a significant amount of its indebtedness. As part of that refinancing, we and the other PTL partners created a new company (“Holdings”), which issued $700 million of 3.8% senior unsecured notes due 2019 to certain investors through an offering pursuant to Rule 144A of the Securities Act of 1933, as amended (the “Holdings Bonds”). A wholly-owned subsidiary of Holdings contributed $700 million derived from the net proceeds from the offering of the Holdings Bonds and a portion of its cash on hand to PTL in exchange for a 21.5% limited partner interest in PTL. PTL used the $700 million of funds to reduce its outstanding debt owed to GECC. GECC agreed to be a co-obligor of the Holdings Bonds in order to achieve lower interest rates on the Holdings Bonds. We have agreed to indemnify GECC for 9.0% of any principal or interest that GECC is required to pay as co-obligor, and pay GECC an annual fee of approximately $0.95 million for acting as co-obligor. The maximum amount of our potential obligations to GECC under this agreement are 9% of the required principal repayment due in 2019 (which is expected to be $63.1 million) and 9% of interest payments under the Holdings Bonds, plus fees and default interest, if any.

We have also granted GECC a first priority security interest in our newly issued Holdings interests and their related distributions. In the event of a default by us under this agreement, GECC is entitled to retain or sell our Holdings interests and any distributions related to those interests, in addition to any other remedies available to GECC. As described below, although we do not currently expect to make material payments to GECC under this agreement, this outcome cannot be predicted with certainty. We expect that distributions from PTL to Holdings, or, if necessary, capital contributions from the PTL partners, will be sufficient to pay the interest payments on the Holdings Bonds. It is not currently expected that at maturity of the Holdings Bonds in 2019, absent voluntary contributions by the PTL partners, Holdings will have received distributions from PTL sufficient to pay the principal of the notes. Accordingly, the PTL partners may need to make additional capital contributions to Holdings at maturity, seek additional equity financing or refinance all or a portion of the Holdings Bonds in order to satisfy the principal amount of those notes. Such additional financing may not be available at terms satisfactory to the members, if at all.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In February 2010, our Board of Directors authorized the repurchase of up to $150.0 million of our outstanding common stock, debt or convertible debt on the open market, in privately negotiated transactions, via a tender offer, or through a pre-arranged trading plan. The program has an indefinite duration. During the first quarter of 2012, we repurchased 350,000 shares of common stock under this program for a total of $8.5 million. As of March 31, 2012, our remaining authorization under the program was $98.3 million.

					Total Number of		Approximate Dollar
					Shares Purchased as		Value of Shares
					Part of Publicly		that May Yet be
	Total Number of		Average Price Paid		Announced Plans		Purchased Under
Period	Shares Purchased		per Share		or Programs		the Plans or Program
January 1 to January 31, 2012		—	$	—		—	$	106,778,845
February 1 to February 29, 2012		131,250	$	24.05		131,250	$	103,622,283
March 1 to March 31, 2012		218,750		24.53		218,750		98,257,266
		350,000	$	24.35		350,000

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Item 5. Other Information

Summary

Since 2008, we have held a 9.0% limited partnership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading transportation services provider. The general partner of PTL is Penske Truck Leasing Corporation, a wholly-owned indirect subsidiary of Penske Corporation (“PTLC”), which owns 41.1% of PTL. The remaining 49.9% of PTL is owned by direct and indirect wholly-owned subsidiaries of General Electric Capital Corporation (“GECC”, and, together with PTLC and us, the “PTL partners”).

PTL has historically relied on GECC to provide funding for its business and as of March 31, 2012, GECC provided over $6.4 billion of funding to PTL on terms and conditions that were the same or no less favorable than those extended to GECC’s wholly-owned subsidiaries. These funding agreements allow GECC to reset the interest rates and other economic terms of the agreement on June 30, 2013 to market rates and terms.

The PTL partners have agreed, subject to debt market conditions, to cause PTL to engage in additional refinancing activities to fund its operations and its repay in full its debt to GECC as soon as reasonably practicable. As a result, PTL and the PTL partners have entered into a series of transactions discussed below to begin to refinance the debt owed by PTL to GECC and over time plan to move PTL’s debt structure to independent market-based financing in an efficient manner. In order to achieve lower interest rates on this market-based debt financing, the PTL partners contributed additional equity to PTL using the structure outlined below.

Bond Offering by a New PTL Ownership Vehicle to Raise Equity for PTL

On April 30, 2012, the PTL partners restructured the ownership of PTL to facilitate the investment of additional equity into PTL (the “Equity Infusion”). In lieu of cash investments by the PTL partners directly into PTL, a new company was created, LJ VP Holdings, LLC (“Holdings”), which is owned by the PTL partners in the same percentages as their ownership of PTL prior to the Equity Infusion, and of which PTLC is the sole managing member. On April 30, 2012, Holdings and GECC, as co-issuers, issued $700 million of 3.8% senior unsecured notes due 2019 to certain investors through an offering pursuant to Rule 144A of the Securities Act of 1933, as amended (the “Holdings Bonds”). A wholly-owned subsidiary of Holdings contributed $700 million derived from the net proceeds from the offering of the Holdings Bonds and a portion of its cash on hand to PTL in exchange for a 21.5% limited partner interest in PTL. PTL used the $700 million of proceeds from this equity infusion to reduce its outstanding debt owed to GECC. Because the PTL partners hold the same relative percentage ownership in Holdings as they did of PTL immediately prior to the Equity Infusion, the ultimate economic ownership of PTL did not change as a result of the Equity Infusion.

GECC agreed to be a co-obligor of the Holdings Bonds in order to obtain lower interest rates on the Holdings Bonds. Therefore, either Holdings or GECC may make the payments required under the Holdings Bonds. However, in the event GECC is required to make any payments, we agreed to indemnify GECC for our pro rata 9.0% of any principal and interest funded by GECC in respect of the Holdings Bonds, and, to accommodate GECC for the credit enhancement, we agreed to pay GECC an annual fee of approximately $0.95 million pursuant to the Co-obligation Fee, Indemnity and Security Agreement filed as Exhibit 10.1 hereto and incorporated herein by reference. The maximum amount of our potential obligations to GECC under this agreement is 9.0% of the required principal repayment due in 2019 (which is expected to be $63.1 million) and 9.0% of interest payments under the Holdings Bonds, plus fees and default interest, if any. Although we do not currently expect to make material payments to GECC under this agreement, this outcome cannot be predicted with certainty. See “Item 1A. Risk Factors”. We have also granted GECC a first priority security interest in our newly issued Holdings ownership interests and any distributions with respect thereto. In the event of a default by us under this agreement, GECC is entitled to retain or sell our Holdings ownership interests and any distributions related to those ownership interests, in addition to any other remedies available to GECC. PTLC and an affiliate entered into a similar agreement with respect to 41.1% of any payments made by GECC under the Holdings Bonds.

Holdings LLC Agreement

The limited liability company agreement of Holdings is filed as Exhibit 10.2 hereto and is incorporated herein by reference. This agreement extends through 2023 and required an initial capital contribution from us of $0.45 million to acquire 9.0% of Holdings. Any cash distributed to Holdings by PTL, except for an amount up to $0.1 million, is required to be used to service the Holdings Bonds, unless otherwise agreed to in certain circumstances by the Holdings members. The members expect to contribute amounts to Holdings relating to the debt service of the Holdings Bonds if necessary. See “Item 1A. Risk Factors”. We have governance rights in Holdings typical of a minority investor and, in light of our indemnification requirements related to the Holdings Bonds noted above, we have the right to approve certain additional debt obligations before incurrence by Holdings to the extent such incurrence would affect our indemnification requirements, any change in Holdings’ business activities and changes to the maturity, interest rate and principal amount of the Holdings Bonds. The agreement contains restrictions on our ability to transfer our interests similar to those in the existing and revised PTL partnership agreement discussed below.

Amended and Restated PTL Partnership Agreement

We amended and restated the PTL partnership agreement to admit Holdings’ wholly-owned subsidiary as a partner. Under the amended and restated partnership agreement, subject to applicable law and the terms of any applicable finance agreements, PTL is required to make quarterly pro rata distributions to its partners, including Holdings’ wholly-owned subsidiary, equal to 50% of its consolidated net income (calculated without regard to most currency translation adjustments and goodwill impairment charges). The amended agreement, which now extends through 2023, also allows GECC or PTLC, beginning December 31, 2017, to give notice to require PTL to begin to effect an initial public offering of equity securities, subject to certain limitations, as soon as practicable after the first anniversary of the initial notice. The party that is not exercising this right may seek to find a third party to purchase all of the partnership interests from the exercising party or to propose another alternative to such equity offers. The amended and restated partnership agreement is filed as Exhibit 10.3 hereto and incorporated herein by reference. In connection with the right to cause PTL to conduct an initial public offering, the PTL partners have agreed to customary demand and piggyback registration rights.

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Amendment of our U.S. Credit Agreement

In connection with the transaction noted above, we have amended certain covenants and other provisions of our existing U.S. credit agreement with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation to allow the incurrence of the obligations, and grant of a first priority security interest to GECC, noted above. These changes are further described in the amendment to the credit agreement, which is filed as Exhibit 4.1 hereto and incorporated herein by reference.

Other Information

The descriptions of the transaction agreements above are not complete and are qualified in their entirety by the actual terms of those agreements, copies of which are filed as Exhibits 4.1, 10.1, 10.2, and 10.3 hereto, and are incorporated by reference herein. These transactions were approved by the disinterested members of our Board of Directors. We purchase motor vehicles from Daimler AG and Toyota Motor Corporation, affiliates of the respective lenders under the U. S. Credit Agreement, for sale at certain of our dealerships. The lenders also provide certain of our dealerships with “floor-plan” and consumer financing. For the Item 404(a) of Regulation S-K “related party” disclosure between us, PTL and Penske Corporation, see the “Related Party Transactions” section of our proxy statement filed on March 19, 2012, which is incorporated herein by reference.

Item 6. Exhibits

4.1	Sixth Amendment dated April 30, 2012 to the Third Amended and Restated Credit Agreement dated September 30, 2008 by and among us, Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit, which also amends the Second Amended and Restated Security Agreement dated as of September 4, 2004 among these same parties.
10.1	Co-obligation Fee, Indemnity and Security Agreement dated April 30, 2012 between General Electric Capital Corporation and us.
10.2	Amended and Restated Limited Liability Company Agreement of LJ VP Holdings LLC dated April 30, 2012 by and among Penske Truck Leasing Corporation, GE Capital Truck Leasing Holding Corp., Logistics Holding Corp., General Electric Credit Corporation of Tennessee, and us.
10.3	Fourth Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P. dated April 30, 2012 by and among Penske Truck Leasing Corporation, LJ VP LLC, GE Capital Truck Leasing Holding Corp., Logistics Holding Corp., General Electric Credit Corporation of Tennessee, and us.
10.4	Form of Restricted Stock Agreement**
12	Computation of Ratio of Earnings to Fixed Charges
31.1	Rule 13(a)-14(a)/15(d)-14(a) Certification.
31.2	Rule 13(a)-14(a)/15(d)-14(a) Certification.
32	Section 1350 Certification.
101	The following materials from Penske Automotive Group’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Condensed Balance Sheets as of March 31, 2012 and December 31, 2011, (ii) the Consolidated Condensed Statements of Income for the three months ended March 31, 2012 and 2011, (iii) the Consolidated Condensed Statements of Cash Flows for the three months ended March 31, 2012 and 2011, (iv) the Consolidated Condensed Statement of Equity for the three months ended March 31, 2012, and (v) the Notes to Consolidated Condensed Financial Statements.*

* Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

** Compensatory plan or contract

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	PENSKE AUTOMOTIVE GROUP, INC.
Date: May 4, 2012	By:	/s/ Roger S. Penske
		Roger S. Penske Chief Executive Officer
Date: May 4, 2012	By:	/s/ David K. Jones
		David K. Jones Chief Financial Officer

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EXHIBIT INDEX

Exhibit
No.	Description
4.1	Sixth Amendment dated April 30, 2012 to the Third Amended and Restated Credit Agreement dated September 30, 2008 by and among us, Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit, which also amends the Second Amended and Restated Security Agreement dated as of September 4, 2004 among these same parties.
10.1	Co-obligation Fee, Indemnity and Security Agreement dated April 30, 2012 between General Electric Capital Corporation and us.
10.2	Amended and Restated Limited Liability Company Agreement of LJ VP Holdings LLC dated April 30, 2012 by and among Penske Truck Leasing Corporation, GE Capital Truck Leasing Holding Corp., Logistics Holding Corp., General Electric Credit Corporation of Tennessee, and us.
10.3	Fourth Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P. dated April 30, 2012 by and among Penske Truck Leasing Corporation, LJ VP LLC, GE Capital Truck Leasing Holding Corp., Logistics Holding Corp., General Electric Credit Corporation of Tennessee, and us.
10.4	Form of Restricted Stock Agreement **
12	Computation of Ratio of Earnings to Fixed Charges
31.1	Rule 13(a)-14(a)/15(d)-14(a) Certification.
31.2	Rule 13(a)-14(a)/15(d)-14(a) Certification.
32	Section 1350 Certification.
101	The following materials from Penske Automotive Group’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2012, formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Condensed Balance Sheets as of March 31, 2012 and December 31, 2011, (ii) the Consolidated Condensed Statements of Income for the three months ended March 31, 2012 and 2011, (iii) the Consolidated Condensed Statements of Cash Flows for the three months ended March 31, 2012 and 2011, (iv) the Consolidated Condensed Statement of Equity for the three months ended March 31, 2012, and (v) the Notes to Consolidated Condensed Financial Statements.*

* Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

** Compensatory plan or contract

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EX-4.1

EXHIBIT 4.1

EXECUTION VERSION

SIXTH AMENDMENT

THIS SIXTH AMENDMENT, dated as of April 30, 2012 (this “Amendment”), is to the Third Amended and Restated Credit Agreement (as heretofore amended, the “Credit Agreement”) dated as of October 30, 2008 among PENSKE AUTOMOTIVE GROUP, INC. (the “Company”), various financial institutions (the “Lenders”) and MERCEDES-BENZ FINANCIAL SERVICES USA LLC (formerly DCFS USA LLC), as agent for the Lenders (the “Agent”). Reference is also made to that certain Second Amended and Restated Security Agreement (as heretofore amended, the “Security Agreement”) dated as of September 8, 2004, among the Company, certain Subsidiaries of the Company that are parties thereto and the Agent. Unless otherwise defined herein, terms defined in the Credit Agreement are used herein as defined in the Credit Agreement (including as amended hereby).

WHEREAS, the Company desires to make an equity investment in LJ VP Holdings LLC, a Delaware limited liability company (“LJVP Holdings”), which investment will not exceed 9.02% of the outstanding equity of LJVP Holdings (with the equity investors in LJVP Holdings being the same as the current equity investors in PTL (defined below) and in the same ratable percentages as such holders’ current ownership percentages in PTL); LJVP Holdings will in turn form a wholly-owned subsidiary, LJ VP, LLC, a Delaware limited liability company (“LJ VP”), which will acquire a 21.5% partnership interest in Penske Truck Leasing Co., L.P., a Delaware limited partnership (“PTL”), and make a capital contribution to PTL (the “PTL Capital Contribution”);

WHEREAS, LJVP Holdings proposes to issue $700,000,000 of senior unsecured notes, for which General Electric Capital Corporation (“GECC”) will be co-obligor (the “LJVP Bonds”); LJVP Holdings shall use the net cash proceeds of the LJVP Bonds to make a capital contribution to LJ VP, and LJ VP will use the proceeds of such capital contribution to fund the PTL Capital Contribution;

WHEREAS, PTL will use the proceeds of the PTL Capital Contribution to pay down existing debt at PTL;

WHEREAS, the Company and certain other equity investors in LJVP Holdings will enter into indemnity obligations in favor of GECC in respect of the principal and interest on the LJVP Bonds, with each such investor being obligated to indemnify GECC for certain payments made by GECC under the LJVP Bonds in an amount reflecting such investor’s current ownership percentage in LJVP Holdings times the amount of principal or interest due on the LJVP Bonds, as well as obligations to pay GECC a fee in respect of GECC’s co-obligation on the LJVP Bonds in an amount reflecting such investor’s ownership percentage in LJVP Holdings;

WHEREAS, the Company and the other equity investors in LJVP Holdings will be obligated to make certain payments upon any principal or interest on the LJVP Bonds becoming due and payable, with each such investor being obligated to make such payments in an amount reflecting such investor’s ownership percentage in LJVP Holdings times the amount of principal or interest due on the LJVP Bonds (the transactions described in this recital and the transactions described in the immediately preceding four recitals being the “LJVP Transaction”);

WHEREAS, the parties hereto desire to amend the Credit Agreement and the Security Agreement in certain respects;

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto agree as follows:

SECTION 1 AMENDMENTS TO CREDIT AGREEMENT. Effective on the Amendment Effective Date (defined below), the Credit Agreement shall be amended as follows:

1.1 Section 1.1 of the Credit Agreement shall be amended as follows:

(a) each of the following definitions in its proper alphabetical position as follows:

GECC means General Electric Capital Corporation.

Indemnity and Security Agreement means that certain PAG Co-Obligation Fee, Indemnity and Security Agreement, between the Company and GECC.

LJVP Bond Indenture means the indenture, by and among LJVP Holdings, GECC and The Bank of New York Mellon Trust Company, N.A., as trustee, pursuant to which the LJVP Bonds are issued.

LJVP Bond Obligations means, without duplication, all obligations of the Company under the Indemnity and Security Agreement (including without limitation, the payment of the PAG Co-Obligation Fee and any Indemnified Amounts (as such terms are defined in the Indemnity and Security Agreement) and all obligations of the Company to contribute capital to LJVP Holdings under Sections 3.2 or 3.3 of the LJVP Holdings LLC Agreement.

LJVP Bonds means those certain bonds of LJVP Holdings and GECC, as co-obligors, in an aggregate amount of $700,000,000, to be issued pursuant to the LJVP Bond Indenture.

LJVP Holdings means LJ VP Holdings LLC, a Delaware limited liability company.

LJVP Documents means the LJVP Holdings LLC Agreement, the LJVP Bonds, the Indemnity and Security Agreement and all other documents, instruments and agreements related to LJVP Transaction (as defined in the Sixth Amendment to this Agreement dated as of April 30, 2012).

LJVP Holdings LLC Agreement means the Limited Liability Company Agreement of LJVP Holdings, among Penske Truck Leasing Corporation, the Company, GE Truck Leasing Holding Corp., Logistics Holding Corp. and General Electric Capital Corporation of Tennessee.

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PAG Co-Obligation Fee has the meaning assigned thereto in the Indemnity and Security Agreement.

PTL means Penske Truck Leasing Co., L.P., a Delaware limited partnership.

(b) the definition of “Funded Debt” shall be amended by adding the following sentence at the end thereof:

“For the avoidance of doubt, for purposes of this definition, Funded Debt shall include the portion of the LJVP Bond Obligations allocable to principal on the LJVP Bonds.”

1.2 Section 9.1 of the Credit Agreement shall be amended by inserting the following as a new Section 9.1.10 and renumbering each subsequent Section:

“9.1.10 LJVP Documents. Promptly, and in any event within five days of the Company obtaining knowledge thereof, written notice of (x) the occurrence of (1) any default under any of the LJVP Documents or (2) a Fall Away Event (as defined in the LJVP Bond Indenture) or (y) any amendment to any of the LJVP Documents.”

1.3 Section 9.7 of the Credit Agreement shall be amended as follows:

(a) clause (o) thereof shall be amended by deleting the word “and” from the end of such clause;

(b) clause (p) thereof shall be amended by deleting the “.” from the end of such clause and replacing it with “; and”; and

(c) the following new clause (q) shall be added to the end of Section 9.7 immediately after clause (p) thereof:

“(q) the LJVP Bond Obligations; provided that the aggregate amount of LJVP Bond Obligations allocable to the principal amount of the LJVP Bonds shall not at any time exceed $63,140,000 and the interest rate on the LJVP Bonds plus the rate applicable to the PAG Co-Obligation Fee shall not exceed 6.5% per annum.”

1.4 Section 9.8 of the Credit Agreement shall be amended as follows:

(a) clause (l) thereof shall be amended by deleting the word “and” from the end of such clause;

(b) clause (m) thereof shall be amended by deleting the “.” from the end of such clause and replacing it with “; and”; and

(c) the following new clause (n) shall be added to the end of Section 9.7 immediately after clause (m) thereof:

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“(n) Liens on Capital Stock of LJVP Holdings held by the Company in favor of GECC securing the LJVP Bond Obligations.”

1.5 Section 9.18 of the Credit Agreement shall be amended by deleting the reference to “Penske Truck Leasing Co., L.P.” where it appears in such section and inserting in lieu thereof “PTL.”

1.6 Section 9.19 of the Credit Agreement shall be amended as follows:

(a) clause (j) thereof shall be amended by deleting the words “Penske Truck Leasing Co., L.P., a Delaware limited partnership” where they appear, and inserting in lieu thereof “PTL”;

(b) clause (l) thereof shall be amended by deleting the word “and” from the end of such clause;

(c) the following shall be added as a new clause (m) thereto and relettering each subsequent clause:

“(m) Investments by the Company (i) in LJVP Holdings or (ii) pursuant to the Indemnity and Security Agreement, provided that (x) on the date of the Company’s first investment in LJVP Holdings, the Company’s ownership percentage therein shall not exceed 9.02% of the outstanding equity of LJVP Holdings (calculated as of the date of the Company’s initial investment therein), and (y) at no time shall the aggregate amount of Investments permitted by this clause (m) exceed an amount equal to the LJVP Bond Obligations (determined as of the date of the Company’s initial investment in LJVP Holdings); and”.

1.7 Section 9.20 of the Credit Agreement shall be amended and restated to read in its entirety as follows:

“9.20 Restriction of Amendments to Certain Documents. Not (a) amend or otherwise modify, or waive any rights under, the notes or indentures relating to the Subordinated Notes (or any instrument governing Refinancing Debt in respect of the Subordinated Notes), the Indemnity and Security Agreement, Section 3 of the LJVP Holdings LLC Agreement or the Approved Swap Documents, in any case, if such amendment, modification or waiver could reasonably be expected to be adverse to the Lenders in any respect and (b) amend or otherwise modify, or waive any rights under, the LJVP Documents (other than as covered under clause (a) above), in any case, if such amendment, modification or waiver could reasonably be expected to have a Material Adverse Effect; and not take any action to terminate any Approved Swap Document if it is a condition to such termination that the Company make any payment to the counterparty under such Approved Swap Document, or if a consequence of such termination would permit such counterparty to retain or sell any collateral or to demand any payment from the Company.

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1.8 Section 10.2.1 of the Credit Agreement shall be amended as follows:

(a) clause (a) thereof shall be amended by deleting the word “and” from the end of such clause;

(b) clause (b) thereof shall be amended by deleting the “.” from the end of such clause and replacing it with “; and”; and

(c) the following new clause (c) shall be added to the end of Section 10.2.1 immediately after clause (b) thereof:

“(c) with respect to the making of any Loan or the issuance of any Letter of Credit that will be used to pay any LJVP Bond Obligations, the Company shall be in pro forma compliance with the financial covenants set forth in Section 9.6 after giving effect to such payment and such Loan or Letter of Credit, and shall have delivered to the Agent a certificate to such effect.”

1.9 Section 11.1.2 of the Credit Agreement shall be amended by adding the following sentence at the end thereof:

“For the avoidance of doubt, for purposes of this Section 11.1.2, Debt shall include the LJVP Bond Obligations and an Event of Default under this Section 11.1.2 shall exist whenever the Company shall have failed to pay any amount with respect to the LJVP Bond Obligations when due (provided that the aggregate amount of the LJVP Bond Obligations exceeds $20,000,000) and such default shall (a) consist of the failure to pay an amount greater than $20,000,000 when due, or (b) accelerate the maturity of the LJVP Bond Obligations or permit the holder or holders thereof, or any trustee or agent for such holder or holders, to cause the LJVP Bond Obligations to become due and payable prior to its expressed maturity.”

SECTION 2 AMENDMENT TO SECURITY AGREEMENT. Effective on the Amendment Effective Date, Section 2 of the Security Agreement shall be amended by amending the restating clause (z) of the proviso thereto in its entirety to read as follows:

“(z) any Investment Property that consists of (1) equity securities of an issuer that is a Subsidiary of any Debtor to the extent (but only to the extent) that the grant of a security interest therein would constitute a violation of a Permitted Restriction that is valid and enforceable, (2) equity securities of an issuer that is a Foreign Subsidiary of any Debtor in excess of 65% of the total combined voting power of all equity securities of such Foreign Subsidiary or (3) equity securities of LJVP Holdings held by the Company, to the extent the same are required to be pledged to GECC (and are not permitted to be pledged to the Agent) pursuant to the terms of the LJVP Documents.”

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SECTION 3 REPRESENTATIONS AND WARRANTIES. The Company represents and warrants to the Agent and the Lenders that: (a) the representations and warranties made in Section 8 of the Credit Agreement are true and correct on and as of the date hereof with the same effect as if made on and as of the date hereof (except to the extent relating solely to an earlier date, in which case they were true and correct as of such earlier date); (b) no Event of Default or Unmatured Event of Default exists or will result from the execution of this Amendment; (c) no event or circumstance has occurred since the Effective Date that has resulted, or would reasonably be expected to result, in a Material Adverse Effect; (d) the execution and delivery by the Company of this Amendment and the performance by the Company of its obligations under the Credit Agreement as amended hereby (as so amended, the “Amended Credit Agreement”) (i) are within the corporate powers of the Company, (ii) have been duly authorized by all necessary corporate action, (iii) have received all necessary approval from any governmental authority and (iv) do not and will not contravene or conflict with any provision of any law, rule or regulation or any order, decree, judgment or award which is binding on the Company or any of its Subsidiaries or of any provision of the certificate of incorporation or bylaws or other organizational documents of the Company or of any agreement, indenture, instrument or other document which is binding on the Company or any of its Subsidiaries; and (e) the Amended Credit Agreement is the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles relating to enforceability.

SECTION 4 CONDITIONS TO EFFECTIVENESS. The amendments set forth in Sections 1 and 2 above shall become effective as of the date (the “Amendment Effective Date”) when the following conditions precedent have been satisfied, each in form and substance satisfactory to the Agent:

4.1 Amendment. The Agent shall have received a counterpart of this Amendment duly executed by the Company and the Required Lenders (or, in the case of any party other than the Company from which the Agent has not received a counterpart hereof, facsimile confirmation of the execution of a counterpart hereof by such party).

4.2 Borrowing Base Certificate. The Agent shall have received a Borrowing Base Certificate dated as of the Amendment Effective Date.

4.3 Reaffirmation. The Agent shall have received a counterpart of the Reaffirmation of Loan Documents, in form and substance satisfactory to the Agent, duly executed by each Loan Party other than the Company.

4.4 LJVP Transaction. The LJVP Transaction shall have been consummated in all material respects in accordance with the terms of the documents relating thereto previously provided to the Agent and the Lenders (it being understood that the initial capital contribution of the Company in LJVP Holdings shall not exceed $1,000,000), without giving effect to any modification, amendment or waiver thereto that is adverse to the Lenders or the Agent, and with an interest rate on the LJVP Bonds plus the PAG Co-Obligation Fee rate not to exceed 6.5% per annum.

4.5 Other Documents. The Agent shall have received such other documents as the Agent or any Lender may reasonably request.

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SECTION 5 POST-EFFECTIVENESS OBLIGATION. The Company shall deliver to the Agent certified copies of each of the LJVP Documents promptly upon the entry into thereof.

SECTION 6 MISCELLANEOUS.

6.1 Continuing Effectiveness, etc. As hereby amended, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed in all respects. All references in the Credit Agreement, the Notes, each other Loan Document and any similar document to the “Credit Agreement” or similar terms shall refer to the Amended Credit Agreement.

6.2 Counterparts. This Amendment may be executed in any number of counterparts and by the different parties on separate counterparts, and each such counterpart shall be deemed to be an original but all such counterparts shall together constitute one and the same Amendment.

6.3 Expenses. The Company agrees to pay the reasonable costs and expenses of the Agent in connection with the preparation, execution and delivery of this Amendment.

6.4 Severability of Provisions. In the event that any provision in or obligation under this Amendment shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

6.5 Section Headings. The various headings of this Amendment are inserted for convenience only and shall not affect the meaning or interpretation of this Amendment or the Agreement or any provision hereof or thereof.

6.6 Governing Law. This Amendment shall be a contract made under and governed by the laws of the State of New York applicable to contracts made and to be wholly performed within the State of New York.

6.7 Successors and Assigns. This Amendment shall be binding upon the Company, the Lenders and the Agent and their respective successors and assigns, and shall inure to the benefit of the Company, the Lenders and the Agent and the successors and assigns of the Lenders and the Agent.

6.8 Loan Document. This Amendment is a Loan Document.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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Delivered as of the day and year first above written.

PENSKE AUTOMOTIVE GROUP, INC.
By:	/s/ David Jones
Title:	EVP & CFO
MERCEDES-BENZ FINANCIAL SERVICES USA LLC, as Agent, as Issuing Lender and as a Lender
By:	/s/ Michele Nowak
Title:	Credit Director, National Accounts
TOYOTA MOTOR CREDIT CORPORATION, as a Lender
By:	/s/ C. Furukawa
Title:	Manager, National Accounts

Sixth Amendment

EX-10.1

EXHIBIT 10.1

EXECUTION VERSION

PAG CO-OBLIGATION FEE, INDEMNITY AND SECURITY AGREEMENT

THIS PAG CO-OBLIGATION FEE, INDEMNITY AND SECURITY AGREEMENT is made this 30^th day of April, 2012, by PENSKE AUTOMOTIVE GROUP, INC., a Delaware corporation (“PAG”), to and in favor of GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation (“GECC”), for the purpose of inducing GECC to enter into certain transactions for the benefit of PAG, as described more particularly below.

WHEREAS, PAG, Penske Truck Leasing Corporation, a Delaware corporation (“PTLC”), and subsidiaries of GECC, as general and limited partners in Penske Truck Leasing Co., L.P., a Delaware limited partnership (the “Partnership”), have formed LJ VP Holdings LLC, a Delaware limited liability company (“Holdings”), and Holdings is co-issuing together with GECC the Holdings Bonds, the proceeds of which are being contributed to the Partnership, thereby enabling the increase in equity of the Partnership without altering ultimate ownership or control of the Partnership;

WHEREAS, the increased equity of the Partnership will enable the Partnership to obtain one or more investment grade credit ratings of the Partnership and enable it to issue debt at advantageous rates to pay off borrowings under the revolving credit agreement between the Partnership and GECC (the “GECC Revolver”) and reduce credit support obligations outstanding under the Contingent Liabilities Agreement between the Partnership and GECC; and

WHEREAS, concurrently with the execution and delivery of this Agreement, PTLC and Penske System, Inc. are entering into a co-obligation fee, indemnity and security agreement to and in favor of GECC (as the same may be amended, restated, supplemented or otherwise modified from time to time, the “PTLC Co-Obligation Agreement”) on similar terms and conditions as contained in this Agreement.

NOW, THEREFORE, in consideration of the foregoing premises, the undertakings set forth and described herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby mutually acknowledged, PAG, intending to be legally bound, covenants and agrees to and with GECC as follows:

1. Definitions. As used in this Agreement:

“Additional Capital Contribution Loan” shall have the meaning set forth in the Holdings LLC Agreement.

“Agent” shall mean a representative of GECC designated by GECC in writing, which shall initially be GECC until such time as GECC designates another representative of GECC in writing.

“Agreement” shall mean this PAG Co-Obligation Fee, Indemnity and Security Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Bankruptcy Action” means (i) the filing by PAG of a voluntary petition seeking liquidation, reorganization, arrangement or readjustment, in any form, of its debts under Title 11 of the United States Bankruptcy Code or any other federal or state insolvency Law, or PAG’s filing an answer consenting to or acquiescing in any such petition, (ii) the making by PAG of any assignment for the benefit of its creditors or (iii) the expiration of sixty (60) days after the filing of an involuntary petition under Title 11 of the United States Bankruptcy Code, an application for the appointment of a receiver for a material portion of the assets of PAG, or an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of its debts under any other federal or state insolvency Law, provided that the same shall not have been vacated, set aside or stayed within such sixty (60) -day period.

“Board” shall mean the board of directors of PAG.

“Bonds Maturity Date” shall have the meaning set forth in the Holdings LLC Agreement.

“Business Day” shall mean any day other than a Saturday or Sunday or other day that commercial banks are required or permitted to be closed in New York City.

“Claim” shall mean any claim, demand, right, damage, dispute, cost, expense, Lien, debt, liability, loss, judgment, suit, action and cause of action of whatever kind and nature whatsoever, whether known or unknown, contingent or absolute.

“Closing” shall have the meaning set forth in Section 2.

“Collateral” shall mean the property, or interests in property, in which PAG has granted security interests to GECC in Section 4, to secure payment of the Secured Obligations.

“Collateral Document” shall mean the Holdings LLC Agreement.

“Collateral Distributions” shall mean any monies at any time or from time to time received or receivable by PAG, under, in respect of, or pursuant to, the Collateral Document, howsoever denominated, documented or occurring, including Holdings Member Interest Distributions.

“Contribution Subaccount” shall have the meaning set forth in the Holdings LLC Agreement.

“Co-Obligation” shall mean all initially scheduled obligations for the payment of money by GECC as co-issuer of the Holdings Bonds or, after the Fall Away Event, as issuer, in each case as initially provided in the Holdings Bond Indenture.

“Deemed Transfer” shall have the meaning set forth in Section 9(b).

“Default” shall mean any of the events specified in the definition of “Event of Default” whether or not any applicable requirement for the giving of notice, the lapse of time, or both, has been satisfied.

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“Default Rate” shall mean a rate of interest per annum equal to the Prime Rate as it may change from time to time plus 2.5%, provided that the Default Rate shall not exceed a rate that may be lawfully charged.

“Effective Date” shall mean the date of this Agreement.

“Event of Default” shall mean: (i) the failure of PAG to pay the PAG Co-Obligation Fee, when due; (ii) the failure of PAG to make any Indemnity Payment with respect to the Indemnified Amounts referred to in Section 3(i) or 3(iii) below within five (5) Business Days after any such amount is due; (iii) the failure of PAG to make any Indemnity Payment with respect to the Indemnified Amounts referred to in Section 3(ii) or 3(iv) below, when due; (iv) the failure of PAG to observe, comply with or perform any of its material obligations or covenants hereunder (other than the payment obligations referred to in clauses (i), (ii) or (iii) of this definition) or under any Transaction Document and such default shall remain un-remedied upon the expiration of any grace or cure period provided in respect thereof and, if none has been provided, within five (5) Business Days after receipt of notice from GECC of the failure of PAG to observe, comply with or perform any of such obligations; (v) the failure of PAG to pay any amounts due under Sections 11.7 or 11.8 within five (5) Business Days after any such amount is due; (vi) any breach of any representation or warranty of PAG made hereunder; (vii) the failure of PAG to pay any interest at the Default Rate, when due; or (viii) PAG becoming the subject of any Bankruptcy Action.

“Fall Away Event” shall mean the assumption by GECC of all obligations under the Holdings Bond Indenture and the securities issued thereunder pursuant to Section 11.03 thereof.

“Fall Away Payment Amounts” shall mean any amounts paid under Section 10.3 of the Holdings LLC Agreement, which will be deemed distributed when paid in accordance with such Section.

“Funding Loan” shall have the meaning set forth in Section 9(c).

“GE Members” shall mean, collectively, (i) GE Capital Truck Leasing Holding Corp., a Delaware corporation, (ii) General Electric Credit Corporation of Tennessee, a Tennessee corporation, and (iii) Logistics Holding Corp., a Delaware corporation, in each case including their respective permitted successors and permitted assigns pursuant to Article 9 of the Holdings LLC Agreement.

“GECC” shall have the meaning set forth in the first paragraph hereof, including its successors and assigns pursuant to Section 11.4.

“GECC Revolver” shall have the meaning set forth in the first “Whereas” clause of this Agreement.

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“Governmental Authority” shall mean any (a) U.S., foreign, federal, state, local or other government, (b) governmental commission, board, body, bureau, agency, department or other judicial, regulatory or administrative authority of any nature, including courts, tribunals and other judicial bodies, (c) self regulatory body or authority, or (d) instrumentality or entity designed to act for or on behalf of the foregoing in exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

“Holdings” shall have the meaning set forth in the first “Whereas” clause of this Agreement.

“Holdings Bond Indenture” shall mean that certain Senior Indenture, dated as of the Effective Date, by and among GECC and Holdings in their capacities as co-issuers of the Holdings Bonds, with The Bank of New York Mellon, as Trustee, or any successor thereto appointed as Trustee pursuant to such Indenture, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with the Holdings LLC Agreement.

“Holdings Bonds” shall mean the notes issued under the Holdings Bond Indenture, in an aggregate principal amount of $700,000,000.

“Holdings LLC Agreement” shall mean that certain Amended and Restated Limited Liability Company Agreement of Holdings, dated the Effective Date, by and among the managing member and other members of Holdings, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Holdings Members” shall mean the Members (as defined in the Holdings LLC Agreement).

“Holdings Member Interests” shall mean all membership interests (including preferred and common) of Holdings issued to its members at any time or from time to time.

“Holdings Member Interest Distributions” shall mean any distributions, whether of cash or property, including additional Holdings Member Interests, at any time or from time to time received or receivable from Holdings by any holder of Holdings Member Interests, including dividends and returns of capital.

“Indemnified Amount” shall have the meaning set forth in Section 3 below.

“Indemnity Payments” shall have the meaning set forth in Section 3 below.

“Interest Obligations” shall have the meaning set forth in the Holdings LLC Agreement.

“Interest Obligations Deficiency” shall have the meaning set forth in the Holdings LLC Agreement.

“Law” shall mean any applicable foreign or domestic, federal, state or local, statute, ordinance, rule, regulation, code, license, permit, authorization, approval, consent, order, judgment, decree, injunction or requirement of any Governmental Authority or any arbitration tribunal.

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“Lien” shall mean any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement) and any capital lease having substantially the same economic effect as any of the foregoing).

“LJ VP LLC Agreement” shall mean that certain Limited Liability Company Agreement of LJ VP, LLC, dated as of the Effective Date, executed by Holdings as the sole member of LJ VP, LLC, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Losses” shall mean all damages, losses, liabilities, costs and expenses incurred by GECC or any of its Affiliates in connection with any breach of or default under an Additional Capital Contribution Loan.

“Material Adverse Effect” shall mean, with respect to PAG, (i) a material adverse effect on its interest in, or title to, any Collateral, (ii) a material adverse effect on the validity, status, perfection or priority of any Lien granted pursuant hereto or pursuant to any other Transaction Document or (iii) a material adverse effect on the ability of PAG to perform its obligations under any of the Transaction Documents.

“Material Agreements” shall mean the (i) Organizational Documents of Holdings and (ii) Holdings Bond Indenture.

“Maturity Deficiency” shall have the meaning set forth in the Holdings LLC Agreement.

“Maturity Obligations” shall have the meaning set forth in the Holdings LLC Agreement.

“Organizational Documents” shall mean: (i) for a corporation, its articles (or certificate) of incorporation and bylaws; (ii) for a limited partnership, its articles (or certificate)of limited partnership and limited partnership agreement; and (iii) for a limited liability company, its articles (or certificate) of formation or organization and any operating agreement or limited liability company agreement; together with, for each such entity and any other entity not described above, such other, similar documents as are integral to its formation or the conduct of its business operations among its shareholders, partners, or members and the corporation, partnership or limited liability company.

“PAG” shall have the meaning set forth in the first paragraph hereof, including its permitted successors and permitted assigns pursuant to Section 11.4.

“PAG Co-Obligation Fee” shall mean a fee per annum (pro-rated quarterly), equal in amount to the product of (x) one and fifty one-hundredths percent (1.50%) (expressed as a decimal), (y) the PAG Co- Obligation Percentage (expressed as a decimal), and (z) $700,000,000, accrued daily from the date of issuance of the Holdings Bonds on the basis of a 360-day year comprised of twelve 30-day months and pro-rated for any partial quarterly period.

“PAG Co-Obligation Percentage” shall mean 9.02%.

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“Partnership” shall have the meaning set forth in the first “Whereas” clause of this Agreement.

“Partnership Agreement” shall mean the Fourth Amended and Restated Agreement of Limited Partnership of the Partnership, dated April 30, 2012, by and among the limited partners and general partner of the Partnership, as the same may be amended, restated, supplemented or otherwise modified from time to time.

“Partnership Interest Distributions” shall mean any distributions, whether of cash or property, including additional Partnership Interests, at any time or from time to time received or receivable from the Partnership by any holder of Partnership Interests, including dividends and returns of capital.

“Partnership Interests” shall have the meaning set forth in the Partnership Agreement.

“Partnership Member” and “Partnership Members” shall mean each of, and together, PTLC and PAG.

“Permitted Collateral Encumbrances” shall mean (a) Liens in favor of GECC granted to secure payment of the Secured Obligations; (b) Liens for taxes, assessments or other governmental charges not delinquent or being contested in good faith and by appropriate proceedings and with respect to which proper reserves have been taken by PAG; provided, that such Liens, individually or in the aggregate, have no effect on the priority of any Liens in favor of GECC or the value of any assets in which GECC has such a Lien; and (c) the encumbrances granted under the Holdings LLC Agreement.

“Permitted Encumbrances” shall mean (a) Liens in favor of GECC granted to secure payment of the Secured Obligations; (b) Liens for taxes, assessments or other governmental charges not delinquent or being contested in good faith and by appropriate proceedings and with respect to which proper reserves have been taken by PAG; provided, that such Liens, individually or in the aggregate, have no effect on the priority of any Liens in favor of GECC or the value of any assets in which GECC has such a Lien; (c) deposits or pledges to secure obligations under worker’s compensation, social security or similar Laws, or under unemployment insurance; (d) deposits or pledges to secure bids, tenders, contracts (other than contracts for the payment of money), leases, statutory obligations, surety and appeal bonds and other obligations of like nature arising in the ordinary course of PAG’s business; (e) mechanic’s, worker’s, materialmen’s or other like Liens arising in the ordinary course of PAG’s business with respect to obligations which are not due or which are being contested in good faith by PAG; (f) Liens in the nature of ownership interests of lessors of real and personal property; (g) other Liens incidental to the conduct of PAG’s business or the ownership of its property and assets which were not incurred in connection with the borrowing of money or the obtaining of advances or credit, and which do not in the aggregate materially detract from GECC’s rights to, in or under the Collateral or the value of PAG’s business property or assets or which do not materially impair the use thereof in the operation of PAG’s business; and (h) the encumbrances granted under the Holdings LLC Agreement, the LJ VP LLC Agreement and the Partnership Agreement.

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“Person” shall mean an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporated association, joint venture, Governmental Authority or other entity of whatever nature.

“Prime Rate” means the prime rate (the base rate on corporate loans at large U.S. money center commercial banks) as published in the Wall Street Journal or other equivalent publication if the Wall Street Journal no longer publishes such information.

“PTLC” shall have the meaning set forth in the first paragraph hereof, including its permitted successors and permitted assigns pursuant to Article 9 of the Holdings LLC Agreement.

“Sale” and “Sold” shall have the meanings set forth in the Holdings LLC Agreement.

“Secured Obligations” shall mean the obligations of PAG described in Section 4 below as being secured by the Collateral.

“Subsidiary” of a Person shall refer to (i) any corporation (or equivalent legal entity under foreign Law) of which such Person owns directly or indirectly more than fifty percent (50%) of the stock, the holders of which are ordinarily and generally, in the absence of contingencies or understandings, entitled to vote for the election of directors, (ii) any limited liability company in which such Person owns directly or indirectly more than fifty percent (50%) of the membership interests, (iii) any partnership in which such other Person owns directly or indirectly more than a fifty percent (50%) interest and (iv) any other entity of which another Person has the voting power to elect the majority of the members of the board of directors, the board of managers, or a similar governing body of such entity.

“Transaction Documents” shall mean this Agreement, the Collateral Document and any and all other agreements, instruments and documents, including guaranties, pledges, powers of attorney, consents and all other writings heretofore, now or hereafter executed by PAG and/or delivered to GECC relating to the security interests granted by this Agreement.

“Transfer” shall have the meaning set forth in the Holdings LLC Agreement.

“Trustee” shall have the meaning set forth in the Holdings LLC Agreement.

“UCC” shall mean the Uniform Commercial Code, as amended from time to time and any successor thereto.

“UCC Filing” shall have the meaning set forth in Section 4(b)(iii).

2. PAG Co-Obligation Fee. In consideration of the Co-Obligation, commencing on the closing of the Holdings Bonds offering (the “Closing”) and continuing on a calendar quarterly basis thereafter, on the last Business Day of each calendar quarter, until the originally scheduled maturity date of the Holdings Bonds, PAG shall pay to GECC the PAG Co-Obligation Fee.

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3. Indemnification. Without limiting any other rights which GECC may have hereunder, under any of the other Transaction Documents or under applicable Law, subject to Section 10, PAG hereby agrees to indemnify GECC for losses resulting from (i) (a) at any time when the Holdings Bonds are outstanding, the PAG Co-Obligation Percentage of any interest payments on the Holdings Bonds and any payments of trustee and similar fees related to the Holdings Bonds made directly by GECC under the Co-Obligation and (b) if the Holdings Bonds are redeemed by GECC prior to their scheduled maturity date, the PAG Co-Obligation Percentage of the amount of any interest that would have been payable on the Holdings Bonds if they had not been so redeemed, accruing from the date of redemption until the originally scheduled maturity date of the Holdings Bonds, with any such deemed accrual being due and payable upon each originally scheduled payment date (such payments of deemed accrual amounts to be the applicable indemnification, notwithstanding that the aggregate of these payments may exceed the interest component of the redemption price paid by GECC on the Holdings Bonds), (ii) the PAG Co-Obligation Percentage of any principal payments on the Holdings Bonds made directly by GECC under the Co-Obligation, with such obligation becoming due and payable on the originally scheduled maturity date of the Holdings Bonds (whether or not the Holdings Bonds remain outstanding until their originally scheduled maturity date), (iii) any default or Losses with respect to an Additional Capital Contribution Loan made by any GE Members to PAG, (iv) without duplication with clauses (i) or (ii), the failure to make any payment due to GECC under Section 11.7 or Section 11.8, (v) interest at the Default Rate on any payment referred to in clauses (i)—(iv) hereof or with respect to the PAG Co-Obligation Fee when such payment was not made on or prior to the due date thereof and (vi) all damages, losses, liabilities, costs and expenses incurred by GECC or any of its Affiliates in connection with the failure of PAG to observe, comply with or perform its material obligations or covenants hereunder or a breach of any representation or warranty of PAG hereunder (all of the foregoing clauses (i)—(vi) hereof are called, collectively, the “Indemnified Amounts”), which Indemnified Amounts shall be due and payable on demand (such amounts, as and when payment thereof is demanded, are herein collectively called the “Indemnity Payments”)). The PAG Co-Obligation Percentage of any Fall Away Payment Amounts will reduce any Indemnified Amounts due hereunder with respect to PAG. The indemnity obligations contained in this Section 3 shall survive the termination of this Agreement.

4. Security Interests. (a) Grants of Liens. As security for its obligations with respect to the PAG Co-Obligation Fee under Section 2 and all of its Indemnified Amounts, PAG hereby grants to GECC a security interest in all right, title and interest of PAG to, in or under all Holdings Member Interests held by PAG on or after the date hereof, including (i) all Holdings Member Interest Distributions thereunder, (ii) any certificate at any time issued to represent or evidence its right, title and interest therein, and (iii) all proceeds of the foregoing; which security interest PAG at all times shall cause to be first priority and perfected.

(b) Collateral Representation and Warranties. PAG represents and warrants to GECC with respect to the Collateral that:

(i) It is the owner of the Collateral pledged by it free and clear of any and all Liens, other than Permitted Collateral Encumbrances.

(ii) It has all power, statutory and otherwise, to grant the first priority, perfected security interest in the Collateral pledged by it.

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(iii) No authorization, approval or other action by, and, except with respect to PAG’s disclosure obligations as a public company, no notice to or filing with, any Governmental Authority is required (i) for its granting of a security interest in the Collateral pursuant hereto, (ii) except for filings with the Secretary of State of Delaware under Article 9 of the UCC of the State of Delaware (the “UCC Filing”), which are being made concurrently with the execution and delivery of this Agreement, for the perfection of such security interest as a first priority security interest or (iii) for the exercise by GECC of any rights or remedies pursuant to this Agreement or applicable Law.

(iv) The UCC Filing is being made concurrently with the execution and delivery of this Agreement, and this Agreement creates a valid first priority, perfected security interest in the Collateral of PAG securing the payment of the Secured Obligations. All filings and other actions necessary or desirable to perfect and protect such first priority, perfected security interest have been duly taken or are being taken concurrently with the execution and delivery of this Agreement. GECC has a first priority, perfected security interest in the Collateral of PAG, subject only to the Permitted Collateral Encumbrances.

(c) Collateral Covenants. PAG covenants to GECC with respect to the Collateral that:

(i) At any time and from time to time, upon the written request of GECC, and at the sole expense of PAG, PAG will promptly and duly execute and deliver any and all such further instruments and documents and take such further actions as GECC may reasonably deem desirable to obtain the full benefits of this Agreement and of the rights and powers herein granted with respect to PAG, including the execution and filing of any financing or continuation statements under the UCC in effect in any jurisdiction with respect to the first priority, perfected security interest granted hereby and, if otherwise required hereunder, transferring Collateral to the possession of Agent (if a first priority, perfected security interest in such Collateral can be perfected by possession) or causing Holdings to agree (in writing) that it will only comply with instructions originated by Agent without further consent by PAG upon the occurrence and continuance of an Event of Default with respect to PAG. PAG also hereby authorizes GECC to file any such financing or continuation statement without the signature of PAG to the maximum extent not prohibited by applicable Law.

(ii) PAG will defend the right, title and interest hereunder of GECC, as holder of a first priority, perfected security interest in the Collateral in which PAG has granted a first priority, perfected security interest to GECC hereunder, against the Claims of all Persons whomsoever.

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(iii) PAG will not change its name in any manner which might make any financing or continuation statement filed hereunder seriously misleading within the meaning of Section 9-507 of the UCC of the State of New York (or any other then-applicable provision of the UCC of the State of New York), unless PAG shall have given GECC at least thirty (30) days prior written notice thereof and shall have taken all action (or made arrangements to take such action substantially simultaneously with such change if it is impossible to take such action in advance) necessary or reasonably requested by GECC to amend such financing statement or continuation statement so that it is not seriously misleading. PAG will not sign or authorize the signing on PAG’s behalf of any financing statement naming PAG as debtor covering all or any portion of PAG’s Collateral, except financing statements naming GECC as secured party.

(iv) PAG will not directly or indirectly Transfer or create or suffer or permit to be created any Lien on any of the Collateral, other than Permitted Collateral Encumbrances or as otherwise permitted by this Agreement, provided that nothing in this Section 4(c)(iv) will prevent the payment of Holdings Member Interest Distributions, and the application such funds by PAG, at any time an Event of Default shall not then exist.

(v) PAG will perform all of its obligations (if any) under the Collateral Document prior to the time that any interest or penalty would attach against PAG or any of the Collateral as a result of PAG’s failure to perform any of such obligations.

(vi) PAG will not (x) suffer or permit any amendment, restatement, supplement or other modification or waiver of its Organizational Documents unless and to the extent (1) required by Law to do so, or (2) such amendment, restatement, supplement or other modification or waiver (A) would not cause any contravention of, or conflict with, any material term or condition of this Agreement, any other Transaction Document, or any Material Agreement, or (B) would not otherwise reasonably be expected to have a Material Adverse Effect; or (y) waive, release or compromise any Claims PAG may have against any other Person which arise under any Collateral Document.

(vii) So long as an Event of Default shall not then exist, PAG shall be entitled (1) to exercise for any purpose any and all powers, and (2) to receive any and all Holdings Member Interest Distributions (if any) arising from or relating to the Collateral; provided, however, that PAG shall not exercise such rights or powers, or approve or consent to any action that would be in contravention of the provisions of, or constitute a breach or Default under, this Agreement or any of the Transaction Documents.

(viii) If there is an Event of Default with respect to PAG, any Event of Default attributable to a failure to pay any Indemnified Amounts shall be deemed waived upon the receipt by GECC of amounts sufficient to satisfy all such Indemnified Amounts then due and payable by PAG.

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(d) Event of Default. If any Event of Default shall occur and be continuing (and not waived in accordance herewith), the Agent may exercise in addition to all other rights and remedies granted to it in this Agreement, the Holdings LLC Agreement and in any other Transaction Documents, all rights and remedies of a secured party under the UCC of the State of New York with respect to the Collateral described in Section 4(a) hereto. Without limiting the generality of the foregoing, PAG expressly agrees that in any such event Agent, without demand of performance or other demand, advertisement or notice of any kind (except the notice specified below of time and place of public or private sale) to or upon PAG or any other Person (all and each of which demands, advertisements or notices are hereby expressly, irrevocably and unconditionally waived), may forthwith collect, receive, appropriate and realize upon such Collateral in which PAG has granted a security interest to GECC with respect thereto, or any part thereof, or may forthwith sell, lease, assign, give option or options to purchase, or sell or otherwise dispose of and deliver such Collateral (or contract to do so), or any part thereof, in one or more parcels at public or private sale or sales, at any exchange or broker’s board or at any of the Agent’s offices or elsewhere at such prices as it may deem best, for cash or on credit or for future delivery without the assumption of any credit risk. PAG expressly acknowledges that (A) private sales may be less favorable to a seller than public sales but that private sales shall nevertheless be deemed commercially reasonable and otherwise permitted hereunder and (B) the GE Members may sell, lease, assign, give option or options to purchase, or sell or otherwise dispose of and deliver their Member Interests (or contract to do so) at the same time in one transaction or in a series of related transactions. In view of the fact that federal and state securities Laws and/or other applicable Laws may impose certain restrictions on the method by which a sale of such Collateral may be effected, PAG agrees that upon the occurrence of an Event of Default with respect to it, the Agent may, from time to time, attempt to sell all or any part of such Collateral in which PAG has granted a security interest to GECC relating to such Event of Default hereunder, by means of a private placement, restricting the prospective purchasers to those who will represent and agree that they are purchasing for investment only and not for distribution. In so doing, the Agent may solicit offers to buy such Collateral, or any part thereof, for cash, from a limited number of investors deemed by the Agent in its judgment, to be financially responsible parties who might be interested in purchasing such Collateral, and if the Agent solicits such offers, then the acceptance by the Agent of the highest offer obtained therefrom shall be deemed to be a commercially reasonable method of disposing of such Collateral. GECC or the Agent shall have the right upon any such public sale or sales, and, to the maximum extent not prohibited by applicable Law, upon any such private sale or sales, to purchase the whole or any part of such Collateral so sold, free of any right or equity of redemption, which equity of redemption PAG hereby irrevocably and unconditionally releases. GECC shall apply the net proceeds of any such collection, recovery, receipt, appropriation, realization or sale to the Secured Obligations in such order and manner as GECC may elect. Only after so paying over such net proceeds and after the payment by the Agent of any other amount required by any provision of Law, including Section 9-608(a)(1)(C) of the UCC of the State of New York, need GECC account for the surplus, if any, to PAG. To the maximum extent not prohibited by applicable Law, PAG hereby irrevocably and unconditionally waives all Claims against the Agent and/or GECC arising out of the repossession, retention or sale of such Collateral except in each case such as arise out of the gross negligence or willful misconduct of the Agent or GECC. Any notification of intended disposition of any of such Collateral required by Law will be deemed to be a reasonable authenticated notification of disposition if given at least ten (10) days prior to such disposition and such notice shall (i) describe GECC and PAG, (ii) describe such Collateral that is the subject of the intended disposition, (iii) state the method of the intended disposition, (iv) state that PAG is entitled to an accounting of the Secured Obligations and state the charge, if any, for an accounting and (v) state the time and place of any public disposition or the time after which any private sale is to be made. The Agent and/or GECC may disclaim any representations or warranties that might arise in connection with the Sale or other Transfer of such Collateral and has no obligation to provide any representations or warranties at such time except to advise the purchaser in writing of provisions of the Collateral Document or instruments to which it will succeed or be subject to. Except as expressly required by the UCC of the State of New York or by the equitable principles of good faith and fair dealing, the Agent and/or GECC shall have no duty as to any Collateral in its possession or control or in the possession or control of any agent or nominee of the Agent and/or GECC or as to any income thereon or as to the preservation of rights against prior parties or any other rights pertaining thereto. Notwithstanding the foregoing, the parties hereto agree that to the extent that PAG is the Managing Member (as defined in the Holdings LLC Agreement) at the time that GECC exercises its remedies with respect to any Holdings Member Interests in the Collateral, then the transferee of such Holdings Member Interests shall become the Managing Member only to the extent permitted and as provided in the Holdings LLC Agreement.

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(e) Default Rate. If any payments hereunder are not received by GECC on the due date therefor, interest on such payments shall accrue at the Default Rate with respect to any of such payments until such payments and all accrued interest thereon have been fully paid to GECC.

(f) Inspection of Premises. At all reasonable times, upon the occurrence and during the continuation of a Default, at PAG’s expense, GECC shall have full access to and the right to audit, check, inspect and make abstracts and copies from PAG’s books, records, audits, correspondence and all other papers relating to the Collateral from time to time in GECC’s sole discretion. Upon the occurrence and during the continuation of a Default, GECC may also enter upon PAG’s premises at any time during business hours and at any other reasonable time, and from time to time, for the purpose of inspecting the Collateral and any and all records pertaining thereto.

(g) GECC’s Discretion. After an Event of Default exists, and while it is continuing, GECC shall have the right in its sole discretion to determine which rights, Liens or remedies GECC may at any time pursue, relinquish, subordinate, or modify or to take any other action with respect thereto and such determination will not in any way modify or affect any of GECC’s rights hereunder. In no event shall PAG have any right to require GECC to marshal any Collateral.

(h) Waiver of Subrogation. Except as provided in Section 7.6, PAG shall not have any right of subrogation as to any Collateral until this Agreement has terminated as provided in Section 11.16.

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5. Conditions. The following shall occur simultaneously with the execution and delivery of this Agreement:

(a) Transaction Documents. GECC shall have received on or prior to the Effective Date this Agreement and each of the other Transaction Documents and the Material Agreements, duly executed by PAG if it is a party thereto and delivered to GECC;

(b) Organizational Documents. GECC shall have received on or prior to the Effective Date the following items, each of which shall be in form and substance satisfactory to GECC:

(i) a certificate of the Secretary or an Assistant Secretary of PAG, dated the Effective Date, and certifying (A) that attached thereto is a true and complete copy of the resolutions of the Board of PAG authorizing the execution, delivery and performance of this Agreement, and the other Transaction Documents to which it is a party and the Material Agreements to which it is a party and the other documents to be delivered by it hereunder and thereunder and the transactions contemplated hereby and thereby, and that such resolutions have not been amended, modified, revoked or rescinded and are in full force and effect, (B) that attached thereto is a true and complete copy of such Party’s Organizational Documents, each as in effect as of the Effective Date and (C) as to the incumbency and specimen signature of each officer or authorized signatory executing any Transaction Document and Collateral Document or any other document delivered in connection herewith or therewith on behalf of PAG, together with evidence of the incumbency of such Secretary or Assistant Secretary;

(ii) copies of certificates of good standing dated as of a recent date of PAG from the Secretary of State of the State of Delaware;

(c) Lien Searches. GECC shall have received on or prior to the Effective Date the following items, each of which shall be in form and substance satisfactory to GECC:

(i) certified copies of requests for information or copies (Form UCC-11) dated a date reasonably near the Effective Date listing all effective financing statements which name PAG (under its present name or any previous name in the past ten years) as transferor or debtor and which are filed with the Secretary of State of Delaware, together with copies of such financing statements, and tax and judgment lien searches showing no such liens that are not permitted by the Transaction Documents;

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(d) UCCs. The following filings shall have been made on or prior to the Effective Date, each of which shall be in form and substance satisfactory to GECC:

(i) proper financing statements (Form UCC-1), naming PAG, as the debtor, and GECC, as secured party, in respect of the first priority, perfected security interest created hereunder and proper financing statements (Form UCC-3), if any, necessary to release all first priority, perfected security interests and other rights of any other Person in the Collateral previously granted by PAG shall have been filed and all filing fees, taxes or other amounts required to be paid in connection with such filings shall have been paid;

(e) Opinions. GECC shall have received on or prior to the Effective Date the following items, each of which shall be in form and substance satisfactory to GECC:

(i) the executed legal opinions of Shane Spradlin, general counsel of PAG, dated the Effective Date and addressed to GECC, with respect to certain corporate Law matters, including due organization, valid existence and good standing, power and authority, and due authorization, execution and delivery of this Agreement, the other Transaction Documents, and the Collateral Document, the Governmental Authority consents or filings required in connection with the execution, delivery and performance of the Transaction Documents, the absence of conflicts with the Organizational Documents of PAG or Laws and regulations arising from the execution, delivery and performance of the Transaction Documents and the Collateral Document, the absence of conflicts with court orders or agreements or other contracts arising from the execution, delivery and performance of the Transaction Documents and the Collateral Document, the absence of litigation affecting the transactions contemplated by the Transaction Documents, the enforceability of this Agreement, and the Collateral Document and the other Transaction Documents, the creation, attachment and perfection of the perfected security interests in the Collateral granted by PAG pursuant hereto, and other such matters as GECC may request.

6. General Representations and Warranties. PAG hereby represents and warrants to GECC that:

6.1. Authority. PAG has full power, authority and legal right to enter into this Agreement and the other Transaction Documents to which it is party and to perform all its respective obligations hereunder and thereunder. The execution, delivery and performance of this Agreement and of the other Transaction Documents to which it is a party (a) are within PAG’s corporate (or other organizational) powers, have been duly authorized, are not in contravention of Law or the terms of its Organizational Documents of any Collateral Document or Material Agreement or undertaking to which PAG is a party or by which PAG is bound, and (b) will not conflict with nor result in any breach in any of the provisions of or constitute a default under or result in the creation of any Lien (except Liens created pursuant to this Agreement or permitted by this Agreement) upon any asset of PAG under the provisions of any Organizational Document or other instrument to which PAG or its property is a party or by which it may be bound.

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6.2. Formation and Qualification.

(a) PAG is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization and is duly qualified to do business and is in good standing in the states or other jurisdictions listed on Schedule 6.2 which constitute all states in which qualification and good standing where its ownership, lease or operation of property or the conduct of its business requires such qualification, except to the extent the failure to so qualify or be in good standing would not, in the aggregate, reasonably be expected to have a Material Adverse Effect on PAG.

(b) PAG (excluding, for the avoidance of doubt, its Subsidiaries) has not been known by any other organization name in the ten (10) years immediately preceding the Effective Date (other than “United Auto Group, Inc.”) and does not itself sell inventory under any other name; nor has PAG been the surviving organization of a merger or consolidation during the ten (10) years immediately preceding the Effective Date.

6.3. Enforceable Obligations. This Agreement is, and each other Transaction Document executed by PAG, constitutes (or will constitute upon the execution and delivery thereof), the legal, valid and binding obligation of PAG, enforceable against it in accordance with its terms, except as such enforcement is subject to the effect of (i) any applicable bankruptcy, insolvency, moratorium or similar Laws affecting creditors’ rights generally, and (ii) general principles of equity (regardless of whether considered in a proceeding in equity or at Law).

6.4. Financial Condition Representation. The consolidated financial statements of PAG and its subsidiaries and the related notes thereto included in its Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 24, 2012 comply in all material respects with the applicable requirements of the Exchange Act (as defined in the Partnership Agreement) and fairly present in all material respects the consolidated financial position of PAG and its subsidiaries as of the dates indicated and the results of their operations and cash flows for the periods specified and such financial statements have been prepared in conformity with Generally Accepted Accounting Principles (as defined in the Partnership Agreement) applied on a consistent basis throughout the periods covered thereby. Since December 31, 2011, PAG has conducted its business in the ordinary course in all material respects consistent with past practice, and, since such date, there has not been any changes, events or occurrences which has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect with respect to PAG.

6.5. Absence of Claims Against PTLC. PAG does not have any Claim against PTLC.

7. Covenants.

PAG shall, until payment in full of the Secured Obligations and termination of this Agreement (except as otherwise expressly provided below):

7.1. Conduct of Business and Maintenance of Existence and Assets. (a) Keep in full force and effect (i) its existence and (ii) the Material Agreements to which it is then a party, each to the extent within PAG’s control and using its reasonable best efforts to the extent not within PAG’s control; and (b) make all such reports and pay all such franchise and other taxes and license fees and do all such other acts and things as may be lawfully required to maintain its rights, licenses, leases, powers and franchises under the Laws of the United States or any political subdivision thereof where the failure to do so, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.

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7.2. Requirements of Law. Comply at all times, in all material respects, with all requirements of Law, the failure to comply with which would reasonably be expected to have a Material Adverse Effect and promptly notify GECC in writing of any violation by PAG of any requirement of Law which violation would reasonably be expected to have a Material Adverse Effect.

7.3. Notice of Default. Promptly give written notice to GECC of the occurrence of any Default by PAG.

7.4. Inspection of Property; Books and Records; Discussions. Keep proper books and records of account in which full, true and correct entries in conformity with generally accepted accounting principles as in effect from time to time in the United States of America and all requirements of Law shall be made in all material respects of all dealings and transactions in relation to its business and activities.

7.5. Further Assurances. Execute and deliver, or cause to be executed and delivered, such additional instruments, certificates, legal opinions or documents, and take such actions, as the Agent may reasonably request for the purposes of implementing or effectuating the provisions of this Agreement and the other Transaction Documents upon the exercise by GECC of any power, right, privilege or remedy pursuant to this Agreement or the other Transaction Documents, including any filings necessary to perfect and protect the first priority, perfected security interest, which requires any consent, approval, recording, qualification or authorization of any Governmental Authority, and it shall execute and deliver, or shall cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that such Agent may be required to obtain from it for such governmental consent, approval, recording, qualification or authorization.

7.6. No Enforcement of Claims. Until the termination of the PTLC Co-Obligation Agreement in accordance with Section 9.16 thereof, not enforce any Claim against PTLC other than any Claim PAG may have against PTLC arising after the date hereof directly as a result of any action or inaction of PTLC as general partner of the Partnership.

8. Expense Reimbursement. In light of (i) the agreement by PTLC and the GE Partners (as defined in the Partnership Agreement) to move the Partnership’s debt structure to market-based financing in a non-disruptive, efficient manner and (ii) the terms of the Transition Agreement, expected to be executed on or around May 1, 2012, by and between the Partnership and GECC, as the same may be amended, restated, supplemented or otherwise modified from time to time, PAG hereby agrees that Section 3(a) of the Purchase and Sale Agreement, dated June 26, 2008, by and among General Electric Credit Corporation of Tennessee, Logistics Holding Corp., RTLC Acquisition Corp. (now known as GE Capital Truck Leasing Holding Corp.), PTLC, PAG, the Partnership and the other parties thereto is hereby terminated in its entirety and that PAG is not owed any amounts thereunder now or in the future.

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9. Tax Characterization. PAG and GECC agree to the following characterization, for tax purposes, of the Holdings Bonds and related payments and expenses:

(a) The Holdings Bonds shall be treated as debt of GECC and not as debt of Holdings;

(b) An amount equal to the net proceeds of the Holdings Bonds shall be treated as transferred in cash by GECC to the Holdings Members in proportion to their Holdings Percentage Interests (each such transfer a “Deemed Transfer”);

(c) Each Deemed Transfer to a Partnership Member shall be treated as the proceeds of a loan from GECC to such Partnership Member (each such loan a “Funding Loan”) with a face amount equal to the product of the face amount of the Holdings Bonds and such Partnership Member’s Holdings Percentage Interest;

(d) Each Funding Loan shall be treated as having terms consistent with the agreement between GECC and the Partnership Members, as reflected in the Holdings LLC Agreement and this Agreement, relating to their economic sharing of obligations relating to the Holdings Bonds, including the treatment of all PAG Co-Obligation Fees paid or accrued by a Partnership Member as interest paid or accrued on such Partnership Member’s Funding Loan and the treatment of all payments by a Partnership Member of an Indemnified Amount described in Section 3(i) or Section 3(ii) or, to the extent related to the PAG Co-Obligation Fee or to payments referred to in Section 3(i) or Section 3(ii), Section 3(v) as payments made on, or of financing costs or other fees or expenses with respect to, such Partnership Member’s Funding Loan;

(e) Each Holdings Member shall be treated as having contributed cash, in an amount equal to the amount of the Deemed Transfer to such Member, to Holdings as a Capital Contribution (as defined in the Holdings LLC Agreement) on the date the Holdings Bonds are issued;

(f) All payments by Holdings on, or of financing costs or other fees or expenses with respect to, the Holdings Bonds shall be treated as distributed in cash to the Holdings Members in proportion to their Holdings Percentage Interests on the date such payment is made, with amounts so treated as distributed to each Partnership Member further treated as used to make payments to GECC on, or of financing costs or other fees or expenses with respect to, such Partnership Member’s Funding Loan, and then used by GECC to make payments on, or of financing costs or other fees or expenses with respect to, the Holdings Bonds;

(g) All Fall Away Payment Amounts treated under the Holdings LLC Agreement as distributed to a Partnership Member shall be treated as used by such Partnership Member to make payments to GECC on, or of financing costs or other fees or expenses with respect to, such Partnership Member’s Funding Loan, and then used by GECC to make payments on, or of financing costs or other fees or expenses with respect to, the Holdings Bonds; and

(h) Any Additional Capital Contribution Loan to a Delinquent Member (as defined in the Holdings LLC Agreement) shall be treated as a loan of cash equal to the face amount of such loan to such Delinquent Member from the Holdings Member providing the funds, followed by a contribution of such cash by such Delinquent Member to Holdings.

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PAG and GECC are aware of the income tax consequences of the above characterizations of the Holdings Bonds and the related payments and expenses described in this Section 9 and hereby agree to be bound by the tax characterizations as set forth in this Section 9 in reporting such items for income tax purposes.

10. Reduction and Reinstatement of Indemnity Obligation.

(a) Interest Payments. Subject to Section 10(c), if (i) GECC has elected under Section 3.2(c) of the Holdings LLC Agreement to fund the full amount or any portion of the Interest Obligations then due or Interest Obligations Deficiency by making payment of such Interest Obligations or Interest Obligations Deficiency, respectively, directly to the paying agent under the Holdings Bond Indenture, and (ii) GECC has received funds in the Funding Subaccount from the Trustee, then PAG’s obligation to indemnify GECC pursuant to Section 3(i)(a) shall be reduced in an amount equal to the PAG Co-Obligation Percentage of such funds GECC has received from the Funding Subaccount.

(b) Maturity Payments. Subject to Section 10(c), if (i) GECC has elected under Section 3.3(c) of the Holdings LLC Agreement to fund the full amount or any portion of the Maturity Obligations then due or Maturity Deficiency by making payment of such Maturity Obligations or Maturity Deficiency, respectively, directly to the paying agent under the Holdings Bond Indenture, and (ii) (A) GECC has received funds in the Funding Subaccount from the Trustee pursuant to Section 3.3(c) of the Holdings LLC Agreement, then PAG’s obligation to indemnify GECC pursuant to Section 3(ii) shall be reduced in an amount equal to the PAG Co-Obligation Percentage of such funds GECC has received from the Funding Subaccount or (B) GECC has received funds in the Contribution Subaccount from the Trustee pursuant to Section 3.3(f) of the Holdings LLC Agreement, then PAG’s obligation to indemnify GECC pursuant to Section 3(ii) shall be reduced in an amount equal to the relative proportion of funds deposited by PAG into the Contribution Subaccount to those funds deposited by all Members (including PAG) into the Contribution Subaccount.

(c) Reinstatement of Indemnity Obligation. Notwithstanding anything in this Agreement or the Holdings LLC Agreement to the contrary, PAG’s indemnification obligations pursuant to Section 3 shall continue to be effective, or be reinstated, as the case may be, if at any time payment of any Indemnity Payments by or on behalf of PAG hereunder, or of any of the funds out of the Funding Subaccount or the Contribution Subaccount to or for the account of GECC hereunder or under the Holdings LLC Agreement, is rescinded or must otherwise be restored or returned upon any Bankruptcy of PAG or otherwise.

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11. Miscellaneous.

11.1. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLIED TO CONTRACTS TO BE PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK AND WITHOUT REFERENCE TO ANY CONFLICT OF LAW RULES THAT MIGHT LEAD TO THE APLICATION OF THE LAWS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BROUGHT BY OR AGAINST PAG WITH RESPECT TO ANY OF THE OBLIGATIONS, THIS AGREEMENT (INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY OR PERFORMANCE) OR ANY OTHER DOCUMENT OR RELATED TRANSACTION MAY BE BROUGHT IN ANY COURT OF COMPETENT JURISDICTION IN THE CITY, COUNTY AND STATE OF NEW YORK, UNITED STATES OF AMERICA, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, PAG ACCEPTS FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER DOCUMENT. PAG HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO PAG AT ITS ADDRESS SET FORTH IN SECTION 11.5 AND SERVICE SO MADE SHALL BE DEEMED COMPLETED FIVE (5) BUSINESS DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED IN THE MAILS OF THE UNITED STATES OF AMERICA, AND, AT GECC’S OPTION, BY SERVICE UPON THE CT CORPORATION SYSTEM (OR ANY SUCCESSOR OR REPLACEMENT PERSON, AS SELECTED BY GECC), WHICH PAG IRREVOCABLY APPOINTS AS PAG’S AGENT FOR THE PURPOSE OF ACCEPTING SERVICE WITHIN THE STATE OF NEW YORK. NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF GECC TO BRING PROCEEDINGS AGAINST PAG IN THE COURTS OF ANY OTHER JURISDICTION. PAG WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREUNDER AND SHALL NOT ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON FORUM NON CONVENIENS. ANY JUDICIAL PROCEEDING BY PAG AGAINST GECC INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER OR CLAIM IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED WITH THIS AGREEMENT OR ANY OTHER TRANSACTION DOCUMENT, SHALL BE BROUGHT ONLY IN A FEDERAL OR STATE COURT LOCATED IN THE CITY OF NEW YORK, STATE OF NEW YORK.

11.2. Entire Understanding. This Agreement, the other Transaction Documents and the Material Agreements contain the entire understanding between PAG and GECC relative to the subject matter hereof and thereof and supersede all prior agreements and understandings, if any, relating to the subject matter hereof. Any promises, representations, warranties or guarantees not herein contained and hereinafter made shall have no force and effect unless in writing, signed by the respective officers of the party making such promises, representations, warranties or guarantees. Neither this Agreement nor any other Transaction Document, nor any portion or provisions hereof or thereof may be changed, modified, amended, waived, supplemented, discharged, cancelled or terminated, in whole or in part, orally or by any course of dealing, or in any manner other than by an agreement in writing, signed by the party to be charged.

11.3. Advice of Counsel. PAG and GECC acknowledges that it has been advised by counsel in connection with the execution of this Agreement and the other Transaction Documents and is not relying upon oral representations or statements inconsistent with the terms and provisions of this Agreement or any other Transaction Document.

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11.4. Successors and Assigns.

(a) This Agreement shall be binding upon and inure to the benefit of PAG and GECC and all future holders of the Secured Obligations and their respective successors and assigns, except that PAG may not Transfer any of its rights or obligations under this Agreement except as expressly permitted hereunder or in the Holdings LLC Agreement. Any purported Transfer which is not in compliance with this Agreement shall be null and void and of no force or effect whatsoever.

(b) PAG authorizes GECC to disclose to any of its transferees or potential transferees any and all financial information in GECC’s possession concerning PAG which has been delivered to GECC by or on behalf of PAG pursuant to this Agreement, any other Transaction Document, the Material Agreements or in connection with GECC’s credit evaluation of PAG subject, however, to the provisions on confidentiality set forth in Section 6.8 of the Holdings LLC Agreement and Section 6.4(i) of the Partnership Agreement.

(c) In the case of a Sale of Holdings Member Interests pursuant to Article 9 of the Holdings LLC Agreement, subject to the restrictions and requirements thereunder and under the Partnership Agreement, such purchaser or transferee shall duly execute an instrument of assumption in form and substance satisfactory to the Agent and delivered to GECC setting forth such purchaser’s or transferee’s agreement to be bound by all of the provisions of this Agreement (including the portion of the Indemnified Amounts corresponding to the Member Interests being transferred) and acknowledging that such Membership Interests are under and subject to the security interest granted hereunder and, upon the execution and delivery of such agreement, shall be deemed “PAG” for purposes of such portion hereunder with respect to such Membership Interests being transferred or otherwise; provided, that the Agent shall have the opportunity to request additional information or documentation reasonably necessary to make a determination that the assumption of the obligations to pay the PAG Co-Obligation Fee and the Indemnified Amounts is being made by a creditworthy party (who shall be at least as creditworthy as the transferor as of the Effective Date) and such transfer shall not be permitted unless and until this determination is made by the Agent, which determination shall be made promptly, reasonably and in good faith; provided further, that the assumption of the obligations to pay the PAG Co-Obligation Fee and the Indemnified Amounts shall not release PAG of any of its obligations or liabilities hereunder. Notwithstanding the immediately preceding proviso, if (i) Penske Corporation, a Delaware corporation, or PTLC acquires PAG’s Holdings Member Interest and PTLC or Penske Corporation, as applicable, fully assumes all of PAG’s obligations to pay the PAG Co-Obligation Fee under Section 2, all Indemnified Amounts under Section 3 (then existing and future) and all other obligations hereunder, and all such obligations are joint and several with PTLC’s obligations to pay the PTLC Co-Obligation Fee (as defined in the PTLC Co-Obligation Agreement) under Section 2 of the PTLC Co-Obligation Agreement and Indemnified Amounts under Section 3 (then existing and future) of the PTLC Co-Obligation Agreement, (ii) GECC continues to have a first priority, perfected security in such Sold Holdings Member Interest and such Sale is made in accordance with this Section 11.4, and (iii) GECC simultaneously obtains a first priority, perfected security interest in the Trademark License Fee (as defined in the PTLC Co-Obligation Agreement) as security for the performance of the obligations of Penske Corporation or PTLC, as applicable, to pay the PAG Co-Obligation Fee under Section 2 and Indemnified Amounts under Section 3(i), Section 3(iii), Section (v) (to the extent relating to payments under Section 3(i)) and Section 3(vi) (to the extent relating to payments under Section 3(i) and 3(iii)) with respect to PAG’s Indemnity Payment obligations hereunder, then PAG will be released from its obligations to pay the PAG Co-Obligation Fee under Section 2 and Indemnified Amounts under Section 3 for obligations or liabilities incurred in the future and all other future obligations hereunder (but not any then existing obligations or liabilities, including with respect to any then existing Additional Capital Contribution Loan, whether or not then due).

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11.5. Notice. Any notice or request hereunder may be given to PAG or to GECC at their respective addresses set forth below or at such other address as may hereafter be specified in a notice designated as a notice of change of address under this Section. Any notice or request hereunder may be given by (a) hand delivery, (b) overnight courier, (c) registered or certified mail, return receipt requested, (d) electronic transmission or facsimile (or such other e-mail address or number as may hereafter be specified in a notice designated as a notice of change of address), with electronic confirmation of its receipt and subsequently confirmed by registered or certified mail or overnight courier. Any notice or other communication required or permitted pursuant to this Agreement shall be deemed given (a) when personally delivered to any officer of the party to whom it is addressed, (b) on the earlier of actual receipt thereof or five (5) Business Days following posting thereof by certified or registered mail, postage prepaid, or (c) upon actual receipt thereof when sent by a recognized overnight delivery service or (d) upon actual receipt thereof when sent by electronic transmission or by facsimile to the address or number set forth below with electronic confirmation of its receipt, in each case, addressed to each party at its address set forth below or at such other address as has been furnished in writing by a party to the other by like notice, provided, that in order for an electronic transmission to constitute proper notice hereunder, such electronic transmission must specifically reference this Section 9.5 and state that it is intended to constitute notice hereunder:

(A)    If to GECC at:	GECC
	901 Main Avenue
	Norwalk, CT 06851
	Attention:         Operations Leader —                            Equipment Services
	Facsimile:         203-823-4502
	E-mail Address: dennis.murray@ge.com
with a copy to:	GECC
	901 Main Avenue
	Norwalk, CT 06851
	Attention:         Strategic Transactions                            Counsel
	Facsimile:         203-750-7098
	E-mail Address: mark.landis@ge.com

21

and a copy to:	GECC
	901 Main Avenue
	Norwalk, CT 06851
	Attention:	Senior Counsel, Strategic Transactions and Relations — Equipment Services
	Facsimile:	203-663-8207
	E-mail Address:	joseph.lincoln@ge.com
(B)     If to PAG at:	Penske Automotive Group, Inc.
	2555 Telegraph Road
	Bloomfield Hills, MI 48302
	Attention:	Executive Vice President and Chief Financial Officer
	Facsimile:	248-648-2805
	E-mail Address:
	dave.jones@penskeautomotive.com
with a copy to:	Penske Automotive Group, Inc.
	2555 Telegraph Road
	Bloomfield Hills, MI 48302
	Attention:	Executive Vice President
		and General Counsel
	Facsimile:	248-648-2515
	E-mail Address:
	sspradlin@penskeautomotive.com
with a copy to:	Penske Corporation
	2555 Telegraph Road,
	Bloomfield Hills, MI 48302
	Attention:	Executive Vice President and General Counsel
	Facsimile:	248-648-2135
	E-mail Address:	larry.bluth@penskecorp.com

11.6. Severability. If any part of this Agreement is contrary to, prohibited by, or deemed invalid under applicable Laws, such provision shall be inapplicable and deemed omitted to the extent so contrary, prohibited or invalid, but the remainder hereof shall not be invalidated thereby and shall be given effect so far as possible.

22

11.7. Expenses. All costs, fees and expenses, including reasonable attorneys’, consultants’ or accountants’ fees and disbursements, incurred by GECC under, pursuant to or in connection with this Agreement or any other Transaction Document in respect of the following: (a) all efforts made to enforce payment of any Secured Obligations or effect collection of any Collateral, or (b) after the occurrence of an Event of Default, as permitted by this Agreement, inspection of PAG’s books and records or any Collateral, including field audits, or any physical inventory or any appraisal of any Collateral, or (c) liquidating, enforcing or foreclosing on GECC’s security interest in or Lien on any of the Collateral, whether through judicial proceedings or otherwise, or (d) defending or prosecuting any actions or proceedings arising out of or relating to this Agreement or any other Transaction Document, shall, in each case, be charged to PAG’s account as and when incurred, shall be due and payable on demand, shall bear interest at the Default Rate until paid in full, shall be part of the Secured Obligations, and shall be secured by the Collateral. This Section 11.7 shall survive the termination of this Agreement.

11.8. Right to Cure. GECC may, in its sole discretion, (a) cure any default or event of default by PAG under any Transaction Document or Material Agreement that affects the Collateral, the value of the Collateral or the ability of GECC to collect or Sell any Collateral or the rights and remedies of GECC therein, (b) pay or bond on appeal any judgment entered against PAG, (c) discharge any Liens at any time levied on or existing with respect to the Collateral and (d) pay any amount, incur any expense or perform any act which GECC, in its sole discretion determines is necessary or appropriate to preserve, protect, insure or maintain the Collateral and the rights of GECC with respect thereto. GECC may add any amounts so expended to the Secured Obligations and charge PAG in default therefor, such amounts to be repayable by PAG on demand, shall bear interest at the Default Rate until paid in full, shall be part of the Secured Obligations of PAG, and shall be secured by the Collateral. GECC shall be under no obligation to effect such cure, payment or bonding and shall not, by doing so, be deemed to have assumed any obligation or liability of PAG. Any payment made or other action taken by GECC under this Section shall be without prejudice to any right to assert a Default or an Event of Default and to proceed accordingly. This Section 11.8 shall survive the termination of this Agreement.

11.9. Injunctive Relief. PAG recognizes that, in the event PAG fails to perform, observe or discharge any of its obligations or liabilities under this Agreement, any remedy at Law may prove to be inadequate relief to GECC and, therefore, GECC, if GECC so requests, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving that actual damages are not an adequate remedy or posting any bond.

11.10. Consequential Damages. PAG hereby waives, to the maximum extent not prohibited by Law, any right it may have to claim or recover any special, exemplary, punitive or consequential damages.

11.11. Captions. The captions at various places in this Agreement and any other Transaction Document are intended for convenience only and do not constitute and shall not be interpreted as part of this Agreement or any Other Document.

11.12. Counterparts; Telecopied Signatures. This Agreement and the other Transaction Documents may be executed in any number of separate counterparts and by different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same agreement. Delivery of a counterpart hereto or to any other Transaction Document by facsimile transmission or by electronic transmission of an Adobe portable document format file (also known as a “PDF file”) shall be as effective as delivery of an original counterpart hereto.

23

11.13. Survival of Representations and Warranties. All representations and warranties of PAG made in this Agreement and the other Transaction Documents shall be true at the time of such party’s execution of this Agreement and the other Transaction Documents, and shall survive the execution, delivery and acceptance thereof by the parties thereto and the closing of the transactions described therein or related thereto. Upon any Sale of a Holdings Member Interest in accordance with Article 9 of the Holdings LLC Agreement, any purchaser or transferee pursuant to such Sale shall confirm the accuracy of the representations and warranties hereto with respect to such purchaser or transferee and the transferred Holdings Member Interests as of the effective date of such Sale pursuant to an instrument of assumption in form and substance reasonably satisfactory to the Agent setting forth such purchaser’s or transferee’s agreement to be bound by all of the provisions of this Agreement, delivered to GECC.

11.14. Certain Matters of Construction. Unless the context otherwise requires, (a) the terms “herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision; (b) terms used herein in the singular also include the plural and vice versa; (c) all references to statutes and related regulations shall include any amendments of same and any successor statutes and regulations; (d) references herein or in any other Transaction Document to any actions being taken (or omitted to be taken) by GECC or its assignee or transferee after a Default or Event of Default shall be presumed to mean, unless otherwise expressly provided, while such Default or Event of Default is continuing; (e) any pronoun shall include the corresponding masculine, feminine and neuter forms; (f) the words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; (g) the word “will” shall be construed to have the same meaning and effect as the word “shall”; (h) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Section of, and Exhibits and Schedules to, this Agreement; and (i) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

11.15. Time. Time is of the essence in this Agreement and each other Transaction Document. Unless otherwise expressly provided, all references herein and in any other Transaction Documents to time shall mean and refer to New York time.

11.16. Termination. This Agreement, and the assignments, pledges and security interests created or granted hereby, shall terminate when all Secured Obligations shall have been fully paid and satisfied, except that Section 7.6 shall survive the termination of this Agreement as set forth therein. At such time, GECC shall release and reassign (without recourse upon, or any warranty whatsoever by, GECC), and deliver to PAG all Collateral then in the custody or possession of GECC, and provide termination statements under the UCC of the State of Delaware, all without recourse upon, or warranty whatsoever by, GECC and at the cost and expense of PAG. This Agreement shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Secured Obligations is rescinded or must otherwise be restored or returned by PAG upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of PAG, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee of similar officer for, PAG or any substantial part of its property, or otherwise, all as though such payments had not been made.

24

[Signature page follows]

25

IN WITNESS WHEREOF, PAG has caused this Agreement to be duly executed and delivered by its authorized representative as of the date first above written.

PENSKE AUTOMOTIVE GROUP, INC.
By:	/s/ David Jones
Name:	David Jones
Title:	Executive Vice President and
	Chief Financial Officer

Accepted:
GENERAL ELECTRIC CAPITAL CORPORATION
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	Vice President

27

Schedule 6.2

Alabama

Arizona

Connecticut

Florida

Massachusetts

Michigan

Missouri

New Jersey

New York

North Carolina

Pennsylvania

Virginia

28

EX-10.2

EXHIBIT 10.2

EXECUTION VERSION

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

OF

LJ VP HOLDINGS LLC

TABLE OF CONTENTS

	Page
ARTICLE 1 THE LIMITED LIABILITY COMPANY		2
1.1 Formation and Membership		2
1.2 Certificate of Limited Liability Company		2
1.3 Name		2
1.4 Character of Business		2
1.5 Certain Business Policies		2
1.6 Principal Offices		3
1.7 Fiscal Year		3
1.8 Accounting Matters		3
ARTICLE 2 DEFINITIONS		3
2.1 Accepting Members		3
2.2 Act		3
2.3 Additional Capital Contribution Loan		3
2.4 Adjusted Capital Account Deficit		3
2.5 Affiliate		4
2.6 Agreement		4
2.7 Alternate Transaction		4
2.8 Alternative Structure		4
2.9 Auditor		4
2.10 Backstop Defaulting Member		4
2.11 Backstop Indemnity Obligation		4
2.12 Bankruptcy		4
2.13 Bonds Interest Payment Date		5
2.14 Bonds Maturity Date		5
2.15 Business Day		5
2.16 Capital Account		5
2.17 Capital Contribution		5
2.18 Certificate		6
2.19 Code		6
2.20 Company		6
2.21 Company Bond Indenture		6
2.22 Company Bonds		6
2.23 Company Minimum Gain		6
2.24 Company Sub		6
2.25 Company Year		6
2.26 Contribution Subaccount		6
2.27 Control		6
2.28 Deemed Transfer		6
2.29 Default Rate		6
2.30 Delinquent Member		7
2.31 Depreciation		7

- i -

TABLE OF CONTENTS

(continued)

	Page
2.32 Effective Time		7
2.33 Equity Offering		7
2.34 Evaluation Material		7
2.35 Exchange Act		7
2.36 Fall Away Event		7
2.37 First Delinquency Notice		7
2.38 Funding Loan		7
2.39 Funding Subaccount		7
2.40 GECC		8
2.41 GECC Consolidated Group		8
2.42 GE Logistics Holdco		8
2.43 GE Losses		8
2.44 GE Members		8
2.45 Generally Accepted Accounting Principles		8
2.46 General Partner Activities		8
2.47 GE Representative Member		8
2.48 GE Tennessee		8
2.49 GE Truck Leasing Holdco		8
2.50 Governmental Authority		8
2.51 Gross Asset Value		9
2.52 Indemnification Agreements		10
2.53 Initial Members		10
2.54 Initiated Offer		10
2.55 Interested Party		10
2.56 Interest Obligations		10
2.57 Interest Obligations Deficiency		10
2.58 Interest Obligations Deficiency Notice		10
2.59 Interest Obligations Deficiency Response Notice		10
2.60 Interest Sweep Date		10
2.61 Investment Company Act		10
2.62 Law		10
2.63 Lien		10
2.64 LJ VP Holdings Payment Account		11
2.65 Managing Member		11
2.66 Maturity Deficiency		11
2.67 Maturity Deficiency Notice		11
2.68 Maturity Obligations		11
2.69 Maturity Sweep Date		11
2.70 Member		11
2.71 Member Interest		11
2.72 Member Nonrecourse Debt		11
2.73 Member Nonrecourse Debt Minimum Gain		11
2.74 Member Nonrecourse Deductions		11

- ii -

TABLE OF CONTENTS

(continued)

	Page
2.75 Non-Issuing Member		11
2.76 Non-Managing Member		12
2.77 Nonrecourse Deductions		12
2.78 Nonrecourse Liability		12
2.79 Offer		12
2.80 Offered Interest		12
2.81 Offeree Member		12
2.82 Offering Member		12
2.83 Original LLC Agreement		12
2.84 PAG		12
2.85 PAG Consolidated Group		12
2.86 Parent Company		12
2.87 Partnership		12
2.88 Partnership Agreement		12
2.89 Partnership Interests		12
2.90 Paying Agent		13
2.91 Penske Members		13
2.92 Percentage Interest		13
2.93 Permitted Intragroup Transferees		13
2.94 Permitted Working Capital		13
2.95 Person		13
2.96 Potential Buyer		13
2.97 Prime Rate		13
2.98 Profits and Losses		13
2.99 Pro Rata Interest Obligations Deficiency Amount		14
2.100 Pro Rata Maturity Deficiency Amount		14
2.101 PTLC		14
2.102 PTLC Consolidated Group		14
2.103 Qualified Purchaser		15
2.104 Rebuttal		15
2.105 Recipient Group		15
2.106 Refinancing		15
2.107 Regulations		15
2.108 Regulatory Allocations		15
2.109 Required Interest Deposit Date		15
2.110 Required Maturity Deposit Date		15
2.111 Response Notice		15
2.112 Returns		15
2.113 Sale		15
2.114 Schedule		15
2.115 Second Delinquency Notice		15
2.116 Securities Act		16
2.117 Subsidiary		16

- iii -

TABLE OF CONTENTS

(continued)

	Page
2.118 Third-Party Proposed Sale		16
2.119 Third Party Sale		16
2.120 Transaction Notice		16
2.121 Transfer		16
2.122 Trustee		16
2.123 Trustee Affiliate		16
2.124 General Provisions		16
ARTICLE 3 CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS		17
3.1 Initial Capital Contribution		17
3.2 Matters Regarding Interest Obligations		17
3.3 Matters Regarding Maturity Obligations		21
3.4 Transfer of Funds in Contribution Subaccount		23
3.5 Investment of Funds in Funding Subaccount and Contribution Subaccount		23
3.6 Capital Accounts		23
3.7 Compliance with Treasury Regulations		23
3.8 Succession to Capital Accounts		24
3.9 No Withdrawal of Capital Contributions		24
3.10 Company’s Obligations Under Company Bond Indenture and Company Bonds		24
ARTICLE 4 COSTS AND EXPENSES		24
4.1 Organizational and Other Costs		24
4.2 Operating Costs		24
ARTICLE 5 DISTRIBUTIONS; COMPANY ALLOCATIONS; TAX MATTERS		25
5.1 Distributions Prior to Dissolution		25
5.2 Company Allocations		25
5.3 Special Allocations		26
5.4 Curative Allocations		27
5.5 Other Allocation Rules		28
5.6 Tax Allocations; Code Section 704(c)		28
5.7 Accounting Method		29
ARTICLE 6 MANAGEMENT		29
6.1 Rights and Duties of the Non-Managing Members		29
6.2 Fiduciary Duty of Managing Member		29
6.3 Powers of Managing Member		29
6.4 Restrictions on Managing Member’s Authority		30
6.5 Other Activities		32
6.6 Exculpation		33
6.7 Transactions with Affiliates		33

- iv -

TABLE OF CONTENTS

(continued)

	Page
6.8 Confidentiality		34
6.9 Replacement of the Managing Member		35
ARTICLE 7 COMPENSATION		35
ARTICLE 8 ACCOUNTS		36
8.1 Books and Records		36
8.2 Reports, Returns and Audits		36
ARTICLE 9 TRANSFERS AND SALES		39
9.1 Transfer of Interests of Managing Member and PTLC Consolidated Group		39
9.2 Transfer or Sale of Member Interests		40
9.3 Right of First Offer		40
9.4 Certain Changes of Control		43
9.5 Certain General Provisions		44
9.6 Allocation of Profits, Losses and Distributions Subsequent to Sale		47
9.7 Death, Incompetence, Bankruptcy, Liquidation or Withdrawal of a Member		48
9.8 Satisfactory Written Assignment Required		48
9.9 Transferee’s Rights		48
9.10 Transferees Admitted as Members		48
ARTICLE 10 REFINANCING; OTHER MATTERS REGARDING THE COMPANY BONDS		49
10.1 Third Party Sale		49
10.2 Refinancing		50
10.3 Fall Away Event		51
10.4 Receipt of Funds in Respect of Company Bonds		51
10.5 Backstop Indemnity Obligations		51
ARTICLE 11 LIABILITY OF MEMBERS		52
11.1 Liability of Members		52
ARTICLE 12 DISSOLUTION		52
12.1 Events of Dissolution		52
12.2 Final Accounting		52
12.3 Liquidation		53
12.4 Cancellation of Certificate		53
ARTICLE 13 NOTICES		53
13.1 Method of Notice		53
13.2 Computation of Time		55

- v -

TABLE OF CONTENTS

(continued)

	Page
ARTICLE 14 INVESTMENT REPRESENTATIONS		56
14.1 Investment Purpose		56
14.2 Investment Restriction		56
ARTICLE 15 GENERAL PROVISIONS		56
15.1 Amendment; Waiver		56
15.2 Governing Law		56
15.3 Binding Effect		56
15.4 Separability		56
15.5 Headings		56
15.6 No Third-Party Rights		57
15.7 Waiver of Partition and Application for Dissolution		57
15.8 Nature of Interests		57
15.9 Counterpart Execution		57

- vi -

SCHEDULES

SCHEDULE A — Initial Capital Contributions

SCHEDULE B — Members and Member Interests

- vii -

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT

OF

LJ VP HOLDINGS LLC

THIS AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT is entered into this 30th day of April, 2012, and effective as of the Effective Time, by and among Penske Truck Leasing Corporation, a Delaware corporation with its offices at 2675 Morgantown Road, Reading, Pennsylvania 19607 (as further defined below, “PTLC”), Penske Automotive Group, Inc., a Delaware corporation with its offices at 2555 Telegraph Road, Bloomfield Hills, Michigan 48302 (as further defined below, “PAG”), GE Capital Truck Leasing Holding Corp., a Delaware corporation with its offices at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808 (as further defined below, “GE Truck Leasing Holdco”), Logistics Holding Corp., a Delaware corporation with its offices at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808 (as further defined below, “GE Logistics Holdco”), and General Electric Credit Corporation of Tennessee, a Tennessee corporation with its offices at 2 Bethesda Metro Center, Suite 600, Bethesda MD 20814 (as further defined below, “GE Tennessee”), as members.

WITNESSETH:

WHEREAS, a limited liability company was heretofore formed in accordance with the provisions of the Delaware Limited Liability Company Act (6 Del.C. §18-101, et seq.) (as amended from time to time and any successor to such Act, the “Act”) under the name LJ VP Holdings LLC (the “Company”);

WHEREAS, the parties hereto entered into a Limited Liability Company Agreement dated as of April 24, 2012, with respect to the Company (the “Original LLC Agreement”), and the members of the Company now desire to amend and restate in its entirety the Original LLC Agreement; and

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto, intending to be legally bound, hereby agree that the Original LLC Agreement is hereby amended and restated in its entirety by this Agreement, and as so amended and restated hereby shall read in its entirety as follows:

ARTICLE 1

THE LIMITED LIABILITY COMPANY

1.1 Formation and Membership.

(a) The parties hereto (the “Initial Members”), in consideration of the mutual covenants and agreements herein contained, have formed the Company under and pursuant to the provisions of the Act to engage in the business hereinafter described for the period and upon the terms and conditions hereinafter set forth.

(b) The Initial Members have been admitted to the Company as Members, and the Initial Members have contributed to the capital of the Company their initial Capital Contributions in exchange for each of their respective Member Interests, as set forth in Article 3 below.

1.2 Certificate of Limited Liability Company. PTLC, as Managing Member, has executed and caused to be filed a Certificate of Formation of the Company in the office of the Secretary of State of the State of Delaware on April 10, 2012 (the “Certificate”). The Managing Member hereafter shall execute such further documents and take such further action as shall be appropriate to comply with all requirements of Law for the formation and operation of a limited liability company in the State of Delaware.

1.3 Name. The name of the Company is “LJ VP Holdings LLC”.

1.4 Character of Business. The business of the Company shall be limited exclusively to (i) issuing the Company Bonds and complying with its obligations with respect thereto and (ii) owning the member interests of the Company Sub and directing the Company Sub’s activities as limited partner or general partner of the Partnership, as applicable. The Company shall have and exercise all the powers now or hereafter conferred by the Laws of the State of Delaware on limited liability companies formed under the Laws of that State to do any and all things as fully as natural persons might or could do as are not prohibited by Law, but only as necessary or appropriate to effectuate the purpose of the Company set forth in the immediately preceding sentence, including, without limitation, the execution and delivery by the Managing Member, on behalf of the Company, of the Company Bond Indenture, the Company Bonds and any related purchase agreement relating to the offer and sale of the Company Bonds in accordance with the provisions thereof. The business of the Company shall be conducted in accordance with, and any action required or permitted to be taken by the Managing Member or any Non-Managing Member shall be taken in compliance with, all applicable Laws.

1.5 Certain Business Policies. The Company, on behalf of itself and the Company Sub, will maintain the standards and abide by the policies set forth in the Partnership’s Code for Business Conduct in effect as of the Effective Time as if the Company were the Partnership thereunder. The Company shall conduct its business and the business of the Company Sub in accordance with such policies, as the same may be amended from time to time in accordance with Subsection 6.4(b)(iii).

- 2 -

1.6 Principal Offices. The location of the principal offices of the Company shall be at 2675 Morgantown Road, Reading, Pennsylvania 19607, or at such other location as may be selected from time to time by the Managing Member. If the Managing Member changes the location of the principal offices of the Company, the Non-Managing Members shall be notified in writing within thirty (30) days thereafter. The Company may maintain such other offices at such other places as the Managing Member deems advisable.

1.7 Fiscal Year. The fiscal year of the Company shall be the calendar year (the “Company Year”).

1.8 Accounting Matters. Unless otherwise specified herein, all accounting determinations hereunder shall be made, all accounting terms used herein shall be interpreted, and all financial statements required to be delivered hereunder shall be prepared, in accordance with Generally Accepted Accounting Principles applied on a consistent basis with prior periods, except, in the case of such financial statements, for departures from Generally Accepted Accounting Principles that may from time to time be approved in writing by the GE Representative Member and the Auditor who is at the time reporting on such financial statements.

ARTICLE 2

DEFINITIONS

The following defined terms used in this Agreement shall have the respective meanings specified below.

2.1 Accepting Members. “Accepting Members” shall have the meaning ascribed to such term in Subsection 9.3(e) hereof.

2.2 Act. “Act” shall have the meaning ascribed to such term in the first “Whereas” clause hereof.

2.3 Additional Capital Contribution Loan. “Additional Capital Contribution Loan” shall mean a loan to a Delinquent Member for an Interest Obligations Deficiency relating to Interest Obligations, which shall bear interest at the Default Rate and will be due and payable in full one hundred eighty (180) days after its issuance.

2.4 Adjusted Capital Account Deficit. “Adjusted Capital Account Deficit” shall mean, with respect to any Member, the deficit balance, if any, in such Member’s Capital Account as of the end of the relevant taxable year or other period, after giving effect to the following adjustments:

(i) Credit to such Capital Account any amounts that such Member is obligated to restore (pursuant to the terms of this Agreement or otherwise) or deemed obligated to restore pursuant to the penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and

- 3 -

(ii) Debit to such Capital Account the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6).

The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

2.5 Affiliate. “Affiliate” shall mean, with respect to any specified Person, any other Person that, at the time of determination, (i) directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with, such specified Person, (ii) beneficially owns or Controls ten percent (10%) or more of any class or series of outstanding voting securities of such specified Person, (iii) is a managing member, manager or general partner of such specified Person, or (iv) is an officer, director, managing member, manager or general partner of any of the foregoing.

2.6 Agreement. This “Agreement” shall refer to this Amended and Restated Limited Liability Company Agreement, including the Schedules hereto, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.7 Alternate Transaction. “Alternate Transaction” shall have the meaning ascribed to such term in Section 10.2.

2.8 Alternative Structure. “Alternative Structure” or “Alternative Structures” shall have the meaning ascribed to such term in Section 10.2.

2.9 Auditor. “Auditor” shall mean Deloitte LLP, or any successor firm of independent auditors selected pursuant to Subsection 6.4(g) of the Partnership Agreement.

2.10 Backstop Defaulting Member. “Backstop Defaulting Member” shall have the meaning ascribed to such term in Section 5.1.

2.11 Backstop Indemnity Obligation. “Backstop Indemnity Obligation” shall mean the obligation of each of PTLC and PAG and its permitted successors and permitted assigns for payment of its Co-Obligation Fee and Indemnified Amount (as such terms are defined in its Indemnification Agreement).

2.12 Bankruptcy. The “Bankruptcy” of a Member shall mean (i) the filing by a Member of a voluntary petition seeking liquidation, reorganization, arrangement or readjustment, in any form, of its debts under Title 11 of the United States Code or any other federal or state insolvency Law, or a Member’s filing an answer consenting to or acquiescing in any such petition, (ii) the making by a Member of any assignment for the benefit of its creditors or (iii) the expiration of sixty (60) days after the filing of an involuntary petition under Title 11 of the United States Code, an application for the appointment of a receiver for the assets of a Member, or an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of its debts under any other federal or state insolvency Law, provided that the same shall not have been vacated, set aside or stayed within such sixty (60) day period.

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2.13 Bonds Interest Payment Date. “Bonds Interest Payment Date” shall mean the date that any Interest Obligations are due and payable to the holders of the Company Bonds as set forth in the Company Bond Indenture as in effect on the date hereof, unless any amendment or waiver thereto is consented to by the Penske Members.

2.14 Bonds Maturity Date. “Bonds Maturity Date” shall mean the date that the Maturity Obligations are due and payable to the holders of the Company Bonds as set forth in the Company Bond Indenture as in effect on the date hereof, unless any amendment or waiver thereto is consented to by the Penske Members.

2.15 Business Day. “Business Day” shall mean any day other than a Saturday or Sunday or other day that commercial banks are required or permitted to be closed in New York City.

2.16 Capital Account. “Capital Account” shall mean, with respect to any Member, the Capital Account maintained for such Member in accordance with the following provisions:

(i) To each Member’s Capital Account there shall be credited such Member’s Capital Contributions, such Member’s distributive share of Profits and any items in the nature of income or gain that are specially allocated pursuant to Section 5.3 or Section 5.4, and the amount of any Company liabilities assumed by such Member or that are secured by any Company property distributed to such Member;

(ii) To each Member’s Capital Account there shall be debited the amount of cash and the Gross Asset Value of any Company property distributed to such Member pursuant to any provision of this Agreement, such Member’s distributive share of Losses and any items in the nature of expenses or losses that are specially allocated pursuant to Section 5.3 or Section 5.4, and the amount of any liabilities of such Member assumed by the Company or that are secured by any property contributed by such Member to the Company.

(iii) In the event all or a portion of an interest in the Company is Transferred, in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred interest.

(iv) In determining the amount of any liability for purposes of subparagraphs (i) and (ii) and the definition of “Capital Contribution,” there shall be taken into account Code Section 752 (c) and any other applicable provisions of the Code and Regulations.

2.17 Capital Contribution. “Capital Contribution” shall mean, with respect to any Member, the amount of money and the initial Gross Asset Value of any property (other than money) contributed to the Company by such Member (or its predecessors in interest) with respect to the Member Interest of such Member.

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2.18 Certificate. “Certificate” shall have the meaning ascribed to such term in Section 1.2.

2.19 Code. “Code” shall mean the Internal Revenue Code of 1986, as amended and in effect from time to time, or the corresponding provisions of any successor statute.

2.20 Company. “Company” shall have the meaning ascribed to such term in the first “Whereas” clause hereof.

2.21 Company Bond Indenture. “Company Bond Indenture” shall mean the indenture, dated as of April 30, 2012, entered into by the Company and GECC in their capacities as co-issuers of the Company Bonds, with The Bank of New York Mellon, as Trustee, as the same may be amended, restated, supplemented or otherwise modified from time to time, or any successor indenture relating to any successor notes or bonds issued in connection with a Refinancing pursuant to Section 10.2.

2.22 Company Bonds. “Company Bonds” shall mean the notes of the Company and GECC, as co-obligors, in an aggregate amount of $700,000,000, issued pursuant to the Company Bond Indenture, or any successor notes or bonds issued in connection with a Refinancing pursuant to Section 10.2.

2.23 Company Minimum Gain. “Company Minimum Gain” shall have the same meaning as the term “partnership minimum gain” in Regulations Sections 1.704-2(b)(2) and 1.704-2(d).

2.24 Company Sub. “Company Sub” shall mean LJ VP, LLC, a wholly owned Subsidiary of the Company and limited partner or general partner, as applicable, of the Partnership.

2.25 Company Year. “Company Year” shall have the meaning ascribed to such term in Section 1.7.

2.26 Contribution Subaccount. “Contribution Subaccount” shall have the meaning ascribed to such term in Subsection 3.2(f).

2.27 Control. “Control” (including the correlative terms “Controlling,” “Controlled by” and “under common Control with”) shall mean 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.

2.28 Deemed Transfer. “Deemed Transfer” shall have the meaning ascribed to such term in Subsection 8.2(e).

2.29 Default Rate. “Default Rate” shall mean a rate of interest per annum equal to the Prime Rate as it may change from time to time plus 2.5%, provided that the Default Rate shall not exceed a rate that may be lawfully charged.

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2.30 Delinquent Member. “Delinquent Member” shall have the meaning ascribed to such term in Subsection 3.2(g).

2.31 Depreciation. “Depreciation” shall mean, for each taxable year or portion of a taxable year for which the Company is required to allocate Profits, Losses, or other items pursuant to Article 5, an amount equal to the depreciation, amortization or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such year or other period, except that (i) with respect to any asset whose Gross Asset Value differs from its adjusted tax basis for federal income tax purposes and which difference is being eliminated by use of the “remedial allocation method” defined by Treasury Regulation Section 1.704-3(d), Depreciation for such taxable year or portion of a taxable year shall be the amount of the book basis recovered for such taxable year or portion of a taxable year under the rules prescribed in Treasury Regulation Section 1.704-3(d)(2) (notwithstanding anything to the contrary in Subsection 5.6(c)) and (ii) with respect to any other asset whose Gross Asset Value differs from its adjusted basis for federal income tax purposes at the beginning of such year or other period, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period bears to such beginning adjusted tax basis; provided, however, that if the adjusted tax basis of an asset at the beginning of such taxable year or portion of a taxable year is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method agreed upon by the Managing Member and the GE Representative Member.

2.32 Effective Time. “Effective Time” shall mean the close of the Company’s business on the date of this Agreement.

2.33 Equity Offering. “Equity Offering” shall have the meaning ascribed to such term in Section 10.2.

2.34 Evaluation Material. “Evaluation Material” shall have the meaning ascribed to such term in Section 6.8.

2.35 Exchange Act. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in effect from time to time, or the corresponding provisions of any successor statute, and the rules and regulations promulgated thereunder.

2.36 Fall Away Event. “Fall Away Event” shall mean the assumption by GECC of all obligations under the Company Bond Indenture and the securities issued thereunder pursuant to Section 11.03 thereof.

2.37 First Delinquency Notice. “First Delinquency Notice” shall have the meaning ascribed to such term in Subsection 3.2(g)(i).

2.38 Funding Loan. “Funding Loan” shall have the meaning ascribed to such term in Subsection 8.2(e)(iii).

2.39 Funding Subaccount. “Funding Subaccount” shall have the meaning ascribed to such term in Subsection 3.2(a).

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2.40 GECC. “GECC” shall mean General Electric Capital Corporation, a Delaware corporation.

2.41 GECC Consolidated Group. “GECC Consolidated Group” shall mean the consolidated group, determined in accordance with Generally Accepted Accounting Principles, of which GECC is the common parent.

2.42 GE Logistics Holdco. “GE Logistics Holdco” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.43 GE Losses. “GE Losses” shall mean all damages, losses, liabilities, costs and expenses incurred by GECC or any of its Affiliates resulting from or attributable to any breach of or default under a Backstop Indemnity Obligation.

2.44 GE Members. “GE Members” shall mean GE Truck Leasing Holdco, GE Logistics HoldCo, GE Tennessee and any Permitted Intragroup Transferees thereof.

2.45 Generally Accepted Accounting Principles. “Generally Accepted Accounting Principles” shall refer to generally accepted accounting principles as in effect from time to time in the United States of America.

2.46 General Partner Activities. “General Partner Activities” shall have the meaning ascribed to such term in Section 4.2.

2.47 GE Representative Member. “GE Representative Member” shall mean (i) GE Truck Leasing Holdco or such other Member as designated by the then existing GE Members, or (ii) any permitted successor or permitted assignee to which a GE Member has Sold in whole or in part its right to designate or replace the GE Representative Member pursuant to Subsection 9.5(d) (and any permitted successor or permitted assignee thereof) or such other Member as designated thereby.

2.48 GE Tennessee. “GE Tennessee” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.49 GE Truck Leasing Holdco. “GE Truck Leasing Holdco” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.50 Governmental Authority. “Governmental Authority” shall mean any (i) U.S., foreign, federal, state, local or other government, (ii) governmental commission, board, body, bureau, agency, department or other judicial, regulatory or administrative authority of any nature, including courts, tribunals and other judicial bodies, (iii) any self regulatory body or authority, and (iv) any instrumentality or entity designed to act for or on behalf of the foregoing in exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

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2.51 Gross Asset Value. “Gross Asset Value” shall mean, with respect to any asset, the asset’s adjusted basis for federal income tax purposes except as follows:

(1) The initial Gross Asset Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset, as agreed to by the Contributing Member and the Managing Member at the time of such contribution; provided, that, if the contributing Member is the Managing Member or an Affiliate of the Managing Member, the gross fair market value of such asset must be approved by the GE Representative Member;

(2) The Gross Asset Values of all Company assets shall be adjusted to equal their respective gross fair market values, as proposed by the Managing Member and approved by the GE Representative Member, as of the following times: (a) the acquisition of an additional interest in the Company by any new or existing Member in exchange for more than a de minimis Capital Contribution; (b) the distribution by the Company to a Member of more than a de minimis amount of property as consideration for a Member Interest; (c) the liquidation of the Company within the meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(g); and (d) in connection with the grant of an interest in the Company (other than a de minimis interest) as consideration for the provision of services to or for the benefit of the Company by an existing Member acting in a member capacity, or by a new Member acting in a member capacity in anticipation of being a Member; provided, however, that adjustments pursuant to clauses (a), (b) and (d) above shall be made only if the Managing Member reasonably determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members in the Company;

(3) The Gross Asset Value of any Company asset distributed to any Member shall be adjusted to equal the gross fair market value of such asset on the date of distribution as determined by the distributee and the Managing Member, provided that, if the distributee is the Managing Member or an Affiliate of the Managing Member, the determination of the fair market value of the distributed asset shall require the approval of the GE Representative Member; and

(4) The Gross Asset Values of Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Section 743(b) but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to (a) Regulations Section 1.704-1(b)(2)(iv)(m) and (b) subparagraph (vi) of the definition of “Profits” and “Losses” in Subsection 2.98 or Subsection 5.3(g), provided, however, that Gross Asset Values shall not be adjusted pursuant to this subparagraph (4) to the extent the Managing Member determines that an adjustment pursuant to subparagraph (2) is necessary or appropriate in connection with a transaction that would otherwise result in an adjustment pursuant to this subparagraph (4).

If the Gross Asset Value of an asset has been determined or adjusted pursuant to Subsections 2.51(1), (2), or (4) hereof, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses.

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2.52 Indemnification Agreements. “Indemnification Agreements” shall mean (i) the PTLC Co-Obligation Fee, Indemnity and Security Agreement, dated as of the date hereof, by and among PTLC, Penske System, Inc. and GECC, (ii) the PAG Co-Obligation Fee, Indemnity, and Security Agreement, dated as of the date hereof, by and among PAG and GECC, each as may be amended, restated, supplemented or otherwise modified from time to time and (iii) any instrument of assumption or indemnification executed by any transferee of Member Interests that sets forth such transferee’s agreement to be bound by all of the provisions of an Indemnification Agreement in connection with a Sale of Member Interests pursuant to Article 9.

2.53 Initial Members. “Initial Members” shall have the meaning ascribed to such term in Subsection 1.1(a).

2.54 Initiated Offer. “Initiated Offer” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.55 Interested Party. “Interested Party” shall have the meaning ascribed to such term in Section 6.5.

2.56 Interest Obligations. “Interest Obligations” shall mean the next scheduled interest payment obligation required under the Company Bonds (other than the interest component of any Maturity Obligations).

2.57 Interest Obligations Deficiency. “Interest Obligations Deficiency” shall have the meaning ascribed to such term in Subsection 3.2(b).

2.58 Interest Obligations Deficiency Notice. “Interest Obligations Deficiency Notice” shall have the meaning ascribed to such term in Subsection 3.2(b).

2.59 Interest Obligations Deficiency Response Notice. “Interest Obligations Deficiency Response Notice” shall have the meaning ascribed to such term in Subsection 3.2(e).

2.60 Interest Sweep Date. “Interest Sweep Date” shall have the meaning ascribed to such term in Subsection 3.2(c).

2.61 Investment Company Act. “Investment Company Act” shall mean the United States Investment Company Act of 1940, as amended and in effect from time to time, or the corresponding provisions of any successor statute, and the rules and regulations thereunder.

2.62 Law. “Law” shall mean any applicable foreign or domestic, federal, state or local statute, ordinance, rule, regulation, code, license, permit, authorization, approval, consent, order, judgment, decree, injunction or requirement of any Governmental Authority or any arbitration tribunal.

2.63 Lien. “Lien” shall mean any mortgage, deed of trust, pledge, hypothecation, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).

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2.64 LJ VP Holdings Payment Account. “LJ VP Holdings Payment Account” shall have the meaning ascribed to such term in the Company Bond Indenture.

2.65 Managing Member. “Managing Member” shall mean initially PTLC until such time as it withdraws or is replaced in accordance with this Agreement, any Person substituted therefor in accordance with the terms of this Agreement and any Person admitted from time to time as a managing member in the Company in accordance with this Agreement.

2.66 Maturity Deficiency. “Maturity Deficiency” shall have the meaning ascribed to such term in Subsection 3.3(b).

2.67 Maturity Deficiency Notice. “Maturity Deficiency Notice” shall have the meaning ascribed to such term in Subsection 3.3(b).

2.68 Maturity Obligations. “Maturity Obligations” shall mean an aggregate amount sufficient to satisfy all obligations due upon the scheduled maturity of the Company Bonds, including principal and interest, pursuant to the Company Bond Indenture as in effect on the date hereof.

2.69 Maturity Sweep Date. “Maturity Sweep Date” shall have the meaning ascribed to such term in Subsection 3.3(d).

2.70 Member. “Member” shall mean the Non-Managing Members and Managing Member, and shall include each Person admitted from time to time as a member in the Company in accordance with Article 9 of this Agreement.

2.71 Member Interest. “Member Interest” shall refer, with respect to a given Member as of a given date, to such Member’s interest as a managing member in the Company (if any) and such Member’s interest as a non-managing member in the Company (if any), in each case as of such date, including any and all benefits to which the holder of such an interest may be entitled as provided in this Agreement, together with all obligations of such Member to comply with the terms and provisions of this Agreement.

2.72 Member Nonrecourse Debt. “Member Nonrecourse Debt” shall have the same meaning as the term “partner nonrecourse debt” set forth in Regulations Section 1.704-2(b)(4).

2.73 Member Nonrecourse Debt Minimum Gain. “Member Nonrecourse Debt Minimum Gain” shall mean an amount, with respect to each Member Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with the provisions of Regulations Section 1.704-2(i)(3) relating to “partner Nonrecourse Debt minimum gain.”

2.74 Member Nonrecourse Deductions. “Member Nonrecourse Deductions” shall have the same meaning as the term “partner nonrecourse deductions” set forth in Regulations Sections 1.704-2(i)(1) and 1.704-2(i)(2).

2.75 Non-Issuing Member. “Non-Issuing Member” shall have the meaning ascribed to such term in Section 6.8.

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2.76 Non-Managing Member. “Non-Managing Member” shall initially mean PAG, GE Tennessee, GE Truck Leasing Holdco and GE Logistics Holdco, and shall include each Person admitted from time to time as a non-managing member in the Company.

2.77 Nonrecourse Deductions. “Nonrecourse Deductions” shall have the meaning set forth in Regulations Sections 1.704-2(b)(1) and 1.704-2(c).

2.78 Nonrecourse Liability. “Nonrecourse Liability” shall have the meaning set forth in Regulations Section 1.704-2(b)(3).

2.79 Offer. “Offer” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.80 Offered Interest. “Offered Interest” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.81 Offeree Member. “Offeree Member” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.82 Offering Member. “Offering Member” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.83 Original LLC Agreement. “Original LLC Agreement” shall have the meaning ascribed to such term in the second “Whereas” clause hereof.

2.84 PAG. “PAG” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.85 PAG Consolidated Group. “PAG Consolidated Group” shall mean a consolidated group, determined in accordance with Generally Accepted Accounting Principles, of which PAG is the common parent.

2.86 Parent Company. “Parent Company” shall mean, in the case of a GE Member, GECC and, in the case of a Penske Member, Penske Corporation. The Parent Company of PAG shall be Penske Corporation for so long as PAG is controlled by Penske Corporation.

2.87 Partnership. “Partnership” shall mean Penske Truck Leasing Co., L.P., a Delaware limited partnership.

2.88 Partnership Agreement. “Partnership Agreement” shall mean the Fourth Amended and Restated Agreement of Limited Partnership dated as of the date hereof by and among PTLC, PAG, GE Logistics Holdco, GE Truck Leasing Holdco, GE Tennessee and Company Sub, as limited partners, and PTLC, as general partner, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.89 Partnership Interests. “Partnership Interests” shall have the meaning ascribed to such term in the Partnership Agreement.

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2.90 Paying Agent. “Paying Agent” shall have the meaning ascribed to such term in Subsection 3.2(a).

2.91 Penske Members. “Penske Members” shall mean PTLC and shall include any Permitted Intragroup Transferees thereof.

2.92 Percentage Interest. The “Percentage Interest” of a Member shall be the percentage ownership set forth next to its respective name on Schedule B hereto, as such Schedule B shall be amended, restated, supplemented, or otherwise modified from time to time to reflect Sales of interests in the Company to the extent permitted by this Agreement.

2.93 Permitted Intragroup Transferees. “Permitted Intragroup Transferees” shall mean successors and assigns permitted or required under Subsections 9.2(b), (c) or (e).

2.94 Permitted Working Capital. “Permitted Working Capital” shall mean any amounts that the Managing Member reasonably determines are necessary to meet current expenses of the Company, provided that such amounts shall not exceed $100,000 in the aggregate.

2.95 Person. “Person” shall include an individual, a partnership, a corporation, a limited liability company, a trust, an unincorporated organization, a government or any department or agency thereof, and any other entity.

2.96 Potential Buyer. “Potential Buyer” shall have the meaning ascribed to such term in Section 6.8.

2.97 Prime Rate. “Prime Rate” shall mean the prime rate (the base rate on corporate loans at large U.S. money center commercial banks) as published in the Wall Street Journal or other equivalent publication if the Wall Street Journal no longer publishes such information.

2.98 Profits and Losses. “Profits” and “Losses” shall mean, for each taxable year or portion of a taxable year, an amount equal to the Company’s taxable income or loss for such taxable year or portion of a taxable year, determined in accordance with Section 703(a) of the Code (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in taxable income or loss), with the following adjustments:

(i) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses pursuant to this Subsection 2.98 shall be added to such taxable income or loss;

(ii) Any expenditures of the Company described in Section 705(a)(2)(B) of the Code or treated as Code Section 705(a)(2)(B) expenditures pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Profits or Losses pursuant to this Subsection 2.98 shall be subtracted from such taxable income or loss;

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(iii) In the event the Gross Asset Value of any Company asset is adjusted pursuant to Subsection 2.51(2) or (3) hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset for purposes of computing Profits or Losses;

(iv) Gain or loss resulting from any disposition of Company property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the property disposed of, notwithstanding that the adjusted tax basis of such property differs from its Gross Asset Value;

(v) In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such taxable year or portion of a taxable year;

(vi) To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Code Sections 734(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s interest in the Company, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for purposes of computing Profits or Losses; and

(vii) Notwithstanding any other provision of this definition of “Profits” and “Losses,” any items that are specially allocated pursuant to Sections 5.3 and 5.4 shall not be taken into account in computing Profits or Losses.

The amounts of items of Company income, gain, loss, or deduction available to be specially allocated pursuant to Sections 5.3 and 5.4 shall be determined by applying rules analogous to those set forth in subparagraphs (i) through (vi).

2.99 Pro Rata Interest Obligations Deficiency Amount. “Pro Rata Interest Obligations Deficiency Amount” shall have the meaning ascribed to such term in Subsection 3.2(b).

2.100 Pro Rata Maturity Deficiency Amount. “Pro Rata Maturity Deficiency Amount” shall have the meaning ascribed to such term in Subsection 3.3(b).

2.101 PTLC. “PTLC” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.102 PTLC Consolidated Group. “PTLC Consolidated Group” shall mean the consolidated group, determined in accordance with Generally Accepted Accounting Principles, of which Penske Corporation is the common parent, except that members of the PAG Consolidated Group shall not be deemed members of the PTLC Consolidated Group.

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2.103 Qualified Purchaser. “Qualified Purchaser” shall mean a “qualified purchaser” as defined in Section 2(a)(51)(A) of the Investment Company Act.

2.104 Rebuttal. “Rebuttal” shall have the meaning ascribed to such term in Section 10.2.

2.105 Recipient Group. “Recipient Group” shall have the meaning ascribed to such term in Section 6.8.

2.106 Refinancing. “Refinancing” shall have the meaning ascribed to such term in Section 10.2.

2.107 Regulations. “Regulations” shall mean the United States Income Tax Regulations, including Temporary Regulations, promulgated under the Code, as such regulations may be amended, restated, supplemented or otherwise modified from time to time.

2.108 Regulatory Allocations. “Regulatory Allocations” shall have the meaning ascribed to such term in Section 5.4.

2.109 Required Interest Deposit Date. “Required Interest Deposit Date” shall have the meaning ascribed to such term in Subsection 3.2(a).

2.110 Required Maturity Deposit Date. “Required Maturity Deposit Date” shall have the meaning ascribed to such term in Subsection 3.3(a).

2.111 Response Notice. “Response Notice” shall have the meaning ascribed to such term in Subsection 9.3(d) hereof.

2.112 Returns. “Returns” shall have the meaning ascribed to such term in Subsection 8.2(d).

2.113 Sale. “Sale” (including, with its correlative meanings, “Sell” and “Sold”) with respect to a Member Interest shall mean any voluntary or involuntary sale, assignment, transfer or other disposition of all or any portion of such Member Interest (or any right or interest therein), including by operation of Law, but, for the avoidance of doubt, does not include the creation of any Liens upon a Member Interest unless the holder of such a Lien acquires all or any portion of such Member Interest or the Member Interest is otherwise sold, transferred or assigned in accordance with the Lien.

2.114 Schedule. “Schedule” shall refer to one of several written Schedules to this Agreement, as amended, restated, supplemented or otherwise modified from time to time to the extent permitted by this Agreement, each of which is hereby incorporated into and made a part of this Agreement for all purposes.

2.115 Second Delinquency Notice. “Second Delinquency Notice” shall have the meaning ascribed to such term in Subsection 3.2(h)(i).

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2.116 Securities Act. “Securities Act” shall mean the Securities Act of 1933, as amended and in effect from time to time, or the corresponding provisions of any successor statute, and the rules and regulations promulgated thereunder.

2.117 Subsidiary. “Subsidiary” shall refer to (i) any corporation (or equivalent legal entity under foreign Law) of which another Person owns directly or indirectly more than fifty percent (50%) of the stock, the holders of which are ordinarily and generally, in the absence of contingencies or understandings, entitled to vote for the election of directors, (ii) any limited liability company in which such Person owns directly or indirectly more than fifty percent (50%) of the membership interests, (iii) any partnership in which such other Person owns directly or indirectly more than fifty percent (50%) of the partnership interests and (iv) any other entity of which another Person has the voting power to elect the majority of the members of the board of directors, the board of managers, or a similar body of such entity.

2.118 Third-Party Proposed Sale. “Third Party Proposed Sale” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.119 Third Party Sale. “Third Party Sale” shall have the meaning ascribed to such term in Section 10.1.

2.120 Transaction Notice. “Transaction Notice” shall have the meaning ascribed to such term in Section 10.2.

2.121 Transfer. “Transfer” shall mean any Sale or creation of a Lien.

2.122 Trustee. “Trustee” shall mean, The Bank of New York Mellon, or any successor thereto appointed as trustee pursuant to the Company Bond Indenture.

2.123 Trustee Affiliate. “Trustee Affiliate” shall mean, with respect to the Trustee, any other Person that, at the time of determination, (i) directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with, the Trustee.

2.124 General Provisions. Unless the context otherwise requires, as used in this Agreement (i) the terms “herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision; (ii) terms used herein in the singular also include the plural and vice versa; (iii) all references to statutes and related regulations shall include any amendments of same and any successor statutes and regulations; (iv) any pronoun shall include the corresponding masculine, feminine and neuter forms; (v) the words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; (vi) the word “will” shall be construed to have the same meaning and effect as the word “shall”; (vii) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Section of, and Exhibits and Schedules to, this Agreement; and (viii) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

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ARTICLE 3

CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS

3.1 Initial Capital Contribution. Each of the Members has made, on or before the Effective Time, the initial Capital Contributions set forth on Schedule A hereto, and, effective as of the Effective Time, the Percentage Interest of each Member in the Company is as set forth on Schedule B hereto.

3.2 Matters Regarding Interest Obligations. At any time prior to the Fall Away Event:

(a) No later than the date that is twenty one (21) Business Days prior to a Bonds Interest Payment Date (each, a “Required Interest Deposit Date”), the Company shall deposit with the Trustee, acting in its capacity as paying agent under the Company Bond Indenture (the “Paying Agent”), in a subaccount maintained by the Trustee for the benefit of the holders of the Company Bonds and itself in its capacity as Paying Agent within the LJ VP Holdings Payment Account established under the Company Bond Indenture (the “Funding Subaccount”), all of the Company’s cash and cash equivalents on hand (other than Permitted Working Capital), but not greater than the amount of such Interest Obligations, to be applied to pay such Interest Obligations.

(b) If the amount deposited by the Company pursuant to Subsection 3.2(a) is insufficient to satisfy in its entirety the Interest Obligations to become due on or before the next Bonds Interest Payment Date, then, no later than one (1) Business Day following such deposit, or, if no deposit has been made, one (1) Business Day following the day that the deposit was due to be made, the Company shall deliver a written notice to the Members (the “Interest Obligations Deficiency Notice”) that sets forth (i) the amount of the Interest Obligations so to become due, (ii) the amount on deposit in the Funding Subaccount, (iii) the excess of the amount necessary to satisfy in their entirety such Interest Obligations, over the amount so on deposit (such excess amount in this clause (iii), the “Interest Obligations Deficiency”), (iv) any other details reasonably necessary to describe the Interest Obligations Deficiency, and (v) such Member’s Percentage Interest of such Interest Obligations Deficiency (the “Pro Rata Interest Obligations Deficiency Amount”).

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(c) Notwithstanding the processes set forth in this Section 3.2, GECC may in its sole discretion at any time elect to fund the full amount or any portion of the Interest Obligations or the Interest Obligations Deficiency by making payment of the Interest Obligations then due or the Interest Obligations Deficiency, respectively, directly to the Paying Agent under the Company Bond Indenture. Upon GECC’s determination to make such payment, if GECC has made such election on or before the fifth (5^th) Business Day prior to the applicable Bonds Interest Payment Date (the “Interest Sweep Date”), it shall to the extent lawful give notice of such determination to the Managing Member (who shall notify the Members), and the processes contemplated by the further provisions of Subsections 3.2(d), 3.2(e), 3.2(f) and 3.2(g) shall be rescinded and the Managing Member by notice to the Trustee on the Interest Sweep Date shall instruct it to return to the applicable Members those payments actually made into the Contribution Subaccount, with such notice to include wire instructions and amounts to be returned to such applicable Members without releasing any party from its obligations under the Indemnification Agreements. If GECC makes any payment as described in this Subsection 3.2(c) with respect to a particular Bonds Interest Payment Date and there are funds remaining in the Funding Subaccount immediately after such payment has been made, (i) GECC shall, as soon as practicable, unless GECC has been advised by counsel that it would reasonably be likely to be prohibited by applicable Law from doing so, direct the Trustee to deliver, or cause to be delivered, such funds in the Funding Subaccount to GECC in an amount not to exceed, and as reimbursement for, the payment of the Interest Obligations or the Interest Obligations Deficiency, as the case may be, by GECC, in which case, upon the receipt of such funds by GECC, PTLC’s and PAG’s respective Backstop Indemnity Obligations with respect to such payment by GECC shall be reduced as provided in the Indemnification Agreements and (ii) if GECC has been reimbursed in full for the payment by GECC of the Penske Members’ and PAG’s respective portions of the Interest Obligations or the Interest Obligations Deficiency, as the case may be, pursuant to the Backstop Indemnity Obligations, then, subject to the Penske Members and PAG reimbursing GECC for any expenses incurred by GECC, GECC shall cooperate with the Members to, unless GECC has been advised by counsel that it would reasonably be likely to be prohibited by applicable Law from doing so, direct the Trustee to deliver, or cause to be delivered, to GECC such funds actually deposited by the Members, which funds GECC shall promptly distribute to the Members in proportion to the Members’ Percentage Interests. Notwithstanding the foregoing, PTLC’s and PAG’s respective Backstop Indemnity Obligations with respect to any payment by GECC to the Paying Agent shall remain in full force and effect and may be satisfied as provided in the Indemnification Agreements if GECC has been advised by counsel that it would reasonably be likely to be prohibited by applicable Law from directing the Trustee to deliver, or the Trustee does not deliver, the funds in the Funding Subaccount to GECC.

(d) If at any time from the Required Interest Deposit Date through and including the Interest Sweep Date for the applicable Bonds Interest Payment Date an Interest Obligations Deficiency exists and the Company receives, other than by way of Capital Contributions, additional funds that it may deposit in the Funding Subaccount, then the Company will promptly deposit such funds into the Funding Subaccount, providing the Trustee with the applicable instructions and orders required by the Company Bond Indenture, and give immediate notice to the Members. Thereafter, the remainder of the process set forth in this Section 3.2 shall be adjusted to take into account such additional funds as reducing or eliminating the Interest Obligations Deficiency.

(e) No later than five (5) Business Days following the delivery of the Interest Obligations Deficiency Notice, each Member shall provide written notice to the Company and the other Members regarding whether such Member intends to fund its Pro Rata Interest Obligations Deficiency Amount through a Capital Contribution to the Company (the “Interest Obligations Deficiency Response Notice”). For the avoidance of doubt, the right to fund a Pro Rata Interest Obligations Deficiency Amount is at the sole discretion of each Member and the Company does not have any contractual right to such Member’s Pro Rata Interest Obligations Deficiency Amount.

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(f) Subject to GECC’s rights under Subsection 3.2(c), if all of the Members state their intention, in written notice within the five (5) Business Day period to the other Members, to fund their Pro Rata Interest Obligations Deficiency Amount, then each Member shall so fund its Pro Rata Interest Obligations Deficiency Amount by payment into the Contribution Subaccount of the LJ VP Holdings Payment Account established under the Company Bond Indenture (the “Contribution Subaccount”) not later than the Interest Sweep Date with notice to the Managing Member indicating the amount of such payment, and such payments shall be deemed to be Capital Contributions by such Members. Each such payment and Capital Contribution shall be conditioned on all Members making their payments and Capital Contributions, and if a Member shall default in making such payments and Capital Contributions by the Interest Sweep Date, the Managing Member by notice to the Trustee shall instruct it to return to the applicable Members those payments actually made into the Contribution Subaccount, with such notice to include wire instructions and amounts to be returned to such applicable Members.

(g) If a Member states that it declines to fund its Pro Rata Interest Obligations Deficiency Amount in a written notice delivered to the other Members within the five (5) Business Day period provided in Subsection 3.2(e) or fails to deliver a written notice to the other Members within such five (5) Business Day period that it so intends to fund (the “Delinquent Member”):

(i) the Managing Member shall deliver a written notice (the “First Delinquency Notice”) no later than one (1) Business Day following the day that the Interest Obligations Deficiency Response Notice is due describing such declination or failure (A) if such Delinquent Member is a Penske Member, to the other Penske Members and PAG, (B) if such Delinquent Member is a GE Member, to the other GE Members and (C) if such Delinquent Member is not a Penske Member or a GE Member, to the other non-declining Members; and

(ii) subject to the rights of GECC under Subsection 3.2(c), if the Members other than the Delinquent Member or Delinquent Members state their intention to fund the Interest Obligations Deficiency within four (4) Business Days of the delivery of the First Delinquency Notice, then each such non-Delinquent Member shall so fund its Pro Rata Interest Obligations Deficiency Amount (and the Members receiving the notice under Subsection 3.2(g)(i)(A), (B) or (C), as applicable, shall fund the Delinquent Member’s Pro Rata Interest Obligations Deficiency Amount) by payment into the Contribution Subaccount not later than the Interest Sweep Date. The payment by a Member of its Pro Rata Interest Obligations Deficiency Amount shall be deemed to be a Capital Contribution by such Member and the Delinquent Member’s Pro Rata Interest Obligations Deficiency Amount shall be deemed a Capital Contribution by the Delinquent Member and an Additional Capital Contribution Loan by the paying Member to the Delinquent Member. Each such payment, Capital Contribution and loan shall be conditioned on all other non-Delinquent Members making their payments and Capital Contributions, and if a Member shall default in making such payments and Capital Contributions by the Interest Sweep Date, the Managing Member by notice to the Trustee shall instruct it to return to the applicable Members those payments actually made into the Contribution Subaccount, with such notice to include wire instructions and amounts to be returned to such applicable Members.

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(h) If a Member that receives the First Delinquency Notice states that it declines to fund the Delinquent Member’s Pro Rata Interest Obligations Deficiency Amount in a written notice delivered to the other Members within the four (4) Business Day period provided in Subsection 3.2(g)(ii) or fails to deliver a written notice to the other Members within such four (4) Business Day period that it so intends to fund:

(i) the Managing Member shall within one (1) Business Day deliver (1) if the First Delinquency Notice was received by the other Penske Members and PAG pursuant to clause (g)(i)(A), to the GE Members and the other Members, (2) if the First Delinquency Notice was received by the other GE Members pursuant to clause (g)(i)(B), to the Penske Members, PAG and the other Members and (3) if the First Delinquency Notice was received by the other Members pursuant to clause (g)(i)(C), to the other non-declining Members, a written notice (a “Second Delinquency Notice”) of such declination or failure; and

(ii) subject to the rights of GECC under Subsection 3.2(c), if one or more Members other than the Delinquent Member or Delinquent Members state their intention to fund the Interest Obligations Deficiency within three (3) Business Days of the delivery of the Second Delinquency Notice (on such basis as such non-Delinquent Members agree among themselves), then each such non-Delinquent Member shall so fund its Pro Rata Interest Obligations Deficiency Amount (and its agreed upon share of any Delinquent Members’ Pro Rata Interest Obligations Deficiency Amount) by payment into the Contribution Subaccount not later than the Interest Sweep Date. The payment by a Member of its Pro Rata Interest Obligations Deficiency Amount shall be deemed to be a Capital Contribution by such Member and its proportionate share of the Delinquent Member’s Pro Rata Interest Obligations Deficiency Amount shall be deemed a Capital Contribution by the Delinquent Member and an Additional Capital Contribution Loan by the paying Member to the Delinquent Member. Each such payment, Capital Contribution and loan shall be conditioned on all other Members making their payments and Capital Contributions, and if a Member shall default in making such payments and Capital Contributions by the Interest Sweep Date, the Managing Member by notice to the Trustee shall instruct it to return to the applicable Members those payments actually made into the Contribution Subaccount, with such notice to include wire instructions and amounts to be returned to such applicable Members.

(i) This Section 3.2 is the exclusive method by which the Company shall pay or cause to be paid any Interest Obligations then due or any Interest Obligations Deficiency.

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3.3 Matters Regarding Maturity Obligations. At any time prior to the Fall Away Event:

(a) No later than the date that is thirty (30) Business Days prior to the Bonds Maturity Date (a “Required Maturity Deposit Date”), the Company shall deposit with the Paying Agent in the Funding Subaccount all of the Company’s cash and cash equivalents on hand (other than Permitted Working Capital), but not greater than the amount of such Maturity Obligations, to be applied to pay such Maturity Obligations.

(b) If the amount deposited by the Company pursuant to Subsection 3.3(a) is insufficient to satisfy in its entirety the Maturity Obligations to become due on or before the Bonds Maturity Date, then, no later than one (1) Business Day following such deposit, or, if no deposit has been made, one (1) Business Day following the day that the deposit was due to be made, the Company shall deliver a written notice to the Members (the “Maturity Deficiency Notice”) that sets forth (i) the amount of the Maturity Obligations, (ii) the amount on deposit in the Funding Subaccount, (iii) the excess of the amount necessary to satisfy in their entirety such Maturity Obligations, over the amount so on deposit (such excess amount in this clause (iii), the “Maturity Deficiency”), (iv) any other details reasonably necessary to describe the Maturity Deficiency, and (v) such Member’s Percentage Interest of such Maturity Deficiency (the “Pro Rata Maturity Deficiency Amount”).

(c) Notwithstanding the processes set forth in this Section 3.3, GECC may in its sole discretion at any time elect to fund the full amount or any portion of any Maturity Obligations or Maturity Deficiency at any time by making payment of the Maturity Obligations then due or Maturity Deficiency, respectively, directly to the Paying Agent under the Company Bond Indenture and shall with respect to such payment with respect to amounts corresponding to the Maturity Obligations or Maturity Deficiency have all rights and remedies with respect to the Backstop Indemnity Obligations under the Indemnification Agreements (as with other amounts it pays as obligor on the Company Bonds). Upon GECC’s determination to make such payment, GECC shall to the extent lawful give notice of such determination to the Managing Member (who shall notify the Members), and the processes contemplated by the further provisions of Subsections 3.3(d), 3.3(e) and 3.3(f) shall be rescinded. If GECC makes payment as described in this Subsection 3.3(c) with respect to the Bonds Maturity Date and there are funds remaining in the Funding Subaccount immediately after such payment has been made, (i) GECC shall, as soon as practicable, unless GECC has been advised by counsel that it would reasonably be likely to be prohibited by applicable Law from doing so, direct the Trustee to deliver, or cause to be delivered, such funds in the Funding Subaccount to GECC in an amount not to exceed, and as reimbursement for, the payment of Maturity Obligations or Maturity Deficiency, as the case may be, by GECC, in which case, upon the receipt of such funds by GECC, PTLC’s and PAG’s respective Backstop Indemnity Obligations with respect to such payment by GECC shall be reduced as provided in the Indemnification Agreements and (ii) if GECC has been reimbursed in full for the payment by GECC of the Penske Members’ and PAG’s respective portions of the Maturity Obligations or the Maturity Deficiency, as the case may be, pursuant to the Backstop Indemnity Obligations, then, subject to the Penske Members and PAG reimbursing GECC for any expenses incurred by GECC, GECC shall, unless GECC has been advised by counsel that it would reasonably be likely to be prohibited by applicable Law from doing so, cooperate with the Members to direct the Trustee to deliver, or cause to be delivered, to GECC such funds actually deposited by the Members, which funds GECC shall promptly distribute to the Members in proportion to the Members’ Percentage Interests. Notwithstanding the foregoing, PTLC’s and PAG’s respective Backstop Indemnity Obligations with respect to any payment by GECC to the Paying Agent shall remain in full force and effect and may be satisfied as provided in the Indemnification Agreements if GECC has been advised by counsel that it would reasonably be likely to be prohibited by applicable Law from directing the Trustee to deliver, or the Trustee does not deliver, the funds in the Funding Subaccount to GECC.

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(d) If at any time from the Required Maturity Deposit Date through and including the date that is the twentieth (20^th) Business Day prior to the applicable Bonds Maturity Date (the “Maturity Sweep Date”) for the Bonds Maturity Date a Maturity Deficiency exists and the Company receives, other than by way of Capital Contributions, additional funds that it may deposit in the Funding Subaccount, then the Company will promptly deposit such funds into the Funding Subaccount, providing the Trustee with the applicable instructions and orders required by the Company Bond Indenture, and give immediate notice to the Members. Thereafter, the remainder of the process set forth in this Section 3.3 shall be adjusted to take into account such additional funds as reducing or eliminating the Maturity Deficiency.

(e) No later than five (5) Business Days following the delivery of the Maturity Deficiency Notice, each Member shall provide written notice to the Company and the other Members regarding whether such Member intends to fund its Pro Rata Maturity Deficiency Amount through a Capital Contribution to the Company. For the avoidance of doubt, the right to fund a Pro Rata Maturity Deficiency Amount is at the sole discretion of each Member and the Company does not have any contractual right to such Member’s Pro Rata Maturity Deficiency Amount.

(f) Subject to GECC’s rights under Subsection 3.3(c), if all of the Members state their intention, in written notice within the five (5) Business Day period to the other Members, to fund their Pro Rata Maturity Deficiency Amount, then each Member shall so fund its Pro Rata Maturity Deficiency Amount by payment into the Contribution Subaccount not later than the Maturity Sweep Date with notice to the Managing Member indicating the amount of such payment, and such payments shall be deemed to be Capital Contributions by such Members. Each such payment and Capital Contribution shall be conditioned on all Members making their payments and Capital Contributions, and if a Member shall default in making such payments and Capital Contributions by the Maturity Sweep Date, the Managing Member by notice to the Trustee shall instruct it to deliver to GECC those payments actually made into the Contribution Subaccount with respect to such Maturity Obligations by Members that are parties to the Backstop Indemnity Obligation (which payment shall be deemed to be payment to GECC by the applicable Member under its Backstop Indemnity Obligation).

(g) (i) This Section 3.3 is the exclusive method by which the Company shall pay or cause to be paid any Maturity Deficiency or any Maturity Obligations then due and (ii) nothing in this Section 3.3 shall supersede the rights and remedies with respect to the Maturity Obligations set forth in Article 10.

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3.4 Transfer of Funds in Contribution Subaccount. If the Managing Member does not provide a notice to the Trustee to instruct it to deliver amounts held in the Contribution Subaccount in accordance with Subsections 3.2(f), 3.2(g)(ii), or 3.2(h)(ii) above, and the amount on deposit in the Funding Subaccount together with the Contribution Subaccount is, at the close of business on the Interest Sweep Date, sufficient to satisfy in their entirety such Interest Obligations on such Bonds Interest Payment Date, then funds in the Contribution Subaccount shall forthwith be transferred to the Funding Subaccount and upon such transfer shall no longer be legally available to the Company, provided, however that, if at the close of business on the Interest Sweep Date, the amount on deposit in the Funding Subaccount (without giving effect to any amounts in the Contribution Subaccount as of such date) is sufficient to satisfy in their entirety such Interest Obligations on such Bonds Interest Payment Date, then no funds in the Contribution Subaccount shall be transferred to the Funding Subaccount and the Managing Member, by notice to the Trustee, shall instruct it to return to the applicable Members those payments actually made into the Contribution Subaccount, such notice to include wire instructions and amounts to be returned to such applicable Members.

3.5 Investment of Funds in Funding Subaccount and Contribution Subaccount. The cash and cash equivalents deposited into the Funding Subaccount and the Contribution Subaccount shall be invested or reinvested in any of the Dreyfus Government Cash Management Fund (Ticker DGCXX) or any of the following, as directed by the Managing Member and the GE Representative Member: (i) money market mutual funds having a rating at time of investment not lower than the AA rating category by S&P or Moody’s, including any mutual fund for which the Trustee or a Trustee Affiliate serves as investment manager, administrator, shareholder servicing agent, or custodian or subcustodian, notwithstanding that (A) the Trustee or Trustee Affiliate receives fees from funds for services rendered, (B) the Trustee collects fees for services rendered pursuant to the Company Bond Indenture, which fees are separate from the fees received from such funds, and (C) services performed for such funds and pursuant to the Company Bond Indenture may at times duplicate those provided to such funds by the Trustee or Trustee Affiliate, or (ii) demand deposits, including interest bearing money market accounts, time deposits, trust funds, trust accounts, overnight bank deposits, interest-bearing deposits, and certificates of deposit or bankers acceptances of depository institutions, including the Trustee or Trustee Affiliate, rated at least in the AA long-term ratings category by S&P or Moody’s or which are fully insured by the Federal Deposit Insurance Corporation. Any interest earned from such investments will be deposited or moved into the Funding Subaccount to be used exclusively to pay Interest Obligations or Maturity Obligations while Company Bonds are outstanding.

3.6 Capital Accounts. A Capital Account shall be established and maintained for each Member on the books of the Company. Each Member’s interest in the capital of the Company shall be represented by its Capital Account.

3.7 Compliance with Treasury Regulations. The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Treasury Regulation Section 1.704-1(b) (or any corresponding provision of succeeding Law) and shall be interpreted and applied in a manner consistent with such Regulation. In the event the Managing Member shall determine and the GE Representative Member approve that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to comply with such Regulation, the Company may make such modifications. The Company also shall make any appropriate modifications in the event unanticipated events might otherwise cause this Agreement not to comply with Treasury Regulation Section 1.704-1(b) (or any corresponding provisions of succeeding Law), provided that such modification shall not have a material adverse effect on the economic position of any Member.

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3.8 Succession to Capital Accounts. In the event any interest in the Company is Sold in accordance with the terms of this Agreement and Article 9 of the Partnership Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred interest. For purposes of the immediately preceding sentence, the portion of the Capital Account to which the transferee succeeds shall be that percentage of the transferor’s total Capital Account as the Percentage Interest being Sold bears to the total Percentage Interest of the transferor, taking into account Section 9.6.

3.9 No Withdrawal of Capital Contributions. Except as provided in Section 3.2 and Section 3.3, no Member shall withdraw any Capital Contributions without the unanimous written approval of the other Members. No Member shall receive any interest with respect to its Capital Contributions.

3.10 Company’s Obligations Under Company Bond Indenture and Company Bonds. Nothing in this Article 3 (and in any of the related terms used in this Article 3 and defined herein) shall alter or impair the Company’s obligations under the Company Bond Indenture and the Company Bonds.

ARTICLE 4

COSTS AND EXPENSES

4.1 Organizational and Other Costs. The Company shall pay or cause to be paid all costs and expenses incurred in connection with the formation and organization of the Company. Such costs and expenses borne by the Company include all related accounting, trustee, administrative, tax, consulting, filing and registration costs.

4.2 Operating Costs. The Company shall (i) pay or cause to be paid all costs and expenses of the Company incurred in pursuing and conducting, or otherwise related to, the business of the Company and the issuance of the Company Bonds, including, without limitation, all legal, trustees and accountants’ costs and expenses relating thereto whether billed to the Company or its Members, and (ii) reimburse the Managing Member for any reasonable documented out-of-pocket costs and expenses incurred by it in connection therewith (including in the performance of its duties as tax matters partner); provided that, at any time the Company Sub acts as general partner of the Partnership (the “General Partner Activities”), neither the Managing Member nor the Company Sub shall be entitled to pay from Company funds or Company Sub funds nor be reimbursed by the Company for any costs, expenses or liabilities incurred in connection with such General Partner Activities.

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ARTICLE 5

DISTRIBUTIONS; COMPANY ALLOCATIONS;

TAX MATTERS

5.1 Distributions Prior to Dissolution. The Managing Member shall not make distributions to the Members, except as required by Section 10.3 or as approved by the GE Representative Member in accordance with Subsection 6.4(b)(x), which distributions shall be made to all Members in proportion to their Percentage Interests; provided, that, if any of PTLC or PAG is in breach of any Backstop Indemnity Obligation (the “Backstop Defaulting Member”), at the option of the GE Representative Member, any cash or cash equivalents on hand at the Company, except Permitted Working Capital, will be required to be distributed to all Members in proportion to their Percentage Interests, with any distributions otherwise payable to any Backstop Defaulting Member being paid by the Company directly to GECC to the extent of the GE Losses at such time; provided, further, that such distributions payable to a Backstop Defaulting Member but paid to GECC will be deemed paid to the Backstop Defaulting Member and directed by such Backstop Defaulting Member to be paid directly to GECC on behalf of such Backstop Defaulting Member; and provided, further, that in case of a breach of a Backstop Indemnity Obligation, in addition to or in lieu of its right to force distributions to the Members as described above, the GE Representative Member shall have the right to direct the Company to pay an amount owing by the Backstop Defaulting Member to GECC, up to the amount owed by such Backstop Defaulting Member, to GECC, which amount shall be treated as (a) loaned by the Company to the Backstop Defaulting Member(s), and (b) used by the Backstop Defaulting Member(s) to pay their Backstop Indemnity Obligation(s) to GECC. The loan described in clause (a) above shall (i) accrue interest at the Default Rate, and (ii) shall be payable on the Bonds Maturity Date.

5.2 Company Allocations.

(a) Profits and Losses. For each taxable year or portion of a taxable year for which the Company is required to allocate Profits, Losses, or other items pursuant to this Article 5, after giving effect to the special allocations set forth in Sections 5.3 and 5.4, Profits and Losses of the Company for the relevant period shall be allocated to the Members in proportion to their Percentage Interests, subject to the limitation in Subsection 5.2(b) below with respect to the allocation of Losses.

(b) Loss Limitation. The Losses allocated pursuant to Subsection 5.2(a) shall not exceed the maximum amount of Losses that can be so allocated without causing any Member to have an Adjusted Capital Account Deficit at the end of any taxable year. All losses otherwise allocable to a Member in excess of the limitation set forth in this Subsection 5.2(b) shall be allocated (A) in the case of any Penske Member and PAG, to those Penske Members and PAG without such an Adjusted Capital Account Deficit in proportion to and to the extent of the amount of Losses that can be allocated to each such Penske Member and PAG without causing it to have an Adjusted Capital Account Deficit, (B) in the case of any GE Member, to the other GE Members without such an Adjusted Capital Account Deficit in proportion to and to the extent of the amount of Losses that can be allocated to each such GE Member without causing it to have an Adjusted Capital Account Deficit, and (C) in the case of any such excess Losses not allocated to a Member under clause (A) or clause (B) of this Subsection 5.2(b), to each Member without such an Adjusted Capital Account Deficit, after the application of clauses (A) and (B) of this Subsection 5.2(b), in proportion to and to the extent of the amount of Losses that can be allocated to each such Member without causing it to have an Adjusted Capital Account Deficit.

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5.3 Special Allocations. The following special allocations shall be made in the following order:

(a) Minimum Gain Chargeback. Except as otherwise provided in Regulations Section 1.704-2(f), notwithstanding any other provision of this Article 5, if there is a net decrease in Company Minimum Gain during any Company taxable year, each Member shall be specially allocated items of Company income and gain for such taxable year (and, if necessary, subsequent taxable years) in an amount equal to such Member’s share of the net decrease in Company Minimum Gain, determined in accordance with Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Subsection 5.3(a) is intended to comply with the minimum gain chargeback requirement in Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

(b) Member Minimum Gain Chargeback. Except as otherwise provided in Regulations Section 1.704-2(i)(4), notwithstanding any other provision of this Article 5, if there is a net decrease in Member Nonrecourse Debt Minimum Gain attributable to a Member Nonrecourse Debt during any Company taxable year, each Member who has a share of the Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be specially allocated items of Company income and gain for such taxable year (and, if necessary, subsequent taxable years) in an amount equal to such Member’s share of the net decrease in Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Subsection 5.3(b) is intended to comply with the minimum gain chargeback requirement in Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

(c) Qualified Income Offset. In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), Section 1.704-1(b)(2)(ii)(d)(5), or Section 1.704-1(b)(2)(ii)(d)(6), items of Company income and gain shall be specially allocated to each such Member in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of such Member as quickly as possible, provided that an allocation pursuant to this Subsection 5.3(c) shall be made only if and to the extent that such Member would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article 5 have been tentatively made as if this Subsection 5.3(c) and Subsection 5.3(h) were not in the Agreement.

(d) Gross Income Allocation. In the event any Member has a deficit Capital Account at the end of any taxable year that is in excess of the sum of (i) the amount such Member is obligated to restore (pursuant to the terms of this Agreement or otherwise) and (ii) the amount such Member is deemed to be obligated to restore pursuant to the penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Member shall be specially allocated items of Company income and gain in the amount of such excess as quickly as possible; provided that an allocation pursuant to this Subsection 5.3(d) shall be made only if and to the extent that such Member would have a deficit Capital Account in excess of such sum after all other allocations provided for in this Article 5 have been made as if Subsections 5.3(c) and 5.3(h) and this Subsection 5.3(d) were not in the Agreement.

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(e) Nonrecourse Deductions. Nonrecourse Deductions for any taxable year shall be specially allocated among the Members in proportion to their Percentage Interests.

(f) Member Nonrecourse Deductions. Any Member Nonrecourse Deductions for any taxable year shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in accordance with Regulations Section 1.704-2(i)(1).

(g) Code Section 754 Adjustment. To the extent an adjustment to the adjusted tax basis of any Company asset pursuant to Code Section 734(b) or 743(b) is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Member in complete liquidation of its interest in the Company, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Members in accordance with their interests in the Company in the event Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Members to whom such distribution was made in the event Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

(h) Special Allocation During Period of Liquidation. In the event that the Capital Accounts of the Members would not otherwise be in proportion to their Percentage Interests in the year liquidating distributions are made under Subsection 12.3(d), after all other allocations provided for in this Article 5 have been made as if this Subsection 5.3(h) were not in the Agreement, items of Company income, gain, loss, or deduction for all taxable years of the Company which include any portion of the period from the date of the event of dissolution described in Section 12.1 that results in the liquidation through the date of the final distribution under Subsection 12.3(d) shall be allocated among the Members in such manner as to cause the Capital Accounts of the Members to be in proportion to their Percentage Interests. To the extent necessary to achieve Capital Accounts that are in proportion to Percentage Interests, after all other items of income, gain, loss, and deduction have been taken into account under this Subsection 5.3(h), with respect to each Member, an amount equal to the excess, if any, of (i) the product of such Member’s Percentage Interest and the aggregate amount of all of the Members’ Capital Accounts over (ii) the amount that would be the Member’s Capital Account absent application of this sentence shall be treated as paid to such Member as a guaranteed payment, and the corresponding deduction shall be allocated among the other Members as required to achieve the desired proportionality of Capital Accounts.

5.4 Curative Allocations. The allocations set forth in Subsection 5.2(b) and Section 5.3, other than Subsection 5.3(h) (the “Regulatory Allocations”) are intended to comply with certain requirements of the Regulations. It is the intent of the Members that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Company income, gain, loss or deduction pursuant to this Section 5.4. Therefore, notwithstanding any other provision of this Article 5 (other than the Regulatory Allocations), the Managing Member shall make such offsetting special allocations of Company income, gain, loss or deduction in whatever manner it determines appropriate (without causing an Adjusted Capital Account Deficit for any Member) so that, after such offsetting allocations are made, each Member’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Member would have had if the Regulatory Allocations were not part of the Agreement and all Company items were allocated pursuant to Subsection 5.2(a). In exercising its discretion under this Section 5.4, the Managing Member shall take into account future Regulatory Allocations under Subsections 5.3(a) and 5.3(b) that, although not yet made, are likely to offset other Regulatory Allocations previously made under Subsections 5.3(e) and 5.3(f).

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5.5 Other Allocation Rules.

(a) Profits, Losses, and any other items of income, gain, loss, deduction or credit shall be allocated to the Members pursuant to this Article 5 as of the last day of each taxable year, provided that Profits, Losses, and such other items shall also be allocated at such times as the Gross Asset Values of Company assets are adjusted pursuant to subparagraph (2) of Subsection 2.51.

(b) The Members are aware of the income tax consequences of the allocations made by this Article 5 and hereby agree to be bound by the provisions of this Article 5 in reporting their shares of Company income and loss for income tax purposes.

(c) For purposes of determining the Profits, Losses, or any other items of income, gain, loss, deduction, or credit allocable to any period, Profits, Losses, and any such other items shall be determined on a daily, monthly, or other basis using the closing of the books method or, if proposed by the Managing Member and approved by the GE Representative Member with respect to a particular period, any other permissible method under Code Section 706 and the Regulations thereunder.

(d) Any “excess nonrecourse liability” of the Company, within the meaning of Regulations Section 1.752-3(a)(3), shall be allocated among the Members in accordance with the Members interests in Company profits. Solely for purposes of this Subsection 5.5(d), the Members’ interests in Company profits are in proportion to their Percentage Interests.

5.6 Tax Allocations; Code Section 704(c).

(a) In accordance with Section 704(c) of the Code and the Treasury Regulations thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for federal income tax purposes and its initial Gross Asset Value.

(b) In the event the Gross Asset Value of any asset of the Company shall be adjusted pursuant to the provisions of this Agreement, subsequent allocations of income, gain, loss and deduction with respect to such asset shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Gross Asset Value in the same manner as under Section 704(c) of the Code and the Treasury Regulations thereunder.

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(c) Any elections or other decisions relating to such Section 704(c) allocations shall be made by the Members in any manner that reasonably reflects the purpose and intention of this Agreement. Section 704(c) allocations pursuant to this Section 5.6 are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing, any Member’s Capital Account or share of Profits, Losses, other items, or distributions pursuant to any provision of this Agreement.

(d) Except as otherwise determined by the Managing Member with the approval of the GE Representative Member, the Company shall use the “traditional method” (as defined in Regulations Section 1.704-3(b)) for purposes of computing section 704(c) allocations with respect to property contributed to the Company with a Gross Asset Value that differs from its adjusted tax basis at the time of contribution, and for purposes of computing reverse section 704(c) allocations with respect to property for which differences between Gross Asset Value and adjusted tax basis are created when the Company revalues Company property pursuant to Regulations Section 1.704-1(b)(2)(iv)(f).

5.7 Accounting Method. The books of the Company (for both tax and financial reporting purposes) shall be kept on an accrual basis.

ARTICLE 6

MANAGEMENT

6.1 Rights and Duties of the Non-Managing Members. The Non-Managing Members shall not participate in the control of the business of the Company and shall have no power to act for or bind the Company. The Non-Managing Members shall have the right to approve certain actions proposed to be taken by the Managing Member and certain voting rights, all as set forth herein.

6.2 Fiduciary Duty of Managing Member. The Managing Member shall have fiduciary responsibility for the safekeeping and use of all funds and assets (including records) of the Company and the Company Sub, whether or not in its immediate possession or control, and the Managing Member shall not employ, or permit another to employ, such funds or assets in any manner except for the exclusive benefit of the Company and the Company Sub, as applicable.

6.3 Powers of Managing Member.

(a) Subject to the terms and conditions of this Agreement, the Managing Member shall have full and complete charge of all affairs of the Company, and the management and control of the Company’s business as described in Section 1.4 shall rest exclusively with the Managing Member. The Managing Member shall be required to devote to the conduct of the business of the Company such time and attention as is necessary to accomplish the purposes, and to conduct properly the business, of the Company.

(b) By executing this Agreement, each Non-Managing Member shall be deemed to have consented to any exercise by the Managing Member of any of the foregoing powers.

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(c) The Managing Member shall cause Schedule B to be amended to reflect any Sale of a Member’s Member Interest (to the extent permitted by this Agreement), the total Member Interest of each Member, any change in name of the Company or change in the name or names under which the Company conducts its business (to the extent permitted by this Agreement), and receipt by the Company of any notice of change of address of a Member. The amended Schedule B, which shall be kept on file at the principal office of the Company, shall supersede all such prior Schedules and become part of this Agreement, and the Managing Member shall promptly forward a copy of the amended Schedule B to each Member upon each amendment thereof.

(d) The Managing Member shall apply all of the Company’s cash and cash equivalents, except for Permitted Working Capital, to payments under the Company Bonds in accordance with the terms of this Agreement and the Company Bond Indenture.

6.4 Restrictions on Managing Member’s Authority.

(a) Notwithstanding any other provision of this Agreement, the Managing Member shall not have authority to do any of the following:

(i) any act in contravention of this Agreement;

(ii) any act which would make it impossible to carry on the ordinary business of the Company, except as otherwise provided in this Agreement;

(iii) possess Company property, or assign any rights in specific Company property, for other than a Company purpose;

(iv) admit a person as a Member or as a member of Company Sub, except as otherwise provided in this Agreement;

(v) amend this Agreement, except in accordance with Section 15.1;

(vi) except to the extent permitted by this Agreement, Transfer its interest as a Managing Member of the Company;

(vii) knowingly commit any act which would subject any Member to any liabilities of the Company in any jurisdiction in which the Company transacts business;

(viii) elect, permit or cause to dissolve the Company or Company Sub, except as expressly permitted herein;

(ix) amend or modify the Limited Liability Company Agreement of the Company Sub or the Certificate of Formation of the Company Sub; or

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(x) cause or permit the Transfer of any equity interest of the Company in the Company Sub, or of all or any portion of the Partnership Interests held by the Company Sub, except to the extent expressly permitted by this Agreement.

(b) Notwithstanding any other provision of this Agreement, the Managing Member shall not have authority to do any of the following without the written approval (which approval may be by resolution) of the GE Representative Member in its sole discretion, provided that the written approval of PAG in its sole discretion shall also be required with respect to Subsections 6.4(b)(i), 6.4(b)(vii) and 6.4(b)(viii)(B):

(i) except for the Company Bonds, cause the Company to (A) incur any indebtedness, including any refinancing of the Company Bonds (other than as contemplated under Section 10.2), (B) grant or permit any Liens with respect to any property of the Company or (C) cause or permit any other obligations or liabilities of the Company, except (x) as contemplated by this Agreement or as the Manager of the Company Sub, (y) usual and customary set off rights associated with bank accounts, securities accounts, and similar accounts, or (z) the payment of its taxes and the expenditure of the monies to maintain its good standing and its insurance and obligations for professional and auditing services;

(ii) change the name of the Company;

(iii) conduct the Company’s business and the business of the Company Sub in a manner other than in accordance with the Partnership’s Code for Business Conduct in effect as of the Effective Time or as changed if approved pursuant to the Partnership Agreement as if the Company were the Partnership thereunder;

(iv) change any policies relating to accounting matters, other than those required by GAAP;

(v) determine the accounting methods and conventions to be used in, or any other method or procedure related to, the preparation of the Returns, make any and all elections under the tax Laws of any jurisdiction as to the treatment of items of income, gain, loss, deduction and credit of the Company, or file a Form 8832—Entity Classification Election or in any other manner make or change an election under U.S. Treasury Regulations Section 301.7701-3(c)(1) or successor regulations to have the Company taxed as anything other than as a partnership for federal tax purposes or to have the Company Sub taxed as anything other than a disregarded entity for federal tax purposes;

(vi) take any position for income tax purposes, whether on a Return or otherwise, that is inconsistent with the income tax treatment as agreed to in Subsection 8.2(e);

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(vii) change the character of the Company’s business from that set forth in clauses (i) and (ii) of Section 1.4 hereof, or cause the Company to engage in any activity other than as permitted therein;

(viii) prior to the Fall Away Event (A) any action relating to the Company Bonds (except for payments under the Company Bonds made in accordance with the terms of this Agreement and the Company Bond Indenture and the actions described in Subsection 6.4(b)(viii)(B)) or (B) any amendment or modification of the Company Bonds or the Company Bond Indenture that would extend, modify or change (I) the maturity date of the Company Bonds, (II) the rate of interest on the Company Bonds, or (III) the principal amount of the Company Bonds;

(ix) form, acquire or hold any subsidiary (other than Company Sub), including any partnership, limited liability company or corporation, or make any investment in any entity (other than Company Sub);

(x) declare or pay any distributions to the Members other than in accordance with Section 5.1 or Section 10.3;

(xi) cause or permit Company Sub to vote, consent, or withhold its vote or consent, on any matter that would require the approval of all Partners or of all Limited Partners under the Partnership Agreement; or

(xii) file a voluntary petition seeking liquidation, reorganization, arrangement or readjustment, in any form, of the Company’s or Company Sub’s debts under Title 11 of the United States Code or any other federal or state insolvency Law, or file an answer consenting to or acquiescing in any such petition, (ii) make any Transfer for the benefit of the Partnership’s creditors or (iii) allow the expiration of sixty (60) days after the filing of an involuntary petition under Title 11 of the United States Code, the application by a third party for the appointment of a receiver for the assets of the Company or Company Sub, or the filing of an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of the Company’s or Company Sub’s debts under any other federal or state insolvency Law, unless the same shall not have been vacated, set aside or stayed within such sixty (60) day period.

6.5 Other Activities.

(a) Any Member (the “Interested Party”) may engage in or possess an interest in other business ventures of any nature or description, independently or with others, whether presently existing or hereafter created, and neither the Company nor any Member other than the Interested Party shall have any rights in or to such independent ventures or the income or profits derived therefrom.

(b) Nothing in this Agreement shall release, terminate or modify the obligations of any Member under Section 6.6 of the Partnership Agreement.

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(c) Any Member, not otherwise bound by the terms of the covenant not to compete in Section 6.6 of the Partnership Agreement, that together with its Affiliates holds at least ten percent (10%) of the Partnership Interests in the Partnership, either directly or indirectly through its pro rata share of the Company Sub’s Partnership Interest in the Partnership, shall enter into a covenant not to compete with the Partnership that shall have the same terms and conditions as the covenant not to compete in Section 6.6 of the Partnership Agreement.

6.6 Exculpation. Neither the Managing Member nor any Affiliate of the Managing Member nor any of their respective partners, shareholders, officers, directors, employees or agents shall be liable, in damages or otherwise, to the Company or to any of the Members for any act or omission on its or his or her part, except for (a) any act or omission resulting from its or his or her own willful misconduct or bad faith, (b) with respect to the Managing Member only, any breach by the Managing Member of its obligations as a fiduciary of the Company or (c) with respect to the Managing Member only, any breach by the Managing Member of any of the terms and provisions of this Agreement. The Company shall indemnify, defend and hold harmless, to the fullest extent permitted by Law, the Managing Member and its respective partners, shareholders, officers, directors, employees and agents, from and against any claim or liability of any nature whatsoever arising out of or in connection with the assets or business of the Company, except where attributable to the willful misconduct or bad faith of such individual or entity or where relating to a breach by the Managing Member of its obligations as a fiduciary of the Company or to a breach by the Managing Member of any of the terms and provisions of this Agreement. The Managing Member shall indemnify, defend and hold harmless to the fullest extent permitted by Law, the Company and each of its Members (other than the Managing Member) from and against any claim or liability attributable to the Managing Member’s willful misconduct or bad faith or where relating to a breach by the Managing Member of its obligations as a fiduciary of the Company or to a breach by the Managing Member of any of the terms and provisions of this Agreement. The Managing Member shall indemnify, defend and hold harmless to the fullest extent permitted by Law, each of the Company and the Company Sub from and against any damage, loss, claim, liability or expense incurred by the Company Sub in its capacity as a general partner of the Partnership and for which the applicable creditors or limited partners of the Partnership have no recourse against the Company Sub or Managing Member (including by indemnification or exculpation) under the Act or the Partnership Agreement.

6.7 Transactions with Affiliates.

(a) Nothing in this Agreement shall preclude transactions between the Company and any Member (including the Managing Member) or an Affiliate or Affiliates of any Member acting in and for its own account, provided that any services performed or products provided by the Member or any such Affiliates are services and/or products that the Managing Member reasonably believes, at the time of requesting such services, to be in the best interests of the Company, and further provided that the rate of compensation to be paid for any such services and/or products shall be comparable to the amount paid for similar services and/or products under similar circumstances to independent third parties in arm’s length transactions, and further provided that commencing with transactions entered into after the Effective Date the Members will receive a written notice within thirty (30) days of the date on which any such transaction is entered setting forth the material terms of any transaction or series of related transactions described above for which the aggregate amount involved in such transaction or series of transactions, which includes the U.S. dollar value of the amounts involved throughout the duration of any agreements entered into with respect to such transaction(s), is greater than $10 million.

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(b) All bills with respect to services provided to the Company by a Member or any Affiliate of a Member shall be separately submitted and shall be supported by logs or other written data.

6.8 Confidentiality. With respect to any and all information provided to or obtained by any Member, any assignees of Member Interests or any of their Affiliates, or any of its or their directors, officers, employees, agents, representatives or advisors as a result of such Member being a Member, except for the exclusions below (“Evaluation Material”), such Member and each of its Affiliates, and its and their directors, officers, employees, agents, representatives or advisors shall hold such information in strict confidence and use such information solely in connection with such Member’s evaluation of its investment in the Company; provided, however, that any Member may disclose such information (a) as required by applicable law, rule or regulation (including but not limited to the Securities Act, the Exchange Act or rules of a stock exchange or other self-regulatory bodies), (b) to any person involved in the preparation of the Member’s or any of its Affiliates’ financial statements, tax returns or public filings, (c) to any of its own Affiliates, or its or their directors, officers, employees, agents, representatives or advisors who are informed of the strictly confidential nature of such information and are or have been advised of their obligation to keep information of this type strictly confidential, (d) upon the request or demand of any Governmental Authority having jurisdiction over any of the Company or any of the Members or any of their Affiliates or (e) to any person and such person’s advisors with whom any Member or any of its Affiliates is contemplating a financing transaction or to whom such Member is contemplating a Transfer of all or any portion of its Member Interests in accordance with the terms of this Agreement (a “Potential Buyer”), provided that such Potential Buyer and such person’s advisors are advised of the strictly confidential nature of such information and the Potential Buyer agrees to be bound by a confidentiality agreement containing protective provisions no less protective of the information of the Company than provided in this Agreement. All press releases, public announcements, and similar publicity (other than such public announcements required by applicable law, rule or regulation, pursuant to clause (a) in the immediately preceding sentence) respecting the Company and referencing the name of any Member or any Affiliate of any Member (“Non-Issuing Member”) other than the Member issuing such press release, public announcement, similar publicity or making such required disclosure shall be made only with the prior written consent of such Non-Issuing Member, which consent will not be unreasonably withheld; provided, however, that without consent any Member may state in such a public announcement that it is a Member and disclose the legal names of the Company, and the other Members and their respective parents. Nothing in this paragraph shall waive any attorney-client privilege, attorney work product privilege or other privilege, and any information subject to such privilege shall not be disclosed except as required by applicable law, rule or regulation or restrict the Company’s ability to issue press releases in the ordinary course of business. For purposes of this Subsection 6.8, the Company shall not be deemed to be an Affiliate of any of the Members. “Evaluation Material” shall not include information that (i) is or becomes generally available to the public other

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than as a result of a disclosure by the applicable Member, its representatives or others to whom it voluntarily discloses such information other than Governmental Authorities (the “Recipient Group”) in breach of this Agreement, (ii) was available to a member of the Recipient Group prior to such information’s disclosure by or on behalf of the Company from a source (other than Recipient Group) who, to the knowledge of the applicable Member, is not subject to a confidentiality agreement with, or other obligation of secrecy to, the Company, its Affiliates or representatives prohibiting such disclosure, (iii) is or becomes available to the Recipient Group from a source (other than the Recipient Group) who, to the knowledge of the applicable Member, is not subject to a confidentiality agreement with, or other obligation of secrecy to, the Company, its Affiliates or representatives prohibiting such disclosure, or (iv) was independently developed by the Recipient Group without reference to the Evaluation Material. If a member of the Recipient Group is requested or required (by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand, or similar legal process or by regulatory agency, or stock exchange or other applicable rules) to disclose any of the Evaluation Material, or if a member of the Recipient Group determines that such Evaluation Material is required to be disclosed by applicable law, rule or regulation, the applicable Member agrees, promptly upon obtaining knowledge of such request, requirement or determination to disclose, to provide the Managing Member and the GE Representative Member with prompt notice of each such request or determination, to the extent practicable and not legally prohibited, so that the Company or a Member as appropriate may seek an appropriate protective order (at its own cost and expense). If, absent the entry of a protective order or other appropriate remedy, the applicable member of a Recipient Group is legally required to disclose the Evaluation Material, such applicable member may disclose such information only to the persons and to the extent required without liability under this Agreement.

6.9 Replacement of the Managing Member. Upon Bankruptcy of PTLC (or any permitted successor to its Member Interests as the Managing Member), PTLC or any such successor shall automatically cease to be the Managing Member and a new Managing Member shall be designated by the GE Members and PAG pursuant to a majority vote of the aggregate Percentage Interests held by GE Members and PAG at that time.

ARTICLE 7

COMPENSATION

The Managing Member shall be entitled to reimbursement of all of its expenses attributable to the performance of its obligations hereunder, to the extent provided in Section 4.2 hereof. Subject to the Act, no amount so paid to the Managing Member shall be deemed to be a distribution of Company assets for purposes of this Agreement.

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ARTICLE 8

ACCOUNTS

8.1 Books and Records. The Managing Member shall maintain complete and accurate books of account of the Company’s affairs at the Company’s principal office, including a list of the names and addresses of all Members. Each Member shall have the right to inspect the Company’s books and records (including the list of the names and addresses of Members). Each of the Members shall have the right to audit independently the books and records of the Company, any such audit being at the sole cost and expense of the Member conducting such audit.

8.2 Reports, Returns and Audits.

(a) The books of account shall be closed promptly after the end of each Company Year. The books and records of the Company shall be audited as of the end of each Company Year by the Auditor. Within ninety (90) days after the end of each Company Year, the Managing Member shall make a written report to each person who was a Member at any time during such Company Year which shall include financial statements comprised of at least the following: a balance sheet as of the close of the immediately preceding Company Year, and statements of earnings or losses, changes in financial position and changes in Member’s capital accounts for the Company Year then ended, which financial statements shall be certified by the Auditor as in accordance with Generally Accepted Accounting Principles. The report shall also contain such additional statements with respect to the status of the Company business as are considered necessary by the Managing Member to advise any or all Members properly about their investment in the Company. The Managing Member shall be reimbursed by the Company for its reasonable documented out-of-pocket expenses incurred in providing the reports contemplated by the immediately preceding sentence and those required by Subsections 8.2(b), 8.2(c), 8.2(d) and 8.2(g).

(b) Prior to August 15 of each year, each Member shall be provided with an information letter (containing such Member’s Form K-1 or comparable information) with respect to its distributive share of income, gains, deductions, losses and credits for income tax reporting purposes for the previous Company Year, together with any other information concerning the Company necessary for the preparation of a Member’s income tax return(s), and the Company shall provide each Member with an estimate of the information to be set forth in such information letter by no later than April 15 of each year. With the sole exception of mathematical errors in computation, the financial statements and the information contained in such information letter shall be deemed conclusive and binding upon such Member unless written objection shall be lodged with the Managing Member within ninety (90) days after the giving of such information letter to such Member.

(c) The Managing Member shall also furnish the Members with such periodic reports concerning the Company’s business and activities as are considered necessary by any Member to advise any or all Members properly about their investment in the Company.

(d) The Managing Member shall prepare or cause to be prepared all federal, state and local tax returns of the Company (the “Returns”) for each year for which such Returns are required to be filed, and shall cause all such Returns to be filed in a timely manner; provided, however that it shall not file any Return without first providing the GE Representative Member with a reasonable opportunity to review the Return and obtaining the consent of the GE Representative Member to such filing, which consent shall not be unreasonably withheld or delayed. Such Returns shall be prepared consistent with the agreed income tax treatment described in Subsection 8.2(e). To the extent permitted by Law, for purposes of preparing the Returns, the Company shall use the Company Year. Subject to Subsection 6.4(b)(v), the Managing Member may make any elections under the Code and/or applicable state or local tax Laws, and the Managing Member shall be absolved from all liability for any and all consequences to any previously admitted or subsequently admitted Members resulting from its making or failing to make any such election. Notwithstanding the foregoing, the Managing Member shall make the election provided for in Section 754 of the Code, if requested to do so by any Member.

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(e) The Members agree, for income tax purposes, that:

(i) The Company Bonds shall be treated as debt of GECC and not as debt of the Company;

(ii) An amount equal to the net proceeds of the Company Bonds shall be treated as Transferred in cash by GECC to the Members in proportion to their Percentage Interests (each such Transfer a “Deemed Transfer”);

(iii) Each Deemed Transfer to PTLC or PAG shall be treated as the proceeds of a loan from GECC to such Member (each such loan a “Funding Loan”) with a face amount equal to the product of the face amount of the Company Bonds and such Member’s Percentage Interest;

(iv) Each Funding Loan shall be treated as having terms consistent with the agreement among GECC, PTLC and PAG, as reflected in this Agreement and the Indemnification Agreements, relating to their economic sharing of obligations relating to the Company Bonds, including, but not by way of limitation, the treatment of all Co-Obligation Fees paid or accrued by PTLC or PAG under the Indemnification Agreements as interest paid or accrued on such Member’s Funding Loan and the treatment of all payments by PTLC or PAG of an Indemnified Amount described in Section 3(i) or Section 3(ii) of the Indemnification Agreements or, to the extent related to the Co-Obligation Fee under the Indemnification Agreements or to payments referred to in Section 3(i) or Section 3(ii) of the Indemnification Agreements, Section 3(v) of the Indemnification Agreements as payments made on, or of financing costs or other fees or expenses with respect to, such Member’s Funding Loan;

(v) Each Member shall be treated as having contributed cash, in an amount equal to the amount of the Deemed Transfer to such Member, to the Company as a Capital Contribution on the date the Company Bonds are issued;

(vi) All payments (including principal and interest) by the Company on, or of financing costs or other fees or expenses with respect to, the Company Bonds shall be treated as distributed in cash to the Members in proportion to their Percentage Interests on the date such payment is made, with amounts so treated as distributed to PTLC or PAG further treated as used to make payments (including principal and interest) to GECC on, or of financing costs or other fees or expenses with respect to, such Member’s Funding Loan, and then used by GECC to make payments (including principal and interest) on, or of financing costs or other fees or expenses with respect to, the Company Bonds;

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(vii) All Fall Away Payment Amounts (as defined in the Indemnification Agreements) treated under this Agreement as distributed to PTLC or PAG shall be treated as used by such Member to make payments (including principal and interest) to GECC on, or of financing costs or other fees or expenses with respect to, such Member’s Funding Loan, and then used by GECC to make payments (including principal and interest) on, or of financing costs or other fees or expenses with respect to, the Company Bonds; and

(viii) Any Additional Capital Contribution Loan to a Delinquent Member will be treated as a loan of cash equal to the face amount of such loan to such Delinquent Member from the Non-Delinquent Member providing the funds, followed by a contribution of such cash by such Delinquent Member to the Company.

The Members are aware of the income tax consequences of the above characterizations of the Company Bonds and the related payments and expenses described in this Subsection 8.2(e) and hereby agree to be bound by the provisions of this Subsection 8.2(e) in reporting such items for income tax purposes.

(f) The Managing Member shall be the “tax matters partner” of the Company within the meaning of Section 6231(a)(7) of the Code (the “Tax Matters Partner”) and shall serve in any similar capacity under applicable state, local or foreign Law. The GE Representative Member shall be given at least fifteen (15) Business Days advance notice from the Tax Matters Partner of the time and place of, and shall have the right to participate in (i) any administrative proceeding relating to the determination at the Company level of partnership items on which the Members, rather than the Company, are taxable and (ii) any discussions with the Internal Revenue Service (or other governmental tax authority) relating to the allocations pursuant to Article 5 of this Agreement. The Tax Matters Partner shall not initiate any action or proceeding in any court in its capacity as Tax Matters Partner, extend any statute of limitation, or take any other action contemplated by Sections 6222 through 6232 of the Code (or similar state, local or foreign Laws with respect to income or income-based taxes that apply to the Members rather than the Company) if such initiation, extension or other action would legally bind any other Member or the Company without the approval of the GE Representative Member, which approval will not be unreasonably withheld or untimely delayed. The Tax Matters Partner shall from time to time upon request of any other Member confer, and cause the Company’s tax attorneys and accountants to confer, with such other Member and its attorneys and accountants on any matters relating to a Company tax return or any tax election.

(g) The Company shall provide such other information as may be reasonably required for the Member to timely comply with applicable financial and tax reporting requirements or their customary financial and tax reporting practices, and the Company shall provide substantially the same accounting assistance to GECC or PAG or their Affiliates with respect to the Company as PTLC provided to them for the 2011 fiscal year with respect to the Partnership, which assistance shall include (i) booking the GE Members’ share of the Profits, Losses, items of income, gain, loss, deduction or credit, distributions or other items of the Company’s activities in the GECC ledger at the end of each quarter of the Company Year and (ii) preparing quarterly accounting closing schedules at the end of each quarter of the Company Year.

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ARTICLE 9

TRANSFERS AND SALES

9.1 Transfer of Interests of Managing Member and PTLC Consolidated Group. Notwithstanding anything to the contrary contained in this Article 9 or any other provision of this Agreement:

(a) The Managing Member shall not withdraw from the Company or resign as Managing Member nor shall it Transfer all or any portion of its Member Interest as a Managing Member, except in each case (i) as a consequence of a Sale mandated by Subsection 9.4(a), (ii) for the Sale of a portion but not all of the Managing Member’s Interests pursuant to Subsection 9.2(b)(ii) or Section 9.3, or (iii) with the prior written approval of all of the Members. Upon the consummation of any such Transfer, the Member Interest so Transferred will automatically and simultaneously convert into a non-managing Member Interest.

(b) The Managing Member shall be liable to the Company for any withdrawal or resignation in violation of Subsection 9.1(a) above, or for a withdrawal by the Managing Member from the Company as its Managing Member arising out of the Bankruptcy of a member of the PTLC Consolidated Group other than the Partnership or a Subsidiary of the Partnership.

(c) Notwithstanding anything to the contrary set forth in this Agreement, Sections 9.1, 9.2 and 9.3 will not apply to (i) any Sale of Collateral (as defined in the Indemnification Agreements) pursuant to any of the Indemnification Agreements, (ii) a Third Party Sale or Equity Offering as contemplated by Article 10, (iii) any Sale of Member Interests by the GE Members contemporaneously with any Sale pursuant to Subsections 9.1(c)(i) or 9.1(c)(ii) to the same buyer group, or (iv) any Sale of Member Interests by the GE Members in anticipation of or at or following any Sale pursuant to Subsections 9.1(c)(i) or 9.1(c)(ii) if the Sale pursuant to Subsections 9.1(c)(i) or 9.1(c)(ii) would reasonably be expected to result in such GE Members being prohibited by Law from owning their Member Interests; provided, that, if any Member Interests held by the Managing Member are Sold pursuant to such Sale, such interests shall automatically and simultaneously convert into non-managing Member Interests upon the consummation of such Sale; provided, further, that, if any such Sale results in a Sale of all remaining Member Interests held by the Managing Member, a new Managing Member shall be designated at that time by the GE Members and PAG pursuant to a majority vote of the aggregate Percentage Interests held by GE Members and PAG at that time.

(d) For so long as members of the GECC Consolidated Group hold, in the aggregate, ten percent (10%) or more of the aggregate Percentage Interests, the PTLC Consolidated Group shall be required at all times to hold not less than a twenty-five percent (25%) Percentage Interest, except as a consequence of a Sale mandated by Subsection 9.4(a) or as a result of a Third Party Sale or an Equity Offering involving Member Interests of the PTLC Consolidated Group.

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9.2 Transfer or Sale of Member Interests.

(a) Commencing as of the Effective Time, no Member may Transfer all or any portion of its Member Interest to any Person except (i) as provided in Subsection 9.1(c), (ii) as permitted by the further provisions of this Section 9.2 and Section 9.3 (subject to the provisions of Sections 9.1 and 9.5), or (iii) as required by Section 9.4, at all times subject to Sections 9.1 and 9.10.

(b) (i) Each of GE Truck Leasing Holdco, GE Logistics Holdco and GE Tennessee may Sell all or any portion of its Member Interests from time to time to any member or members of the GECC Consolidated Group, and (ii) PTLC may Sell a portion but not all of its Member Interests from time to time to any member or members of the PAG Consolidated Group or to any member or members of the PTLC Consolidated Group.

(c) PAG may Sell all or any portion of its Member Interests from time to time to any member or members of the PTLC Consolidated Group or any member or members of the PAG Consolidated Group.

(d) As security for the performance of the Backstop Indemnity Obligation by each of PTLC and PAG, each of PTLC and PAG may grant to GECC a security interest in, or otherwise pledge to GECC, such Member’s Member Interests and any and all rights with respect thereto.

(e) In the event of any Sale pursuant to Subsection 9.2(b) or (c) and the assignee in such Sale shall cease at any time for any reason (other than as a result of a change in Generally Accepted Accounting Principles after the Effective Time) to be a member of the GECC Consolidated Group, the PTLC Consolidated Group or the PAG Consolidated Group, as the case may be, then such assignee shall concurrently with ceasing to be a member of the applicable Consolidated Group Sell such Member Interests to a Person that is a member of the applicable Consolidated Group.

(f) Prior to and as a condition to any Sale pursuant to Subsections 9.2(b), 9.2(c) or 9.2(e), the assignee shall agree in writing with the Company to be bound by all of the terms and conditions of this Agreement in the same manner as the assignor.

9.3 Right of First Offer.

(a) Commencing as of the Effective Time, no Member may Transfer all or any portion of its Member Interest to any Person except (i) as provided in Subsection 9.1(c), (ii) as permitted by the further provisions of Section 9.2 and this Section 9.3 (subject to the provisions of Sections 9.1 and 9.5), or (iii) as required by Section 9.4, at all times subject to Sections 9.1 and 9.10.

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(b) For purposes of this Section 9.3, members of the GECC Consolidated Group, members of the PTLC Consolidated Group and members of the PAG Consolidated Group shall each be deemed a single Member.

(c) The Managing Member may not Transfer all or any portion of its Member Interest as a Managing Member, but, in connection with any Sale of a portion, but not all, of its Member Interests by the Managing Member in accordance with this Section 9.3, such interest shall automatically and simultaneously convert into a non-managing Member Interest upon the consummation of such Sale. No Member may Sell all or any portion of its Member Interest, unless (i) such portion of its Member Interest constitutes a Percentage Interest of at least five percent (5%) unless such Member is selling all of its then-held Member Interests, taken as a whole, immediately prior to the consummation of such Sale, and (ii) the consideration for such Sale consists solely of cash and/or a promissory note; provided, however, that if a promissory note shall form a portion of the consideration being offered by a third-party offeror, such note must (A) be issued by the party which proposes to acquire the Member Interest, (B) bear an interest rate not less than the then-current market rate for a note of such creditworthiness, terms and conditions and tenor and (C) not represent more than fifty percent (50%) of the total amount of the consideration being offered for such Member Interest. In the event that (I) a Member (other than PTLC with respect to the Member Interest held by PTLC as Managing Member) proposes to Sell all or any portion of its Member Interest (an “Initiated Offer”), or (II) a Member shall have received an offer from a third party to acquire such Member’s Member Interest (or such portion thereof) that the Member proposes to accept (provided that the Managing Member shall not be permitted to Sell all of its Member Interests held in its capacity as a Managing Member) (a “Third-Party Proposed Sale”), then in either such event such Member (the “Offering Member”) shall first offer (the “Offer”) in writing (which Offer shall set forth the price and all other material terms of such proposed Sale, and, in the case of a Third-Party Proposed Sale, have attached to it a copy of such third party’s written offer to purchase) to sell its Member Interest (or such portion thereof) (individually or collectively, the “Offered Interest”) to the other Members (the “Offeree Members”) at the price and on the other financial terms specified in the Offer and on substantially the same as the terms (other than price and the other financial terms) as are set forth in the Purchase and Sale Agreement, dated as of March 26, 2009 pursuant to which PTLC3 Holdings Co. LLC purchased a Partnership Interest from GE Logistics Holdco. A copy of such Offer shall also be provided to the Managing Member at the same time as it is provided to the other Members.

(d) Within sixty (60) days (or such longer period as the Offering Member and the Offeree Members may agree) after the date of the Offer each Offeree Member must provide notice to the Offering Member and the Managing Member (the “Response Notice”) that such Offeree Member either (i) agrees to purchase its proportion, based on its Percentage Interests relative to the aggregate Percentage Interests held by all Offeree Members as of the date of the Offer, of the Offered Interest, at the offering price and on the other terms set forth in the Offer or at such other price and on such other terms as the Members may agree or (ii) declines to accept the Offer; provided, that, if the Offering Member is also proposing to Sell Partnership Interests concurrently to the same purchaser or affiliated group of purchasers, each Offeree Member must either (A) agree to purchase its proportion of Member Interests and Partnership Interests, collectively, as provided under Section 9.3 of the Partnership Agreement or (B) decline to accept the Offer for the offered Member Interests and Partnership Interests collectively, and the provisions of Section 9.3 of the Partnership Agreement shall govern exclusively such collectively offered Member Interests and Partnership Interests.

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(e) If the Response Notices of the Offeree Members constitute an acceptance, collectively, for the entire Offered Interest, the parties will consummate the Sale of the Offered Interest at the time and in the manner set forth in Subsections 9.3(g) and 9.5(a). Unless otherwise agreed by the accepting Offeree Members (the “Accepting Members”), the right to purchase the Offered Interest will be allocated among the Offeree Members pro rata based on the relative Percentage Interests held by all Offeree Members for Member Interests as of the date of the Offer. If the Response Notices of the Offeree Members do not constitute an acceptance, collectively, for the entire Offered Interest, then at the end of the sixty (60) day period (as it may be extended pursuant to Subsection 9.3(d) above) (or, if earlier, when all Response Notices have been received) set forth in Subsection 9.3(d), the Offering Member shall provide written notice to the Accepting Members pursuant to which the Accepting Members shall have the option to elect to purchase, for a period of thirty (30) days following the date of such notice, all (but not less than all) of the portion of the Offered Interest that the non-Accepting Members did not elect to purchase, in proportion to the relative Percentage Interests (disregarding the Percentage Interests of the non-Accepting Members) of such Accepting Members (or on such other basis as the Accepting Members determine) and on substantially the same terms and conditions described in Subsection 9.3(c).

(f) If (i) none of the Offeree Members delivers a Response Notice (or the Offeree Members otherwise decline to purchase all of the Offered Interest) within the sixty (60) day period (as it may be extended pursuant to Subsection 9.3(d) above) set forth in Subsection 9.3(d) or (ii) after the end of the thirty (30) day period set forth in Subsection 9.3(e), the Accepting Members have not elected to purchase all of the Offered Interest, then in each case the Offeree Members will be deemed to have declined to exercise their rights under this Section 9.3 and the Offering Member shall, with respect to the Offered Interest only, have the right, if an Initiated Offer, to, at the Offering Partner’s sole expense, not violative of Law or Section 9.5(b), launch a confidential marketing process (which may include the engagement of financial advisors and other advisors to conduct a customary auction sale process in which potential buyers are required to enter into confidentiality agreements contemplated by clause (e) of Subsection 6.8), and, if an Initiated Offer or a Third Party Proposed Sale, enter into negotiations with a third party or enter into a definitive agreement, to Sell the Offered Interest in respect of an Offer at the same or a higher price and upon terms and conditions that are no less favorable in the aggregate to the Offeree Members than as set forth in the Offer (other than those representations, warranties, covenants, indemnities and other agreements customary for similar transactions) for a period of one-hundred eighty (180) days, which period may be extended as agreed upon by the Offering Member and the Offeree Members.

(g) If an Offeree Member or Members shall have accepted the Offer in accordance with Subsections 9.3(d) and (e), then the Offering Member shall Sell the Offered Interest to the Accepting Members (or to such nominees of the Accepting Members as the Accepting Members may specify in writing to the Offering Member not less than three (3) Business Days prior to the closing of such purchase and Sale) and the Sale of the Offered Interest to the Accepting Members (or such nominees, as the case may be) shall be consummated within ninety (90) days thereafter, which period shall if all other conditions to closing have been satisfied except for required regulatory approvals (and those conditions that by their terms are to be satisfied at closing), be extended, unless the Offering Member and the Accepting Members otherwise agree in writing, for as long as reasonably necessary in order to obtain such regulatory approvals (until such time as it is determined that such approvals will not be obtained), at the principal office of the Company or such other location as the Offering Member and the Accepting Members (or their nominees) may agree, at which time the Offering Member shall Sell to the Accepting Members (or their nominees) the Offered Interest, free and clear of all Liens, claims, options to purchase and other restrictions of any nature whatsoever, except those set forth in this Agreement, against payment in cash of the purchase price therefor; provided, however, that in the event that the Accepting Members (or their nominees) shall be purchasing the Offered Interest at the price set forth in the Offer pertaining thereto, and the terms of such Offer shall state that the third-party offeror offered to acquire the Offered Interest for consideration consisting of cash and (subject to the first proviso in Subsection 9.3(c) above) a promissory note, then the Accepting Members (or their nominees) shall pay to the Offering Member the purchase price for the Offered Interest in cash, in an amount equal to the sum of (i) the amount of the purchase price which would have been paid in cash by the third-party offeror as set forth in the Offer, plus (ii) the principal amount of the promissory note which would have been delivered by the third-party offeror as set forth in the Offer.

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(h) In the event that any proposed Sale of a Member Interest to a third party shall not have been consummated within the 90 days after the execution of the underlying definitive agreement referred to in Subsection 9.3(f) (which period shall, if all other conditions to closing have been satisfied except for required regulatory approvals (and those conditions that by their terms are to be satisfied at closing), automatically be extended for as long as reasonably necessary in order to obtain such regulatory approvals (until such time as it is determined that such approvals will not be obtained)), any such proposed Sale, or any further proposed Sale, of such Member Interest shall again be subject to the provisions of this Section 9.3.

9.4 Certain Changes of Control.

(a) In the event that (i) Penske Corporation, at any time and for any reason, either (A) shall have ceased to own, directly or indirectly, at least fifty-one percent (51%) of the outstanding common stock or other voting securities of Penske Transportation Holdings Corp. and (1) in an election of directors for which proxies are not solicited under the Exchange Act, Penske Corporation and/or its Affiliates by vote of their own shares and shares for which they have obtained proxies from other shareholders, shall be unable to elect at least half of the directors of Penske Transportation Holdings Corp., or (2) in an election of directors for which proxies are solicited under the Exchange Act, proxies for management nominees and the vote of Penske Corporation and/or its Affiliates and other persons shall not have resulted in the election of management nominee directors who aggregate at least half of the directors elected, or (B) shall have ceased to own, directly or indirectly, at least twenty-five percent (25%) of the outstanding common stock or other voting securities of Penske Transportation Holdings Corp., or (ii) Penske Transportation Holdings Corp., at any time and for any reason, shall have ceased to own, directly or indirectly, and have voting control over at least eighty percent (80%) of the outstanding common stock or other voting securities of the PTLC Consolidated Group member or members then holding Member Interests (excluding the Company and Company Sub from the PTLC Consolidated Group for this determination), then from and after the occurrence of any of the events specified in clauses (i)(A), (i)(B) and (ii) above, the GE Members or any nominee(s) thereof shall have the right, but not the obligation (which right shall expire one hundred eighty (180) days from the date on which the GE Representative Member shall have received the notice referred to in the last sentence of this Subsection 9.4(a)), to purchase from such holders and any of the members of the PAG Consolidated Group then holding Member Interests, one hundred percent (100%) of their respective Member Interests and 100% of their respective Partnership Interests at a purchase price, payable in cash, to be determined as of the date the GE Representative Member shall advise PTLC and PAG of its or its nominee(s)’s decision to acquire one hundred percent (100%) of the Member Interests and one hundred percent (100%) of the Partnership Interests held by the PTLC Consolidated Group and the PAG Consolidated Group pursuant to this Subsection 9.4(a) by means of the appraisal procedure set forth in Subsection 9.4(c) of the Partnership Agreement. PTLC shall give prompt written notice to the GE Representative Member of the occurrence of any of the events specified in clauses (i)(A), (i)(B) or (ii) of this Subsection 9.4(a).

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(b) In the event that GECC at any time and for any reason shall have ceased to own, directly or indirectly, and have voting control over eighty percent (80%) of the outstanding common stock or other voting securities of the GECC Consolidated Group member or members then holding Member Interests, then from and after the occurrence of such events, PTLC or any nominee(s) thereof shall have the right, but not the obligation (which right shall expire one hundred eighty (180) days from the date on which PTLC shall have received the notice referred to in the last sentence of this Subsection 9.4(b)), to purchase from such holders one hundred percent (100%) of their respective Member Interests and one hundred percent (100%) of their respective Partnership Interests at a purchase price, payable in cash, to be determined as of the date PTLC shall advise such holders of its or its nominee(s)’s decision to acquire one hundred percent (100%) of their respective Member Interests and one hundred percent (100%) of their respective Partnership Interests pursuant to this Subsection 9.4(b) by means of the appraisal procedure set forth in Subsection 9.4(c) of the Partnership Agreement. The GE Representative Member shall give prompt written notice to PTLC of the occurrence of any of the events specified in this Subsection 9.4(b).

9.5 Certain General Provisions.

(a) Any amounts payable in cash by any party pursuant to this Subsection 9.3 or Subsection 9.4 shall be effected by means of wire transfer of immediately available funds to such account or accounts in the United States as the payee shall specify not less than one (1) Business Day prior to the date on which such payment is to occur.

(b) Notwithstanding anything to the contrary set forth in Subsection 9.2, 9.3 or 9.4, in the event that the acquisition by a Person of a Member Interest pursuant to any such provision would result in the Company ceasing to enjoy the status of a limited liability company under Delaware Law, then such Person shall not effect such acquisition, but such Person may effect the acquisition through an Affiliate of such Person or member of such Person’s consolidated group if such acquisition eliminates the cessation of the Company enjoying the status of a limited liability company under Delaware Law.

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(c) The Members agree, upon request of the Managing Member, to execute such certificates or other documents and perform such acts as the Managing Member reasonably deems appropriate to preserve the status of the Company as a limited liability company, upon or after the completion of any Transfer of any Member Interest, under Delaware Law.

(d) Notwithstanding anything to the contrary in this Agreement, (i) in the event of the consummation of any Sale by a GE Member of Member Interests in accordance with this Article 9, the transferring GE Member may Sell the rights of the GE Representative Member (in whole but not in part) under this Agreement, or (ii) in the event of any Sale of a Member Interest permitted by this Agreement, the transferring GE Member or PTLC may Sell its purchase rights under Subsections 9.4(a) or (b), respectively.

(e) Notwithstanding anything to the contrary set forth in this Agreement, in the event of any Sale of a Member Interest permitted by this Agreement, the transferor Member shall not cease to be a Member or be deemed to have withdrawn as a Member until the transferee of such Member Interest shall have been admitted as a Member pursuant to Section 9.10 below.

(f) The Company has not registered and does not intend to register as an investment company under the Investment Company Act in reliance on the exception from such registration provided in Section 3(c)(7) thereof. Accordingly, and notwithstanding any of the provisions of this Agreement to the contrary, the provisions of this Subsection 9.5(f) shall govern any Sale of Member Interests for so long as the Company determines (in the Company’s sole discretion) to retain its ability to qualify for the exception from registration provided by Section 3(c)(7) of the Investment Company Act. In the event of any conflict between the provisions of this Section 9.5 and any other provision of this Agreement, the provisions of this Section 9.5(f) shall govern.

(i) All Member Interests shall be offered and Sold without registration under the Securities Act in transactions that are exempt from the registration requirements of the Securities Act pursuant to Section 4(2) thereof and/or in transactions otherwise exempt from such requirements and in any event only to persons that are Qualified Purchasers that meet the requirements of paragraph (iii) of this Section 9.5(f) in reliance on the exception from registration as an investment company provided by Section 3(c)(7) of the Investment Company Act.

(ii) Member Interests may be Sold to a transferee only if such transferee is a Qualified Purchaser (and meets the requirements as set forth in paragraph (iii) of this Section 9.5(f), as certified in a transfer certificate (in the form attached hereto as Exhibit B) delivered to the Managing Member) and the Sale is exempt from the registration requirements of the Securities Act.

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(iii) The Company has not registered and does not intend to register as an investment company under the Investment Company Act in reliance on the exception from such registration provided in Section 3(c)(7) thereof. Member Interests are to be offered and Sold only to persons that are Qualified Purchasers (and meet the other requirements set forth in Annex 1 hereto). Each initial Member shall represent, warrant, acknowledge and agree, and each subsequent purchaser or other transferee of a Member Interest will, by its acceptance or purchase thereof, represent, warrant, acknowledge and agree, to the restrictions as set forth in Annex 1 hereto. In addition, at any time that a Member shall make a contribution of capital to the Company, whether pursuant to the provisions of Section 3.2 hereof or otherwise, such Member shall, by such action, represent, warrant, acknowledge and agree to the restrictions as set forth in Annex 1 hereto. If a holder of a Member Interest shall at anytime after its acquisition of such Member Interest be unable to make the representations, warranties, acknowledgments and agreements set forth in Annex 1, it shall provide prompt notice thereof to the Managing Member.

(iv) The Members agree that Schedule B hereto, and any amendment thereto delivered to the Members in accordance with the provisions of Section 6.3(c) hereof, shall bear the restrictive legend substantially in the form set out in Exhibit A hereto, for so long as the Company determines to retain its ability to rely on the exception provided by Section 3(c)(7) of the Investment Company Act. The Company shall not delete or change such legend without the approval of the GE Representative Member in its sole discretion that the Company does not desire to retain its ability to rely on the exception from registration under the Investment Company Act pursuant to Section 3(c)(7) thereof.

(v) In addition, whether or not the Company is relying on Section 3(c)(7) of the Investment Company Act, Schedule B hereto will bear such part of the legend set forth in Exhibit A that is applicable to the Securities Act (or a legend substantially to such effect) for so long as such portion of the legend and the restrictions on Sale set forth therein are required to ensure that Sales thereof comply with the provisions of the Securities Act.

(vi) No Member Interest shall be Sold unless it is to a transferee that is a Qualified Purchaser and meets the other requirements set forth in Annex 1 hereto. Notwithstanding anything to the contrary in this Agreement, no Sale of a Member Interest may be made if such Sale would require registration of the Company under the Investment Company Act. Each person that purchases or otherwise acquires a Member Interest will be required to certify in a transfer certificate in the form set forth in Exhibit B that it meets the requirements set forth above under Annex 1 hereto. In addition to the other requirements herein, the Managing Member may request such additional documents and certifications as it may reasonably deem necessary (including but not limited to an opinion of counsel) in order to verify that a Sale of a Member Interest is exempt from or not subject to registration under the Securities Act and other applicable securities laws and would not require the Company to register under the Investment Company Act. The Managing Member may deem as void and of no effect and deny any Sale of a Member Interest if it reasonably determines that such Sale is subject to but not registered or exempt from registration under applicable securities laws or could require the Company to register under the Investment Company Act.

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(vii) Any purported Sale of a Member Interest or any beneficial interests therein that is in breach, at the time made, of any transfer restrictions set forth in this Agreement will be void ab initio. The Managing Member shall be entitled to require any holder of a Member Interest that is determined not to have been a Qualified Purchaser (or to have not met the other requirements set forth under Annex 1 hereto) at the time of acquisition of such Member Interest, to forthwith Sell such Member Interest to a person that is a Qualified Purchaser meeting the requirements set forth under Annex 1 hereto in a transaction that is exempt from the registration requirements of the Securities Act. If such holder (or beneficial owner) fails to effect an immediate Sale of such Member Interest, the Managing Member may cause such holder’s Member Interest to be Sold to a person that certifies to the Managing Member that it is a Qualified Purchaser meeting the other requirements set forth in Annex 1 hereto and is aware that the Sale is being made pursuant to an exemption from the Securities Act, together with the other acknowledgements, representations and agreements made by a transferee of a Member Interest. After the receipt of a written notice from the Managing Member of any such Sale, the Managing Member may treat the transferee of such Member Interest as the owner thereof for all purposes hereunder.

(viii) Until the Company determines (with the consent of the GE Representative Member in its sole discretion) not to retain its ability to qualify for the exception from registration provided by Section 3(c)(7) of the Investment Company Act, the Members shall not cause the Company to offer a Member Interest in its own or any affiliated participant-directed employee plan.

(ix) Until the Company determines (with the consent of the GE Representative Member in its sole discretion) not to retain its ability to qualify for the exception from registration provided by Section 3(c)(7) of the Investment Company Act, the Members shall not cause the Company to issue any Member Interest or any other security or interest therein except pursuant to substantially the same provisions as are set forth in this Section 9.5(f).

9.6 Allocation of Profits, Losses and Distributions Subsequent to Sale. All Profits, Losses, or any other items of income, gain, loss, deduction, or credit of the Company attributable to any Member Interest acquired by reason of any Sale of such Member Interest (i) that are allocable, in accordance with Subsection 5.5(c) to the portion of the Company Year ending on the effective date of the Sale shall be allocated, and any distributions made with respect thereto shall be distributed, to the transferor, and (ii) that are allocable, in accordance with Subsection 5.5(c), to subsequent periods shall be allocated, and any distributions made with respect thereto shall be distributed, to the transferee. The effective date of any Transfer permitted under this Agreement, subject to the provisions of Section 9.9 below, shall be the close of business on the Business Day the Company is notified of the Sale.

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9.7 Death, Incompetence, Bankruptcy, Liquidation or Withdrawal of a Member. The death, incompetence, Bankruptcy, liquidation or withdrawal of a Member shall not cause (in and of itself) a dissolution of the Company, but the rights of such a Member to share in the Profits and Losses of the Company, to receive distributions and to assign its Interest pursuant to this Article 9, on the happening of such an event, shall devolve on its beneficiary or other successor, executor, administrator, guardian or other legal representative for the purpose of settling its estate or administering its property, and the Company shall continue as a limited liability company. Such successor or personal representative, however, shall become a substituted member only upon compliance with the requirements of Section 9.10 hereof with respect to a transferee of a Member Interest. The estate of a Bankrupt Member shall be liable for all the obligations of the Member.

9.8 Satisfactory Written Assignment Required. Anything herein to the contrary notwithstanding, both the Company and the Managing Member shall be entitled to treat the transferor of a Member Interest as the absolute owner thereof in all respects, and shall incur no liability for distributions of cash or other property made in good faith to it, until such time as a written assignment or other evidence of the consummation of a Sale that conforms to the requirements of this Article 9 and is reasonably satisfactory to the Managing Member has been received by and recorded on the books of the Company, at which time the Sale shall become effective for purposes of this Agreement.

9.9 Transferee’s Rights. Any purported Transfer of a Member Interest which is not in compliance with this Agreement shall be null and void and of no force or effect whatsoever. A permitted transferee of any Member Interest pursuant to Sections 9.1, 9.2, 9.3, 9.4 or 9.7 hereof or any transferee of a Member Interest pursuant to the Indemnification Agreements shall be entitled to receive, in accordance with Section 9.6, allocations of Profits, Losses, or other items of income, gain, loss, deduction, or credit of the Company attributable to such Member Interest and allocable to periods after the effective date of the Transfer, and distributions of cash or other property from the Company made with respect to periods after the effective date of the Transfer, but shall not become a Member unless and until admitted pursuant to Section 9.10 hereof.

9.10 Transferees Admitted as Members. The assignee or transferee of any Member Interest shall be admitted as a Member only upon the satisfaction of the following conditions:

(a) A duly executed and acknowledged written instrument of Sale, in a form reasonably acceptable to the Managing Member, and either a copy of each of this Agreement and, in the case of PAG or a Penske Member, the applicable Indemnification Agreement duly executed by the transferee or an instrument of assumption in form and substance satisfactory to the GE Representative Member setting forth the transferee’s agreement to be bound by the provisions of this Agreement and, in the case of PAG or a Penske Member, the applicable Indemnification Agreement (including the portion of the Backstop Indemnity Obligation corresponding to the Member Interests being Transferred) have been delivered to the Company; provided that the GE Representative Member shall have the opportunity to request additional information or documentation reasonably necessary to make a determination that the assumption of Backstop Indemnity Obligation is being made by a creditworthy party; provided further that the assumption of such Backstop Indemnity Obligation shall not release the transferring Member of any of its obligations under the Backstop Indemnity Obligation unless such transferring Member is PAG and the Transfer is effected in accordance with Section 9.4(c) of the Indemnification Agreement executed by PAG; and

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(b) The transferee has paid any fees and reimbursed the Company for any expenses paid by the Company in connection with the Sale and admission.

The effective date of an admission of an assignee of a Member and the withdrawal of the transferring Member, if any, shall be the first day which is the last Business Day of a calendar month to occur following the satisfaction of the foregoing conditions, except as otherwise may be agreed by all the Members in writing.

Notwithstanding anything to the contrary in this Agreement, each Member agrees that any Sale of Collateral (as defined in the Indemnification Agreements) taken in accordance with the Indemnification Agreements or a Third Party Sale or Equity Offering as contemplated by Article 10 shall be valid and effective (including, without limitation, under Section 18-702 of the Delaware Act), without further approval or other action by any Member, to transfer all right, title and interest of each applicable Member in the Member Interest so sold (including, without limitation, the rights to (x) share in profits and losses, (y) receive distributions and (z) receive allocations of income, gain, loss, deduction, credit or similar item) to any Person in accordance with the Indemnification Agreements, this Agreement and applicable law.

ARTICLE 10

REFINANCING; OTHER MATTERS REGARDING THE COMPANY BONDS

10.1 Third Party Sale. If an Event of Default with respect to PTLC or PAG has occurred under any of the Indemnification Agreements which is continuing, the GE Representative Member will immediately have the right at any time thereafter to cause the Company to Sell to a third party at a price for cash, and upon other terms and conditions, all as determined in good faith by the GE Representative Member, all or a portion of the Company Sub or all or a portion of the Company Sub’s Partnership Interest sufficient as determined in good faith by the GE Representative Member to cure the Event of Default (each, a “Third Party Sale”). The expenses of such Third Party Sale shall be paid from the gross proceeds of such Third Party Sale and the net proceeds of such Third Party Sale shall be available for distribution by the Company in accordance with the provisions of Section 5.1. No such Third Party Sale will Transfer directly or indirectly the Company Sub’s rights as general partner of the Partnership. Upon the consummation of (a) any Sale of all of the Company Sub or all of the Company Sub’s Partnership Interest, if the Company Sub is then the general partner of the Partnership, the Company Sub’s general partner Partnership Interest shall automatically convert into a limited partner Partnership Interest and, effective immediately prior to such conversion, PTLC’s interest in the Partnership shall automatically convert into a general partner Partnership Interest and (b) any Sale of any portion of the Company Sub’s Partnership Interest at a time when the Company Sub is the general partner of the Partnership, such Sold Partnership Interest shall automatically convert to a limited partner Partnership Interest.

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10.2 Refinancing. Provided that no Event of Default has occurred under any of the Indemnification Agreements which is continuing, no later than one (1) year prior to the maturity date of the Company Bonds, the Members will meet at a mutually agreeable time and location to attempt to decide jointly whether to pursue one of the following in order for the Company to pay the Maturity Obligations due on the Company Bonds at maturity: (a) contribute cash to the Company in the form of additional Capital Contributions; (b) pursue a refinancing of the Company Bonds (with or without GECC’s co-obligation or similar credit support in GECC’s sole discretion) (a “Refinancing”), provided that as an alternative to a Refinancing, the Members may discuss the defeasance or repayment in full of a Members’ portion of the Maturity Obligations due on the Company Bonds at maturity; or (c) pursue one (1) or more equity offerings by the Company or the Company Sub, either of newly issued Member Interests or of Partnership Interests held by Company Sub, the proceeds of which shall be used to repay the Company Bonds and which would include the automatic conversion of the Managing Member’s Partnership Interest effective immediately prior to such sale into a general partner Partnership Interest with respect to any sale of all of the Partnership Interest held by Company Sub if such conversion has not previously occurred (an “Equity Offering”). If (i) the Members cannot agree in each Member’s respective sole discretion on the method for paying the Maturity Obligations in a reasonable period of time, and the Penske Members and PAG have not provided sufficient evidence satisfactory to the GE Members (in the reasonable discretion of the GE Members) of the ability and intent of the Penske Members and PAG to pay their respective portions of the Maturity Obligations as provided herein, or (ii) an Event of Default has occurred under any of the Indemnification Agreements which is continuing, then, commencing one hundred eighty (180) days prior to the maturity date of the Company Bonds, upon notice by the GE Representative Member delivered to the Managing Member no later than one hundred fifty (150) days prior to the maturity date of the Company Bonds (the “Transaction Notice”) the GE Representative Member will have the right in its sole discretion, absent an agreement in writing among the GE Representative Member, the Penske Members and PAG (which agreement in writing shall be at the sole discretion of the GE Representative Member) to another course of action (an “Alternate Transaction”) to pursue, and to cause the Company and/or the Company Sub to consummate, a Third Party Sale, Refinancing or Equity Offering on terms negotiated by the GE Representative Member in good faith, without any guarantees, pledges or contributions by the other Members or their respective Parent Companies; provided that such other Members will, upon request by the GE Representative Member, absent an Alternate Transaction, enter into indemnity, backstop and security arrangements on the same terms as provided in the Indemnification Agreements with respect to the Company Bonds and; provided, further, that in the event of a Refinancing, the refinancing instrument shall have the same duration, tenor, and other terms and conditions as the Company Bonds (except the interest rate). Upon receipt of the Transaction Notice, promptly and in any event within the immediately succeeding ninety (90)-day period thereafter (or such other period as agreed to by the Members), the Penske Members will have the opportunity to demonstrate to the GE Representative Member that the consummation of a Third Party Sale, Refinancing or Equity Offering, as applicable, would result in material disproportionate adverse tax impacts on the Penske Members or any of their Parent Companies or PAG related to such Members’ Member Interest or Partnership Interest (the “Rebuttal”). If a Rebuttal is received by the GE Representative Member, the Penske Members will have the opportunity to propose alternate structures for the Third Party Sale, Refinancing or Offering, as applicable, to minimize the effect of such adverse tax impacts (the “Alternative Structure” or “Alternative Structures”) and the GE Representative Member will use its commercially reasonable efforts to assist the Penske Members or PAG with devising such Alternative Structure(s), but the GE Representative Member shall not be obligated to utilize such Alternative Structure(s) if such structures are not reasonably acceptable to the GE Representative Member. The Members hereby agree that in no event will indemnification be required for any potential adverse tax impacts arising in connection with the consummation of a Third Party Sale, Refinancing or Offering or Alternative Structure. For the avoidance of doubt, (I) the opportunity to provide a Rebuttal or propose Alternative Structures by the Penske Members or PAG does not in any way affect or limit the right of the GE Representative Member to consummate a Third Party Sale, Refinancing or Equity Offering pursuant to this Section 10.2 and (II) a Third Party Sale, Refinancing or Equity Offering contemplated by this Section 10.2 need not be consummated prior to or simultaneously with the payment of the Maturity Obligations due on the Company Bonds at maturity.

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10.3 Fall Away Event. At all times after the Fall Away Event, the Company will pay to GECC, absent the consummation of an Alternate Transaction that fully funds the total amount of Interest Obligations and Maturity Obligations then remaining, the amount of any Interest Obligations or Maturity Obligations, and all expenses relating to the Company Bonds while the Company Bonds remain outstanding, to the extent of the Company’s cash and cash equivalents, except for the Permitted Working Capital, prior to the scheduled interest payment dates, with respect to the Interest Obligations, and the scheduled maturity date of the Company Bonds, with respect to the Maturity Obligations, in each case as set forth in the Company Bond Indenture as in effect on the date hereof, unless any amendment or waiver thereto is consented to by the Penske Members (whether or not the Company Bonds remain outstanding until their scheduled maturity date or are amended or modified after the Fall Away Event). Such payments shall be deemed distributions in proportion to the Percentage Interests of each of the Members, with the amounts that are deemed distributions to PTLC and PAG deemed to be payments to GECC of their respective obligations under the Backstop Indemnity Obligation.

10.4 Receipt of Funds in Respect of Company Bonds. The GE Representative Member shall be responsible for directing the Trustee to disburse any funds to which the Company is entitled under the Company Bond Indenture following (a) the Fall Away Event or (b) the date on which the Company Bonds cease to be outstanding. The GE Representative Member shall direct that any such funds shall be disbursed first to GECC to repay the amount of Interest Obligations or Maturity Obligations GECC has paid and has not otherwise been reimbursed (including any amounts payable to GECC with respect thereto under the Indemnification Agreements). Any funds in excess of such amounts shall be disbursed to the Company. Any such payments to GECC under this Section 10.4 shall be deemed distributed in proportion to the Percentage Interest of each of the Members, with the amounts that are deemed distributions to PTLC and PAG deemed to be payments to GECC of their respective obligations under the Backstop Indemnity Obligation.

10.5 Backstop Indemnity Obligations. Notwithstanding anything in this Agreement or the Indemnification Agreements to the contrary, PTLC’s and PAG’s respective Backstop Indemnity Obligations shall continue to be effective, or be reinstated, as the case may be, if at any time payment of any of the funds out of the Funding Subaccount to or for the account of GECC is rescinded or must otherwise be restored or returned upon any Bankruptcy of any Member or its Affiliates or otherwise.

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ARTICLE 11

LIABILITY OF MEMBERS

11.1 Liability of Members.

(a) Except as otherwise specifically provided by the Act, no Member will be liable for any debt, obligation or liability of the Company or of any other Member or have any obligation to restore any deficit balance in its Capital Account solely by reason of being a Member of the Company.

(b) Notwithstanding any other provision of this Agreement or any duty otherwise existing at Law or in equity, each Non-Managing Member, will, to the maximum extent permitted by Law, including Section 18-1101(d) of the Act, owe no fiduciary duties to the Company, the other Members or any other Person bound by this Agreement as long as the Non-Managing Members act, subject to their rights under Subsection 11.1(c), in accordance with the implied contractual covenant of good faith and fair dealing, including good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they expand or restrict or eliminate the duties and liabilities of any Non-Managing Member otherwise existing at Law or in equity, are agreed by the Members to modify to that extent the other duties and liabilities of the Non-Managing Members.

(c) Except as expressly provided in this Agreement, whenever in this Agreement a Non-Managing Member is permitted or required to take any action or to make a decision, the Non-Managing Member may take the action or make the decision in its sole discretion, and the Non-Managing Member may consider, and make its determination based on, the interests and factors as it desires.

ARTICLE 12

DISSOLUTION

12.1 Events of Dissolution. The Company shall continue until December 31, 2023, or such later date as the Members may unanimously agree, unless sooner dissolved upon the earliest to occur of the following events, which shall cause an immediate dissolution of the Company:

(a) the sale, exchange or other disposition of all or substantially all of the Company’s assets; or

(b) such earlier date as the Members shall unanimously elect.

12.2 Final Accounting. Upon the dissolution of the Company, a proper accounting shall be made by the Company’s Auditor from the date of the last previous accounting to the date of dissolution.

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12.3 Liquidation. Upon the dissolution of the Company, the Managing Member or, if there is no Managing Member, a person approved by the Members and the GE Representative Member, shall act as liquidator to wind up the Company. The liquidator shall have full power and authority to sell, assign and encumber any or all of the Company’s assets, subject to the provisions of the Partnership Agreement, and to wind up and liquidate the affairs of the Company in an orderly and business-like manner. All proceeds from liquidation shall be distributed in the following orders of priority: (a) to the payment and discharge of the debts and liabilities of the Company (other than liabilities for distributions to Members), (b) to the payment of expenses of liquidation, (c) to the setting up of such reserves as the liquidator may reasonably deem necessary for any contingent liability of the Company (other than liabilities for distributions to Members), and (d) the balance to the Members in accordance with their Percentage Interests.

12.4 Cancellation of Certificate. Upon the completion of the distribution of Company assets as provided in Section 12.3 hereof, the Company shall be terminated and the person acting as liquidator shall cause the cancellation of the Certificate and shall take such other actions as may be necessary or appropriate to terminate the Company.

ARTICLE 13

NOTICES

13.1 Method of Notice. Any notice or request hereunder may be given to any Member at their respective addresses/ numbers set forth below or at such other address/ number as may hereafter be specified in a notice designated as a notice of change of address under this Section. Any notice or request hereunder may be given by (a) hand delivery, (b) overnight courier, (c) registered or certified mail, return receipt requested, or (d) electronic transmission or facsimile (or such other e-mail address or number as may hereafter be specified in a notice designated as a notice of change of address), with electronic confirmation of its receipt and subsequently confirmed by registered or certified mail or overnight courrier. Any notice or other communication required or permitted pursuant to this Agreement shall be deemed given (i) when personally delivered to any officer of the party to whom it is addressed, (ii) on the earlier of actual receipt thereof or five (5) Business Days following posting thereof by certified or registered mail, postage prepaid, (iii) upon actual receipt thereof when sent by a recognized overnight delivery service or (iv) upon actual receipt thereof when sent by electronic transmission or by facsimile to the address or number set forth below with electronic confirmation of its receipt, in each case, addressed to each party at its address set forth below or at such other address as has been furnished in writing by a party to the other by like notice; provided, that in order for an electronic transmission to constitute proper notice hereunder, such electronic transmission must specifically reference this Section 13.1 and state that it is intended to constitute notice hereunder:

(1)    If to PTLC at: Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607 Attention: Senior Vice President — General Counsel Facsimile: 610-775-6330 E-mail Address: mike.duff@penske.com

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with a copy to:	Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607 Attention: Senior Vice President — Finance Facsimile: 610-775-5064 E-mail Address: frank.cocuzza@penske.com
and a copy to:	Penske Corporation 2555 Telegraph Road, Bloomfield Hills, MI 48302 Attention: Executive Vice President and General Counsel Facsimile: 248-648-2135 E-mail Address: larry.bluth@penskecorp.com
(2)    If to PAG at:	Penske Automotive Group, Inc. 2555 Telegraph Road Bloomfield Hills, Michigan 48302 Attention: Senior Vice President — General Counsel Facsimile: 248-648-2515 E-mail Address: sspradlin@penskeautomotive.com
with a copy to:	Penske Automotive Group, Inc. 2555 Telegraph Road Bloomfield Hills, Michigan 48302 Attention: Chief Financial Officer Facsimile: 248-648-2515 E-mail Address: dave.jones@penskeautomotive.com
and a copy to:	Penske Corporation 2555 Telegraph Road, Bloomfield Hills, MI 48302 Attention: Executive Vice President and General Counsel Facsimile: 248-648-2135 E-mail Address: larry.bluth@penskecorp.com
(3)    If to GE Truck Leasing Holdco at:	GE Capital Truck Leasing Holding Corp. 901 Main Avenue, 3rd Floor Norwalk, Connecticut 06851 Attention: Dennis Murray, President Facsimile: 203-823-4502 E-mail Address: Dennis.Murray@ge.com

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with a copy to:	GE Capital Finance 901 Main Avenue, 6th Floor Norwalk, Connecticut 06851 Attention: Strategic Transactions Counsel Facsimile: 203-750-7098 Email: mark.landis@ge.com
(4)    If to GE Logistics Holdco at:	Logistics Holding Corp. 1209 Orange Street Wilmington, Delaware 19808
with a copy to:	GE Equipment Services Division 901 Main Avenue, 3rd Floor Norwalk, CT 06851 Attention: Senior Counsel—Strategic Transactions and Relations, Equipment Services Facsimile: 203-663-8207 E-mail Address: joseph.lincoln@ge.com
(5)    If to GE Tennessee at:	General Electric Credit Corporation of Tennessee 2 Bethesda Metro Center, Suite 600 Bethesda, Maryland 20814 Attention: Deneen Sanders Facsimile: (312) 602-3937 E-mail Address: Deneen.sanders@ge.com
with a copy to:	GE Capital Finance 901 Main Avenue, 6th Floor Norwalk, Connecticut 06851 Attention: Strategic Transactions Counsel Facsimile: (203) 750-7098 Email: mark.landis@ge.com

13.2 Computation of Time. In computing any period of time under this Agreement, the day of the act, event or default from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, Sunday or legal holiday, in which event the period shall run until the end of the next day which is not a Saturday, Sunday or non-Business Day.

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ARTICLE 14

INVESTMENT REPRESENTATIONS

14.1 Investment Purpose. Each Member represents and warrants to the Company and to each other Member that it has acquired its member interest in the Company for its own account, for investment only and not with a view to the distribution thereof, except to the extent provided in or permitted by this Agreement.

14.2 Investment Restriction. Each Member recognizes that (a) the member interests in the Company have not been registered under the Securities Act in reliance upon an exemption from such registration, and agrees that it will not Transfer its member interest in the Company (i) in the absence of an effective registration statement covering such member interest under the Securities Act, unless such Transfer is exempt from registration for any proposed sale, and (ii) except in compliance with all applicable provisions of this Agreement, and (b) the restrictions on Transfer imposed by this Agreement may severely affect the liquidity of an investment in member interests in the Company.

ARTICLE 15

GENERAL PROVISIONS

15.1 Amendment; Waiver. Except as provided in Subsection 6.3(c) and subject to Section 15.6 below, this Agreement may not be amended nor may any rights hereunder be waived without the prior written approval of (a) the Managing Member and (b) the Non-Managing Members holding a majority of the aggregate Percentage Interests of all Non-Managing Members, provided that no such amendment or waiver shall disproportionately and adversely affect the rights or obligations of any Member under this Agreement without the consent of such Member. The Managing Member shall give written notice to all Non-Managing Members promptly after any amendment has become effective.

15.2 Governing Law. This Agreement shall be construed and enforced in accordance with and governed by the Laws of the State of Delaware, without giving effect to the provisions, policies or principles thereof relating to choice or conflict of Laws.

15.3 Binding Effect. Except as provided otherwise herein, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective permitted successors and permitted assigns.

15.4 Separability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

15.5 Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

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15.6 No Third-Party Rights. Nothing in this Agreement shall be deemed to create any right in any person not a party hereto (other than the permitted successors and assigns of a party hereto) and this Agreement shall not be construed in any respect to be a contract in whole or in part for the benefit of any third party (except as aforesaid). Notwithstanding the foregoing, the parties hereto agree that GECC is a third-party beneficiary of Section 3.2, Section 3.3, Section 5.1, Section 10.3, Section 10.4 and Section 10.5 and no such Section may be amended, restated, supplemented or otherwise modified, or any of such provisions waived, without the prior written and manually signed consent of a duly authorized officer of GECC.

15.7 Waiver of Partition and Application for Dissolution. Each Member, by requesting and being granted admission to the Company, is deemed to waive (a) until termination of the Company any and all rights that it may have to maintain an action for partition of the Company’s assets and (b) the right to apply for dissolution of the Company pursuant to § 18-802 of the Act.

15.8 Nature of Interests. All Company property, whether real or personal, tangible or intangible, shall be deemed to be owned by the Company as an entity, and none of the Members shall have any direct ownership of such property.

15.9 Counterpart Execution. This Agreement may be executed in any number of counterparts, each of which shall be an original instrument and all of which, when taken together, shall constitute one and the same Agreement. Delivery of an executed signature page of this Agreement by email, PDF or facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written, effective as of the close of the Company’s business as of the Effective Time.

MANAGING MEMBER:
PENSKE TRUCK LEASING CORPORATION
By:	/s/ Frank Cocuzza
Name:	Frank Cocuzza
Title:	Senior Vice President-Finance
MEMBERS:
GE CAPITAL TRUCK LEASING HOLDING CORP.
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	President
GENERAL ELECTRIC CREDIT CORPORATION OF TENNESSEE
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	Vice President
LOGISTICS HOLDING CORP.
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	President
PENSKE AUTOMOTIVE GROUP, INC.
By:	/s/ David Jones
Name:	David Jones
Title:	Executive Vice President and Chief Financial Officer

Schedule A

Name and Address	Initial Capital Contribution
Managing Member
Penske Truck Leasing Corporation	$	2,054,000
Non-Managing Members
GE Capital Truck Leasing Holding Corp.	$	1,865,500
General Electric Credit Corporation of Tennessee	$	25,000
Logistics Holding Corp.	$	604,500
Penske Automotive Group, Inc.	$	451,000

Schedule B

LJ VP HOLDINGS LLC (THE “COMPANY”) HAS NOT BEEN REGISTERED AS AN INVESTMENT COMPANY UNDER THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “INVESTMENT COMPANY ACT”), AND THE MEMBER INTERESTS SET FORTH BELOW HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND NEITHER THE MEMBER INTERESTS NOR ANY BENEFICIAL INTERESTS THEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO A PERSON WHO IS A “QUALIFIED PURCHASER” WITHIN THE MEANING OF SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT AND THE RULES AND REGULATIONS THEREUNDER (“QUALIFIED PURCHASER”) ACQUIRING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A PERSON WHO IS A QUALIFIED PURCHASER (AN “ELIGIBLE PURCHASER”) AND EACH SUCH PERSON AND ACCOUNT FOR WHICH SUCH PERSON IS PURCHASING (A) IN THE AGGREGATE OWNS AND INVESTS ON A DISCRETIONARY BASIS NOT LESS THAN $25,000,000 IN INVESTMENTS (AS DEFINED IN ANNEX 2), (B) IS NOT (X) A PARTNERSHIP, COMMON TRUST FUND, SPECIAL TRUST, PENSION FUND OR RETIREMENT PLAN OR OTHER ENTITY IN WHICH THE PARTNERS, BENEFICIARIES, SECURITY OWNERS OR PARTICIPANTS, AS THE CASE MAY BE, MAY DESIGNATE THE PARTICULAR INVESTMENTS TO BE MADE OR THE ALLOCATION THEREOF, UNLESS EACH SUCH PARTNER, BENEFICIARY, SECURITY OWNER OR PARTICIPANT EMPOWERED ALONE OR WITH OTHER PARTNERS, BENEFICIARIES, SECURITY OWNERS OR OTHER PARTICIPANTS TO MAKE SUCH DECISIONS MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, OR (Y) OR AN ENTITY THAT HAS INVESTED MORE THAN 40% OF ITS ASSETS IN SECURITIES OF THE COMPANY, GIVING EFFECT TO THE AMOUNT INVESTED IN CONNECTION WITH ITS ACQUISITION HEREOF OR A BENEFICIAL INTEREST HEREIN, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, (C) WAS NOT FORMED, REFORMED, RECAPITALIZED, OPERATED OR ORGANIZED FOR THE SPECIFIC PURPOSE OF PURCHASING THE MEMBER INTEREST OR INVESTING IN THE COMPANY, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH IN THE AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF THE COMPANY (THE “AGREEMENT”) FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, AND (D) EITHER (X) IS NOT AN ENTITY ORGANIZED PRIOR TO APRIL 30, 1996 THAT IS EXCEPTED FROM THE INVESTMENT COMPANY ACT PURSUANT TO SECTION 3(C)(1) OR 3(C)(7) THEREOF OR (Y) HAS RECEIVED THE CONSENT OF THE BENEFICIAL OWNERS OF ITS SECURITIES WITH RESPECT TO ITS TREATMENT AS A QUALIFIED PURCHASER IN THE MANNER REQUIRED BY SECTION 2(A)(51)(C) OF THE INVESTMENT COMPANY ACT AND THE RULES THEREUNDER. EACH HOLDER AND TRANSFEREE OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN, BY VIRTUE OF SUCH HOLDING AND ACQUISITION, REPRESENTS THAT IT AGREES TO COMPLY WITH THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, AND WILL NOT TRANSFER ITS MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN EXCEPT TO AN ELIGIBLE PURCHASER WHO, PRIOR TO SUCH TRANSFER, MAKES THE REPRESENTATIONS AND AGREEMENTS ON BEHALF OF ITSELF AND EACH ACCOUNT FOR WHICH IT IS PURCHASING SET FORTH IN A TRANSFER CERTIFICATE IN THE FORM ATTACHED AS EXHIBIT B TO THE AGREEMENT. ANY PURPORTED TRANSFER OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN THAT IS IN BREACH, AT THE TIME MADE, OF ANY TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT WILL BE VOID AB INITIO. IF AT ANY TIME THE COMPANY DETERMINES IN GOOD FAITH THAT A HOLDER OR BENEFICIAL OWNER OF A MEMBER INTEREST OR BENEFICIAL INTEREST THEREIN IS IN BREACH, AT THE TIME GIVEN, OF ANY OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, THE COMPANY SHALL CONSIDER THE ACQUISITION OF SUCH MEMBER INTEREST OR SUCH BENEFICIAL INTERESTS THEREIN VOID, OF NO FORCE OR EFFECT AND WILL NOT, AT THE DISCRETION OF THE COMPANY, OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO THE COMPANY. IN ADDITION, THE COMPANY MAY REQUIRE SUCH ACQUIRER OR BENEFICIAL OWNER TO SELL ITS MEMBER INTEREST OR SUCH BENEFICIAL INTEREST THEREIN TO AN ELIGIBLE PURCHASER.

Company Name

“LJ VP Holdings LLC”

Percentage Interests

As of the Effective Time

Name and Address	Percentage Interest
Managing Member
Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607		41.08	%
Non-Managing Members
GE Capital Truck Leasing Holding Corp. 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808		37.31	%
General Electric Credit Corporation of Tennessee 2 Bethesda Metro Center, Suite 600,		0.50	%
Bethesda MD 20814
Logistics Holding Corp. 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808		12.09	%
Penske Automotive Group, Inc. 2555 Telegraph Road, Bloomfield Hills, Michigan 48302		9.02	%

Exhibit A

FORM OF RESTRICTIVE LEGEND

LJ VP HOLDINGS LLC (THE “COMPANY”) HAS NOT BEEN REGISTERED AS AN INVESTMENT COMPANY UNDER THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “INVESTMENT COMPANY ACT”), AND THE MEMBER INTERESTS SET FORTH BELOW HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND NEITHER THE MEMBER INTERESTS NOR ANY BENEFICIAL INTERESTS THEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO A PERSON WHO IS A “QUALIFIED PURCHASER” WITHIN THE MEANING OF SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT AND THE RULES AND REGULATIONS THEREUNDER (“QUALIFIED PURCHASER”) ACQUIRING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A PERSON WHO IS A QUALIFIED PURCHASER (AN “ELIGIBLE PURCHASER”) AND EACH SUCH PERSON AND ACCOUNT FOR WHICH SUCH PERSON IS PURCHASING (A) IN THE AGGREGATE OWNS AND INVESTS ON A DISCRETIONARY BASIS NOT LESS THAN $25,000,000 IN INVESTMENTS (AS DEFINED IN ANNEX 2), (B) IS NOT (X) A PARTNERSHIP, COMMON TRUST FUND, SPECIAL TRUST, PENSION FUND OR RETIREMENT PLAN OR OTHER ENTITY IN WHICH THE PARTNERS, BENEFICIARIES, SECURITY OWNERS OR PARTICIPANTS, AS THE CASE MAY BE, MAY DESIGNATE THE PARTICULAR INVESTMENTS TO BE MADE OR THE ALLOCATION THEREOF, UNLESS EACH SUCH PARTNER, BENEFICIARY, SECURITY OWNER OR PARTICIPANT EMPOWERED ALONE OR WITH OTHER PARTNERS, BENEFICIARIES, SECURITY OWNERS OR OTHER PARTICIPANTS TO MAKE SUCH DECISIONS MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, OR (Y) OR AN ENTITY THAT HAS INVESTED MORE THAN 40% OF ITS ASSETS IN SECURITIES OF THE COMPANY, GIVING EFFECT TO THE AMOUNT INVESTED IN CONNECTION WITH ITS ACQUISITION HEREOF OR A BENEFICIAL INTEREST HEREIN, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, (C) WAS NOT FORMED, REFORMED, RECAPITALIZED, OPERATED OR ORGANIZED FOR THE SPECIFIC PURPOSE OF PURCHASING THE MEMBER INTEREST OR INVESTING IN THE COMPANY, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH IN THE AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF THE COMPANY (THE “AGREEMENT”) FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, AND (D) EITHER (X) IS NOT AN ENTITY ORGANIZED PRIOR TO APRIL 30, 1996 THAT IS EXCEPTED FROM THE INVESTMENT COMPANY ACT PURSUANT TO SECTION 3(C)(1) OR 3(C)(7) THEREOF OR (Y) HAS RECEIVED THE CONSENT OF THE BENEFICIAL OWNERS OF ITS SECURITIES WITH RESPECT TO ITS TREATMENT AS A QUALIFIED PURCHASER IN THE MANNER REQUIRED BY SECTION 2(A)(51)(C) OF THE INVESTMENT COMPANY ACT AND THE RULES THEREUNDER. EACH HOLDER AND TRANSFEREE OF A MEMBER INTEREST OR ANY

BENEFICIAL INTERESTS THEREIN, BY VIRTUE OF SUCH HOLDING AND ACQUISITION, REPRESENTS THAT IT AGREES TO COMPLY WITH THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, AND WILL NOT TRANSFER ITS MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN EXCEPT TO AN ELIGIBLE PURCHASER WHO, PRIOR TO SUCH TRANSFER, MAKES THE REPRESENTATIONS AND AGREEMENTS ON BEHALF OF ITSELF AND EACH ACCOUNT FOR WHICH IT IS PURCHASING SET FORTH IN A TRANSFER CERTIFICATE IN THE FORM ATTACHED AS EXHIBIT B TO THE AGREEMENT . ANY PURPORTED TRANSFER OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN THAT IS IN BREACH, AT THE TIME MADE, OF ANY TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT WILL BE VOID AB INITIO. IF AT ANY TIME THE COMPANY DETERMINES IN GOOD FAITH THAT A HOLDER OR BENEFICIAL OWNER OF A MEMBER INTEREST OR BENEFICIAL INTEREST THEREIN IS IN BREACH, AT THE TIME GIVEN, OF ANY OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, THE COMPANY SHALL CONSIDER THE ACQUISITION OF SUCH MEMBER INTEREST OR SUCH BENEFICIAL INTERESTS THEREIN VOID, OF NO FORCE OR EFFECT AND WILL NOT, AT THE DISCRETION OF THE COMPANY, OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO THE COMPANY. IN ADDITION, THE COMPANY MAY REQUIRE SUCH ACQUIRER OR BENEFICIAL OWNER TO SELL ITS MEMBER INTEREST OR SUCH BENEFICIAL INTEREST THEREIN TO AN ELIGIBLE PURCHASER.

Exhibit B

FORM OF TRANSFER CERTIFICATE

Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Amended and Restated Limited Liability Company Agreement of LJ VP Holdings LLC.

The undersigned purchaser of a Member Interest hereby represents, warrants and agrees, that:

(A) the purchaser (i) is a “qualified purchaser” within the meaning of Section 2(a)(51) of the Investment Company Act and the rules and regulations thereunder, (ii) is aware that the Company will not be registered under the Investment Company Act in reliance on the exemption set forth in Section 3(c)(7) thereof and that the Member Interest has not been and will not be registered under the Securities Act and (iii) is acquiring such Member Interest for its own account or the account of one or more qualified purchasers as to which the purchaser exercises sole investment discretion and for which all of the other representations and warranties set forth herein and in the legend appearing above the schedule of Percentage Interests on Schedule B to the Agreement, as the case may be, are true and correct;

(B) the purchaser is not purchasing the Member Interest with a view to the resale, distribution or other disposition thereof in violation of the Securities Act;

(C) neither the purchaser nor any account for which the purchaser is acquiring the Member Interest will hold such Member Interest for the benefit of any other person and the purchaser and each such account (and any parent company that meets the definition of a qualified purchaser) will be the sole beneficial owners thereof for all purposes and will not sell participation interests in the Member Interest or enter into any other arrangement pursuant to which any other person will be entitled to an interest in any payments on or based on the Member Interest;

(D) Schedule B setting forth the Percentage Interests in the Company bear a legend to the following effect:

LJ VP HOLDINGS LLC (THE “COMPANY”) HAS NOT BEEN REGISTERED AS AN INVESTMENT COMPANY UNDER THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “INVESTMENT COMPANY ACT”), AND THE MEMBER INTERESTS SET FORTH BELOW HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND NEITHER THE MEMBER INTERESTS NOR ANY BENEFICIAL INTERESTS THEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO A PERSON WHO IS A “QUALIFIED PURCHASER” WITHIN THE MEANING OF SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT AND THE RULES AND REGULATIONS THEREUNDER (“QUALIFIED PURCHASER”) ACQUIRING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A PERSON WHO IS A QUALIFIED PURCHASER (AN “ELIGIBLE PURCHASER”) AND EACH SUCH PERSON AND ACCOUNT FOR WHICH SUCH PERSON IS PURCHASING (A) IN THE AGGREGATE OWNS AND INVESTS ON A DISCRETIONARY BASIS NOT LESS THAN $25,000,000 IN INVESTMENTS (AS DEFINED IN ANNEX 2), (B) IS NOT (X) A PARTNERSHIP, COMMON TRUST FUND, SPECIAL TRUST, PENSION FUND OR RETIREMENT PLAN OR OTHER ENTITY IN WHICH THE PARTNERS, BENEFICIARIES, SECURITY OWNERS OR PARTICIPANTS, AS THE CASE MAY BE, MAY DESIGNATE THE PARTICULAR INVESTMENTS TO BE MADE OR THE ALLOCATION THEREOF, UNLESS EACH SUCH PARTNER, BENEFICIARY, SECURITY OWNER OR PARTICIPANT EMPOWERED ALONE OR WITH OTHER PARTNERS, BENEFICIARIES, SECURITY OWNERS OR OTHER PARTICIPANTS TO MAKE SUCH DECISIONS MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, OR (Y) OR AN ENTITY THAT HAS INVESTED MORE THAN 40% OF ITS ASSETS IN SECURITIES OF THE COMPANY, GIVING EFFECT TO THE AMOUNT INVESTED IN CONNECTION WITH ITS ACQUISITION HEREOF OR A BENEFICIAL INTEREST HEREIN, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, (C) WAS NOT FORMED, REFORMED, RECAPITALIZED, OPERATED OR ORGANIZED FOR THE SPECIFIC PURPOSE OF PURCHASING THE MEMBER INTEREST OR INVESTING IN THE COMPANY, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH IN THE AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF THE COMPANY (THE “AGREEMENT”) FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, AND (D) EITHER (X) IS NOT AN ENTITY ORGANIZED PRIOR TO APRIL 30, 1996 THAT IS EXCEPTED FROM THE INVESTMENT COMPANY ACT PURSUANT TO SECTION 3(C)(1) OR 3(C)(7) THEREOF OR (Y) HAS RECEIVED THE CONSENT OF THE BENEFICIAL OWNERS OF ITS SECURITIES WITH RESPECT TO ITS TREATMENT AS A QUALIFIED PURCHASER IN THE MANNER REQUIRED BY SECTION 2(A)(51)(C) OF THE INVESTMENT COMPANY ACT AND THE RULES THEREUNDER. EACH HOLDER AND TRANSFEREE OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN, BY VIRTUE OF SUCH HOLDING AND ACQUISITION, REPRESENTS THAT IT AGREES TO COMPLY WITH THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, AND WILL NOT TRANSFER ITS MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN EXCEPT TO AN ELIGIBLE PURCHASER WHO, PRIOR TO SUCH TRANSFER, MAKES THE REPRESENTATIONS AND AGREEMENTS ON BEHALF OF ITSELF AND EACH ACCOUNT FOR WHICH IT IS PURCHASING SET FORTH IN A TRANSFER CERTIFICATE IN THE FORM ATTACHED AS EXHIBIT B TO THE AGREEMENT . ANY PURPORTED TRANSFER OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN THAT IS IN BREACH, AT THE TIME MADE, OF ANY TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT WILL BE VOID AB INITIO. IF AT ANY TIME THE COMPANY DETERMINES IN GOOD FAITH THAT A HOLDER OR BENEFICIAL OWNER OF A MEMBER INTEREST OR BENEFICIAL INTEREST THEREIN IS IN BREACH, AT THE TIME GIVEN, OF ANY OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, THE COMPANY SHALL CONSIDER THE ACQUISITION OF SUCH MEMBER INTEREST OR SUCH BENEFICIAL INTERESTS THEREIN VOID, OF NO FORCE OR EFFECT AND WILL NOT, AT THE DISCRETION OF THE COMPANY, OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO THE COMPANY. IN ADDITION, THE COMPANY MAY REQUIRE SUCH ACQUIRER OR BENEFICIAL OWNER TO SELL ITS MEMBER INTEREST OR SUCH BENEFICIAL INTEREST THEREIN TO AN ELIGIBLE PURCHASER.

(E) the purchaser and each account for which it is purchasing:

(i) in the aggregate owns and invests on a discretionary basis not less than $25,000,000 in investments (as defined in Annex 2);

(ii) is not (x) a partnership, common trust fund, special trust, pension fund or retirement plan or other entity in which the partners, beneficiaries, security owners or participants, as the case may be, may designate the particular investments to be made or the allocation thereof, unless each such partner, beneficiary, security owner or participant empowered alone or with other partners, beneficiaries, security owners or other participants to make such decisions meets all requirements set forth herein for qualification as an eligible purchaser, or (y) or an entity that has invested more than 40% of its assets in securities of the Company, giving effect to the amount invested in connection with its acquisition of the Member Interest or a beneficial interest therein, unless each beneficial owner of the eligible purchaser’s securities meets all requirements set forth herein for qualification as an eligible purchaser;

(iii) was not formed, reformed, recapitalized, operated or organized for the specific purpose of purchasing the Member Interest or investing in the Company, unless each beneficial owner of the eligible purchaser’s securities meets all requirements set forth herein for qualification as an eligible purchaser;

(iv) either (x) is not an entity organized prior to April 30, 1996 that is excepted from the Investment Company Act pursuant to section 3(c)(1) or 3(c)(7) thereof or (y) has received the consent of the beneficial owners of its securities with respect to its treatment as a “qualified purchaser” in the manner required by section 2(a)(51)(c) of the Investment Company Act and the rules thereunder;

(v) will provide notice of the transfer restrictions described in this certificate of transfer to any subsequent transferees;

(vi) may not transfer the Member Interest or beneficial interests therein except to a transferee who can make the same representations and agreements as set forth in this certificate of transfer and the Agreement on behalf of itself and each account for which it is purchasing.

(F) if at any time it shall make a contribution of capital to the Company, whether pursuant to the provisions of Section 3.2 of the Agreement or otherwise, it shall, by such action, represent, warrant, acknowledge and agree to the restrictions as set forth in Annex 1 to the Agreement and that if, at anytime after its acquisition of a Member Interest it shall be unable to make the representations, warranties, acknowledgments and agreements set forth in Annex 1 to the Agreement, it shall provide prompt notice thereof to the Managing Member.

The purchaser acknowledges that the Member Interest is being offered only in a transaction not involving any public offering within the meaning of the Securities Act. The Member Interests have not been and will not be registered under the Securities Act and the Company has not been or will be registered under the Investment Company Act, and, if in the future the purchaser decides to offer, resell, pledge or otherwise transfer the Member Interest, such Member Interest may be offered, resold, pledged or otherwise transferred only in accordance with the legend appearing above the schedule of Percentage Interests on Schedule B to the Agreement described above. The purchaser acknowledges that no representation is made by the Company as to the availability of any exemption under the Securities Act or any state securities laws for resale of the Member Interest.

Dated:
	[Type or print name of Transferee]
	By:
		Authorized Signatory

Annex 1

TRANSFER RESTRICTIONS

The provisions of this Annex 1 will be applicable to the Member Interests for so long as the Company determines (in the Company’s sole discretion) to retain its ability to qualify for the exception provided by Section 3(c)(7) of the Investment Company Act. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Agreement of which this Annex 1 forms a part.

Each purchaser and holder of a Member Interest (including those set forth in Schedule B to the Agreement as they exist from time to time, including as a result of transfers, in each case as of the time of purchase), by virtue of its acquisition and holding of such Member Interest, represents and agrees as follows:

(A) the purchaser (i) is a “qualified purchaser” within the meaning of Section 2(a)(51) of the Investment Company Act and the rules and regulations thereunder, (ii) is aware that the Company will not be registered under the Investment Company Act in reliance on the exemption set forth in Section 3(c)(7) thereof and that the Member Interests have not been and will not be registered under the Securities Act and (iii) is acquiring such Member Interest for its own account or the account of one or more qualified purchasers as to which the purchaser exercises sole investment discretion and for which all of the other representations and warranties set forth herein and in the legend appearing above the schedule of Percentage Interests on Schedule B to the Agreement, as the case may be, are true and correct;

(B) the purchaser is not purchasing the Member Interest with a view to the resale, distribution or other disposition thereof in violation of the Securities Act;

(C) neither the purchaser nor any account for which the purchaser is acquiring the Member Interest will hold such Member Interest for the benefit of any other person and the purchaser and each such account (and any parent company that meets the definition of a qualified purchaser) will be the sole beneficial owners thereof for all purposes and will not sell participation interests in the Member Interest or enter into any other arrangement pursuant to which any other person will be entitled to an interest in any payments on or based on the Member Interest;

(D) Schedule B setting forth the Percentage Interests in the Company shall bear a legend to the following effect:

LJ VP HOLDINGS LLC (THE “COMPANY”) HAS NOT BEEN REGISTERED AS AN INVESTMENT COMPANY UNDER THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE “INVESTMENT COMPANY ACT”), AND THE MEMBER INTERESTS SET FORTH BELOW HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND NEITHER THE MEMBER INTERESTS NOR ANY BENEFICIAL INTERESTS THEREIN MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT TO A PERSON WHO IS A “QUALIFIED PURCHASER” WITHIN THE MEANING OF SECTION 2(a)(51) OF THE INVESTMENT COMPANY ACT AND THE RULES AND REGULATIONS THEREUNDER (“QUALIFIED PURCHASER”) ACQUIRING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A PERSON WHO IS A QUALIFIED PURCHASER (AN “ELIGIBLE PURCHASER”) AND EACH SUCH PERSON AND ACCOUNT FOR WHICH SUCH PERSON IS PURCHASING (A) IN THE AGGREGATE OWNS AND INVESTS ON A DISCRETIONARY BASIS NOT LESS THAN $25,000,000 IN INVESTMENTS (AS DEFINED IN ANNEX 2), (B) IS NOT (X) A PARTNERSHIP, COMMON TRUST FUND, SPECIAL TRUST, PENSION FUND OR RETIREMENT PLAN OR OTHER ENTITY IN WHICH THE PARTNERS, BENEFICIARIES, SECURITY OWNERS OR PARTICIPANTS, AS THE CASE MAY BE, MAY DESIGNATE THE PARTICULAR INVESTMENTS TO BE MADE OR THE ALLOCATION THEREOF, UNLESS EACH SUCH PARTNER, BENEFICIARY, SECURITY OWNER OR PARTICIPANT EMPOWERED ALONE OR WITH OTHER PARTNERS, BENEFICIARIES, SECURITY OWNERS OR OTHER PARTICIPANTS TO MAKE SUCH DECISIONS MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, OR (Y) OR AN ENTITY THAT HAS INVESTED MORE THAN 40% OF ITS ASSETS IN SECURITIES OF THE COMPANY, GIVING EFFECT TO THE AMOUNT INVESTED IN CONNECTION WITH ITS ACQUISITION HEREOF OR A BENEFICIAL INTEREST HEREIN, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH HEREIN FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, (C) WAS NOT FORMED, REFORMED, RECAPITALIZED, OPERATED OR ORGANIZED FOR THE SPECIFIC PURPOSE OF PURCHASING THE MEMBER INTEREST OR INVESTING IN THE COMPANY, UNLESS EACH BENEFICIAL OWNER OF THE ELIGIBLE PURCHASER’S SECURITIES MEETS ALL REQUIREMENTS SET FORTH IN THE AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT OF THE COMPANY (THE “AGREEMENT”) FOR QUALIFICATION AS AN ELIGIBLE PURCHASER, AND (D) EITHER (X) IS NOT AN ENTITY ORGANIZED PRIOR TO APRIL 30, 1996 THAT IS EXCEPTED FROM THE INVESTMENT COMPANY ACT PURSUANT TO SECTION 3(C)(1) OR 3(C)(7) THEREOF OR (Y) HAS RECEIVED THE CONSENT OF THE BENEFICIAL OWNERS OF ITS SECURITIES WITH RESPECT TO ITS TREATMENT AS A QUALIFIED PURCHASER IN THE MANNER REQUIRED BY SECTION 2(A)(51)(C) OF THE INVESTMENT COMPANY ACT AND THE RULES THEREUNDER. EACH HOLDER AND TRANSFEREE OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN, BY VIRTUE OF SUCH HOLDING AND ACQUISITION, REPRESENTS THAT IT AGREES TO COMPLY WITH THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, AND WILL NOT TRANSFER ITS MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN EXCEPT TO AN ELIGIBLE PURCHASER WHO, PRIOR TO SUCH TRANSFER, MAKES THE REPRESENTATIONS AND AGREEMENTS ON BEHALF OF ITSELF AND EACH ACCOUNT FOR WHICH IT IS PURCHASING SET FORTH IN A TRANSFER CERTIFICATE IN THE FORM ATTACHED AS EXHIBIT B TO THE AGREEMENT. ANY PURPORTED TRANSFER OF A MEMBER INTEREST OR ANY BENEFICIAL INTERESTS THEREIN THAT IS IN BREACH, AT THE TIME MADE, OF ANY TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT WILL BE VOID AB INITIO. IF AT ANY TIME THE COMPANY DETERMINES IN GOOD FAITH THAT A HOLDER OR BENEFICIAL OWNER OF A MEMBER INTEREST OR BENEFICIAL INTEREST THEREIN IS IN BREACH, AT THE TIME GIVEN, OF ANY OF THE TRANSFER RESTRICTIONS SET FORTH IN THE AGREEMENT, THE COMPANY SHALL CONSIDER THE ACQUISITION OF SUCH MEMBER INTEREST OR SUCH BENEFICIAL INTERESTS THEREIN VOID, OF NO FORCE OR EFFECT AND WILL NOT, AT THE DISCRETION OF THE COMPANY, OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE NOTWITHSTANDING ANY INSTRUCTIONS TO THE CONTRARY TO THE COMPANY. IN ADDITION, THE COMPANY MAY REQUIRE SUCH ACQUIRER OR BENEFICIAL OWNER TO SELL ITS MEMBER INTEREST OR SUCH BENEFICIAL INTEREST THEREIN TO AN ELIGIBLE PURCHASER.

(E) the purchaser and each account for which it is purchasing:

(i) in the aggregate owns and invests on a discretionary basis not less than $25,000,000 in investments (as defined in Annex 2);

(ii) is not (x) a partnership, common trust fund, special trust, pension fund or retirement plan or other entity in which the partners, beneficiaries, security owners or participants, as the case may be, may designate the particular investments to be made or the allocation thereof, unless each such partner, beneficiary, security owner or participant empowered alone or with other partners, beneficiaries, security owners or other participants to make such decisions meets all requirements set forth herein for qualification as an eligible purchaser, or (y) or an entity that has invested more than 40% of its assets in securities of the Company, giving effect to the amount invested in connection with its acquisition of the Member Interest or a beneficial interest therein, unless each beneficial owner of the eligible purchaser’s securities meets all requirements set forth herein for qualification as an eligible purchaser;

(iii) was not formed, reformed, recapitalized, operated or organized for the specific purpose of purchasing the Member Interest or investing in the Company, unless each beneficial owner of the eligible purchaser’s securities meets all requirements set forth herein for qualification as an eligible purchaser;

(iv) either (x) is not an entity organized prior to April 30, 1996 that is excepted from the Investment Company Act pursuant to section 3(c)(1) or 3(c)(7) thereof or (y) has received the consent of the beneficial owners of its securities with respect to its treatment as a “qualified purchaser” in the manner required by section 2(a)(51)(c) of the Investment Company Act;

(v) will provide notice of the transfer restrictions described in Section 9.5(f) of the Agreement to any subsequent transferees; and

(vi) may not transfer the Member Interest or beneficial interests therein except to a transferee who can make the same representations and agreements as set forth in Section 9.5(f) of the Agreement on behalf of itself and each account for which it is purchasing.

(F) if at any time it shall make a contribution of capital to the Company, whether pursuant to the provisions of Section 3.2 of the Agreement or otherwise, it shall, by such action, represent, warrant, acknowledge and agree to the restrictions as set forth in this Annex 1 and that if, at anytime after its acquisition of a Member Interest it shall be unable to make the representations, warranties, acknowledgments and agreements set forth in this Annex 1, it shall provide prompt notice thereof to the Managing Member.

The purchaser acknowledges that the Member Interest is being offered only in a transaction not involving any public offering within the meaning of the Securities Act. The Member Interests have not been and will not be registered under the Securities Act and the Company has not been or will be registered under the Investment Company Act, and, if in the future the purchaser decides to offer, resell, pledge or otherwise transfer the Member Interest, such Member Interest may be offered, resold, pledged or otherwise transferred only in accordance with the legend appearing above the schedule of Percentage Interests on Schedule B to the Agreement described above. The purchaser acknowledges that no representation is made by the Company as to the availability of any exemption under the Securities Act or any state securities laws for resale of the Member Interest.

Annex 2

Investments. For the purposes of the definition of Qualified Purchaser, “investments” are defined as follows:

1. Securities (as defined by Section 2(a)(1) of the Securities Act), other than securities of an issuer that controls, is controlled by, or is under common control with, the Prospective Qualified Purchaser that owns such securities, unless the issuer of such securities is:

i. An Investment Vehicle;

ii. A Public Company; or

iii. A company with shareholders’ equity of not less than $50 million (determined in accordance with generally accepted accounting principles) as reflected on the company’s most recent financial statements, provided that such financial statements present the information as of a date within 16 months preceding the date on which the Prospective Qualified Purchaser acquires the securities of a Section 3(c)(7) Company;

2. Real estate held for investment purposes;

3. Commodity Interests held for investment purposes;

4. Physical Commodities held for investment purposes;

5. To the extent not securities, financial contracts (as such term is defined in Section 3(c)(2)(B)(ii) of the Investment Company Act entered into for investment purposes;

6. In the case of a Prospective Qualified Purchaser that is a Section 3(c)(7) Company or a commodity pool, any amounts payable to such Prospective Qualified Purchaser pursuant to a firm agreement or similar binding commitment pursuant to which a person has agreed to acquire an interest in, or make capital contributions to, the Prospective Qualified Purchaser upon the demand of the Prospective Qualified Purchaser; and

7. Cash and cash equivalents (including foreign currencies) held for investment purposes. For purposes of this definition, cash and cash equivalents include:

i. Bank deposits, certificates of deposit, bankers acceptances and similar bank instruments held for investment purposes; and

ii. The net cash surrender value of an insurance policy.

For the purpose of the meaning of “investments”:

A. Commodity Interests means commodity futures contracts, options on commodity futures contracts, and options on physical commodities traded on or subject to the rules of:

a. Any contract market designated for trading such transactions under the Commodity Exchange Act and the rules thereunder; or

b. Any board of trade or exchange outside the United States, as contemplated in Part 30 of the rules under the Commodity Exchange Act.

B. Family Company means a company described in paragraph (A)(ii) of Section 2(a)(51) of the Investment Company Act.

C. Investment Vehicle means an investment company, a company that would be an investment company but for the exclusions provided by Sections 3(c)(1) through 3(c)(9) of the Investment Company Act or the exemptions provided by Rule 3a-6 or Rule 3a-7, or a commodity pool.

D. Physical Commodity means any physical commodity with respect to which a Commodity Interest is traded on a market specified in paragraph A.a. of above.

E. Prospective Qualified Purchaser means a person seeking to purchase a security of a Section 3(c)(7) Company.

For purposes of determining whether a Prospective Qualified Purchaser is a Qualified Purchaser, the aggregate amount of Investments owned and invested on a discretionary basis by the Prospective Qualified Purchaser shall be the Investments’ fair market value on the most recent practicable date or their cost, provided that:

a. In the case of Commodity Interests, the amount of Investments shall be the value of the initial margin or option premium deposited in connection with such Commodity Interests; and

b. In each case, there shall be deducted from the amount of Investments owned by the Prospective Qualified Purchaser the amounts specified in the following two paragraphs, as applicable:

• In determining whether any person is a Qualified Purchaser there shall be deducted from the amount of such person’s Investments the amount of any outstanding indebtedness incurred to acquire or for the purpose of acquiring the Investments owned by such person.

• In determining whether a Family Company is a Qualified Purchaser, in addition to the amounts specified in the paragraph above, there shall be deducted from the value of such Family Company’s Investments any outstanding indebtedness incurred by an owner of the Family Company to acquire such Investments.

F. Public Company means a company that:

a. Files reports pursuant to section 13 or 15(d) of the Exchange Act; or

b. Has a class of securities that are listed on a “designated offshore securities market” as such term is defined by Regulation S under the Securities Act.

G. Relying Person means a Section 3(c)(7) Company or a person acting on its behalf.

H. Section 3(c)(7) Company means a company that would be an investment company but for the exclusion provided by section 3(c)(7) of the Investment Company Act.

Valuations. For purposes of determining the amount of Investments owned by a company under Section 2(a)(51)(A)(iv) of the Investment Company Act, there may be included Investments owned by majority-owned subsidiaries of the company and Investments owned by a company (“Parent Company”) of which the company is a majority-owned subsidiary, or by a majority-owned subsidiary of the company and other majority-owned subsidiaries of the Parent Company.

Investment Purposes. For purpose of the meaning “investment purposes”:

1) Real estate shall not be considered to be held for investment purposes by a Prospective Qualified Purchaser if it is used by the Prospective Qualified Purchaser or a Related Person for personal purposes or as a place of business, or in connection with the conduct of the trade or business of the Prospective Qualified Purchaser or a Related Person, provided that real estate owned by a Prospective Qualified Purchaser who is engaged primarily in the business of investing, trading or developing real estate in connection with such business may de deemed to be held for investment purposes. Residential real estate shall not be deemed to be used for personal purposes if deductions with respect to such real estate are not disallowed by section 280A of the Internal Revenue Code.

2) A Commodity Interest or Physical Commodity owned, or a financial contract entered into, by the Prospective Qualified Purchaser who is engaged primarily in the business of investing, reinvesting, or trading in Commodity Interests, Physical Commodities or financial contracts in connection with such business may be deemed to be held for investment purposes.

EX-10.3

EXHIBIT 10.3

EXECUTION VERSION

FOURTH AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF PENSKE TRUCK LEASING CO., L.P.

TABLE OF CONTENTS

	Page
ARTICLE 1 THE LIMITED PARTNERSHIP		2
1.1 Formation.		2
1.2 Certificate of Limited Partnership		3
1.3 Name		3
1.4 Character of Business		3
1.5 Certain Business Policies		3
1.6 Principal Offices		4
1.7 Fiscal Year		4
1.8 Accounting Matters		4
ARTICLE 2 DEFINITIONS		4
2.1 Accepting Partners		4
2.2 Act		4
2.3 Adjusted Capital Account Deficit		5
2.4 Advisory Committee		5
2.5 After-Acquired Company		5
2.6 Affiliate		5
2.7 After-Acquired Business		5
2.8 Agreement		5
2.9 Alternative Structure		5
2.10 Approved IPO Structure		5
2.11 Auditor		5
2.12 Bankruptcy		6
2.13 Beneficial Owner or Beneficially Own		6
2.14 Bona Fide Lender		6
2.15 Business Activities Ancillary		6
2.16 Business Day		6
2.17 Capital Account		6
2.18 Capital Contribution		7
2.19 Capital Markets Activity		7
2.20 Certificate		7
2.21 Change of Control of the Partnership		7
2.22 Code		7
2.23 Control		7
2.24 Conversion Event		7
2.25 Corresponding Provision		7
2.26 Default Recovery/Remarketing Activities		7
2.27 Depreciation		8
2.28 De Minimis Business		8
2.29 Effective Time		8
2.30 Evaluation Material		8
2.31 Event of Withdrawal		8

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TABLE OF CONTENTS

(continued)

	Page
2.32 Exchange Act		8
2.33 Exercising Partner		8
2.34 Existing Business Activities		8
2.35 Final Distributions		8
2.36 Financial Services Business		8
2.37 Financing		9
2.38 Foreclosure		9
2.39 GECC		9
2.40 GECC Consolidated Group		9
2.41 GECC Contingent Liabilities Agreement		9
2.42 GECC Credit Agreement		9
2.43 GE Committee Member		9
2.44 GE Logistics Holdco		9
2.45 General Partner		9
2.46 Generally Accepted Accounting Principles		9
2.47 GE Partners		9
2.48 GE Representative Partner		9
2.49 GE Tennessee		10
2.50 GE Truck Leasing Holdco		10
2.51 Governmental Authority		10
2.52 GP Event Date		10
2.53 Gross Asset Value		10
2.54 Holdings		11
2.55 Holdings LLC Agreement		11
2.56 Initiated Offer		11
2.57 Insurance		11
2.58 Interested Party		11
2.59 IPO		11
2.60 IPO Consummation Obligation		11
2.61 IPO Demand Notice		11
2.62 IPO Notice		12
2.63 IPO Rebuttal		12
2.64 Issuing Entity		12
2.65 Law		12
2.66 Leasing		12
2.67 Lien		12
2.68 Limited Partner		12
2.69 LJ VP		12
2.70 Majority Limited Partners		12
2.71 Member		12
2.72 Member Interest		12
2.73 Net Income		13
2.74 Net Losses		13

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TABLE OF CONTENTS

(continued)

	Page
2.75 New Credit Agreement		13
2.76 Non-Exercising Partner		13
2.77 Non-Issuing Partner		13
2.78 Nonrecourse Deductions		13
2.79 Nonrecourse Liability		13
2.80 Non-Voting Observer		13
2.81 Offer		13
2.82 Offered Interest		13
2.83 Offeree Partners		13
2.84 Offering Partner		13
2.85 Other Financial Services Activities		13
2.86 PAG		13
2.87 PAG Consolidated Group.		14
2.88 PAG Pledge		14
2.89 PAG Pledged Interest		14
2.90 Parent Company		14
2.91 Partner		14
2.92 Partner Nonrecourse Debt		14
2.93 Partner Nonrecourse Debt Minimum Gain		14
2.94 Partner Nonrecourse Deductions		14
2.95 Partnership		14
2.96 Partnership Certificate		14
2.97 Partnership Group		14
2.98 Partnership Interest		14
2.99 Partnership Minimum Gain		14
2.100 Partnership Registrant		15
2.101 Partnership Year		15
2.102 Penske Committee Member		15
2.103 Penske Corporation		15
2.104 Penske Partners		15
2.105 Percentage Interest		15
2.106 Permitted Intragroup Transferees		15
2.107 Person		15
2.108 Potential Buyer		15
2.109 Preliminary Distribution		15
2.110 Prior Agreement		15
2.111 Profits and Losses		15
2.112 PTLC		16
2.113 PTLC Consolidated Group		17
2.114 Purchased Interest		17
2.115 Qualified Purchaser		17
2.116 Recipient Group		17
2.117 Registration Rights Agreement		17

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TABLE OF CONTENTS

(continued)

	Page
2.118 Regulations		17
2.119 Regulatory Allocations		17
2.120 Response Notice		17
2.121 Restricted Person		17
2.122 Returns		17
2.123 Rollins Business		17
2.124 Sale		17
2.125 Schedule		17
2.126 SEC		18
2.127 Securities		18
2.128 Securities Act		18
2.129 Securities Activity		18
2.130 Selling Interests		18
2.131 Subject Year		18
2.132 Subject Year To Date		18
2.133 Subsidiary		18
2.134 Tax Matters Partner		18
2.135 Third Party Proposed Sale		18
2.136 Third Tier Built-In Gain		18
2.137 TMP Eligible Partner		19
2.138 Trade Name and Trademark Agreement		19
2.139 Transfer		19
2.140 UPREIT Structure		19
2.141 General Provisions		19
ARTICLE 3 CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS		19
3.1 Additional Capital Contributions		19
3.2 Capital Contributions and Accounts		19
3.3 Negative Capital Accounts		20
3.4 Compliance with Treasury Regulations		20
3.5 Succession to Capital Accounts		20
3.6 No Withdrawal of Capital Contributions		20
3.7 No Partnership Certificates		20
3.8 Percentage Interests		20
ARTICLE 4 COSTS AND EXPENSES		21
4.1 Operating Costs		21
ARTICLE 5 DISTRIBUTIONS; PARTNERSHIP ALLOCATIONS; TAX MATTERS		21
5.1 Distributions Prior to Dissolution		21
5.2 Partnership Allocations		23
5.3 Special Allocations		25

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TABLE OF CONTENTS

(continued)

	Page
5.4 Curative Allocations		26
5.5 Other Allocation Rules		27
5.6 Tax Allocations; Code Section 704(c)		28
5.7 Accounting Method		29
ARTICLE 6 MANAGEMENT		29
6.1 Rights and Duties of the Partners		29
6.2 Fiduciary Duty of General Partner		29
6.3 Powers of General Partner		29
6.4 Advisory Committee		31
6.5 Restrictions on the Authority of the General Partner		36
6.6 Other Activities		40
6.7 Transactions with Affiliates		44
6.8 Exculpation		45
ARTICLE 7 COMPENSATION		45
ARTICLE 8 ACCOUNTS		45
8.1 Books and Records		45
8.2 Reports, Returns and Audits		45
ARTICLE 9 TRANSFERS AND SALES		47
9.1 Transfer of Interests of General Partner and PTLC Consolidated Group		47
9.2 Transfer or Sale of Limited Partner Interests		48
9.3 Right of First Offer		49
9.4 Certain Changes of Control		53
9.5 Certain General Provisions		54
9.6 Allocation of Profits, Losses and Distributions Subsequent to Sale		55
9.7 Death, Incompetence, Bankruptcy, Liquidation or Withdrawal of a Limited Partner		56
9.8 Satisfactory Written Assignment Required		56
9.9 Transferee’s Rights		56
9.10 Transferees Admitted as Partners		57
9.11 Change of Control Rights		57
ARTICLE 10 EXIT/ IPO RIGHT		57
10.1 IPO Notice		57
10.2 Partnership Restructuring in connection with IPO		59
10.3 IPO Alternative		59
ARTICLE 11 DISSOLUTION		60
11.1 Events of Dissolution		60

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TABLE OF CONTENTS

(continued)

	Page
11.2 Final Accounting		60
11.3 Liquidation		60
11.4 Cancellation of Certificate		61
ARTICLE 12 INVESTMENT REPRESENTATIONS		61
12.1 Investment Purpose		61
12.2 Investment Restriction		61
ARTICLE 13 NOTICES		61
13.1 Method of Notice		61
13.2 Computation of Time		64
ARTICLE 14 GENERAL PROVISIONS		64
14.1 Entire Agreement		64
14.2 Amendment; Waiver		65
14.3 Governing Law		65
14.4 Binding Effect		65
14.5 Separability		65
14.6 Headings		65
14.7 No Third-Party Rights		65
14.8 Waiver of Partition		65
14.9 Nature of Interests		65
14.10 Counterpart Execution		65

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SCHEDULES

SCHEDULE A – Partners and Percentage Interests

SCHEDULE B – Current Members of Advisory Committee

SCHEDULE C – Capital Accounts

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FOURTH AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

PENSKE TRUCK LEASING CO., L.P.

THIS FOURTH AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP is entered into this 30th day of April, 2012, and effective as of the Effective Time, by and among Penske Truck Leasing Corporation, a Delaware corporation with its offices at 2675 Morgantown Road, Reading, Pennsylvania 19607 (as further defined below, “PTLC”), LJ VP, LLC, a Delaware limited liability company with its offices at 2675 Morgantown Road, Reading, Pennsylvania 19607 (as further defined below, “LJ VP”), Penske Automotive Group, Inc., a Delaware corporation with its offices at 2555 Telegraph Road, Bloomfield Hills, Michigan 48302 (as further defined below, “PAG”), GE Capital Truck Leasing Holding Corp., a Delaware corporation with its offices at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808 (as further defined below, “GE Truck Leasing Holdco”), Logistics Holding Corp., a Delaware corporation with its offices at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808 (as further defined below, “GE Logistics Holdco”), and General Electric Credit Corporation of Tennessee, a Tennessee corporation with its offices at 2 Bethesda Metro Center, Suite 600, Bethesda, MD 20814 (as further defined below, “GE Tennessee”).

WITNESSETH:

WHEREAS, a limited partnership was heretofore formed in accordance with the provisions of the Delaware Revised Uniform Limited Partnership Act (6 Del.C. §17-101, et seq.) (as amended from time to time and any successor to such Act, the “Act”) under the name Penske Truck Leasing Co., L.P. pursuant to an Agreement of Limited Partnership dated July 18, 1988 (the “Partnership”);

WHEREAS, the Agreement of Limited Partnership was amended and restated in its entirety by the Amended and Restated Agreement of Limited Partnership dated August 10, 1988, and thereafter and heretofore was amended or amended and restated from time to time, most recently by an amendment and restatement in its entirety known as the Third Amended and Restated Agreement of Limited Partnership of the Partnership, dated March 26, 2009 (the “Third Amended and Restated Partnership Agreement”), by and among the parties hereto and their predecessors (other than LJ VP); and

WHEREAS, the parties hereto desire to recognize the admission of LJ VP initially as a limited partner and to amend and restate the Third Amended and Restated Partnership Agreement in its entirety as hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto, intending to be legally bound, hereby agree that the Third Amended and Restated Partnership Agreement is hereby amended and restated in its entirety by this Fourth Amended and Restated Agreement of Limited Partnership and, as so amended and restated hereby, shall read in its entirety as follows:

ARTICLE 1

THE LIMITED PARTNERSHIP

1.1 Formation.

(a) The parties hereto other than LJ VP have heretofore been admitted to the Partnership as general partner or limited partners of the Partnership, as applicable, and the Partnership shall engage in the business hereinafter described for the period and upon the terms and conditions hereinafter set forth.

(b) As of the Effective Time, LJ VP is being admitted to the Partnership initially as a limited partner in the Partnership.

(c) Notwithstanding any provision of this Agreement to the contrary, PTLC (or any successor thereto pursuant to the proviso in Subsection 11.1(b)) shall be the general partner in the Partnership until the GP Event Date, at which time, unless the GE Representative Partner and PTLC (or any such successor) otherwise agree in writing, each in its sole discretion, (i) PTLC’s (or any such successor’s) Partnership Interest as a general partner in the Partnership will automatically convert to a Partnership Interest as a limited partner in the Partnership (at the same Percentage Interest) and PTLC shall be automatically admitted to the Partnership as a Limited Partner, and (ii) effective immediately prior to such conversion, LJ VP’s Partnership Interest in the Partnership will automatically convert from a Partnership Interest as a limited partner in the Partnership to a Partnership Interest as a general partner in the Partnership (at the same Percentage Interest) and LJ VP shall be automatically admitted to the Partnership as a General Partner and shall continue the Partnership without dissolution. If the GP Event Date has occurred and LJ VP is then the general partner in the Partnership, and subsequently any Conversion Event occurs, then at such time (A) LJ VP’s Partnership Interest (or in the case of a Sale of a portion of such Partnership Interest, the portion thereof being Sold) will automatically convert from a Partnership Interest as a general partner in the Partnership to a Partnership Interest as a limited partner in the Partnership (at the same Percentage Interest) and, subject to the further conditions relating to Transfers under this Agreement, the transferee in such Sale or, if there is no such transferee, LJ VP, shall be admitted as a Limited Partner and (B) if such conversion would otherwise result in there being no General Partner, then, effective immediately prior to such conversion, the Partnership Interest held by the then Managing Member of Holdings will automatically convert from a Partnership Interest as a limited partner in the Partnership to a Partnership Interest as a general partner in the Partnership (at the same Percentage Interest as it then holds in the Partnership, but no more than the 9.18% Percentage Interest, in its capacity as general partner, held by the General Partner at the Effective Time) and the then Managing Member of Holdings shall be automatically admitted to the Partnership as a General Partner and shall continue the Partnership without dissolution.

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1.2 Certificate of Limited Partnership. PTLC has previously executed and caused to be filed (a) a Certificate of Limited Partnership of the Partnership in the office of the Secretary of State of the State of Delaware on July 18, 1988, (b) a Certificate of Amendment to Certificate of Limited Partnership of the Partnership in the office of the Secretary of State of the State of Delaware on July 21, 1988, and (c) a Certificate of Amendment to Certificate of Limited Partnership of the Partnership in the office of the Secretary of State of the State of Delaware on March 20, 2002 (such Certificate of Limited Partnership, together with and as amended by such Certificates of Amendment, is hereinafter collectively referred to as the “Certificate”). The General Partner shall execute such further documents (including any additional amendments to the Certificate to reflect the occurrence of the transactions contemplated by Section 1.1) and take such further action as shall be appropriate to comply with all requirements of Law for the formation and operation of a limited partnership in the State of Delaware and all other jurisdictions where the Partnership may elect to do business.

1.3 Name. The name of the Partnership is Penske Truck Leasing Co., L.P. Subject to the provisions of Subsection 6.5(c)(iv), the General Partner may change the name of the Partnership or cause the business of the Partnership to be conducted under any other name (other than any name including the term “General Electric”, “GE” or derivatives thereof) and, in any such event, the General Partner shall notify the Limited Partners of such name change within thirty (30) days thereafter.

1.4 Character of Business. The business of the Partnership shall be (i) the rental, leasing and servicing of tractors, trailers and trucks to third-party users, and the sale of such tractors, trailers and trucks used in the business of the Partnership; (ii) acting as a dedicated contract motor carrier, (iii) the provision of other third-party logistics services such as distribution center management, transportation management, managing and optimizing enterprises’ logistics networks, and providing supply chain consulting services, (iv) conducting Business Activities Ancillary to the businesses set forth in clauses (i), (ii) and (iii), and (v) such other activities and business as may be lawfully conducted by a limited partnership formed under the Laws of the State of Delaware. “Business Activities Ancillary” to a specified business shall mean business activities that are not conducted as a separate profitable business offering and comprise not more than five percent (5%) of the value measured by the net profit of the business activities of the specified business. The Partnership shall have and exercise all the powers now or hereafter conferred by the Laws of the State of Delaware on limited partnerships formed under the Laws of that State, and to do any and all things as fully as natural persons might or could do as are not prohibited by Law in furtherance of the aforesaid business of the Partnership. The business of the Partnership shall be conducted in accordance with, and any action required or permitted to be taken by the General Partner or any Limited Partner shall be taken in compliance with, all applicable Laws.

1.5 Certain Business Policies. The Partnership adopted prior to the Effective Time, in accordance with the terms of this Agreement as then in effect, and maintains policies with respect to requirements of environmental Laws, antitrust Laws, Laws relating to contracts with Governmental Authorities, insider trading and ethical business practices, as well as credit approval levels. The Partnership shall conduct its business in accordance with such policies, as the same may be amended from time to time in accordance with Subsections 6.5(b)(ii) and (c)(ii).

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1.6 Principal Offices. The location of the principal offices of the Partnership shall be at 2675 Morgantown Road, Reading, Pennsylvania 19607, or at such other location as may be selected from time to time by the General Partner. If the General Partner changes the location of the principal offices of the Partnership, the Limited Partners shall be notified in writing within thirty (30) days thereafter. The Partnership may maintain such other offices at such other places as the General Partner deems advisable.

1.7 Fiscal Year. The fiscal year of the Partnership shall be the calendar year (the “Partnership Year”).

1.8 Accounting Matters. Unless otherwise specified herein, all accounting determinations hereunder shall be made, all accounting terms used herein shall be interpreted, and all financial statements required to be delivered hereunder shall be prepared, in accordance with Generally Accepted Accounting Principles applied on a consistent basis with prior periods, except, in the case of such financial statements, for departures from Generally Accepted Accounting Principles that may from time to time be approved in writing by the Partners and the Auditor who is at the time reporting on such financial statements. In the event that any “Accounting Change” (as defined below) shall occur and such change results in a change in the method of calculation of permitted distributions, standards or other terms in this Agreement, then the General Partner agrees to enter into negotiations with the other Partners in order to amend such provisions of this Agreement so as to reflect equitably such Accounting Changes with the desired result that the criteria for permitting distributions and other matters shall have the same economic effect after such Accounting Changes as if such Accounting Changes had not been made. Until such time as such an amendment shall have been executed and delivered by the Partners, all such permitted distributions and other matters in this Agreement shall continue to be calculated or construed as if such Accounting Changes had not occurred. “Accounting Changes” refers to changes in accounting principles required by the promulgation of any final rule, regulation, pronouncement or opinion by the Financial Accounting Standards Board of the American Institute of Certified Public Accountants or any successor organization or, if applicable, the SEC.

ARTICLE 2

DEFINITIONS

The following defined terms used in this Agreement shall have the respective meanings specified below.

2.1 Accepting Partners. “Accepting Partners” shall have the meaning ascribed to such term in Subsection 9.3(e).

2.2 Act. “Act” shall have the meaning ascribed to such term in the first “Whereas” clause hereof as amended and in effect from time to time, or the corresponding provisions of any successor statute.

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2.3 Adjusted Capital Account Deficit. “Adjusted Capital Account Deficit” shall mean, with respect to any Limited Partner, the deficit balance, if any, in such Partner’s Capital Account as of the end of the relevant taxable year or other period after giving effect to the following adjustments:

(i) Credit to such Capital Account any amounts that such Partner is obligated to restore (pursuant to the terms of this Agreement or otherwise) or deemed obligated to restore pursuant to the penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and

(ii) Debit to such Capital Account the items described in Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and 1.704-1(b)(2)(ii)(d)(6).

The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

2.4 Advisory Committee. “Advisory Committee” shall have the meaning ascribed to such term in Subsection 6.4(a).

2.5 After-Acquired Company. “After-Acquired Company” shall have the meaning ascribed to such term in Subsection 6.6(h).

2.6 Affiliate. “Affiliate” shall mean, with respect to any specified Person, any other Person that, at the time of determination, (i) directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with, such specified Person, (ii) beneficially owns or Controls ten percent (10%) or more of any class or series of outstanding voting securities of such specified Person, (iii) is a managing member, manager or general partner of such specified Person, or (iv) is an officer, director, managing member, manager or general partner of any of the foregoing.

2.7 After-Acquired Business. “After-Acquired Business” shall have the meaning ascribed to such term in Subsection 6.6(h).

2.8 Agreement. This “Agreement” shall refer to this Fourth Amended and Restated Agreement of Limited Partnership, including the Schedules hereto, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.9 Alternative Structure. “Alternative Structure” or “Alternative Structures” shall have the meaning ascribed to such term in Subsection 10.1(b).

2.10 Approved IPO Structure. “Approved IPO Structure” shall have the meaning ascribed to such term in Subsection 10.1(f).

2.11 Auditor. “Auditor” shall mean Deloitte LLP or any successor firm of independent auditors selected pursuant to Subsection 6.4(g).

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2.12 Bankruptcy. The “Bankruptcy” of a Partner shall mean (i) the filing by a Partner of a voluntary petition seeking liquidation, reorganization, arrangement or readjustment, in any form, of its debts under Title 11 of the United States Code or any other federal or state insolvency Law, or a Partner’s filing an answer consenting to or acquiescing in any such petition, (ii) the making by a Partner of any assignment for the benefit of its creditors or (iii) the expiration of sixty (60) days after the filing of an involuntary petition under Title 11 of the United States Code, an application for the appointment of a receiver for the assets of a Partner, or an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of its debts under any other federal or state insolvency Law, provided that the same shall not have been vacated, set aside or stayed within such sixty (60)-day period.

2.13 Beneficial Owner or Beneficially Own. “Beneficial Owner” or “Beneficially Own” shall have the meaning given in Rule 13d-3 under the Exchange Act and a Person’s beneficial ownership of securities of any Person will be calculated in accordance with the provisions of that Rule.

2.14 Bona Fide Lender. “Bona Fide Lender” shall have the meaning ascribed to such term in Subsection 9.2(f).

2.15 Business Activities Ancillary. “Business Activities Ancillary” shall have the meaning ascribed to such term in Subsection 1.4.

2.16 Business Day. “Business Day” shall mean any day other than a Saturday or Sunday or other day that commercial banks are required or permitted to be closed in New York City.

2.17 Capital Account. “Capital Account” shall mean, with respect to any Partner, the Capital Account maintained for such Partner in accordance with the following provisions:

(i) To each Partner’s Capital Account there shall be credited such Partner’s Capital Contributions, such Partner’s distributive share of Profits and any items in the nature of income or gain that are specially allocated pursuant to Section 5.3 or Section 5.4, and the amount of any Partnership liabilities assumed by such Partner or that are secured by any Partnership property distributed to such Partner;

(ii) To each Partner’s Capital Account there shall be debited the amount of cash and the Gross Asset Value of any Partnership property distributed to such Partner pursuant to any provision of this Agreement, such Partner’s distributive share of Losses and any items in the nature of expenses or losses that are specially allocated pursuant to Section 5.3 or Section 5.4, and the amount of any liabilities of such Partner assumed by the Partnership or that are secured by any property contributed by such Partner to the Partnership.

(iii) In the event all or a portion of an interest in the Partnership is Transferred, in accordance with the terms of this Agreement (including Section 9.4), the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred interest.

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(iv) In determining the amount of any liability for purposes of subparagraphs (i) and (ii) and the definition of “Capital Contribution,” there shall be taken into account Code Section 752(c) and any other applicable provisions of the Code and Regulations.

2.18 Capital Contribution. “Capital Contribution” shall mean, with respect to any Partner, the amount of money and the initial Gross Asset Value of any property (other than money) contributed to the Partnership by such Partner (or its predecessors in interest) with respect to the Partnership Interest held by such Partner.

2.19 Capital Markets Activity. “Capital Markets Activity” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.20 Certificate. “Certificate” shall have the meaning ascribed to such term in Section 1.2.

2.21 Change of Control of the Partnership. “Change of Control of the Partnership” shall mean (i) the consummation of a merger or consolidation of one or more members of the Partnership Group which collectively own, directly or indirectly, all or substantially all of the Partnership Group’s assets with or into another entity (whether or not it is the surviving entity) that is not the Partnership or a direct or indirect wholly-owned subsidiary of the Partnership; or (ii) the Sale of all or substantially all of the Partnership’s assets in one or more of a series of related transactions.

2.22 Code. “Code” shall mean the Internal Revenue Code of 1986, as amended and in effect from time to time, or the corresponding provisions of any successor statute.

2.23 Control. “Control” (including the correlative terms “Controlling,” “Controlled by” and “under common Control with”) shall mean 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.

2.24 Conversion Event. “Conversion Event” shall mean the occurrence of any of the following: (i) the Sale in accordance with this Agreement or the Holdings LLC Agreement of all or any portion of LJ VP’s Partnership Interest; (ii) the dissolution of Holdings pursuant to Section 12.1 of the Holdings LLC Agreement; (iii) the dissolution of LJ VP pursuant to Section 15 of the LJ VP LLC Agreement or the Bankruptcy of LJ VP; and (iv) while LJ VP then holds a Partnership Interest (as a general partner), the Managing Member of Holdings ceases to be PTLC or a Controlled Affiliate of PTLC other than as a result of a Bankruptcy of PTLC (or any permitted successor to its Member Interest as the Managing Member of Holdings).

2.25 Corresponding Provision. “Corresponding Provision” shall mean the provision in a Prior Agreement, if any, that corresponds to a given provision in this Agreement.

2.26 Default Recovery/Remarketing Activities. “Default Recovery/Remarketing Activities” shall have the meaning ascribed to such term in Subsection 6.6(j).

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2.27 Depreciation. “Depreciation” shall mean, for each taxable year or portion of a taxable year for which the Partnership is required to allocate Profits, Losses, or other items pursuant to Article 5 or the Corresponding Provision of any Prior Agreement, an amount equal to the depreciation, amortization or other cost recovery deduction allowable for federal income tax purposes with respect to an asset for such year or other period, except that (i) with respect to any asset whose Gross Asset Value differs from its adjusted tax basis for federal income tax purposes and which difference is being eliminated by use of the “remedial allocation method” defined by Treasury Regulation Section 1.704-3(d), Depreciation for such taxable year or portion of a taxable year shall be the amount of the book basis recovered for such taxable year or portion of a taxable year under the rules prescribed in Treasury Regulation Section 1.704-3(d)(2) (notwithstanding anything to the contrary in Subsection 5.6(c) or the Corresponding Provision of any Prior Agreement) and (ii) with respect to any other asset whose Gross Asset Value differs from its adjusted basis for federal income tax purposes at the beginning of such year or other period, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period bears to such beginning adjusted tax basis; provided, however, that if the adjusted tax basis of an asset at the beginning of such taxable year or portion of a taxable year is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method agreed upon by the Partners.

2.28 De Minimis Business. “De Minimis Business” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.29 Effective Time. “Effective Time” shall mean the close of the Partnership’s business on the date of this Agreement.

2.30 Evaluation Material. “Evaluation Material” shall have the meaning ascribed to such term in Subsection 6.4(i).

2.31 Event of Withdrawal. “Event of Withdrawal” shall have the meaning ascribed to such term in Subsection 11.1(b).

2.32 Exchange Act. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended and in effect from time to time, or the corresponding provisions of any successor statute, and the rules and regulations promulgated thereunder.

2.33 Exercising Partner. “Exercising Partner” shall mean the GE Representative Partner or PTLC (excluding any Permitted Intragroup Transferees thereof), either of whom may deliver an IPO Notice.

2.34 Existing Business Activities. “Existing Business Activities” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.35 Final Distributions. “Final Distributions” shall have the meaning ascribed to such term in Subsection 5.1(b).

2.36 Financial Services Business. “Financial Services Business” shall have the meaning ascribed to such term in Subsection 6.6(j).

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2.37 Financing. “Financing” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.38 Foreclosure. “Foreclosure” shall have the meaning ascribed to such term in Subsection 9.2(f).

2.39 GECC. “GECC” shall mean General Electric Capital Corporation, a Delaware corporation.

2.40 GECC Consolidated Group. “GECC Consolidated Group” shall mean the consolidated group, determined in accordance with Generally Accepted Accounting Principles, of which GECC is the common parent.

2.41 GECC Contingent Liabilities Agreement. “GECC Contingent Liabilities Agreement” shall mean the Amended and Restated Contingent Liabilities Agreement, dated on or about the date of this Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.42 GECC Credit Agreement. “GECC Credit Agreement” shall mean the Second Amended and Restated Credit Agreement, dated the date of this Agreement, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.43 GE Committee Member. “GE Committee Member” shall have the meaning ascribed to such term in Subsection 6.4(a).

2.44 GE Logistics Holdco. “GE Logistics Holdco” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.45 General Partner. “General Partner” shall mean, (i) as of the Effective Time, PTLC and (ii) unless this Agreement otherwise provides or upon receipt of a manually signed approval of a duly authorized officer of the GE Representative Partner and PTLC, each in its sole discretion, then at any time after the GP Event Date, LJ VP until such time as LJ VP is replaced or substituted in accordance with the terms of Section 1.1(c) or Section 11.1(b) of this Agreement, each in its capacity as the general partner in the Partnership and with respect to its Partnership Interest as a general partner in the Partnership.

2.46 Generally Accepted Accounting Principles. “Generally Accepted Accounting Principles” shall refer to generally accepted accounting principles as in effect from time to time in the United States of America.

2.47 GE Partners. “GE Partners” shall mean GE Truck Leasing Holdco, GE Logistics Holdco and GE Tennessee and any Permitted Intragroup Transferees thereof.

2.48 GE Representative Partner. “GE Representative Partner” shall mean (i) GE Truck Leasing Holdco or such other Partner as designated by the then existing GE Partners, or (ii) any permitted successor or permitted assignee to which a GE Partner has Sold its right to designate or replace the GE Representative Partner pursuant to Subsection 9.5(d) (and any permitted successor or permitted assignee thereof) or such other Partner as designated thereby.

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2.49 GE Tennessee. “GE Tennessee” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.50 GE Truck Leasing Holdco. “GE Truck Leasing Holdco” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

2.51 Governmental Authority. “Governmental Authority” shall mean any (i) U.S., foreign, federal, state, local or other government, (ii) governmental commission, board, body, bureau, agency, department or other judicial, regulatory or administrative authority of any nature, including courts, tribunals and other judicial bodies, (iii) any self-regulatory body or authority, and (iv) any instrumentality or entity designed to act for or on behalf of the foregoing in exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

2.52 GP Event Date. “GP Event Date” shall mean the close of the Partnership’s business on January 31, 2014.

2.53 Gross Asset Value. “Gross Asset Value” shall mean, with respect to any asset, the asset’s adjusted basis for federal income tax purposes except as follows:

(1) The initial Gross Asset Value of any asset contributed by a Partner to the Partnership shall be the gross fair market value of such asset, as agreed to by the General Partner and the Contributing Partner at the time of such contribution, provided that, if the contributing Partner is the General Partner or an Affiliate of the General Partner, the gross fair market value of such asset must be approved by the Majority Limited Partners and the GE Representative Partner;

(2) The Gross Asset Values of all Partnership assets shall be adjusted to equal their respective gross fair market values, as proposed by the General Partner and approved by the Majority Limited Partners and the GE Representative Partner, as of the following times: (a) the acquisition of an additional interest in the Partnership by any new or existing Partner in exchange for more than a de minimis Capital Contribution; (b) the distribution by the Partnership to a Partner of more than a de minimis amount of property as consideration for a Partnership Interest; (c) the liquidation of the Partnership within the meaning of Treasury Regulation Section 1.704-1(b)(2)(ii)(g); and (d) in connection with the grant of an interest in the Partnership (other than a de minimis interest) as consideration for the provision of services to or for the benefit of the Partnership by an existing Partner acting in a partner capacity, or by a new Partner acting in a partner capacity in anticipation of being a Partner; provided, however, that adjustments pursuant to clauses (a), (b) and (d) above shall be made only if the General Partner reasonably determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Partners in the Partnership;

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(3) The Gross Asset Value of any Partnership asset distributed to any Partner shall be adjusted to equal the gross fair market value of such asset on the date of distribution as determined by the distributee and the General Partner, provided that, if the distributee is the General Partner or an Affiliate of the General Partner, the determination of the fair market value of the distributed asset shall require the approval of the Majority Limited Partners and the GE Representative Partner; and

(4) The Gross Asset Values of Partnership assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Section 743(b) but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to (a) Regulations Section 1.704-1(b)(2)(iv)(m) and (b) subparagraph (vi) of the definition of “Profits” and “Losses” in Subsection 2.111 or Subsection 5.3(g), provided, however, that Gross Asset Values shall not be adjusted pursuant to this subparagraph (4) to the extent the General Partner determines that an adjustment pursuant to subparagraph (2) is necessary or appropriate in connection with a transaction that would otherwise result in an adjustment pursuant to this subparagraph (4).

If the Gross Asset Value of an asset has been determined or adjusted pursuant to Subsections 2.53(1), (2), or (4) hereof or the Corresponding Provision of any Prior Agreement, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses.

2.54 Holdings. “Holdings” shall mean LJ VP Holdings LLC, a Delaware limited liability company and the sole member of LJ VP.

2.55 Holdings LLC Agreement. “Holdings LLC Agreement” shall mean that certain Amended and Restated Limited Liability Company Agreement of Holdings, dated as of the date hereof, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.56 Initiated Offer. “Initiated Offer” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.57 Insurance. “Insurance” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.58 Interested Party. “Interested Party” shall have the meaning ascribed to such term in Subsection 6.6(a).

2.59 IPO. “IPO” shall mean the initial public offering limit to common equity securities involving the Partnership Registrant.

2.60 IPO Consummation Obligation. “IPO Consummation Obligation” shall have the meaning ascribed to such term in Subsection 10.1(c).

2.61 IPO Demand Notice. “IPO Demand Notice” shall have the meaning ascribed to such term in Subsection 10.1(b).

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2.62 IPO Notice. “IPO Notice” shall have the meaning ascribed to such term in Subsection 10.1(a).

2.63 IPO Rebuttal. “IPO Rebuttal” shall have the meaning ascribed to such term in Subsection 10.1(b).

2.64 Issuing Entity. “Issuing Entity” shall mean any entity formed to be the issuer in the IPO.

2.65 Law. “Law” shall mean any applicable foreign or domestic, federal, state or local statute, ordinance, rule, regulation, code, license, permit, authorization, approval, consent, order, judgment, decree, injunction or requirement of any Governmental Authority or any arbitration tribunal.

2.66 Leasing. “Leasing” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.67 Lien. “Lien” shall mean any mortgage, deed of trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement and any capital lease having substantially the same economic effect as any of the foregoing).

2.68 Limited Partner. “Limited Partner” shall mean (i) as of the Effective Time, GE Tennessee, LJ VP, PTLC in its capacity as limited partner to the extent set forth in Schedules A and C, PAG, GE Truck Leasing Holdco and GE Logistics Holdco, and (ii) after the Effective Time, the Persons set forth in the foregoing clause (i) and such other Persons as may be admitted from time to time as limited partners in the Partnership in accordance with this Agreement, each in its capacity as a Limited Partner, but at any given time shall not include (A) such Persons that cease to be limited partners as provided in Article 9 or (B) LJ VP to the extent provided in Subsection 1.1(c) with respect to its Partnership Interest as a general partner in the Partnership.

2.69 LJ VP. “LJ VP” shall mean LJ VP, LLC, a Delaware limited liability company and initially a Limited Partner.

2.70 Majority Limited Partners. “Majority Limited Partners” shall mean, at any given time, Limited Partners (other than PTLC and its Affiliates, which for the preclusion of doubt includes as of the Effective Time PAG and LJ VP and will continue to include PAG and LJ VP as long as each is an Affiliate of PTLC) who then hold a majority of limited partner interests in the Partnership (exclusive of any limited partner interest in the Partnership then held by PTLC and its Affiliates).

2.71 Member. “Member” shall have the meaning ascribed to such term in the Holdings LLC Agreement.

2.72 Member Interest. “Member Interest” shall have the meaning ascribed to such term in the Holdings LLC Agreement.

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2.73 Net Income. “Net Income” shall mean, for any period, the consolidated net income of the Partnership and its Subsidiaries, determined on a consolidated basis in accordance with Generally Accepted Accounting Principles; provided, however, (i) any positive or negative currency transaction adjustments will be excluded from the determination of Net Income to the extent such adjustments do not require an adjustment to the Partnership’s equity and (ii) goodwill impairment charges will be excluded from the determination of Net Income.

2.74 Net Losses. “Net Losses” shall have the meaning ascribed to such term in Subsection 9.3(i).

2.75 New Credit Agreement. “New Credit Agreement” shall mean the Credit Agreement expected to be executed on or around May 1, 2012 by and among the Partnership, PTL Finance Corporation, the subsidiary borrowers and the several lenders from time to time parties thereto, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.76 Non-Exercising Partner. “Non-Exercising Partner” shall mean the GE Representative Partner or PTLC (excluding any Permitted Intragroup Transferees thereof), whichever did not deliver an IPO Notice, as the case may be.

2.77 Non-Issuing Partner. “Non-Issuing Partner” shall have the meaning ascribed to such term in Subsection 6.4(i).

2.78 Nonrecourse Deductions. “Nonrecourse Deductions” shall have the meaning set forth in Regulations Sections 1.704-2(b)(1) and 1.704-2(c).

2.79 Nonrecourse Liability. “Nonrecourse Liability” shall have the meaning set forth in Regulations Section 1.704-2(b)(3).

2.80 Non-Voting Observer. “Non-Voting Observer” shall have the meaning ascribed to such term in Subsection 6.4(j).

2.81 Offer. “Offer” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.82 Offered Interest. “Offered Interest” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.83 Offeree Partners. “Offeree Partners” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.84 Offering Partner. “Offering Partner” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.85 Other Financial Services Activities. “Other Financial Services Activities” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.86 PAG. “PAG” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

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2.87 PAG Consolidated Group. “PAG Consolidated Group” shall mean a consolidated group, determined in accordance with Generally Accepted Accounting Principles, of which PAG is the common parent.

2.88 PAG Pledge. “PAG Pledge” shall have the meaning ascribed to such term in Subsection 9.2(f).

2.89 PAG Pledged Interest. “PAG Pledged Interest” shall have the meaning ascribed to such term in Subsection 9.2(f).

2.90 Parent Company. “Parent Company” shall mean, in the case of a GE Partner, GECC and, in the case of a Penske Partner, Penske Corporation. The Parent Company of PAG shall be Penske Corporation for so long as PAG is Controlled by Penske Corporation.

2.91 Partner. “Partner” shall mean the General Partner or a Limited Partner.

2.92 Partner Nonrecourse Debt. “Partner Nonrecourse Debt” shall have the meaning set forth in Regulations Section 1.704-2(b)(4).

2.93 Partner Nonrecourse Debt Minimum Gain. “Partner Nonrecourse Debt Minimum Gain” shall mean an amount, with respect to each Partner Nonrecourse Debt, equal to the Partnership Minimum Gain that would result if such Partner Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with the provisions of Regulations Section 1.704-2(i)(3) relating to “partner nonrecourse debt minimum gain.”

2.94 Partner Nonrecourse Deductions. “Partner Nonrecourse Deductions” shall have the meaning set forth in Regulations Sections 1.704-2(i)(1) and 1.704-2(i)(2).

2.95 Partnership. “Partnership” shall have the meaning ascribed to such term in in the first “Whereas” clause hereof.

2.96 Partnership Certificate. “Partnership Certificate” shall have the meaning ascribed to such term in Section 3.7.

2.97 Partnership Group. “Partnership Group” shall mean, individually or in the aggregate, the Partnership and its Subsidiaries.

2.98 Partnership Interest. “Partnership Interest” shall refer, with respect to a given Partner as of a given date, to such Partner’s interest as a general partner of the Partnership (if any) and such Partner’s interest as a limited partner of the Partnership (if any), in each case as of such date, including any and all benefits to which the holder of such an interest may be entitled as provided in this Agreement, together with all obligations of such Partner to comply with the terms and provisions of this Agreement.

2.99 Partnership Minimum Gain. “Partnership Minimum Gain” shall have the meaning set forth in Regulations Sections 1.704-2(b)(2) and 1.704-2(d).

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2.100 Partnership Registrant. “Partnership Registrant” shall mean the Partnership or the Issuing Entity that is the issuer in the IPO, as the case may be.

2.101 Partnership Year. “Partnership Year” shall have the meaning ascribed to such term in Section 1.7.

2.102 Penske Committee Member. “Penske Committee Member” shall have the meaning ascribed to such term in Subsection 6.4(a).

2.103 Penske Corporation. “Penske Corporation” shall mean Penske Corporation, a Delaware corporation.

2.104 Penske Partners. “Penske Partners” shall mean (i) PTLC and (ii) PAG until the date, if any, that PAG ceases to be a Controlled Affiliate of Penske Corporation, and, in each case, any Permitted Intragroup Transferees thereof.

2.105 Percentage Interest. The “Percentage Interest” of a Partner shall be the percentage ownership set forth next to its respective name on Schedule A hereto, as such Schedule A shall be amended, restated, supplemented or otherwise modified from time to time to reflect Sales of interests in the Partnership to the extent permitted by this Agreement.

2.106 Permitted Intragroup Transferees. “Permitted Intragroup Transferees” shall mean successors and assigns permitted or required under Subsections 9.2(b), (c) or (d).

2.107 Person. “Person” shall include an individual, a partnership, a corporation, a limited liability company, a trust, an unincorporated organization, a government or any department or agency thereof, and any other entity.

2.108 Potential Buyer. “Potential Buyer” shall have the meaning ascribed to such term in Subsection 6.4(i).

2.109 Preliminary Distribution. “Preliminary Distribution” shall have the meaning ascribed to such term in Subsection 5.1(a).

2.110 Prior Agreement. “Prior Agreement” shall mean each of the Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P., dated August 10, 1988, the Second Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P., dated September 19, 2008, and the Third Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P., dated March 26, 2009, in each case as amended and in effect from time to time.

2.111 Profits and Losses. “Profits” and “Losses” shall mean, for each taxable year or portion of a taxable year, an amount equal to the Partnership’s taxable income or loss for such taxable year or portion of a taxable year, determined in accordance with Section 703(a) of the Code (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in taxable income or loss), with the following adjustments:

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(i) Any income of the Partnership that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses pursuant to this Subsection 2.111 shall be added to such taxable income or loss;

(ii) Any expenditures of the Partnership described in Section 705(a)(2)(B) of the Code or treated as Code Section 705(a)(2)(B) expenditures pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Profits or Losses pursuant to this Subsection 2.111 shall be subtracted from such taxable income or loss;

(iii) In the event the Gross Asset Value of any Partnership asset is adjusted pursuant to Subsection 2.53(2) or (3) hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset for purposes of computing Profits or Losses;

(iv) Gain or loss resulting from any disposition of Partnership property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the property disposed of, notwithstanding that the adjusted tax basis of such property differs from its Gross Asset Value;

(v) In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such taxable year or portion of a taxable year;

(vi) To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Code Sections 734(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(4) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Partner’s interest in the Partnership, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for purposes of computing Profits or Losses; and

(vii) Notwithstanding any other provision of this definition of “Profits” and “Losses,” any items that are specially allocated pursuant to Sections 5.3 and 5.4 shall not be taken into account in computing Profits or Losses.

The amounts of items of Partnership income, gain, loss, or deduction available to be specially allocated pursuant to Sections 5.3 and 5.4 shall be determined by applying rules analogous to those set forth in subparagraphs (i) through (vi).

2.112 PTLC. “PTLC” shall have the meaning ascribed to such term in the first Paragraph of this Agreement and shall include any Permitted Intragroup Transferees thereof.

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2.113 PTLC Consolidated Group. “PTLC Consolidated Group” shall mean the consolidated group, determined in accordance with Generally Accepted Accounting Principles, of which Penske Corporation is the common parent, except that members of the PAG Consolidated Group shall not be deemed members of the PTLC Consolidated Group.

2.114 Purchased Interest. “Purchased Interest” shall have the meaning ascribed to such term in Subsection 9.4(c).

2.115 Qualified Purchaser. “Qualified Purchaser” shall mean a Person who does not directly compete with the Partnership (as such term is defined in Subsection 6.6(d)).

2.116 Recipient Group. “Recipient Group” shall have the meaning ascribed to such term in Subsection 6.4(i).

2.117 Registration Rights Agreement. “Registration Rights Agreement” shall mean the Registration Rights Agreement entered into by the Partners, the Partnership, Holdings and LJ VP as of the Effective Time, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.118 Regulations. “Regulations” shall mean the United States Income Tax Regulations, including Temporary Regulations, promulgated under the Code, as such regulations may be amended, restated, supplemented or otherwise modified from time to time.

2.119 Regulatory Allocations. “Regulatory Allocations” shall have the meaning set forth in Section 5.4.

2.120 Response Notice. “Response Notice” shall have the meaning ascribed to such term in Subsection 9.3(d).

2.121 Restricted Person. “Restricted Person” shall have the meaning ascribed to such term in Subsection 6.6(h).

2.122 Returns. “Returns” shall have the meaning ascribed to such term in Subsection 8.2(d).

2.123 Rollins Business. “Rollins Business” shall mean the truck leasing business as conducted by Rollins Truck Leasing Corp. at the time of its acquisition by the Partnership and such business as may have been continued by the Partnership Group.

2.124 Sale. “Sale” (including, with its correlative meanings, “Sell” and “Sold”) with respect to a Partnership Interest shall mean any voluntary or involuntary sale, assignment, transfer or other disposition of all or any portion of such Partnership Interest (or any right or interest therein), including by operation of Law, but, for the avoidance of doubt, does not include the creation of any Liens upon a Partnership Interest unless the holder of such a Lien acquires all or any portion of such Partnership Interest or the Partnership Interest is otherwise sold, transferred or assigned in accordance with the Lien.

2.125 Schedule. “Schedule” shall refer to one of several written Schedules to this Agreement, as amended, restated, supplemented or otherwise modified from time to time to the extent permitted by this Agreement, each of which is hereby incorporated into and made a part of this Agreement for all purposes.

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2.126 SEC. “SEC” shall mean the Securities and Exchange Commission or any successor agency.

2.127 Securities. “Securities” shall mean any common equity securities of the Partnership Registrant.

2.128 Securities Act. “Securities Act” shall mean the Securities Act of 1933, as amended and in effect from time to time, or the corresponding provisions of any successor statute, and the rules and regulations promulgated thereunder.

2.129 Securities Activity. “Securities Activity” shall have the meaning ascribed to such term in Subsection 6.6(j).

2.130 Selling Interests. “Selling Interests” shall have the meaning ascribed to such term in Subsection 10.1(d).

2.131 Subject Year. “Subject Year” shall mean a Partnership Year with respect to which Net Income for such Partnership Year or the fiscal quarters thereof is being calculated for purposes of determining whether distributions to the Partners are to be made under Section 5.1, regardless of whether such distributions are to be made in such Partnership Year or the following Partnership Year.

2.132 Subject Year To Date. “Subject Year to Date” shall mean the Subject Year through and including the quarter for which Net Income is being calculated.

2.133 Subsidiary. “Subsidiary” shall refer to (i) any corporation (or equivalent legal entity under foreign Law) of which another Person owns directly or indirectly more than fifty percent (50%) of the stock, the holders of which are ordinarily and generally, in the absence of contingencies or understandings, entitled to vote for the election of directors, (ii) any limited liability company in which such Person owns directly or indirectly more than fifty percent (50%) of the membership interests, (iii) any partnership in which such other Person owns directly or indirectly more than fifty percent (50%) of the partnership interests and (iv) any other entity of which another Person has the voting power to elect the majority of the members of the board of directors, the board of managers or a similar body of such entity.

2.134 Tax Matters Partner. “Tax Matters Partner” shall have the meaning ascribed to such term in Subsection 8.2(e).

2.135 Third Party Proposed Sale. “Third Party Proposed Sale” shall have the meaning ascribed to such term in Subsection 9.3(c).

2.136 Third Tier Built-In Gain. “Third Tier Built-In Gain” shall have the meaning ascribed to such term in Subsection 5.5(d).

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2.137 TMP Eligible Partner. “TMP Eligible Partner” shall have the meaning ascribed to such term in Subsection 8.2(e).

2.138 Trade Name and Trademark Agreement. “Trade Name and Trademark Agreement” shall mean that certain Amended and Restated Trade Name and Trademark Agreement, dated the date of this Agreement, between Penske System, Inc. and the Partnership, as the same may be amended, restated, supplemented or otherwise modified from time to time.

2.139 Transfer. “Transfer” shall mean any Sale or creation of a Lien.

2.140 UPREIT Structure. “UPREIT Structure” shall have the meaning ascribed to such term in Subsection 10.1(a).

2.141 General Provisions. Unless the context otherwise requires, as used in this Agreement, (i) the terms “herein”, “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision; (ii) terms used in the singular also include the plural and vice versa; (iii) all references to statutes and related regulations shall include any amendments of same and any successor statutes and regulations; (iv) any pronoun shall include the corresponding masculine, feminine and neuter forms; (v) the words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”; (vi) the word “will” shall be construed to have the same meaning and effect as the word “shall”; (vii) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Section of, and Exhibits and Schedules to, this Agreement; and (viii) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

ARTICLE 3

CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS

3.1 Additional Capital Contributions. Except as set forth in Section 3.3 of this Agreement, which shall not in any event result in a change in a Partner’s Percentage Interest, no additional contributions shall be required to be made by the Partners, except that LJ VP shall make its Capital Contribution at the Effective Time.

3.2 Capital Contributions and Accounts. As of the Effective Time, LJ VP is contributing $700,000,000 in cash to the Partnership as a Capital Contribution, LJ VP’s Capital Account is being credited for the amount of such Capital Contribution and LJ VP is being admitted as a Limited Partner. A Capital Account shall be established and maintained for each Partner on the books of the Partnership. Each Partner’s interest in the capital of the Partnership shall be represented by its Capital Account. The Capital Accounts of each Partner as of the Effective Time, which give effect to the contribution of LJ VP described in this Section 3.2, to all previous Capital Contributions, and to all allocations, of Profits, Losses, and any other items allocable, in accordance with Section 706(d) of the Code, to the period prior to the Effective Time, are set forth on Schedule C.

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3.3 Negative Capital Accounts. In the event the Partnership is “liquidated” within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g), (x) distributions shall be made pursuant to Article 11 to the Partners who have positive Capital Accounts in compliance with Regulations Section 1.704-1(b)(2)(ii)(b)(2), and (y) if the General Partner’s Capital Account has a deficit balance (after giving effect to all contributions, distributions, and allocations for all taxable years, including the taxable year during which such liquidation occurs), the General Partner shall contribute to the capital of the Partnership the amount necessary to restore such deficit balance to zero in compliance with Regulations Section 1.704-1(b)(2)(ii)(b)(3). If any Limited Partner has a deficit balance in its Capital Account (after giving effect to all contributions, distributions, and allocations for all taxable years, including the taxable year during which such liquidation occurs), such Limited Partner shall have no obligation to make any contribution to the capital of the Partnership with respect to such deficit, and such deficit shall not be considered a debt owed to the Partnership or to any other Person for any purposes whatsoever.

3.4 Compliance with Treasury Regulations. The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Treasury Regulation Section 1.704-1(b) (or any corresponding provision of succeeding Law) and shall be interpreted and applied in a manner consistent with such Regulation. In the event the General Partner shall determine and the Majority Limited Partners and the GE Representative Partner approve that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to comply with such Regulation, the Partnership may make such modifications. The Partnership also shall make any appropriate modifications in the event unanticipated events might otherwise cause this Agreement not to comply with Treasury Regulation Section 1.704-1(b) (or any corresponding provisions of succeeding Law provided that such modification shall not have a material adverse effect on the economic position of any Partner).

3.5 Succession to Capital Accounts. In the event any interest in the Partnership is Sold in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred interest. For purposes of the immediately preceding sentence, the portion of the Capital Account to which the transferee succeeds shall be that percentage of the transferor’s total Capital Account as the Percentage Interest being transferred bears to the total Percentage Interest of the transferor, taking into account Section 9.6.

3.6 No Withdrawal of Capital Contributions. No Partner shall withdraw any Capital Contributions without the unanimous written approval of the other Partners. No Partner shall receive any interest with respect to its Capital Contributions.

3.7 No Partnership Certificates. No certificates to evidence a Partner’s interest in the Partnership (a “Partnership Certificate”) shall be issued and any Partnership Certificates previously issued shall be null and void and without any force or effect whatsoever.

3.8 Percentage Interests. Effective as of the Effective Time, the Percentage Interest of each Partner in the Partnership is as set forth on Schedule A hereto.

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ARTICLE 4

COSTS AND EXPENSES

4.1 Operating Costs. The Partnership shall (i) pay or cause to be paid all costs and expenses of the Partnership incurred in pursuing and conducting, or otherwise related to, the business of the Partnership and (ii) reimburse the General Partner for any documented out-of-pocket costs and expenses incurred by it in connection therewith (including in the performance of its duties as tax matters partner), to the extent permitted by Subsection 6.7(b).

ARTICLE 5

DISTRIBUTIONS; PARTNERSHIP ALLOCATIONS;

TAX MATTERS

5.1 Distributions Prior to Dissolution.

(a) Preliminary Quarterly Distributions. By no later than 45 days following the end of each of the first three quarters of each Subject Year (commencing with respect to the quarter ending March 31, 2012), subject to Section 9.6, applicable Law and the terms of any applicable credit agreement, indenture, debt security or debt instrument, the Partnership shall make a distribution to the Partners of the amount, if any, by which fifty percent (50%) of Net Income for the Subject Year To Date exceeds the distributions made pursuant to this Subsection 5.1(a) with respect to such Subject Year (the “Preliminary Distributions”), in the following amounts, order and priority:

(i) First, in the event that the Partnership shall have sold all or substantially all of the Rollins Business, to GE Truck Leasing Holdco in an amount equal to the excess, if any, of (A) the excess, if any, of (1) $57 million, over (2) the product of (x) .40 times (y) the excess, if any, of (I) the initial Gross Asset Value of the Code Section 197 intangibles attributable to the Rollins Business, over (II) the sales price for such intangibles, over (B) all prior distributions to GE Truck Leasing Holdco pursuant to this Subsection 5.1(a)(i) or Subsection 5.1(b)(i);

(ii) Second, in the event that the Partnership shall have sold all or substantially all of the logistics business of the Partnership, to GE Logistics Holdco in an amount equal to the excess, if any, of (A) the excess, if any, of (1) $183 million, over (2) the product of (x) .40 times (y) the excess, if any, of (I) the initial Gross Asset Value of the Code Section 197 intangibles attributable to the logistics business, over (II) the sales price for such intangibles, over (B) all prior distributions to GE Logistics Holdco pursuant to this Subsection 5.1(a)(ii) or Subsection 5.1(b)(ii); and

(iii) Third, to the Partners pro rata in accordance with each Partner’s Percentage Interest.

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(b) Annual Distributions. With respect to any Subject Year ending on or after December 31, 2012, by no later than April 15 of the following Partnership Year, subject to Section 9.6, applicable Law and the terms of any applicable credit agreement, indenture, debt security or debt instrument, the Partnership shall make a distribution to the Partners of the amount, if any, by which fifty percent (50%) of Net Income for the Subject Year based on the Partnership’s audited financial statements determined in accordance with Generally Accepted Accounting Principles with respect to the Subject Year exceeds the cumulative Preliminary Distributions made with respect to the Subject Year (the “Final Distribution”), in the following amounts, order and priority:

(i) First, in the event that the Partnership shall have sold all or substantially all of the Rollins Business, to GE Truck Leasing Holdco in an amount equal to the excess, if any, of (A) the excess, if any, of (1) $57 million, over (2) the product of (x) .40 times (y) the excess, if any, of (I) the initial Gross Asset Value of the Code Section 197 intangibles attributable to the Rollins Business, over (II) the sales price for such intangibles, over (B) all prior and current distributions to GE Truck Leasing Holdco pursuant to Subsection 5.1(a)(i) and prior distributions to GE Truck Leasing Holdco pursuant to this Subsection 5.1(b)(i);

(ii) Second, in the event that the Partnership shall have sold all or substantially all of the logistics business of the Partnership, to GE Logistics Holdco in an amount equal to the excess, if any, of (A) the excess, if any, of (1) $183 million, over (2) the product of (x) .40 times (y) the excess, if any, of (I) the initial Gross Asset Value of the Code Section 197 intangibles attributable to the logistics business, over (II) the sales price for such intangibles, over (B) all prior and current distributions to GE Logistics Holdco pursuant to Subsection 5.1(a)(ii) and prior distributions to GE Logistics Holdco pursuant to this Subsection 5.1(b)(ii); and

(iii) Third, to the Partners pro rata in accordance with each Partner’s Percentage Interest.

(c) Discretionary Special Distributions. Subject to the provisions of Subsection 6.5(c)(ix), the General Partner may from time to time cause the Partnership to make other distributions to the Partners, provided that any such distribution is made pro rata in accordance with each Partner’s Percentage Interest.

(d) Notice of Determination of Law. If any determination is made by the General Partner that applicable Law would forbid any distribution pursuant to this Section 5.1, then the General Partner shall provide notice to the GE Representative Partner of such determination (which shall include the basis for such determination) and provide the GE Representative Partner with a reasonable opportunity to discuss such determination.

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5.2 Partnership Allocations.

(a) Profits and Losses. For each taxable year or portion of a taxable year for which the Partnership is required to allocate Profits, Losses, or other items pursuant to this Article 5, after giving effect to the special allocations set forth in Sections 5.3 and 5.4, and subject to the rules of Section 5.5 and Section 9.6, Profits and Losses of the Partnership for the relevant period shall be allocated to the Partners in proportion to their Percentage Interests, subject to the limitation in Subsection 5.2(b) below with respect to the allocation of Losses.

(b) Loss Limitation.

(i) Capital Account Limitation. The Losses allocated pursuant to Subsection 5.2(a) shall not exceed the maximum amount of Losses that can be so allocated without causing any Limited Partner to have an Adjusted Capital Account Deficit at the end of any taxable year. All Losses otherwise allocable to a Limited Partner in excess of the limitation set forth in this Subsection 5.2(b)(i) shall be allocated (A) in the case of any Penske Partner (other than PAG), first, to the other Penske Partners (other than PAG), if any, that are Limited Partners without such an Adjusted Capital Account Deficit in proportion to and to the extent of the amount of Losses that can be allocated to each such Penske Partner without causing it to have an Adjusted Capital Account Deficit and, thereafter, to the General Partner, (B) in the case of PAG, to the General Partner, (C) in the case of any GE Partner, first, to the other GE Partners without such an Adjusted Capital Account Deficit in proportion to and to the extent of the amount of Losses that can be allocated to each such GE Partner without causing it to have an Adjusted Capital Account Deficit and, thereafter, to the General Partner, and (D) in the case of LJ VP, as a Limited Partner, (x) with respect to forty-one and eight- hundredths percent (41.08%) of such excess losses, first to Penske Partners that are Limited Partners without such an Adjusted Capital Account Deficit, after the application of clauses (A), (B) and (C) of this Subsection 5.2(b)(i), in proportion to and to the extent of the amount of Losses that can be allocated to each such Limited Partner without causing it to have an Adjusted Capital Account Deficit and, thereafter, to the General Partner, (y) with respect to nine and two-hundredths percent (9.02%) of such excess losses, first to PAG to the extent of the amount of Losses that can be allocated to PAG, after the application of clause (B) of this Subsection 5.2(b)(i), without causing it to have an Adjusted Capital Account Deficit and, thereafter, to the General Partner, and (z) with respect to forty-nine and nine-tenths percent (49.9%) of such excess losses, first to the GE Partners without such an Adjusted Capital Account Deficit, after the application of clause (C) of this Subsection 5.2(b)(i), in proportion to and to the extent of the amount of Losses that can be allocated to each such Limited Partner without causing it to have an Adjusted Capital Account Deficit, and, thereafter, to the General Partner.

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(ii) Tax Basis Limitation. If, as a result of the application of Code Section 704(d), the federal income tax loss associated with an allocation of Losses allocated to a Partner pursuant to Subsection 5.2(a) or Subsection 5.2(b)(i) cannot be claimed by such Partner for the taxable year during which such Losses arose, then such Losses may be reallocated as set forth in this Subsection 5.2(b)(ii), but only to the extent such Partner consents to such reallocation, in the following manner and order: (A) if any Penske Partner other than PAG is limited to any extent by Code Section 704(d) with respect to its ability to claim tax losses associated with an allocation of Losses pursuant to Subsection 5.2(a) or Subsection 5.2(b)(i), then the other Penske Partners among such group that are not so limited may elect, by written notice to the General Partner, to have such Losses allocated to them in proportion to and to the extent of the amount of such Losses that can be allocated to each such Penske Partner without causing its ability to claim the tax losses associated with such Losses to be limited under Code Section 704(d) and without causing it to have an Adjusted Capital Account Deficit; (B) if any GE Partner is limited to any extent by Code Section 704(d) with respect to its ability to claim tax losses associated with an allocation of Losses pursuant to Subsection 5.2(a) or Subsection 5.2(b)(i), then the other GE Partners among such group that are not so limited may elect, by written notice to the General Partner, to have such Losses allocated to them in proportion to and to the extent of the amount of such Losses that can be allocated to each such GE Partner without causing its ability to claim the tax losses associated with such Losses to be limited under Code Section 704(d) and without causing it to have an Adjusted Capital Account Deficit; and (C) if LJ VP is limited to any extent by Code Section 704(d) with respect to its ability to claim tax losses associated with an allocation of Losses pursuant to Subsection 5.2(a) or Subsection 5.2(b)(i), then the Penske Partners (other than PAG) that are not so limited may elect, by written notice to the General Partner, to have up to forty-one and eight- hundredths percent (41.08%) of such Losses allocated to them in proportion to and to the extent of the amount of such Losses that can be allocated to each such Penske Partner without causing its ability to claim the tax losses associated with such Losses to be limited under Code Section 704(d) and without causing it to have an Adjusted Capital Account Deficit, PAG may elect, by written notice to the General Partner, to have up to nine and two- hundredths percent (9.02%) of such Losses allocated to it to the extent of the amount of such Losses that can be allocated to PAG without causing its ability to claim the tax losses associated with such Losses to be limited under Code Section 704(d) and without causing it to have an Adjusted Capital Account Deficit, and the GE Partners that are not so limited may elect, by written notice to the General Partner, to have up to forty-nine and nine-tenths percent (49.9%) of such Losses allocated to them in proportion to and to the extent of the amount of such Losses that can be allocated to each such GE Partner without causing its ability to claim the tax losses associated with such Losses to be limited under Code Section 704(d) and without causing it to have an Adjusted Capital Account Deficit.

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5.3 Special Allocations. The following special allocations shall be made in the following order:

(a) Minimum Gain Chargeback. Except as otherwise provided in Regulations Section 1.704-2(f), notwithstanding any other provision of this Article 5, if there is a net decrease in Partnership Minimum Gain during any Partnership taxable year, each Partner shall be specially allocated items of Partnership income and gain for such taxable year (and, if necessary, subsequent taxable years) in an amount equal to such Partner’s share of the net decrease in Partnership Minimum Gain, determined in accordance with Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Partner pursuant thereto. The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2). This Subsection 5.3(a) is intended to comply with the minimum gain chargeback requirement in Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

(b) Partner Minimum Gain Chargeback. Except as otherwise provided in Regulations Section 1.704-2(i)(4), notwithstanding any other provision of this Article 5, if there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to a Partner Nonrecourse Debt during any Partnership taxable year, each Partner who has a share of the Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be specially allocated items of Partnership income and gain for such taxable year (and, if necessary, subsequent taxable years) in an amount equal to such Partner’s share of the net decrease in Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Partner pursuant thereto. The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Subsection 5.3(b) is intended to comply with the minimum gain chargeback requirement in Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

(c) Qualified Income Offset. In the event any Limited Partner unexpectedly receives any adjustments, allocations, or distributions described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), Section 1.704-1(b)(2)(ii)(d)(5), or Section 1.704-1(b)(2)(ii)(d)(6), items of Partnership income and gain shall be specially allocated to each such Limited Partner in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of such Limited Partner as quickly as possible, provided that an allocation pursuant to this Subsection 5.3(c) shall be made only if and to the extent that such Limited Partner would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article 5 have been tentatively made as if this Subsection 5.3(c) were not in the Agreement.

(d) Gross Income Allocation. In the event any Limited Partner has a deficit Capital Account at the end of any taxable year that is in excess of the sum of (i) the amount such Limited Partner is obligated to restore (pursuant to the terms of this Agreement or otherwise) and (ii) the amount such Limited Partner is deemed to be obligated to restore pursuant to the penultimate sentences of Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5), each such Limited Partner shall be specially allocated items of Partnership income and gain in the amount of such excess as quickly as possible; provided that an allocation pursuant to this Subsection 5.3(d) shall be made only if and to the extent that such Limited Partner would have a deficit Capital Account in excess of such sum after all other allocations provided for in this Article 5 have been made as if Subsection 5.3(c) and this Subsection 5.3(d) were not in the Agreement.

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(e) Nonrecourse Deductions. Nonrecourse Deductions for any taxable year shall be specially allocated among the Partners in proportion to their Percentage Interests.

(f) Partner Nonrecourse Deductions. Any Partner Nonrecourse Deductions for any taxable year shall be specially allocated to the Partner who bears the economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner Nonrecourse Deductions are attributable in accordance with Regulations Section 1.704-2(i)(1).

(g) Code Section 754 Adjustment. To the extent an adjustment to the adjusted tax basis of any Partnership asset pursuant to Code Section 734(b) or 743(b) is required, pursuant to Regulations Section 1.704-1(b)(2)(iv)(m)(2) or 1.704-1(b)(2)(iv)(m)(4), to be taken into account in determining Capital Accounts as the result of a distribution to a Partner in complete liquidation of its interest in the Partnership, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis) and such gain or loss shall be specially allocated to the Partners in accordance with their interests in the Partnership in the event Regulations Section 1.704-1(b)(2)(iv)(m)(2) applies, or to the Partners to whom such distribution was made in the event Regulations Section 1.704-1(b)(2)(iv)(m)(4) applies.

(h) Special Allocation of Income and Gain to GE Truck Leasing Holdco Upon Liquidation. In the event that, during any taxable year, the Partnership dissolves and is liquidated, GE Truck Leasing Holdco shall be specially allocated items of Partnership income and gain in an amount equal to $44.5 million.

(i) Special Allocation of Gain. In the event that, in any taxable year, the Partnership realizes, or is deemed to realize, a gain from the sale, disposition, or adjustment to the Gross Asset Value of Partnership Property, such gain shall be specially allocated to the Partners in proportion to, and to the extent of, the excess, if any, of (i) the aggregate amount of Losses allocated to each such Partner for the current and all prior taxable years pursuant to Subsection 5.2(b)(ii) or the Corresponding Provision of any Prior Agreement, over (ii) the cumulative amount of gain allocated to such Partner pursuant to this Subsection 5.3(i) or the Corresponding Provision of any Prior Agreement for all prior tax years.

5.4 Curative Allocations. The allocations set forth in Subsections 5.2(b)(i), 5.3(a), 5.3(b), 5.3(c), 5.3(d), 5.3(e), 5.3(f) and 5.3(g) and the Corresponding Provisions of the Prior Agreements (the “Regulatory Allocations”) are intended to comply with certain requirements of the Regulations. It is the intent of the Partners that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Partnership income, gain, loss or deduction pursuant to this Section 5.4 Therefore, notwithstanding any other provision of this Article 5 (other than the Regulatory Allocations), the General Partner shall make such offsetting special allocations of Partnership income, gain, loss or deduction in whatever manner it determines appropriate (without causing an Adjusted Capital Account Deficit for any Partner) so that, after such offsetting allocations are made, each Partner’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Partner would have had if the Regulatory Allocations were not part of the Agreement or any Prior Agreement and all Partnership items were allocated pursuant to Subsections 5.2(a), 5.2(b)(ii), 5.3(h) and 5.3(i) or the Corresponding Provisions of the Prior Agreements. In exercising its discretion under this Section 5.4, the General Partner shall take into account future Regulatory Allocations under Subsections 5.3(a) and 5.3(b) that, although not yet made, are likely to offset other Regulatory Allocations previously made under Subsections 5.3(e) and 5.3(f).

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5.5 Other Allocation Rules.

(a) Profits, Losses, and any other items of income, gain, loss, deduction, or credit shall be allocated to the Partners pursuant to this Article 5 as of the last day of each taxable year, provided that Profits, Losses, and such other items shall also be allocated at such times as the Gross Asset Values of Partnership assets are adjusted pursuant to subparagraph (2) of Subsection 2.53.

(b) The Partners are aware of the income tax consequences of the allocations made by this Article 5 and hereby agree to be bound by the provisions of this Article 5 in reporting their shares of Partnership income and loss for income tax purposes.

(c) For purposes of determining the Profits, Losses, or any other items of income, gain, loss, deduction, or credit allocable to any period, Profits, Losses, and any such other items shall be determined on a daily, monthly, or other basis using the closing of the books method or, if proposed by the General Partner and approved by the GE Representative Partner with respect to a particular period, any other permissible method under Code Section 706 and the Regulations thereunder.

(d) Any “excess nonrecourse liability” of the Partnership, within the meaning of Regulations Section 1.752-3(a)(3), shall be allocated first among the Partners in proportion to and to the extent of the amount of built-in gain that is allocable to each such Partner on section 704(c) property or property for which reverse section 704(c) allocations are applicable where such property is subject to the nonrecourse liability to the extent that such built-in gain exceeds the gain described in Regulations Section 1.752-3(a)(2) with respect to such property (“Third Tier Built-In Gain”), except that, if and to the extent necessary for a Partner or Partners to avoid a limitation in a taxable year on Partnership deductions or losses under Code Section 704(d) or the recognition of gain on a Partnership distribution under Code Section 731(a)(1), allocations based on Third Tier Built-In Gain for such taxable year shall be increased to such Partner or Partners and reduced to one or more other Partners, in each case in accordance with Regulations Section 1.752-3(a)(3), provided that such decreases have no adverse effect under Code Section 704(d) or 731(a)(1) on any Partner for such taxable year. The amount of any excess nonrecourse liabilities not allocated pursuant to the preceding sentence shall be allocated in accordance with the Partners interests in Partnership profits. Solely for purposes of this Subsection 5.5(d), the Partners’ interests in Partnership profits are in proportion to their Percentage Interests.

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5.6 Tax Allocations; Code Section 704(c).

(a) In accordance with Section 704(c) of the Code and the Treasury Regulations thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the Partnership shall, solely for tax purposes, be allocated among the Partners so as to take account of any variation between the adjusted basis of such property to the Partnership for federal income tax purposes and its initial Gross Asset Value.

(b) In the event the Gross Asset Value of any asset of the Partnership shall be or has been adjusted pursuant to the provisions of this Agreement or any Prior Agreement, subsequent allocations of income, gain, loss and deduction with respect to such asset shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Gross Asset Value in the same manner as under Section 704(c) of the Code and the Treasury Regulations thereunder.

(c) Any elections or other decisions relating to such Section 704(c) allocations shall be made by the Partners in any manner that reasonably reflects the purpose and intention of this Agreement. Section 704(c) allocations pursuant to this Section 5.6 are solely for purposes of federal, state, and local taxes and shall not affect, or in any way be taken into account in computing, any Partner’s Capital Account or share of Profits, Losses, other items, or distributions pursuant to any provision of this Agreement.

(d) Except as otherwise provided in Subsection 5.6(e) or Subsection 5.6(f), the Partnership shall use the “traditional method” (as defined in Regulations Section 1.704-3(b)) for purposes of computing section 704(c) allocations with respect to property contributed to the Partnership with a Gross Asset Value that differs from its adjusted tax basis at the time of contribution, and for purposes of computing reverse section 704(c) allocations with respect to property for which differences between Gross Asset Value and adjusted tax basis were or are created by a revaluation of Partnership property pursuant to Regulations Section 1.704-1(b)(2)(iv)(f).

(e) The Partnership shall use the “remedial allocation method” (as defined in Regulations Section 1.704-3(d)) for purposes of computing reverse section 704(c) allocations with respect to property for which differences between Gross Asset Value and adjusted tax basis are created upon the Partnership’s revaluation of Partnership property pursuant to Regulations Section 1.704-1(b)(2)(iv)(f) as of the date of this Agreement in connection with the Capital Contribution by LJ VP in exchange for its Partnership Interest, and shall continue to use the remedial allocation method to the extent that it has previously used that method for purposes of computing reverse section 704(c) allocations with respect to property for which differences between Gross Asset Value and adjusted tax basis were created when the Partnership revalued Partnership property pursuant to Regulations Section 1.704-1(b)(2)(iv)(f) as of March 19, 1996, and September 19, 2008.

(f) The Partnership may use any method or combination of methods that is reasonable, under Regulations Section 1.704-3(a), that is proposed in writing by the General Partner and approved by the GE Representative Partner in writing, for purposes of computing section 704(c) allocations with respect to specific contributions of property, as identified in the General Partner’s written proposal, or for purposes of computing reverse section 704(c) allocations with respect to specific revaluations of property pursuant to Regulations Section 1.704-1(b)(2)(iv)(f), as identified in the General Partner’s written proposal.

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(g) The Partnership shall account for any goodwill of the Partnership with respect to which there is a Code Section 734(b) basis adjustment consistent with the provisions of Regulations Section 1.197-2 (including Regulations Section 1.197-2(k), Example 31).

5.7 Accounting Method. The books of the Partnership (for both tax and financial reporting purposes) shall be kept on an accrual basis.

ARTICLE 6

MANAGEMENT

6.1 Rights and Duties of the Partners.

(a) The Limited Partners shall not participate in the control of the business of the Partnership and shall have no power to act for or bind the Partnership. The Limited Partners shall have the right to approve certain actions proposed to be taken by the General Partner and certain voting rights, all as set forth herein.

(b) Subject to Delaware Law, no Limited Partner shall be liable for losses or debts of the Partnership beyond the aggregate amount such Partner is required to contribute to the Partnership pursuant to this Agreement plus such Partner’s share of the undistributed net profits of the Partnership, except that nothing in this Subsection 6.1(b) shall limit any liability, obligation or claim incurred by a Limited Partner in its capacity as General Partner at such time as it was acting as the General Partner of the Partnership.

6.2 Fiduciary Duty of General Partner. The General Partner shall have fiduciary responsibility for the safekeeping and use of all funds and assets (including records) of the Partnership, whether or not in its immediate possession or control, and the General Partner shall not employ, or permit another to employ, such funds or assets in any manner except for the exclusive benefit of the Partnership.

6.3 Powers of General Partner.

(a) Subject to the terms and conditions of this Agreement, the General Partner shall have full and complete charge of all affairs of the Partnership, and the management and control of the Partnership’s business shall rest exclusively with the General Partner. Except as otherwise provided in the Act or by this Agreement, the General Partner shall possess all of the rights and powers of a partner in a partnership without limited partners under Delaware Law. The General Partner shall be required to devote to the conduct of the business of the Partnership such time and attention as is necessary to accomplish the purposes, and to conduct properly the business, of the Partnership.

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(b) Subject to the limitations set forth in this Agreement, including but not limited to Section 6.5, the General Partner shall perform or cause to be performed all management and operational functions relating to the business of the Partnership. Without limiting the generality of the foregoing, the General Partner is solely authorized on behalf of the Partnership, in the General Partner’s sole discretion and without the approval of the Limited Partners, to:

(i) expend the capital and revenues of the Partnership in furtherance of the Partnership’s business set forth in clauses (i), (ii), (iii) and (iv) of Section 1.4 or otherwise approved in accordance with Subsection 6.5(c)(viii) after the Effective Time, and pay, in accordance with the provisions of this Agreement, all expenses, debts and obligations of the Partnership to the extent that funds of the Partnership are available therefor;

(ii) make investments in United States government securities, securities of governmental agencies, commercial paper, insured money market funds, bankers’ acceptances and certificates of deposit, pending disbursement of the Partnership funds in furtherance of the Partnership’s business set forth in clauses (i), (ii), (iii) and (iv) of Section 1.4 or otherwise approved in accordance with Subsection 6.5(c)(viii) after the Effective Time or to provide a source from which to meet contingencies;

(iii) enter into and terminate agreements and contracts with third parties in furtherance of the Partnership’s business set forth in clauses (i), (ii) and (iii) of Section 1.4 or otherwise approved in accordance with Subsection 6.5(c)(viii) after the Effective Time, institute, defend and settle litigation arising therefrom, and give receipts, releases and discharges with respect to all of the foregoing;

(iv) maintain, at the expense of the Partnership, adequate records and accounts of all operations and expenditures and furnish any Partner with the reports referred to in Section 8.2;

(v) purchase, at the expense of the Partnership, liability, casualty, fire and other insurance and bonds to protect the Partnership’s properties, business, partners and employees and to protect the General Partner and its employees;

(vi) employ, at the expense of the Partnership, consultants, accountants, attorneys, and others and terminate such employment; provided, however, that if any Affiliate of any Partner is so employed, such employment shall be in accordance with Section 6.7;

(vii) execute and deliver any and all agreements, documents and other instruments necessary or incidental to the conduct of the business of the Partnership; and

(viii) incur indebtedness, borrow funds and/or issue guarantees, in each case for the conduct of the Partnership’s business set forth in (i), (ii), (iii) and (iv) of Section 1.4 or otherwise approved in accordance with Subsection 6.5(c)(viii) after the Effective Time.

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By executing this Agreement, each Partner shall be deemed to have consented to any exercise by the General Partner of any of the foregoing powers.

(c) The General Partner shall cause Schedule A to be amended to reflect any Sale of a Partner’s Partnership Interest (to the extent permitted by this Agreement), the total Percentage Interest of each Partner, any change in name of the Partnership or change in the name or names under which the Partnership conducts its business (to the extent permitted by this Agreement), and receipt by the Partnership of any notice of change of address of a Partner. The amended Schedule A, which shall be kept on file at the principal office of the Partnership, shall supersede all such prior Schedules and become part of this Agreement, and the General Partner shall promptly forward a copy of the amended Schedule A to each Partner upon each amendment thereof.

6.4 Advisory Committee.

(a) Selection of the Advisory Committee. The Partnership shall have an Advisory Committee (the “Advisory Committee”) consisting of five (5) members. Of the five (5) Advisory Committee members, three (3) shall be designated by PTLC (a “Penske Committee Member”) and, subject to Section 9.5(d), two (2) shall be designated by the GE Representative Partner (a “GE Committee Member”). Schedule B annexed hereto sets forth the members of the Advisory Committee as of the Effective Time.

(b) Functions of the Advisory Committee; Quorum; Vote Required for Action.

(i) The Advisory Committee shall consult with and advise the General Partner with respect to the business of the Partnership. In addition, the Advisory Committee shall review any matters or actions proposed to be taken by the General Partner which pursuant to Section 6.5 hereof require the Advisory Committee’s prior approval. Subject to the provisions of Subsection 6.4(b)(ii) below and provided that notice shall have been duly given as set forth in Subsection 6.4(c) below: (A) at any meeting of the Advisory Committee in which an action specified in Subsection 6.5(c) shall be considered, the presence of any four members of the Advisory Committee shall be a quorum for the conduct of any business; and (B) at any other meeting of the Advisory Committee, the presence of any three (3) members of the Advisory Committee shall be the quorum necessary for the conduct of any business.

(ii) With respect to any regularly-scheduled meeting of the Advisory Committee, and any other meeting of the Advisory Committee notice of which shall have been duly given as set forth in Subsection 6.4(c) below, in the event that a quorum shall not be present at the time and place fixed for such regularly-scheduled meeting or specified in such notice of any other meeting, then such meeting shall automatically be adjourned (without the need for further notice) until the same time (and at the same place) on the next succeeding Business Day. At any meeting of the Advisory Committee which shall have been so adjourned, the number of members specified for the quorum in Subsection 6.4(b)(i) above shall constitute a quorum solely with respect to (A) as to any regularly-scheduled meeting of the Advisory Committee, any matter that may properly be considered at such meeting and (B) as to any other meeting of the Advisory Committee, only those matters which shall have been specified in the notice calling the meeting which was so adjourned and no other matters, and any action purportedly taken by the Advisory Committee in contravention of the foregoing shall be void and of no force or effect whatsoever.

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(iii) Each member of the Advisory Committee shall have one vote on all matters which may come before the Advisory Committee for decision. Members of the Advisory Committee may be present and vote at meetings thereof in person or by written proxy. All actions by the Advisory Committee shall require the affirmative vote of a majority of the members of the Advisory Committee and in certain circumstances as further specified in Subsection 6.5(c) below the affirmative vote of four (4) members of the Advisory Committee.

(c) Meetings in Person or by Telephone; Notice; Action by Written Consent. Meetings of the Advisory Committee may be in person or by telephonic communication in such manner as to permit all members to hear and be heard by each other at the same time. All members of the Advisory Committee shall be given not less than five (5) Business Days’ advance notice of all meetings (other than regularly scheduled meetings), which notice shall set forth the business to be considered at such meeting, the time of such meeting and the place of such meeting (if other than the principal office of the Partnership). Notice of any meeting may be waived by means of a written instrument to such effect executed and delivered by the waiving member to the Partnership either prior to or after such meeting. Meetings in person shall be held at the principal office of the Partnership, or at such other place as may be determined by the Advisory Committee and, at any such meeting, any one or more members of the Advisory Committee may participate by means of telephonic communication as aforesaid, so long as all members of the Advisory Committee participating in such meeting can hear and be heard by one another, and such participation shall be deemed presence in person for purposes of such meeting. Any action required or permitted to be taken at any meeting of the Advisory Committee may be taken without a meeting if all members of the Advisory Committee approve such action in a writing or writings or by electronic transmission or transmissions, and the writing or writings or electronic transmission or transmissions are filed with the minutes of meetings of the Advisory Committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

(d) Regular Meetings and Special Meetings.

(1) Regular meetings of the Advisory Committee shall be held at such times as the Advisory Committee shall from time to time determine, but no less frequently than once each quarter of the Partnership Year.

(2) Special meetings of the Advisory Committee shall be held whenever called by at least two members of the Advisory Committee upon no less than five (5) Business Days’ notice to each member of the Advisory Committee prior to such meeting unless such notice is waived by such member. Any and all business that may be transacted at a regular meeting of the Advisory Committee may be transacted at a special meeting, subject to the notice requirements of Subsection 6.4(b)(ii)(B).

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(e) Resignation, Replacement and Removal of Advisory Committee Members. Any Penske Committee Member may be removed at any time, with or without cause, by proposal of PTLC. Any GE Committee Member may be removed at any time, with or without cause, by proposal of the GE Representative Partner. In the event of the death, adjudication of insanity or incompetency, resignation, withdrawal or removal of: (i) a Penske Committee Member, PTLC shall designate a replacement member; or (ii) the other Committee Members, the Partner authorized under Subsections 6.4(a) or 9.5(d) to designate such Committee Member shall designate a replacement member.

(f) Certain Provisions with respect to the Advisory Committee. The Advisory Committee may adopt from time to time appropriate rules and regulations concerning the frequency and conduct of its meetings. Any member of the Advisory Committee may delegate any or all of his or her authority as a member of the Advisory Committee to any person, or may appoint any person as such member’s proxy with respect to any matter or matters to be considered or action to be taken by the Advisory Committee, provided that the Partner which designated the Advisory Committee member has approved such delegation or appointment in writing. Such approval may be revoked by the granting Partner or Advisory Committee member at any time, provided that any such revocation shall not affect the validity of any action taken by such delegate or proxy prior to such revocation.

(g) Audit Function. The Partnership has engaged the Auditor as its independent auditors. The Advisory Committee shall review and confer with respect to the performance of the Partnership’s independent auditors and may, by the vote of four (4) of its members, require that such auditors be substituted by the General Partner; provided, however, that a vote of only three (3) of the members of the Advisory Committee shall be required if the substitute auditors are Deloitte LLP or KPMG LLP. The Partnership shall establish an internal audit staff which (i) shall report directly to the Advisory Committee and (ii) shall not be utilized by any Partner with respect to its separate business.

(h) No Liability. Notwithstanding anything else contained in this Agreement, the Advisory Committee shall not be deemed to possess and shall not exercise any power that, if possessed or exercised by a Limited Partner, would constitute participation in the control of the business of the Partnership, within the meaning of Section 17-303 of the Delaware Revised Uniform Limited Partnership Act, and no member of the Advisory Committee shall be liable to the Partnership, the General Partner, any Limited Partner, or any other person or entity for any losses, claims, damages or liabilities arising from any act or omission performed or omitted by it as a member of the Advisory Committee other than acts or omissions involving willful misconduct or bad faith or a breach of Subsection 6.4(i). The Partnership shall indemnify, to the fullest extent permitted by Law, each member of the Advisory Committee against losses, claims, damages or liabilities arising from any act or omission performed or omitted by him or her as a member of the Advisory Committee other than those involving willful misconduct or bad faith on the part of such committee member or a breach of Subsection 6.4(i).

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(i) Confidentiality. With respect to any and all information provided to or obtained by any Partner, any assignees of Partnership Interests or any of their Affiliates, or any of its or their directors, officers, employees, agents, representatives or advisors, including Non-Voting Observers, as a result of such Partner being a Partner in the Partnership or its designee being a member of or an observer on the Advisory Committee (except for the exclusions below, “Evaluation Material”), such Partner and each of its Affiliates, and its and their directors, officers, employees, agents, representatives or advisors, including a Non-Voting Observer, shall hold such information in strict confidence and use such information solely in connection with such Partner’s evaluation of its investment in the Partnership; provided, however, that any Partner may disclose such information (a) as required by applicable law, rule or regulation (including but not limited to the Securities Act, the Exchange Act or rules of a stock exchange or other self-regulatory bodies), (b) to any person involved in the preparation of the Partner’s or any of its Affiliates’ financial statements, public filings or tax returns, (c) to any of its own Affiliates, or its or their directors, officers, employees, agents, representatives or advisors who are informed of the strictly confidential nature of such information and are or have been advised of their obligation to keep information of this type strictly confidential, (d) upon the request or demand of any Regulatory Authority having jurisdiction over any of the Partnership or any of their Partners or any of their Affiliates or (e) to any person and such person’s advisors with whom any Partner or any of its Affiliates is contemplating a financing transaction or to whom such Partner is contemplating a Transfer of all or any portion of its Partnership Interests in accordance with the terms of this Agreement (a “Potential Buyer”), provided that such Potential Buyer and such person’s advisors are advised of the strictly confidential nature of such information and the Potential Buyer agrees to be bound by a confidentiality agreement containing protective provisions no less protective of the information of the Partnership than provided in this Agreement. All press releases, public announcements, and similar publicity (other than such public announcements required by applicable law, rule or regulation, pursuant to clause (a) in the immediately preceding sentence) respecting the Partnership and referencing the name of any Partner or any Affiliate of any Partner (“Non-Issuing Partner”) other than the Partner issuing such press release, public announcement, similar publicity or making such required disclosure shall be made only with the prior written consent of such Non-Issuing Partner, which consent will not be unreasonably withheld; provided, however, that without consent any Partner may state in such a public announcement that it is a Partner and disclose the legal names of the Partnership, and the other Partners and their respective parents. Nothing in this paragraph shall waive any attorney-client privilege, attorney work product privilege or other privilege, and any information subject to such privilege shall not be disclosed except by agreement of the Advisory Committee or as required by applicable law, rule or regulation or restrict the Partnership’s ability to issue press releases in the ordinary course of business. For purposes of this Subsection 6.4(i), the Partnership shall not be deemed to be an Affiliate of any of the Partners. “Evaluation Material” shall not include information that (i) is or becomes generally available to the public other than as a result of a disclosure by the applicable Partner, its representatives or others to whom it voluntarily discloses such information other than Governmental Authorities (the “Recipient Group”) in breach of this Agreement, (ii) was available to a member of the Recipient Group prior to such information’s disclosure by or on behalf of the Partnership from a source (other than Recipient Group) who, to the knowledge of the applicable Partner, is not subject to a confidentiality agreement with, or other obligation of secrecy to, the

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Partnership, its Affiliates or representatives prohibiting such disclosure, (iii) is or becomes available to the Recipient Group from a source (other than the Recipient Group) who, to the knowledge of the applicable Partner, is not subject to a confidentiality agreement with, or other obligation of secrecy to, the Partnership, its Affiliates or representatives prohibiting such disclosure, or (iv) was independently developed by the Recipient Group without reference to the Evaluation Material. If a member of the Recipient Group is requested or required (by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand, or similar legal process or by regulatory agency, or stock exchange or other applicable rules) to disclose any of the Evaluation Material, or if a member of the Recipient Group determines that such Evaluation Material is required to be disclosed by applicable law, rule or regulation, the applicable Partner agrees promptly upon obtaining knowledge of such request, requirement or determination to disclose to provide the Advisory Committee with prompt notice of each such request or determination, to the extent practicable and not legally prohibited, so that the Partnership or a Partner as appropriate may seek an appropriate protective order (at its own cost and expense). If, absent the entry of a protective order or other appropriate remedy, the applicable member of a Recipient Group is legally required to disclose the Evaluation Material, such applicable member may disclose such information only to the persons and to the extent required without liability under this Agreement.

(j) Non-Voting Observers.

(i) Each Partner, together with its Affiliates, that does not have the right to appoint a member of the Advisory Committee pursuant to Subsection 6.4(a), but holds a Percentage Interest of not less than five percent (5%) (which for the purposes of this determination shall include a pro rata portion of the Partnership Interest held by LJ VP based upon the Partner’s and its Affiliates’ ownership interests in Holdings (if any), but, with respect to PAG, excluding Partnership Interests held directly or indirectly by the other Penske Partners) and only for so long as such Partner, together with its Affiliates, owns a Percentage Interest of not less than five percent (5%) (which for the purposes of this determination shall include a pro rata portion of the Partnership Interest held by LJ VP based upon the Partner’s and its Affiliates’ ownership interests in Holdings (if any), but, with respect to PAG, excluding Partnership Interests held directly or indirectly by the other Penske Partners), including as of the Effective Time, PAG, shall have the right to a non-voting observer (the “Non-Voting Observer”) at all duly called and convened meetings of the Advisory Committee (as provided for in Subsection 6.4(c)). The Non-Voting Observer shall be entitled to receive all materials and information distributed to the members of the Advisory Committee (in such capacity) in connection with such duly called and convened meetings (including written consents in lieu of such meetings) and shall have access to the Partnership’s management and records as if the Non-Voting Observer were a member of the Advisory Committee, except that the General Partner may exclude any Non-Voting Observers from all applicable portions of any meeting of the Advisory Committee, or deny access to any information or portions thereof provided to members of the Advisory Committee, if the General Partner reasonably determines that the participation of the Non-Voting Observer, or access to the applicable information, could reasonably be expected to (1) result in a waiver of the attorney-client privilege (based on the advice of the Partnership’s counsel and, if applicable, taking

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into account the execution of a common interest agreement) with respect to any matters to be discussed or any matters included in the information to be distributed; (2) expose to any Non-Voting Observer (who represents or is affiliated with a competitor to the Partnership, a customer, supplier or other business partner of the Partnership or a competitor to the Partnership’s customers, suppliers or other business partners) (A) if a contract or understanding with any Person or Affiliate of such Person represented by the Non-Voting Observer is being described, discussed or voted upon, any information related to such contract or understanding and/or (B) the Partnership’s business operations, objectives, opportunities, competitive positioning and/or prospects related to any such Person or any matter in which such Person may be reasonably deemed to have an interest that is adverse to the Partnership; (3) cause the Partnership to violate obligations with respect to confidential or proprietary information of third parties, provided that a Non-Voting Observer shall not be so excluded unless all other Persons whose participation in such meeting of the Advisory Committee, or portions thereof, or receipt of such information, or portions thereof, would result in a violation of such third party obligations are also excluded; or (4) pose an actual or potential conflict of interest for the Partner designating the Non-Voting Observer, any of its Affiliates or the Non-Voting Observer. In addition, if a Non-Voting Observer designated by a Partner is an observer, employee, officer, director, partner, member, consultant or fiduciary at another company that competes with the Partnership or is primarily engaged in a business in a substantially related industry, a majority of the members of the Advisory Committee shall be permitted to exclude the Non-Voting Observer from any meeting of the Advisory Committee, or portions thereof, or deny access to any information provided to the members of the Advisory Committee, if such members reasonably determine, in a closed session, to exclude such Non-Voting Observer to protect the proprietary nature of the information included in the matters to be discussed and/or distributed.

(iii) For the avoidance of doubt, any failures to comply with this Subsection 6.4(j) shall not affect in any way the validity of any actions taken by the Advisory Committee.

6.5 Restrictions on the Authority of the General Partner.

(a) Notwithstanding any other provision of this Agreement, the General Partner shall not have authority to do any of the following:

(i) any act in contravention of this Agreement;

(ii) any act which would make it impossible to carry on the ordinary business of the Partnership, except as otherwise provided in this Agreement;

(iii) possess Partnership property, or assign any rights in specific Partnership property, for other than a Partnership purpose;

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(iv) admit a Person as a Partner, except as otherwise provided in this Agreement;

(v) except as permitted pursuant to Section 14.2, amend or waive any provision of this Agreement;

(vi) except as otherwise permitted by this Agreement, Transfer all or any portion of its interest as the General Partner of the Partnership;

(vii) knowingly commit any act which would subject any Limited Partner to liability as a general partner in any jurisdiction in which the Partnership transacts business, except to effect the conversion of the Partnership Interests pursuant to Subsection 1.1(c); or

(viii) elect to dissolve the Partnership, except as expressly permitted herein.

(b) Notwithstanding any other provision of this Agreement, other than Subsection 6.4(h), the General Partner shall not have authority to do any of the following without the written approval (which approval may be by resolution) of the Advisory Committee:

(i) Adopt the annual budget of the Partnership Group;

(ii) Materially change the Partnership’s policies relating to credit approval levels;

(iii) Appoint the senior officers of the Partnership; or

(iv) Commence any action, claim or proceeding by or in the name of the Partnership where the same involves an amount in excess of $10,000,000 or confess a judgment against the Partnership in an amount in excess of $100,000; provided, however, that the prior approval of the Advisory Committee shall not be required in order for the Partnership to commence an action, claim or proceeding in excess of the above-mentioned amount if the General Partner determines in the exercise of its reasonable business judgment that such action, claim or proceeding is necessary to protect the interests of the Partnership in its properties or assets and the Partnership would be prejudiced by the delay in seeking approval.

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(c) Notwithstanding any other provision of this Agreement, other than Subsection 6.4(h), the General Partner shall not have authority to do any of the following without the written approval (which approval may be by resolution) of four (4) members of the Advisory Committee (including at least one GE Committee Member designated by the GE Representative Partner):

(i) Cause the Partnership Group to (a) incur indebtedness outside of the ordinary course of business, (b) incur indebtedness that is not pari passu in right of payment with the GE Revolver or the New Credit Agreement (or any replacement or successor revolving credit agreements pari passu in right of payment with the GE Revolver or the New Credit Agreement) or the senior notes of the Partnership and PTL Finance Corporation authorized by the Advisory Committee on April 25, 2012 or (c) grant any Liens with respect to any property of the Partnership Group (other than such Liens granted in connection with the financing of the acquisition of vehicles by the Partnership Group in the ordinary course of business, which Liens attach only to the vehicles being acquired with the proceeds of the applicable financing, including any chattel paper, replacements, substitutes and proceeds thereof, as such terms are defined in Article 9 of the Uniform Commercial Code, or liens permitted by the GECC Credit Agreement (whether or not such Agreement has been terminated));

(ii) Enter into any credit agreement, indenture, debt security or debt instrument (or any amendment, restatement, supplement or other modification thereto or waiver thereof) that would or (at such time the agreement or other instrument, or amendment, restatement, supplement or other modification thereto or waiver thereof, is executed), reasonably would be expected to (a) restrict or prevent the exercise by the GE Partners, including any permitted successors or permitted assignees, of any rights, actions or transactions contemplated by Subsection 1.1(c), Article 9 or Article 10 (without limiting the foregoing, any provision that would require the consent of creditors or their agents or representatives to such exercise in order to prevent acceleration or rapid amortization of indebtedness or would give creditors or their agents or representatives the right to accelerate or more rapidly amortize indebtedness in connection with such exercise being deemed to be expected to restrict or prevent such right, action or transaction) or (b) reduce distributions by the Partnership below those otherwise required by Subsections 5.1(a) and (b);

(iii) Change the Partnership’s policies relating to requirements of environmental Laws, antitrust Laws, Laws relating to contracts with Governmental Authorities, insider trading and ethical business practices;

(iv) Change the name of the Partnership or the name or names under which the Partnership conducts business; provided, however, that nothing in this Subsection 6.5(c)(iv) shall be deemed to prevent the Partnership from ceasing to use the name “Penske” if and to the extent required by the Trade Name and Trademark Agreement;

(v) Materially change policies relating to accounting matters other than those required by GAAP;

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(vi) Determine the accounting methods and conventions to be used in, or any other method or procedure related to, the preparation of the Returns (as defined in Subsection 8.2(d)), and make any and all elections under the tax Laws of any jurisdiction as to the treatment of items of income, gain, loss, deduction and credit of the Partnership or file a Form 8832—Entity Classification Election or in any other manner make or change an election under U.S. Treasury Regulations Section 301.7701-3(c)(1) or successor regulations to have the Partnership taxed as anything other than as a partnership for federal tax purposes, except that it is agreed that for 2012 the Partnership may elect “bonus depreciation” under Code Section 168(k)(1) for federal income tax and Capital Account purposes (including reverse section 704(c) allocations);

(vii) (x) Cause the Partnership Group to expend in excess of $10 million in any single transaction or series of related transactions involving the acquisition of (A) any stock or other equity interest in any other entity or (B) all or substantially all of the assets of any other entity or person, or (y) cause the Partnership to incur capital expenditures (other than in respect of vehicles) in any Partnership Year, individually or in the aggregate, in excess of an amount equal to the sum of (A) $10 million and (B) 15% of facilities and equipment, net (excluding vehicles) as of the end of the immediately preceding Partnership Year as set forth in the Partnership’s consolidated balance sheet for such immediately preceding Partnership Year; provided, however, that with respect to transactions involving an investment in excess of $10 million but not in excess of $20 million, the requisite approval of the Advisory Committee shall be deemed to have been given if the Advisory Committee does not disapprove such investment by delivery of written notice thereof to the Partnership stating that at least two (2) members of the Advisory Committee have disapproved within five (5) Business Days following receipt of written notice of a request for approval of such transaction;

(viii) Change the character of the Partnership Group’s business from that set forth in clauses (i), (ii), (iii) and (iv) of Section 1.4 or cause the Partnership to engage in any activity other than as described therein;

(ix) Declare or cause the Partnership to make any discretionary special distributions to its Partners pursuant to Subsection 5.1(c) or declare or pay any dividend on or make any distribution on or purchase, redeem or otherwise acquire or retire for value any of the equity interests of any Subsidiary of the Partnership held by Persons other than the Partnership or any of the Partnership’s wholly owned Subsidiaries except for pro rata payments to all holders of the equity interests of any such Subsidiary;

(x) Increase or amend the compensation arrangements for the direct services of Roger S. Penske between the Partnership Group and Roger S. Penske or any entity that is an Affiliate of Roger S. Penske from those currently in effect;

(xi) (a) File a voluntary petition seeking liquidation, reorganization, arrangement or readjustment, in any form, of the Partnership’s debts under Title 11 of the United States Code or any other federal or state insolvency Law, or file an answer consenting to or acquiescing in any such petition, (b) make any Transfer for the benefit of the Partnership’s creditors or (c) allow the expiration of sixty days after the filing of an involuntary petition under Title 11 of the United States Code, the application by a third party for the appointment of a receiver for the assets of the Partnership, or the filing of an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of the Partnership’s debts under any other federal or state insolvency Law, unless the same shall not have been vacated, set aside or stayed within such sixty-day period;

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(xii) Hire or terminate or modify the compensation of the manager of the internal audit staff contemplated by Subsection 6.4(g) or adopt its budget;

(xiii) Cause the Partnership Group to take any action or series of related actions that could reasonably be expected to result in the loss of an investment grade corporate, unsecured, long-term debt rating for the Partnership on a stand-alone basis from any of Standard & Poor’s, Moody’s or Fitch; it being understood that (i) such actions shall not include distributions required by Sections 5.1(a) and 5.1(b) and (ii) changes in policies or ratings criteria of ratings agencies shall not be taken into account for this provision; or

(xiv) Amend or waive any provision of the Trade Name and Trademark Agreement, if such amendment or waiver is adverse in any respect to the Partnership.

6.6 Other Activities. (a) Any Partner (other than the General Partner in such capacity) (the “Interested Party”) may engage in or possess an interest in other business ventures of any nature or description, independently or with others, whether presently existing or hereafter created, and neither the Partnership nor any Partner (including the General Partner) other than the Interested Party shall have any rights in or to such independent ventures or the income or profits derived therefrom.

(b) Notwithstanding the foregoing, none of Penske Corporation, PTLC or any of their respective Affiliates shall, at any time that (i) the aggregate Percentage Interests that the Penske Partners own exceed five percent (5%) (without taking into account any Partnership Interest held by LJ VP), (ii) any Penske Partner has the right to designate one or more members of the Advisory Committee, (iii) a Penske Partner is the General Partner or (iv) at such time as LJ VP is the General Partner, a Penske Partner is the Managing Member of Holdings, and for a period of two (2) years after none of the conditions set forth in the foregoing clauses (i), (ii), (iii) or (iv) applies, directly compete with the Partnership (as such phrase is defined in Subsection 6.6(d) below) or acquire or possess any ownership interest (other than investments of less than two percent (2%) of any class of outstanding securities of a corporation or other entity) in any other entity which directly competes with the Partnership.

(c) Notwithstanding the foregoing, neither GECC nor any of its Subsidiaries shall, at any time that the aggregate Percentage Interests that the GE Partners own exceeds five percent (5%) (without taking into account any Partnership Interest held by LJ VP) and for a period of two (2) years after the later of (x) the date upon which the GE Partners cease to own in excess of such five percent (5%) and (y) the date on which none of the GE Partners has the right to designate a member of the Advisory Committee, directly compete with the Partnership (as such phrase is defined in Subsection 6.6(d) below).

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(d) As used in this Section 6.6, the phrase “directly compete(s) with the Partnership” shall mean the active conduct and operation of a business engaged in the renting and full-service leasing (but not any other types of Leasing) and servicing of tractors, trailers and/or trucks to third party users, or in acting as a dedicated contract motor carrier, in each case in the United States of America or Canada.

(e) Nothing in this Section 6.6 shall modify consents contained in written resolutions signed by all members of the Advisory Committee.

(f) Subsection 6.6(b) above shall cease to be applicable to any Person (other than the General Partner and its Subsidiaries) at such time as it is no longer an Affiliate of Penske Corporation and shall not apply to any Person (other than the General Partner and its Subsidiaries) that purchases assets, operations or a business from Penske Corporation or one of its Affiliates, if such Person is not an Affiliate of Penske Corporation after such transaction is consummated.

(g) Subsection 6.6(c) above shall cease to be applicable to any Person at such time as it is no longer a Subsidiary of GECC and shall not apply to any Person that purchases assets, operations or a business from GECC or one of its Subsidiaries, if such Person is not a Subsidiary of GECC after such transaction is consummated.

(h) Notwithstanding the provisions of Subsections 6.6(b) and 6.6(c) above, and without implicitly agreeing that the following activities would be subject to the provisions of Subsections 6.6(b) or 6.6(c) above, nothing in Subsection 6.6(b) or 6.6(c) above shall preclude, prohibit or restrict a Person whose conduct is restricted under Subsection 6.6(b) or 6.6(c) above (each a “Restricted Person”) from engaging in any manner in any (i) Financial Services Business, (ii) Existing Business Activities, (iii) De Minimis Business or (iv) business activity that would otherwise violate Subsection 6.6(b) or 6.6(c) above, as applicable, that is acquired from any Person (an “After-Acquired Business”) or is carried on by any Person that is acquired by or combined with a Restricted Person in each case after the Effective Time (an “After-Acquired Company”); provided, that with respect to clauses (iii) and (iv), as applicable, so long as within 18 months (or such longer period agreed to by the GE Representative Partner and PTLC) after the purchase or other acquisition of the After-Acquired Business or the After-Acquired Company or the loss by a Restricted Person of De Minimis Business status for its otherwise violative business activities if the restriction in Subsection 6.6(b) or (c) above with respect to the applicable Restricted Person has not terminated during such period, such Restricted Person, following the extension to the Partnership of the First Opportunity which does not result in an acquisition transaction with the Partnership, signs a definitive agreement to dispose, and subsequently disposes of the relevant portion of the business or securities of the After-Acquired Business or the After-Acquired Company or the otherwise violative business activity; or at the expiration of such 18-month period (or such longer period agreed to by the GE Representative Partner and PTLC) the business of the After-Acquired Business or the After-Acquired Company or the otherwise violative business activity complies with Subsection 6.6(b) or Subsection 6.6(c) above, as applicable. With respect to clauses (iii) and (iv), as applicable, the applicable Restricted Person shall extend to the Partnership the first opportunity to potentially acquire the relevant portion of the business or securities of the Acquired Business or the Acquired Company or the otherwise violative business activity. The Restricted Person and the Partnership agree to enter into good faith discussions, for a period of ninety (90) days after the Restricted Person notifies the Partnership of the transaction opportunity in writing, regarding the Partnership’s potential acquisition of the relevant portion of the business or securities of the Acquired Business or the Acquired Company or the otherwise violative business activity (the “First Opportunity”); provided, that the Partnership shall notify the Restricted Person as soon as practicable if it is not interested in vigorously pursuing the opportunity, which notice shall terminate the First Opportunity; provided, further that nothing herein shall (A) require the Restricted Party to Sell to the Partnership, or require the Partnership to acquire from the Restricted Party, the relevant portion of the business or securities of the Acquired Business or the Acquired Company or the otherwise violative business activity; or (B) prohibit or restrict any discussions or negotiations at any time with third parties to acquire the relevant portion of the business or securities of the Acquired Business or the Acquired Company. At any time following the expiration or termination of the First Opportunity, the Restricted Party may enter into definitive agreements to Sell, or subsequently Sell, the relevant portion of the business or securities of the Acquired Business or the Acquired Company; provided, that, if the applicable Restricted Person is an Affiliate of Penske Corporation, the terms and conditions of the Partnership’s potential acquisition shall be presented to the Advisory Committee for discussion prior to the consummation of any Sale of the relevant portion of the business or securities of the Acquired Business or the Acquired Company.

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(i) Notwithstanding anything to the contrary in this Agreement, any amendments, modifications or waivers to this Section 6.6 relating to activities of (x) Penske Corporation or any of its Affiliates or GECC or any of its Subsidiaries shall be approved in writing by all of the members of the Advisory Committee or (y) any Partner other than Penske Corporation or any of its Affiliates or GECC or any of its Subsidiaries shall be approved in writing by four (4) members of the Advisory Committee (including at least one GE Committee Member).

(j) Definitions:

(1) “Capital Markets Activity” means any activity undertaken in connection with efforts by any Person to raise for or on behalf of any Person capital from any public or private source.

(2) “Default Recovery/Remarketing Activities” means (i) the exercise of any rights or remedies in connection with any Capital Markets, Financing, Insurance, Leasing, Other Financial Services or Securities Activity (whether such rights or remedies arise under any agreement relating to such activity, under applicable Law or otherwise) including any foreclosure, realization or repossession or ownership of any collateral, business assets or other security for any Financing (including the equity in any entity or business), Insurance or Other Financial Services Activity or any property subject to Leasing or (ii) the remarketing (including any possession, ownership, Insurance, maintenance, transportation, shipment, storage, refurbishment, repair, sale, offer to sale, auction, consignment, liquidation, disposal, scrapping or other remarketing activities) of any collateral, business assets or other security for any Financing (including the equity in any entity or business), Insurance or Other Financial Services Activity or any property subject to Leasing.

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(3) “De Minimis Business” means (a) any business activity that would otherwise violate Subsection 6.6(b) or Subsection 6.6(c) above that is carried on by an After-Acquired Business or an After-Acquired Company, but only if, at the time of such acquisition or thereafter at the end of each Partnership Year following such acquistion, the operating revenues (excluding non-operating revenues) derived from business that directly competes with the Partnership (as such phrase is defined in Subsection 6.6(d) above) by such After-Acquired Business or After-Acquired Company constitute less than $100 million for the most recently completed fiscal year preceding such acquisition or at the end of any Partnership Year following such acquisition, or (b) any business activity conducted by Penske Corporation or any of its Affiliates or GECC or any of its Subsidiaries that constitutes Business Activities Ancillary to its principal businesses.

(4) “Existing Business Activities” means any business conducted or investment held by Penske Corporation or any of its Affiliates or GECC or its Subsidiaries, or contemplated by any existing contractual arrangements applicable to Penske Corporation or any of its Affiliates or GECC or any of its Subsidiaries, on the date of this Agreement. It is acknowledged and agreed that neither the business operations conducted as of April 30, 2012 by GE Capital Fleet Services or the Commercial Equipment Finance Divisions of GE Capital, nor any reasonable expansions of such business operations or extensions of such business operations which are reasonably and directly related to the businesses and operations of GE Capital Fleet Services or the Commercial Equipment Finance Divisions of GE Capital conducted as of April 30, 2012 shall be deemed to directly compete with the Partnership for purposes of this Section 6.6.

(5) “Financial Services Business” means any activities undertaken principally in connection with or in furtherance of (i) any Capital Markets Activity, (ii) Financing, (iii) Leasing (other than Leasing activities that would constitute directly competing with the Partnership, as defined in Subsection 6.6(d) above), (iv) Default Recovery/Remarketing Activities, (v) Other Financial Services Activities, (vi) any Securities Activity or (vii) the sale of Insurance, the conduct of any Insurance brokerage activities or services or the provision of Insurance advisory services, business processes or software. Financial Services Business also includes any investment or ownership interest in a Person through an employee benefit or pension plan.

(6) “Financing” means the making, entering into, purchase of, or participation in (including syndication or servicing activities) (i) secured or unsecured loans, conditional sales agreements, debt instruments or transactions of a similar nature or for similar purposes and (ii) non-voting preferred equity investments.

(7) “Insurance” means any product or service determined to constitute insurance, assurance or reinsurance by the Laws in effect in any jurisdiction in which the restriction set forth in Subsection 6.6(b) or 6.6(c) above applies.

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(8) “Leasing” means the rental, leasing, or financing, in each case under operating leases, finance leases, capital leases, synthetic leases, leveraged leases, tax-oriented leases, non-tax-oriented leases, retail installment sales contracts, hire purchase or rental agreements, of property, whether real, personal, tangible or intangible.

(9) “Other Financial Services Activities” means the offering, sale, distribution or provision, directly or through any distribution system or channel, of any financial products, financial services, asset management services, including investments on behalf of Penske Corporation or any of its Affiliates or GECC and its Subsidiaries purely for financial investment purposes, investments for the benefit of third party and client accounts, credit card products or services, vendor financing and trade payables services, back-office billing, processing, collection and administrative services or products or services related or ancillary to any of the foregoing.

(10) “Securities Activity” means any activity, function or service (without regard to where such activity function or service actually occurs) which, if undertaken or performed (i) in the United States would be subject to the United States federal securities Laws or the securities Laws of any state of the United States or (ii) outside of the United States within any other jurisdiction in which the restrictions set forth in Subsection 6.6(b) or Subsection 6.6(c) above apply, would be subject to any Law in any such jurisdiction governing, regulating or pertaining to the sale, distribution or underwriting of securities or the provision of investment management, financial advisory or similar services.

6.7 Transactions with Affiliates.

(a) Nothing in this Agreement shall preclude transactions between the Partnership and any Partner (including the General Partner) or an Affiliate or Affiliates of any Partner acting in and for its own account, provided that any services performed or products provided by the Partner or any such Affiliates are services and/or products that the General Partner reasonably believes, at the time of requesting such services, to be in the best interests of the Partnership, and further provided that the rate of compensation to be paid for any such services and/or products shall be comparable to the amount paid for similar services and/or products under similar circumstances to independent third parties in arm’s length transactions, and further provided that commencing with transactions entered into after March 26, 2009 the members of the Advisory Committee will receive a written notice within thirty days of the date on which any such transaction is entered setting forth the material terms of any transaction or series of related transactions described above for which the aggregate amount involved in such transaction or series of transactions, which includes the U.S. dollar value of the amounts involved throughout the duration of any agreements entered into with respect to such transaction(s), is greater than $10 million.

(b) All bills with respect to services provided to the Partnership by a Partner or any Affiliate of a Partner shall be separately submitted and shall be supported by logs or other written data.

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6.8 Exculpation.

Neither the General Partner (including for purposes of this Section 6.8 any Person formerly serving as the General Partner) nor any of its Affiliates nor any of their respective holders of partnership interests, shareholders, officers, directors, employees or agents shall be liable, in damages or otherwise, to the Partnership or to any of the Limited Partners for any act or omission on its or his or her part, except for (i) any act or omission resulting from its or his or her own willful misconduct or bad faith, (ii) with respect to the General Partner only, any breach by the General Partner of its obligations as a fiduciary of the Partnership or (iii) with respect to the General Partner only, any breach by the General Partner of any of the terms and provisions of this Agreement. The Partnership shall indemnify, defend and hold harmless, to the fullest extent permitted by Law, the General Partner or any of its Affiliates or any of their respective holders of partnership interests, members, shareholders, officers, directors, employees and agents, from and against any claim or liability of any nature whatsoever arising out of or in connection with the assets or business of the Partnership, except where attributable to the willful misconduct or bad faith of such individual or entity or where relating to a breach by the General Partner of its obligations as a fiduciary of the Partnership or to a breach by the General Partner of any of the terms and provisions of this Agreement.

ARTICLE 7

COMPENSATION

The General Partner shall be entitled to reimbursement of all of its expenses attributable to the performance of its obligations hereunder, as provided in Article 4 hereof, to the extent permitted by Section 6.7. Subject to the Act, no amount so paid to the General Partner shall be deemed to be a distribution of Partnership assets for purposes of this Agreement.

ARTICLE 8

ACCOUNTS

8.1 Books and Records. The General Partner shall maintain complete and accurate books of account of the Partnership’s affairs at the Partnership’s principal office, including a list of the names and addresses of all Partners. Each Partner shall have the right to inspect the Partnership’s books and records (including the list of the names and addresses of Partners). Each of the Partners shall have the right to audit independently the books and records of the Partnership, any such audit being at the sole cost and expense of the Partner conducting such audit.

8.2 Reports, Returns and Audits.

(a) The books of account shall be closed promptly after the end of each Partnership Year. The books and records of the Partnership shall be audited as of the end of each Partnership Year by the Auditor. Within ninety (90) days after the end of each Partnership Year, the General Partner shall make a written report to each person who was a Partner at any time during such Partnership Year which shall include financial statements comprised of at least the following: a balance sheet as of the close of the preceding Partnership Year, and statements of earnings or losses, changes in financial position and changes in Partners’ capital accounts for the Partnership Year then ended, which financial statements shall be certified by the Auditor as in accordance with Generally Accepted Accounting Principles. The report shall also contain such additional statements with respect to the status of the Partnership business as are considered necessary by any member of the Advisory Committee to advise any or all Partners properly about their investment in the Partnership. As soon as practicable after the end of each quarter in each Partnership Year, the Partnership shall deliver to PTLC, the GE Representative Partner and PAG a written report which shall include forecasts for the current quarter, including forecast changes in debt balance of the Partnership.

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(b) Prior to August 15 of each year, each Partner shall be provided with an information letter (containing such Partner’s Form K-1 or comparable information) with respect to its distributive share of income, gains, deductions, losses and credits for income tax reporting purposes for the previous Partnership Year, together with any other information concerning the Partnership necessary for the preparation of a Partner’s income tax return(s), and the Partnership shall provide each Partner with an estimate of the information to be set forth in such information letter by no later than April 15 of each year. With the sole exception of mathematical errors in computation, the financial statements and the information contained in such information letter shall be deemed conclusive and binding upon such Partner unless written objection shall be lodged with the General Partner within ninety (90) days after the giving of such information letter to such Partner.

(c) The Partnership shall also furnish the Partners with such periodic reports concerning the Partnership’s business and activities as are considered necessary by any member of the Advisory Committee or PAG to advise any or all Partners properly about their investment in the Partnership.

(d) The General Partner shall, in accordance with the advice of the Advisory Committee, prepare or cause to be prepared all federal, state and local tax returns of the Partnership (the “Returns”) for each year for which such Returns are required to be filed, and shall cause all such Returns to be filed in a timely manner; provided, however that it shall not file any Return without first providing the GE Representative Member with a reasonable opportunity to review the Return and obtaining the consent of the GE Representative Member to such filing, which consent shall not be unreasonably withheld or delayed. To the extent permitted by Law, for purposes of preparing the Returns, the Partnership shall use the Partnership Year. Subject to Subsection 6.5(c)(v), the General Partner may make any elections under the Code and/or applicable state or local tax Laws, and the General Partner shall be absolved from all liability for any and all consequences to any previously admitted or subsequently admitted Partners resulting from its making or failing to make any such election. Notwithstanding the foregoing, the General Partner shall make the election provided for in Section 754 of the Code, if requested to do so by any Partner, without the need of approval of the Advisory Committee.

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(e) The General Partner shall be the “tax matters partner” of the Partnership within the meaning of Section 6231(a)(7) of the Code (the “Tax Matters Partner”) and shall serve in any similar capacity under applicable Law. In any case in which more than one Partner is eligible under Regulations Section 301.6231(a)(7)-1(c), by reason of having been or being the General Partner, to be designated as the Tax Matters Partner for a given taxable year (each such Partner a “TMP Eligible Partner”), the Tax Matters Partner designated for such year shall be selected by unanimous agreement among all such eligible TMP Eligible Partners for such year. In the absence of unanimous agreement, the TMP Eligible Partner that was the General Partner on the last day of such taxable year shall be designated as the Tax Matters Partner for such taxable year. The GE Representative Partner shall be given at least fifteen (15) Business Days advance notice from the Tax Matters Partner of the time and place of, and shall have the right to participate in (i) any administrative proceeding relating to the determination at the Partnership level of partnership items on which the Partners, rather than the Partnership, are taxable and (ii) any discussions with the Internal Revenue Service (or other governmental tax authority) relating to the allocations pursuant to Article 5 of this Agreement or the Corresponding Provision of any Prior Agreement. The Tax Matters Partner shall not initiate any action or proceeding in any court in its capacity as Tax Matters Partner, extend any statute of limitation, or take any other action contemplated by Sections 6222 through 6232 of the Code (or similar state, local or foreign Laws with respect to income or income-based taxes that apply to the Partners rather than the Partnership) if such initiation, extension or other action would legally bind any other Partner or the Partnership without the approval of the GE Representative Partner, which approval will not be unreasonably withheld or untimely delayed. The Tax Matters Partner shall from time to time upon request of any other Partner confer, and cause the Partnership’s tax attorneys and accountants to confer, with such other Partner and its attorneys and accountants on any matters relating to a Partnership tax return or any tax election.

(f) The Partnership shall provide such other information as may be reasonably required for the Partners or their Affiliates to timely comply with applicable financial reporting requirements or their customary financial reporting practices, and the Partnership shall continue to provide substantially the same accounting assistance to the Partners or their Affiliates as the Partnership provided to them for the 2011 Partnership Year including (i) booking the GE Partners’ share of the Profits, Losses, items of income, gain, loss, deduction, or credit, distributions or other items of the Partnership’s activities in the GECC ledger at the end of each quarter of the Partnership Year and (ii) preparing quarterly accounting closing schedules at the end of each quarter of the Partnership Year.

ARTICLE 9

TRANSFERS AND SALES

9.1 Transfer of Interests of General Partner and PTLC Consolidated Group. Notwithstanding anything to the contrary contained in this Article 9 or any other provision of this Agreement:

(a) The General Partner shall not withdraw from the Partnership or resign as General Partner or Transfer all or any portion of its general partner Partnership Interest, except in each case (i) as provided in Subsection 1.1(c), (ii) as a consequence of a Sale mandated by Subsection 9.4(a) or (iv) with the prior written approval of the Majority Limited Partners and the GE Representative Partner.

(b) The General Partner shall be liable to the Partnership for any Event of Withdrawal in violation of Subsection 9.1(a) above.

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(c) LJ VP may not Sell all or any portion of its Partnership Interest, except in accordance with the Holdings LLC Agreement.

(d) For so long as members of the GECC Consolidated Group hold in the aggregate not less than a ten percent (10%) Percentage Interest (without taking into account any Partnership Interest held by LJ VP) and for two (2) years after that is no longer the case, the PTLC Consolidated Group shall be required at all times to hold not less than a twenty-five percent (25%) Percentage Interest (without taking into account any Partnership Interest held by LJ VP), except as a consequence of a Sale mandated by Subsection 9.4(a).

9.2 Transfer or Sale of Limited Partner Interests.

(a) Except (i) as permitted by the further provisions of this Section 9.2, (ii) as permitted by Section 9.3, (iii) as required by Section 9.4, (iv) in accordance with Article 10 or (v) in accordance with Sections 10.1 and 10.2 of the Holdings LLC Agreement, at all times subject to Section 9.1, commencing as of the Effective Time, no Limited Partner may Transfer all or any portion of its limited partner Partnership Interest to any Person.

(b) (i) Each of GE Truck Leasing Holdco, GE Logistics Holdco and GE Tennessee may Sell all or any portion of its Partnership Interests from time to time to any member or members of the GECC Consolidated Group, and (ii) PTLC may Sell all or any portion of its limited partner Partnership Interests from time to time to any member or members of the PAG Consolidated Group or to any member or members of the PTLC Consolidated Group.

(c) PAG may Sell all or any portion of its Partnership Interests from time to time to any member or members of the PTLC Consolidated Group or any member or members of the PAG Consolidated Group.

(d) In the event of any Sale pursuant to Subsection 9.2(b) or (c), if the assignee in such Sale shall cease at any time for any reason (other than as a result of a change in Generally Accepted Accounting Principles after the Effective Time) to be a member of the GECC Consolidated Group, the PTLC Consolidated Group or the PAG Consolidated Group, as the case may be, then such assignee shall concurrently with ceasing to be a member of the applicable Consolidated Group Sell such Partnership Interests to a Person that is a member of the applicable Consolidated Group.

(e) Prior to and as a condition to any Sale pursuant to Subsection 9.2 (b), 9.2(c) or 9.2(d), the assignee shall agree in writing with the Partnership to be bound by all of the terms and conditions of this Agreement in the same manner as the assignor.

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(f) PAG may, in connection with a bona fide financing from one or more third-party lenders (such lenders, or an agent or a representative therefor (a “Bona Fide Lender”)), grant a security interest in, or otherwise pledge (the “PAG Pledge”), to a Bona Fide Lender, PAG’s share in the profits and losses of the Partnership and PAG’s right to receive distributions of the Partnership solely with respect to all or any portion of its Percentage Interest as of the Effective Time in the Partnership, as such percentage has been or may be increased other than by virtue of a Transfer to PAG or any of its Subsidiaries of any additional Partnership Interest, unless the GE Representative Partner and PTLC agree otherwise (such portion of the limited partner Partnership Interests in the Partnership owned by PAG and so secured or pledged being referred to herein as the “PAG Pledged Interest” but, for the avoidance of doubt, (x) shall not include any indirect interest held by PAG in or through Holdings or LJ VP and (y) notwithstanding anything else herein, PAG’s rights pursuant to this Subsection 9.2(f) shall not be Transferable to any assignee or otherwise, unless the GE Representative Partner and PTLC agree otherwise, it being understood and agreed that (i) prior to or upon any foreclosure or similar exercise of rights of the Bona Fide Lender pursuant to the terms of its security interest (a “Foreclosure”) the Bona Fide Lender (or any transferee of the Pledged PAG Interest following any Foreclosure) shall only be entitled to receive distributions of cash or other property from the Partnership in accordance with the terms of this Agreement (and after a Foreclosure only to receive allocations of the income, gains, credits, deductions, profits and losses of the Partnership attributable to such PAG Pledged Interest after the effective date of such Foreclosure in accordance with the terms of this Agreement) and shall not at any time become a Partner (and shall not have any rights with respect to governance, voting, approvals, consents, observation or other management rights with respect to the Partnership, all of which shall remain with PAG) and (ii) upon a Foreclosure, PAG’s rights with respect to governance, observation or other management rights with respect to the Partnership shall lapse and any and all voting, approval and consent rights of PAG attributable to the PAG Pledged Interest foreclosed upon shall be deemed made in proportion to the other Partners.

9.3 Right of First Offer.

(a) No Partner shall Transfer all or any portion of such Partner’s Partnership Interest except (i) as permitted by Section 9.2, (ii) as further permitted in this Section 9.3, (iii) as required by Section 9.4, (iv) in accordance with Article 10 or (v) in accordance with Sections 10.1 and 10.2 of the Holdings LLC Agreement, at all times subject to Section 9.1, or, for avoidance of doubt, Subsection 1.1(c).

(b) For purposes of this Section 9.3, members of the GECC Consolidated Group, members of the PTLC Consolidated Group and members of the PAG Consolidated Group shall each be deemed a single Partner.

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(c) No Partner may Sell all or any portion of its Partnership Interest, unless (i) such portion of its Partnership Interest constitutes a Percentage Interest of at least five percent (5%) (without taking into account any Partnership Interest held by LJ VP) unless such Partner is selling all of its then-held Partnership Interests (without taking into account any Partnership Interest held by LJ VP), taken as a whole, immediately prior to the consummation of such Sale and (ii) the consideration for such Sale consists solely of cash and/or a promissory note; provided, however, that if a promissory note shall form a portion of the consideration being offered by a third-party offeror, such note must (A) be issued by the party which proposes to acquire the Partnership Interest, (B) bear an interest rate not less than the then-current market rate for a note of such creditworthiness, terms and conditions and tenor and (iii) not represent more than fifty percent (50%) of the total amount of the consideration being offered for such Partnership Interest. In the event that (I) a Partner (other than (i) LJ VP or (ii) PTLC, in each case with respect to its general partner interest), proposes to Sell all or any portion of its Partnership Interest (an “Initiated Offer”), or (II) a Partner shall have received an offer from a third party to acquire such Partner’s Partnership Interest (or such portion thereof) that the Partner proposes to accept (a “Third-Party Proposed Sale”), then in either such event such Partner (the “Offering Partner”) shall first offer (the “Offer”) in writing (which Offer shall set forth the price and all other material terms of such proposed Sale, and, in the case of a Third-Party Proposed Sale, have attached to it a copy of such third party’s written offer to purchase) to sell its Partnership Interest (or such portion thereof) (individually or collectively, the “Offered Interest”) to the other Partners other than LJ VP (the “Offeree Partners”) at the price and on the other financial terms specified in the Offer and on substantially the same terms (other than price and the other financial terms) as are set forth in the Purchase and Sale Agreement dated as of March 26, 2009 pursuant to which PTLC3 Holdings Co., LLC purchased a Partnership Interest from GE Logistics Holdco. A copy of such Offer shall also be provided to the General Partner at the same time as it is provided to the other Partners.

(d) Within sixty (60) days (or such longer period as the Offering Partner and the Offeree Partners may agree) after the date of the Offer each Offeree Partner must provide notice to the Offering Partner and the General Partner (the “Response Notice”) that such Offeree Partner either (1) agrees to purchase its proportion, based on its Percentage Interests relative to the aggregate Percentage Interests held by all Offeree Partners, of the Offered Interest at the offering price and on the other terms set forth in the Offer or at such other price and on such other terms as the Partners may agree or (2) declines to accept the Offer; provided that, if the Offering Partner is also proposing to Sell Member Interests concurrently to the same purchaser or affiliated group of purchasers, each Offeree Partner must either (x) agree to purchase its proportion of Member Interests and Partnership Interests, collectively, based on its Percentage Interest relative to the aggregate Percentage Interests held by all Offeree Partners for Partnership Interests as of the date of the Offer, or (y) decline to accept the Offer for the offered Partnership Interests and Member Interests collectively, and the terms “Offer” and “Offered Interest” shall be deemed to include such offered Partnership Interests and Member Interests collectively.

(e) If the Response Notices of the Offeree Partners constitute an acceptance, collectively, for the entire Offered Interest, the parties will consummate the Sale of the Offered Interest at the time and in the manner set forth in Subsection 9.3(g) and 9.5(a). Unless otherwise agreed by the accepting Offeree Partners (the “Accepting Partners”), the right to purchase the Offered Interest will be allocated among the Offeree Partners pro rata based on the relative Percentage Interests held by all Offeree Partners for Partnership Interests as of the date of the Offer. If the Response Notices of the Offeree Partners do not constitute an acceptance, collectively, for the entire Offered Interest, then at the end of the sixty (60) day period (as it may be extended pursuant to Subsection 9.3(d) above) (or, if earlier, when all Response Notices have been received) set forth in Subsection 9.3(d), the Offering Partner shall provide written notice to the Accepting Partners pursuant to which the Accepting Partners shall have the option to elect to purchase, for a period of thirty (30) days following the date of such notice, all (but not less than all) of the portion of the Offered Interest that the non-Accepting Partners did not elect to purchase, in proportion to the relative Percentage Interests (disregarding the Percentage Interests of the non-Accepting Partners) of such Accepting Partners (or on such other basis as the Accepting Partners determine) and on substantially the same terms and conditions described in Subsection 9.3(c).

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(f) If (i) none of the Offeree Partners delivers a Response Notice (or the Offeree Partners otherwise decline to purchase all of the Offered Interest) within the sixty (60) day period (as it may be extended pursuant to Subsection 9.3(d) above) set forth in Subsection 9.3(d) or (ii) after the end of the thirty (30) day period set forth in Subsection 9.3(e), the Accepting Partners have not elected to purchase all of the Offered Interest, then in each case the Offeree Partners will be deemed to have declined to exercise their rights under this Section 9.3 and the Offering Partner shall, with respect to the Offered Interest only, have the right, if an Initiated Offer, to, at the Offering Partner’s sole expense, not violative of Law or Section 9.5(b), launch a confidential marketing process (which may include the engagement of financial advisors and other advisors to conduct a customary auction sale process in which potential buyers are required to enter into confidentiality agreements contemplated by clause (e) of Section 6.4(i)), and, if an Initiated Offer or a Third Party Proposed Sale, enter into negotiations with a third party or enter into a definitive agreement, to Sell the Offered Interest in respect of an Offer at the same or a higher price and upon terms and conditions that are no less favorable in the aggregate to the Offeree Partners than as set forth in the Offer (other than those representations, warranties, covenants, indemnities and other agreements customary for similar transactions) for a period of one-hundred eighty (180) days, which period may be extended as agreed upon by the Offering Partner and the Offeree Partners.

(g) If an Offeree Partner or Partners shall have accepted the Offer in accordance with Subsections 9.3(d) and (e), then the Offering Partner shall Sell the Offered Interest to the Accepting Partners (or to such nominees of the Accepting Partners as the Accepting Partners may specify in writing to the Offering Partner not less than three (3) Business Days prior to the closing of such purchase and Sale) and the Sale of the Offered Interest to the Offeree Partners (or such nominees, as the case may be) shall be consummated within ninety (90) days thereafter, which period shall if all other conditions to closing have been satisfied except for required regulatory approvals (and those conditions that by their terms are to be satisfied at closing), be extended, unless the Offering Partner and the Accepting Partners otherwise agree in writing, for as long as reasonably necessary in order to obtain such regulatory approvals (until such time as it is determined that such approvals will not be obtained), at the principal office of the Partnership or such other location as the Offering Partner and the Accepting Partners (or their nominees) may agree, at which time the Offering Partner shall Sell to the Accepting Partners (or their nominees) the Offered Interest, free and clear of all Liens, claims, options to purchase and other restrictions of any nature whatsoever, except those set forth in this Agreement, against payment in cash of the purchase price therefor; provided, however, that in the event that the Accepting Partners (or their nominees) shall be purchasing the Offered Interest at the price set forth in the Offer pertaining thereto, and the terms of such Offer shall state that the third-party offeror offered to acquire the Offered Interest for consideration consisting of cash and (subject to the proviso to Subsection 9.3(c) above) a promissory note, then the Accepting Partners (or their nominees) shall pay to the Offering Partner the purchase price for the Offered Interest in cash, in an amount equal to the sum of (i) the amount of the purchase price which would have been paid in cash by the third-party offeror as set forth in the Offer, plus (ii) the principal amount of the promissory note which would have been delivered by the third-party offeror as set forth in the Offer.

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(h) In the event that any proposed Sale of a Partnership Interest to a third party shall not have been consummated within the 90 days after the execution of the underlying definitive agreement referred to in Subsection 9.3(f) (which period shall, if all other conditions to closing have been satisfied except for required regulatory approvals (and those conditions that by their terms are to be satisfied at closing), automatically be extended for as long as reasonably necessary in order to obtain such regulatory approvals (until such time as it is determined that such approvals will not be obtained), any such proposed Sale, or any further proposed Sale, of such Partnership Interest shall again be subject to the provisions of this Section 9.3.

(i) Upon any Sale or exchange by PTLC and/or any of its Affiliates of one-hundred percent (100%) of the Partnership Interest then held by PTLC and its Affiliates, without taking into account any Partnership Interest held by LJ VP (whether to the GE Representative Partner or any of its Affiliates or to one or more third parties), GE Tennessee (or an assignee of Partnership Interests held at the Effective Time by members of the GECC Consolidated Group which assignee shall have assumed the obligations under this Subsection 9.3(i)) shall pay or cause to be paid to PTLC, in cash, an amount equal to the lesser of (i) $5,000,000 and (ii) the amount equal to the amount of federal income tax that would be due and payable by PTLC and/or its Affiliates, as the case may be, in respect of such Sale or exchange, determined as if the maximum marginal rate for corporations with respect to ordinary income or capital gains, as the case may be, as in effect in the year such Sale or exchange takes place, applied to such transaction, on the excess of (A) the gain recognized by PTLC and/or its Affiliates upon such Sale or exchange over (B) the excess of (1) the aggregate amount of the losses and deductions allocated to PTLC and/or any of its Affiliates from the inception of the Partnership through the date of such Sale or exchange pursuant to Section 5.2, 5.3, 5.4 and 5.6 of this Agreement or the Corresponding Provisions of any Prior Agreement over (2) the aggregate amount of the income and gains allocated to PTLC and/or any of its Affiliates from the date of inception of the Partnership through the date of such Sale or exchange pursuant to Sections 5.2, 5.3, 5.4 and 5.6 of this Agreement or the Corresponding Provisions of any Prior Agreement (the excess of such losses and deductions over such income and gains is sometimes hereinafter referred to as “Net Losses”). For purposes of computing the amount of such federal income tax that would be due and payable in respect of such Sale or exchange, (x) both the Net Losses and the gain recognized by PTLC and/or its Affiliates upon such Sale or exchange shall be deemed to have arisen in the same taxable year, and (y) all losses, deductions and credits allocated to PTLC and/or its Affiliate under Sections 5.2, 5.3, 5.4 and 5.6 of this Agreement shall be taken into account and no limitations shall apply or be deemed to apply to the use of such losses, deductions and credits. Such calculation shall initially be made by PTLC and shall be confirmed in writing to GE Tennessee (or the assuming assignee as aforesaid) by the Auditor before any payment shall be required to be made by or on behalf of GE Tennessee (or such assignee) under this Subsection 9.3(i).

(j) Notwithstanding anything to the contrary set forth in this Section 9.3, (i) the provisions of this Subsection 9.3 shall not restrict or otherwise apply to the Sale of Partnership Interests (x) effected pursuant to the IPO or (y) after the IPO that are effected pursuant to (I) a public offering under an effective registration statement or (II) Rule 144 under the Securities Act and (ii) no Transfer permitted under this Section 9.3 shall be offered or consummated in the absence of an effective registration statement covering the applicable Partnership Interest under the Securities Act, unless such Transfer is exempt from registration under the Securities Act.

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9.4 Certain Changes of Control.

(a) In the event that (i) Penske Corporation, at any time and for any reason, either (A) shall have ceased to own, directly or indirectly, at least fifty-one percent (51%) of the outstanding common stock or other voting securities of Penske Transportation Holdings Corp. and (1) in an election of directors for which proxies are not solicited under the Exchange Act, Penske Corporation and/or its Affiliates by vote of their own shares and shares for which they have obtained proxies from other shareholders, shall be unable to elect at least half of the directors of Penske Transportation Holdings Corp., or (2) in an election of directors for which proxies are solicited under the Exchange Act, proxies for management nominees and the vote of Penske Corporation and/or its Affiliates and other persons shall not have resulted in the election of management nominee directors who aggregate at least half of the directors elected, or (B) shall have ceased to own, directly or indirectly, at least twenty-five percent (25%) of the outstanding common stock or other voting securities of Penske Transportation Holdings Corp., or (ii) Penske Transportation Holdings Corp., at any time and for any reason, shall have ceased to own, directly or indirectly, and have voting control over at least eighty percent (80%) of the outstanding common stock or other voting securities of the PTLC Consolidated Group member or members then holding Partnership Interests (excluding LJ VP and Holdings from the PTLC Consolidated Group for this determination), then from and after the occurrence of any of the events specified in clauses (i)(A), (i)(B) and (ii) above, the GE Partners or any nominee(s) thereof shall have the right, but not the obligation (which right shall expire one hundred eighty (180) days from the date on which the GE Partners shall have received the notice referred to in the last sentence of this Subsection 9.4(a), to purchase from such holders and any of the members of the PAG Consolidated Group then holding Partnership Interests, one-hundred percent (100%) of their respective Partnership Interests and one-hundred percent (100%) of their respective Member Interests at a purchase price, payable in cash, to be determined as of the date the GE Partners shall advise PTLC and PAG of the GE Partners’ or its nominee(s)’s decision to acquire one-hundred percent (100%) of the Partnership Interests and one-hundred percent (100%) of the Member Interests held by the PTLC Consolidated Group and the PAG Consolidated Group pursuant to this Subsection 9.4(a) by means of the appraisal procedure set forth in Subsection 9.4(c) herein plus any additional amount payable pursuant to the provisions of Subsection 9.3(i). PTLC shall give prompt written notice to the GE Partners of the occurrence of any of the events specified in clauses (i)(A), (i)(B) or (ii) of this Subsection 9.4(a).

(b) In the event that GECC at any time and for any reason shall have ceased to own, directly or indirectly, and have voting control over eighty percent (80%) of the outstanding common stock or other voting securities of the GECC Consolidated Group member or members then holding Partnership Interests, then from and after the occurrence of such events, PTLC or any nominee(s) thereof shall have the right, but not the obligation (which right shall expire one hundred eighty (180) days from the date on which PTLC shall have received the notice referred to in the last sentence of this Subsection 9.4(b)), to purchase from such holders one-hundred percent (100%) of their respective Partnership Interests and one-hundred percent (100%) of their respective Member Interests at a purchase price, payable in cash, to be determined as of the date PTLC shall advise such holders of its or its nominee(s)’s decision to acquire one-hundred percent (100%) of their respective Partnership Interests and one-hundred percent (100%) of their respective Member Interests pursuant to this Subsection 9.4(b) by means of the appraisal procedure set forth in Subsection 9.4(c). The GE Partners shall give prompt written notice to PTLC of the occurrence of any of the events specified in this Subsection 9.4(b).

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(c) If the GE Partners or any nominee(s) thereof shall have elected in writing within the period specified in Subsection 9.4(a) to purchase one-hundred percent (100%) of the Partnership Interests and one-hundred percent (100%) of the Member Interests held by the PTLC Consolidated Group and the PAG Consolidated Group or if PTLC or any nominee(s) thereof shall have elected in writing within the period specified in Subsection 9.4(b) to purchase one-hundred percent (100%) of the Partnership Interests and one-hundred percent (100%) of the Member Interests held by the GECC Consolidated Group (the Partnership Interests and Member Interests to be purchased hereinafter referred to as the “Purchased Interest”), then each of the PTLC Consolidated Group and the GE Consolidated Group shall engage, at its own expense, an investment banking firm or valuation firm (which term includes accounting firms) of recognized national standing and experience in matters of this type, to appraise the Purchased Interest. Such firms shall determine the fair market value of the Purchased Interest as of the date of the GE Partners’ or PTLC’s, as applicable, notice referred to above. In reaching their determinations, such firms shall not take into account any “control premium” or “non-controlling discount” attributable to the Purchased Interest or the illiquid nature of an investment in the Purchased Interest. If the difference between the amount of the higher of such determinations and the amount of the lower of such determinations is not more than an amount equal to ten percent (10%) of the amount of the higher of such determinations, then the determinations of both such firms shall be averaged. If the difference between the respective amounts of such determinations is greater than an amount equal to ten percent (10%) of the amount of the higher of such determinations, then, in lieu of averaging such determinations, such firms shall jointly select an independent third investment banking or valuation firm (which term includes accounting firms) of recognized national standing and experience in matters of this type, in each case, to determine the fair market value of the Purchased Interest, which determination shall not take into account any “control premium”, “non-controlling discount” or the illiquid nature of an investment therein as aforesaid. The costs and expenses of any such independent third investment banking or valuation firm shall be borne equally by the GE Partners and PTLC. Each applicable Partner agrees to use its reasonable best efforts to cause the appraising firms to complete their appraisals pursuant to this Subsection 9.4(c) as promptly as practicable. Upon the determination of the fair market value of the Purchased Interest by such third firm, the two highest determinations of the fair market value of the Purchased Interest shall be averaged, which amount shall be the purchase price referred to in Subsection 9.4(a) or 9.4(b).

9.5 Certain General Provisions.

(a) Any amounts payable in cash by any party pursuant to this Subsection 9.3 or Subsection 9.4 shall be effected by means of wire transfer of immediately available funds to such account or accounts in the United States as the payee shall specify not less than one (1) Business Day prior to the date on which such payment is to occur.

(b) Notwithstanding anything to the contrary set forth in Subsection 9.2, 9.3 or 9.4, in the event that the acquisition by a Person of a Partnership Interest pursuant to any such provision would result in the Partnership ceasing to enjoy the status of a limited partnership under Delaware Law, then such Person shall not effect such acquisition, but such Person may effect the acquisition through an Affiliate of such Person or member of such Person’s consolidated group if such acquisition eliminates the cessation of the Partnership’s enjoying the status of a limited partnership under Delaware Law.

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(c) The Limited Partners agree, upon request of the General Partner, to execute such certificates or other documents and perform such acts as the General Partner reasonably deems appropriate to preserve the status of the Partnership as a limited partnership, upon or after the completion of any Transfer of any Partnership Interest, under Delaware Law.

(d) Notwithstanding anything to the contrary in this Agreement, (i) in the event of the consummation of any Sale by any GE Partner of all or any portion of its Partnership Interests in accordance with this Article 9, the transferring GE Partner may Sell (A) the rights of the GE Representative Partner under Subsections 6.4(a) and 6.4(e) to designate and replace members of the Advisory Committee that it is then entitled to so designate and replace or (B) the rights to designate and replace the GE Representative Partner under Section 2.48, provided that such Sale is accompanied by the Sale to the same third party of the right of the GE Representative Partner under Subsections 6.4(a) and 6.4(e) to designate and replace at least one member of the Advisory Committee; or (ii) in the event of any Sale of a Partnership Interest permitted by this Agreement, the transferring GE Partner or PTLC may Sell its purchase rights under Subsection 9.4(a) or (b), respectively. For the avoidance of doubt, the GE Representative Partner may Sell its right to designate and replace one or both of the members of the Advisory Committee to another member of the GECC Consolidated Group, subject to Subsection 9.2(d).

(e) Any transferee of a Partnership Interest that (i) acquires a Percentage Interest of at least ten percent (10%), (ii) has the right to designate and replace a member of the Advisory Committee pursuant to this Agreement or (iii) has the right to direct the vote of a member of the Advisory Committee shall be required to enter into a noncompetition covenant on substantially the same terms as the restrictions on GECC and its Subsidiaries set forth in Subsection 6.6(c).

(f) Notwithstanding anything to the contrary set forth in this Agreement, in the event of any Sale of a Partnership Interest permitted by this Agreement, the transferor Partner shall not cease to be a Partner or be deemed to have withdrawn as a Partner, until the transferee of such Partnership Interest shall have been admitted as a Partner pursuant to Section 9.10 below.

9.6 Allocation of Profits, Losses and Distributions Subsequent to Sale. All Profits, Losses, or any other items of income, gain, loss, deduction, or credit of the Partnership attributable to any Partnership Interest acquired by reason of any Sale of such Partnership Interest (i) that are allocable, in accordance with Subsection 5.5(c) to the portion of the Partnership Year ending on the effective date of the Sale shall be allocated, and any distributions made with respect thereto shall be distributed, to the transferor, and (ii) that are allocable, in accordance with Subsection 5.5(c), to subsequent periods shall be allocated, and any distributions made with respect thereto shall be distributed, to the transferee; provided, however, that with respect to the Preliminary Distribution to be made with respect to the second fiscal quarter of 2012, each Partner will receive a pro rata distribution in proportion to its respective Percentage Interest held during such quarter (which will be calculated based on the Percentage Interest held by such Partner and the corresponding number of days in the quarter such Percentage Interest was held by such Partner) with income being allocated proportionately on a daily basis over the quarter. With respect to the foregoing proviso, by way of example, if a quarter is 90 days long and a Partner held a 20% Percentage Interest for the first 45 days and a 15% Percentage Interest for the last 45 days, the distribution for such quarter would be calculated based on a 20% Percentage Interest for half of the quarter and a 15% Percentage Interest for half of the quarter. The effective date of any Transfer permitted under this Agreement, subject to the provisions of Section 9.9 below, shall be the close of business on the day the Partnership is notified of the Sale.

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9.7 Death, Incompetence, Bankruptcy, Liquidation or Withdrawal of a Limited Partner. The death, incompetence, Bankruptcy, liquidation or withdrawal of a Limited Partner shall not cause (in and of itself) a dissolution of the Partnership, but the rights of such a Limited Partner to share in the Profits and Losses of the Partnership, to receive distributions and to assign its Partnership Interest pursuant to this Article 9, on the happening of such an event, shall devolve on its beneficiary or other successor, executor, administrator, guardian or other legal representative for the purpose of settling its estate or administering its property, and the Partnership shall continue as a limited partnership. Such successor or personal representative, however, shall become a substituted limited partner only upon compliance with the requirements of Section 9.10 with respect to a transferee of a Partnership Interest. The estate of a Bankrupt Limited Partner shall be liable for all the obligations of the Limited Partner.

9.8 Satisfactory Written Assignment Required. Anything herein to the contrary notwithstanding, both the Partnership and the General Partner shall be entitled to treat the transferor of a Partnership Interest as the absolute owner thereof in all respects, and shall incur no liability for distributions of cash or other property made in good faith to it, until such time as a written assignment or other evidence of the consummation of a Sale that conforms to the requirements of this Article 9 and is reasonably satisfactory to the General Partner has been received by and recorded on the books of the Partnership, at which time the Sale shall become effective for purposes of this Agreement.

9.9 Transferee’s Rights. Any purported Transfer of a Partnership Interest which is not in compliance with this Agreement shall be null and void and of no force or effect whatsoever. A permitted transferee of any Partnership Interest pursuant to Section 9.1, 9.2, 9.3, 9.4 or 9.7 hereof shall be entitled to receive, in accordance with Section 9.6, allocations of Profits, Losses, or other items of income, gain, loss, deduction, or credit of the Partnership attributable to such Partnership Interest and allocable to periods after the effective date of the Sale, and distributions of cash or other property from the Partnership made with respect to periods after the effective date of the Sale, but shall not become a Partner unless and until admitted pursuant to Section 9.10 hereof.

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9.10 Transferees Admitted as Partners. The assignee or transferee of any Partnership Interest shall be admitted as a Partner only upon the satisfaction of the following conditions:

(a) A duly executed and acknowledged written instrument of Sale, in a form reasonably acceptable to the General Partner, and either a copy of this Agreement duly executed by the transferee or an instrument of assumption in form and substance reasonably satisfactory to the General Partner setting forth the transferee’s agreement to be bound by the provisions of this Agreement have been delivered to the Partnership.

(b) The transferee has paid any fees and reimbursed the Partnership for any expenses paid by the Partnership in connection with the Sale and admission.

The effective date of an admission of an assignee of a Partner and the withdrawal of the transferring Partner, if any, shall be the first day which is the last Business Day of a calendar month to occur following the satisfaction of the foregoing conditions, except as otherwise may be agreed by all the Partners in writing.

9.11 Change of Control Rights. In addition to any other approval required under the Act, any Change of Control of the Partnership (excluding, for the avoidance of doubt, the changes contemplated by Subsection 1.1(c)) shall be subject to approval by the GE Representative Partner.

ARTICLE 10

EXIT/ IPO RIGHT

10.1 IPO Notice.

(a) On or after December 31, 2017, any Exercising Partner will have the right to deliver a written demand to the General Partner and the other Partners that an IPO (the “IPO Notice”) be effected in accordance with the provisions of this Article 10 and, if applicable, to effect the registration of all or any portion of the Exercising Partner’s Securities (which may include any of such Partner’s Affiliates identified in such IPO Notice) in such IPO. Except as expressly provided below, each of the other Partners agrees to use all reasonable best efforts to effect such IPO. Upon receipt of such IPO Notice, promptly and in any event within the sixty (60) day period thereafter, the Exercising Partner and the Non-Exercising Partner (and their respective advisors) will meet from time to time at mutually agreeable times and locations to attempt to decide jointly in good faith on an appropriate transaction structure for such IPO. In such meetings, the Exercising Partner and the Non-Exercising Partner (and their respective advisors) will review, analyze and discuss the economic and tax impacts of potential transaction structures and will, without limitation, consider a transaction structure similar to the Barnes & Noble transaction (commonly referred to as an “UPREIT structure”) and appropriate opinion(s) (if any) of a nationally recognized law firm or accounting firm with respect to potential transaction structures.

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(b) If the Exercising Partner and the Non-Exercising Partner are unable to agree on a transaction structure for such IPO within such sixty (60) day period (or such longer period as they may mutually agree), the Exercising Partner will have the right, within the thirty (30) day period following such sixty (60) day period, to deliver a written demand to the General Partner and the other Partners that such IPO shall utilize the transaction structure set forth in such notice (the “IPO Demand Notice”). Within sixty (60) days thereafter, the Non-Exercising Partner will have the right to object to such IPO Demand Notice by delivering a written notice to such effect to the Exercising Partner and the other Partners based solely on the Non-Exercising Partner’s conclusion that the consummation of such IPO (utilizing the transaction structure set forth in the IPO Demand Notice) could be reasonably expected to result in material adverse tax impacts on the Non-Exercising Partner or its Parent Company as well as the basis for such objection (with such basis set forth in reasonable detail in writing if practicable) (the “IPO Rebuttal”). If an IPO Rebuttal is received, for the thirty (30) day period following receipt thereof, the Exercising Partner will have the opportunity to (i) object to such IPO Rebuttal on the basis that the proposed transaction structure set forth therein would not constitute such a material adverse tax impact and/or (ii) propose an alternate transaction structure(s) for the IPO that would not result in material adverse tax impacts on the Non-Exercising Partner or its Parent Company (the “Alternative Structure” or “Alternative Structures”). If a valid Alternative Structure is proposed within such thirty (30) day period (or such longer period as the Exercising Partner and the Non-Exercising Partner may mutually agree), then the IPO Consummation Obligation will continue by utilizing such Alternative Structure, provided that the Alternative Structure would not have material adverse tax impacts on the Non-Exercising Partner or its Parent Company. The Partners hereby agree that in no event will indemnification be required for any potential adverse tax impacts arising in connection with the consummation of an IPO or the utilization of any transaction structure.

(c) Subject to Subsections 10.1(a) and 10.1(b), commencing one year from the date of the initial IPO Notice, the General Partner and the Partnership shall take all reasonable best efforts to pursue an IPO to be consummated as soon as practicable thereafter (the “IPO Consummation Obligation”). The time period for commencement or consummation of the IPO pursuant to the IPO Consummation Obligation may be delayed upon receipt of a manually signed approval of a duly authorized officer of the Exercising Partner to such effect.

(d) If the Company Bonds (as defined in the Holdings LLC Agreement) are outstanding at the time of consummation of the IPO, and the GE Partners and the Penske Partners desire to participate as selling equityholders in the IPO (the “Selling Interests”), then, with respect to the Selling Interests, the GE Partners or the Penske Partners will have the right to demand that the Partnership give first priority to the Partnership Interests held by LJ VP Sub, with all net proceeds resulting from the sale thereof to be used to repay indebtedness outstanding under the Company Bonds.

(e) For the avoidance of doubt, the transactions contemplated by this Section 10.1 shall not be subject to Sections 9.2 and 9.3.

(f) In the event that an IPO is abandoned or otherwise not consummated pursuant to this Section 10.1, and a transaction structure proposed for such IPO had been subject to the review and discussion process in Subsections 10.1(a) and 10.1(b), during which it was agreed or determined that such transaction structure would not have material adverse tax impacts on the Non-Exercising Partner or its Parent Company (an “Approved IPO Structure”), either Exercising Partner will have the right to deliver an IPO Notice with respect to such Approved IPO Structure and the Non-Exercising Partner will have the right, within the sixty (60) day period following the delivery of such IPO Notice, to deliver an IPO Rebuttal based solely on its conclusion that such Approved IPO Structure could reasonably be expected to result in material adverse tax impacts on the Non-Exercising Partner or its Parent Company when compared to the tax impacts existing at the time such transaction structure was previously determined not to have material adverse tax impacts on the Non-Exercising Partner or its Parent Company. If such IPO Rebuttal is delivered, then the Exercising Partner and the Non-Exercising Partner shall then follow the procedures set forth in Subsection 10.1(b) with respect to such IPO Notice. If no such IPO Rebuttal is timely delivered to the Exercising Partner, then the IPO Consummation Obligation will continue by utilizing such Approved IPO Structure.

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(g) In the event that an IPO is abandoned or otherwise not consummated pursuant to this Section 10.1, and (i) the last transaction structure proposed by the Exercising Partner and discussed under Subsections 10.1(a) and (b) would have had material adverse tax impacts on the Non-Exercising Partner or its Parent Company, (ii) an Approved IPO Structure did not exist, or (iii) the Exercising Partner desires to pursue a transaction other than an Approved IPO Structure, then, notwithstanding the first sentence of Subsection 10.1(a), neither the Exercising Partner nor the non-Exercising Partner will have the right to deliver a new IPO Notice until on or after the first anniversary of the date of the most recent IPO Notice. Such IPO Notice will be subject to the process set forth in Subsections 10.1(a) and 10.1(b), except that the sixty (60) day periods therein shall be thirty (30) day periods for any such subsequent IPO Notice.

(h) No Exercising Partner shall have the right to deliver an IPO Notice during the pendency of discussions pursuant to this Section 10.1 concerning a previously delivered IPO Notice.

10.2 Partnership Restructuring in connection with IPO. Subject to Subsection 10.1(a), commencing one year from the date of receipt of the IPO Notice by the General Partner, the GE Partners and PTLC shall meet to discuss restructuring the Partnership in order to effect an IPO with the most favorable tax treatment possible and each of the General Partner, the GE Partners and PTLC shall use reasonable best efforts to devise and effect such restructuring.

10.3 IPO Alternative. Upon receipt of the IPO Notice, the GE Partners or Penske Partners, as applicable, will have the option to simultaneously seek a purchaser of the Partnership Interests and Member Interests held by the Exercising Partner. If such interests are not purchased pursuant to a purchase agreement executed and delivered to the Partnership by another Person at a price acceptable to the Exercising Partner(s) in its sole discretion by the first anniversary of the date of the IPO Notice, then the Exercising Partner or other Partners will have the right to participate in the IPO in accordance with the Registration Rights Agreement. Any Sale of Partnership Interests pursuant to this Section 10.3 shall not be subject to the provisions of Article 9.

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ARTICLE 11

DISSOLUTION

11.1 Events of Dissolution. The Partnership shall continue until December 31, 2023, or such later date as PTLC and the GE Representative Partner may agree, unless sooner dissolved upon the earliest to occur of the following events, which shall cause an immediate dissolution of the Partnership:

(a) the sale, exchange or other disposition of all or substantially all of the Partnership’s assets;

(b) the withdrawal, resignation, filing of a certificate of dissolution or revocation of the charter or Bankruptcy of the General Partner or the occurrence of any other event which causes the General Partner to cease to be a general partner of the Partnership under the Act, except as contemplated by Section 1.1 (each an “Event of Withdrawal”); provided, however, that upon the occurrence of an Event of Withdrawal of the General Partner, the Partnership shall not be dissolved and its business shall not be required to be wound up if within 90 days after such Event of Withdrawal all the Limited Partners then holding a majority of the Partnership Interests (exclusive of any Partnership Interest then held by members of the PTLC Consolidated Group) agree in writing to continue the business of the Partnership and to the appointment, effective as of the occurrence of such Event of Withdrawal, of one or more successor general partners of the Partnership, each of whom is hereby authorized to continue the business of the Partnership; or

(c) such earlier date as the Partners shall unanimously elect.

11.2 Final Accounting. Upon the dissolution of the Partnership and the failure to continue the Partnership as provided in Section 11.1 hereof, a proper accounting shall be made by the Partnership’s Auditor from the date of the last previous accounting to the date of dissolution.

11.3 Liquidation. Upon the dissolution of the Partnership and the failure to continue the Partnership as provided in Section 11.1 hereof, the General Partner or, if there is no General Partner, a person approved by the Majority Limited Partners and the GE Representative Partner, shall act as liquidator to wind up the Partnership. The liquidator shall have full power and authority to sell, assign and encumber any or all of the Partnership’s assets and to wind up and liquidate the affairs of the Partnership in an orderly and business-like manner. All proceeds from liquidation shall be distributed in the following orders of priority: (a) to the payment and discharge of the debts and liabilities of the Partnership (other than liabilities for distributions to Partners) and expenses of liquidation, (b) to the setting up of such reserves as the liquidator may reasonably deem necessary for any contingent liability of the Partnership (other than liabilities for distributions to Partners), and (c) the balance to the Partners in accordance with their Capital Accounts after adjustment to reflect all Profit and Loss for the Partnership Year in which such liquidation occurs.

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11.4 Cancellation of Certificate. Upon the completion of the distribution of Partnership assets as provided in Section 11.3 hereof, the Partnership shall be terminated and the person acting as liquidator shall cause the cancellation of the Certificate and shall take such other actions as may be necessary or appropriate to terminate the Partnership.

ARTICLE 12

INVESTMENT REPRESENTATIONS

12.1 Investment Purpose. Each Limited Partner represents and warrants to the Partnership and to each other Partner that it has acquired its limited partner interest in the Partnership for its own account, for investment only and not with a view to the distribution thereof, except to the extent provided in or contemplated by this Agreement.

12.2 Investment Restriction. Each Partner recognizes that (a) the limited partner interests in the Partnership have not been registered under the Securities Act in reliance upon an exemption from such registration, and agrees that it will not Transfer its limited partner interest in the Partnership (i) in the absence of an effective registration statement covering such limited partner interest under the Securities Act, unless such offer or Transfer is exempt from registration for any proposed sale, and (ii) except in compliance with all applicable provisions of this Agreement, and (b) the restrictions on transfer imposed by this Agreement may severely affect the liquidity of an investment in limited partner interests in the Partnership.

ARTICLE 13

NOTICES

13.1 Method of Notice. Any notice or request hereunder may be given to any Partner at their respective addresses/ numbers set forth below or at such other address/ number as may hereafter be specified in a notice designated as a notice of change of address under this Section. Any notice or request hereunder may be given by (a) hand delivery, (b) overnight courier, (c) registered or certified mail, return receipt requested, or (d) electronic transmission or facsimile (or such other e-mail address or number as may hereafter be specified in a notice designated as a notice of change of address), with electronic confirmation of its receipt and subsequently confirmed by registered or certified mail or overnight courrier. Any notice or other communication required or permitted pursuant to this Agreement shall be deemed given (i) when personally delivered to any officer of the party to whom it is addressed, (ii) on the earlier of actual receipt thereof or five (5) Business Days following posting thereof by certified or registered mail, postage prepaid, (iii) upon actual receipt thereof when sent by a recognized overnight delivery service or (iv) upon actual receipt thereof when sent by electronic transmission or by facsimile to the address or number set forth below with electronic confirmation of its receipt, in each case, addressed to each party at its address set forth below or at such other address as has been furnished in writing by a party to the other by like notice, provided, that in order for an electronic transmission to constitute proper notice hereunder, such electronic transmission must specifically reference this Section 13.1 and state that it is intended to constitute notice hereunder:

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(1)    If to PTLC at:	Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607 Attention: Senior Vice President — General Counsel Facsimile:                 610-775-6330 E-mail Address:       mike.duff@penske.com
with a copy to:	Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607 Attention: Senior Vice President — Finance Facsimile:                 610-775-5064 E-mail Address:       frank.cocuzza@penske.com
and a copy to:	Penske Corporation 2555 Telegraph Road, Bloomfield Hills, MI 48302 Attention: Executive Vice President and General Counsel Facsimile:                 248-648-2135 E-mail Address:       larry.bluth@penskecorp.com
(2)    If to LJ VP at:	c/o Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607 Attention: Senior Vice President — General Counsel Facsimile:                 610-775-6330 E-mail Address:     mike.duff@penske.com
with a copy to:	c/o Penske Truck Leasing Corporation 2675 Morgantown Road, Reading, Pennsylvania 19607 Attention: Senior Vice President — Finance Facsimile:                 610-775-5064 E-mail Address:     frank.cocuzza@penske.com
and a copy to:	Penske Corporation 2555 Telegraph Road, Bloomfield Hills, MI 48302 Attention: Executive Vice President and General Counsel Facsimile:                 248-648-2135 E-mail Address:       larry.bluth@penskecorp.com

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(3)    If to PAG at:	Penske Automotive Group, Inc. 2555 Telegraph Road Bloomfield Hills, Michigan 48302 Attention: Senior Vice President — General Counsel Facsimile:                                                   E-mail Address: sspradlin@penskeautomotive.com
with a copy to:	Penske Automotive Group, Inc. 2555 Telegraph Road Bloomfield Hills, Michigan 48302 Attention: Chief Financial Officer Facsimile:                 248-648-2515 E-mail Address: dave.jones@penskeautomotive.com
and a copy to:	Penske Corporation 2555 Telegraph Road, Bloomfield Hills, MI 48302 Attention: Executive Vice President and General Counsel Facsimile:                 248-648-2135 E-mail Address:       larry.bluth@penskecorp.com
(4)    If to GE Truck Leasing Holdco at:	GE Capital Truck Leasing Holding Corp. 901 Main Avenue, 3rd Floor Norwalk, Connecticut 06851 Attention:                 Dennis Murray, President Facsimile:                 203-823-4502 E-mail Address:       Dennis.Murray@ge.com
with a copy to:	GE Capital Finance 901 Main Avenue, 6th Floor Norwalk, Connecticut 06851 Attention: Strategic Transactions Counsel Facsimile: (203) 750-7098 Email: mark.landis@ge.com
(5)    If to GE Logistics Holdco at:	Logistics Holding Corp. 1209 Orange Street Wilmington, Delaware 19808

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with a copy to:	GE Equipment Services Division 901 Main Avenue, 3rd Floor Norwalk, CT 06851 Attention: Senior Counsel—Strategic Transactions and Relations, Equipment Services Facsimile:(203) 663-8207 E-mail Address: joseph.lincoln@ge.com
(6)    If to GE Tennessee at:	General Electric Credit Corporation of Tennessee 2 Bethesda Metro Center, Suite 600 Bethesda, Maryland 20814 Attention:             Deneen Sanders Facsimile:             (312) 602-3937 E-mail Address:   Deneen.sanders@ge.com
with a copy to:	GE Capital Finance 901 Main Avenue, 6th Floor Norwalk, Connecticut 06851 Attention: Strategic Transactions Counsel Facsimile: (203) 750-7098 Email: mark.landis@ge.com

13.2 Computation of Time. In computing any period of time under this Agreement, the day of the act, event or default from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, Sunday or legal holiday, in which event the period shall run until the end of the next day which is not a Saturday, Sunday or non-Business Day.

ARTICLE 14

GENERAL PROVISIONS

14.1 Entire Agreement. This Agreement constitutes the entire agreement with respect to the subject matter hereof prospectively from the Effective Time, provided that the resolutions of the Advisory Committee dated April 25, 2012 as acknowledged by the General Partner are not superseded by this Agreement. For preclusion of doubt, this Agreement does not modify or amend any rights or obligations of the Partnership or any Partners with respect to events or circumstances arising or existing prior to the Effective Time, which matters will continue to be governed by the agreement of limited partnership of the Partnership in effect at the applicable time, and does not waive or release any claim of a Partner or the Partnership with respect to any event or circumstance arising or existing prior to the Effective Time. The Partners hereby acknowledge that, with respect to the Venture Agreement, dated as of August 1, 1988, by and among PTLC, GE Tennessee, Gelco Corporation and the Partnership, as amended as of July 1, 1993, as further amended, restated, supplemented or otherwise modified, all rights and obligations of the parties thereunder have been satisfied or terminated in accordance with the terms of such Agreement.

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14.2 Amendment; Waiver. The written approval of all of the Partners shall be required with respect to any amendment of this Agreement that would have either a disproportionate or a material adverse effect on the rights or obligations of any Partner; all other amendments shall require the approval of the General Partner and Majority Limited Partners. For the avoidance of doubt, distributions and allocations to the Partners are deemed material for the purposes of the preceding sentence. No rights under this Agreement shall be waived except by an instrument in writing signed by the party sought to be charged with such waiver. The General Partner shall give written notice to all Partners promptly after any amendment has become effective.

14.3 Governing Law. This Agreement shall be construed and enforced in accordance with and governed by the Laws of the State of Delaware, without giving effect to the provisions, policies or principles thereof relating to choice or conflict of Laws.

14.4 Binding Effect. Except as provided otherwise herein, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective permitted successors and permitted assigns.

14.5 Separability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

14.6 Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement.

14.7 No Third-Party Rights. Nothing in this Agreement shall be deemed to create any right in any person not a party hereto (other than the permitted successors and permitted assigns of a party hereto) and this Agreement shall not be construed in any respect to be a contract in whole or in part for the benefit of any third party (except as aforesaid).

14.8 Waiver of Partition. Each Partner, by requesting and being granted admission to the Partnership, is deemed to waive until termination of the Partnership any and all rights that it may have to commence or maintain any action for partition of the Partnership’s assets.

14.9 Nature of Interests. All Partnership property, whether real or personal, tangible or intangible, shall be deemed to be owned by the Partnership as an entity, and none of the Partners shall have any direct ownership of such property.

14.10 Counterpart Execution. This Agreement may be executed in any number of counterparts, each of which shall be an original instrument and all of which, when taken together, shall constitute one and the same Agreement. Delivery of an executed signature page of this Agreement by email, PDF or facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.

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[Signature Page Follows]

- 66 -

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written, effective as of the close of the Partnership’s business on April 30, 2012.

GENERAL PARTNER: PENSKE TRUCK LEASING CORPORATION
By:	/s/ Frank Cocuzza
Name:	Frank Cocuzza
Title:	Senior Vice President-Finance

LIMITED PARTNERS: PENSKE TRUCK LEASING CORPORATION
By:	/s/ Frank Cocuzza
Name:	Frank Cocuzza
Title:	Senior Vice President-Finance
PENSKE AUTOMOTIVE GROUP, INC.
By:	/s/ David Jones
Name:	David Jones
Title:	Executive Vice President and Chief Financial Officer
LJ VP, LLC
By LJ VP Holdings LLC, its sole member
	By Penske Truck Leasing Corporation, its sole managing member

By:	/s/ Frank Cocuzza
Name:	Frank Cocuzza
Title:	Senior Vice President — Finance

GE CAPITAL TRUCK LEASING HOLDING CORP.
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	President
LOGISTICS HOLDING CORP.
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	President
GENERAL ELECTRIC CREDIT CORPORATION OF TENNESSEE
By:	/s/ Dennis M. Murray
Name:	Dennis M. Murray
Title:	Vice President

Schedule A

Effective at the Close of Business of the Partnership on April 30, 2012

Name	Percentage Interest
General Partner
Penske Truck Leasing Corporation		9.18	%
Limited Partners
Penske Truck Leasing Corporation		23.05	%
Penske Automotive Group, Inc.		7.08	%
LJ VP, LLC		21.54	%
GE Capital Truck Leasing Holding Corp.		29.27	%
Logistics Holding Corp.		9.49	%
General Electric Credit Corporation of Tennessee		.39	%

Schedule B

Current Members of Advisory Committee

Penske Committee Members:	Roger S. Penske Brian Hard Frank Cocuzza
GE Committee Members:	Mark W. Begor Dennis Murray

Schedule C

Capital Accounts

As of the Effective Time, the Capital Account of LJ VP, LLC shall equal the amount of cash contributed to the Partnership on the date of this Agreement, and the Capital Accounts of each of the other Partners shall equal the following percentages of the fair market value of the assets of the Partnership, net of all liabilities, immediately prior to the contribution by LJ VP, LLC:

Penske Truck Leasing Corporation (both as a general partner and as a limited partner)	41.08	%
Penske Automotive Group, Inc.	9.02	%
GE Capital Truck Leasing Holding Corp.	37.31	%
Logistics Holding Corp.	12.09	%
General Electric Credit Corporation of Tennessee	0.50	%

The Partners agree that the fair market value of the assets of the Partnership, net of all liabilities, immediately prior to the contribution by LJ VP, LLC is the amount that, in the absence of any transfers of interests by any Partner after the Effective Time, would result in the Capital Accounts of the Partners as of December 31, 2012, determined after taking into account all allocations under Section 5.2, 5.3, and 5.4 hereof with respect to the taxable year ending on December 31, 2012 and as if the Annual Distribution under Section 5.1(b) hereof with respect to the Subject Year ending on December 31, 2012 had been distributed on December 31, 2012, being in proportion to their Percentage Interests, as set forth in Schedule A hereof.

EX-10.4

Exhibit 10.4

RESTRICTED STOCK AGREEMENT

This Restricted Stock Agreement (the “Agreement”) is dated as of             and is entered into between Penske Automotive Group, Inc., a Delaware corporation (the “Company”), and             (the “Grantee”).

WHEREAS, the Company is granting the Grantee restricted shares of voting common stock, par value $0.0001 per share (the “Common Stock”), of the Company, on the terms and conditions set forth herein and in the Amended and Restated 2002 Penske Automotive Group, Inc. Equity Compensation Plan (the “Plan”).

NOW, THEREFORE, the parties hereby agree:

1. Defined Terms. Capitalized terms used in this Agreement and not specifically defined herein shall have the respective meanings ascribed thereto in the Plan. In the event of any inconsistency between the Agreement and the Plan, the terms of the Plan shall govern.

2. Authority. The shares of Common Stock issuable to the Participant pursuant to this Agreement will be issued pursuant to the authority granted under the Plan (which has been provided to Grantee), and are subject to the terms and conditions of the Plan, as the same may be amended from time to time. The interpretation and construction by the Committee of the Plan, this Agreement and such rules and interpretations as may be adopted by the Committee for the purpose of administering the Plan shall be final and binding upon the Participant.

3. Grant of Restricted Stock. The Company hereby grants to Grantee             restricted shares of Common Stock (the “Shares”). The Shares will be restricted by being subject to vesting and non-transferability as hereafter provided in this Agreement and shall be subject to such limitations on transfer as are contained in the Plan, the federal and state securities laws applicable to the Shares or any other limitations on transferability as may be imposed by the Company.

4. Risk of Forfeiture. The Shares will be subject to a substantial risk of forfeiture. The Participant must continue in his or her employment as set forth in the Plan on the vesting dates set forth below in order to vest in the ownership of the Shares. If the Participant’s employment with the Company is terminated for any reason prior to the vesting dates as to any Shares, those Shares shall revert to the Company, except as set forth in the Plan. This Agreement is not an employment agreement and shall not confer on the Participant any right to be retained in the employment of Company.

5. Restriction on Transfer. Until the Participant vests in the Shares, the Shares may not be sold, assigned, transferred, pledged, hypothecated or otherwise encumbered in any manner.

6. Vesting of Shares. Subject to the restrictions set forth herein and in the Plan, the Shares shall vest:

                        15% on June 1, 201                 20% on June 1, 201    

                        15% on June 1, 201                 50% on June 1, 201    

7. Voting. Unless the Committee shall determine otherwise, the Participant shall be entitled to exercise any voting rights with respect to the Shares and receive any dividends paid with respect thereto. In the event that the outstanding securities of any class then comprising the Shares are increased, decreased or exchanged for or converted into cash, property and/or a different number or kind of securities, or cash, property and/or securities are distributed in respect of such outstanding securities, in either case as a result of a reorganization, merger, consolidation, recapitalization, reclassification, dividend (other than a regular cash dividend) or other distribution, stock split, reverse stock split or the like, then, unless the Committee shall determine otherwise, the terms “Common Stock” or “Shares” shall, from and after the date of such event, include such cash, property and/or securities so distributed in respect of the Shares, or into or for which the Shares are so increased, decreased, exchanged or converted.

Whenever the word “Grantee” is used in any provision of this Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators or personal representatives, the world “Grantee” shall be deemed to include such person or persons.

8. Taxes. (i) Section 83(b) Election. The Participant understands that the taxable income recognized by the Participant as a result of the award of Shares hereunder, and the withholding liability and required date of withholding with respect thereto, if any, will be affected by a decision by the Participant to make an election pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended (an “83(b) Election”). The Participant understands and agrees that the Participant will have the sole responsibility for determining whether to make an 83(b) Election with respect to the Shares, and for properly making such election and filing the election with the relevant taxing authorities on a timely basis. The Participant acknowledges that the Company has urged the Participant to consult with the Participant’s own tax advisor with respect to the desirability of and procedures for making an 83(b) Election with respect to the Shares, including when the election should be made. The Participant agrees to submit to the Company a copy of any 83(b) Election with respect to the Shares immediately upon filing such election with the relevant taxing authority.

(ii) Withholding. By the execution of this Agreement, the Participant agrees to pay to the Company the amount of federal, state and local taxes that the Company is required to withhold and remit to the taxing authorities applicable to the Participant as a result of the transactions contemplated by this Agreement (collectively, “Taxes”). The Participant shall pay to the Company an amount equal to the Taxes the Company is required to withhold and remit as calculated by the Company in accordance with the rules and regulations of applicable taxing authorities governing the calculation of such withholding. The Participant shall make such withholding payment to the Company on the vesting date(s) or upon the Participant making an 83(b) Election. If the Participant does not make a Section 83(b) Election, the withholding can be satisfied by having the Company retain from the Shares Common Stock having a fair market value equal to the amount of the withholding obligation.

If the Participant fails or refuses to make such payment to the Company on its due date, the Participant hereby authorizes the Company, in addition to any of its other remedies, to withhold from any other compensation or payments due by the Company to the Participant an amount sufficient to pay such withholding plus interest as hereafter provided until such withholding and interest is paid in full.

9. Notice. Any notice required or permitted hereunder shall be in writing and shall be sufficiently given if personally delivered or if sent by telegram, telex, facsimile transmission or by registered or certified mail, postage prepaid, with return receipt requested, as follows: If to the Company: Penske Automotive Group, Inc., 2555 Telegraph Road, Bloomfield Hills, Michigan 48302, Facsimile: (248) 648-2515, Attn: Shane M. Spradlin; or to such other address or to the attention of such other person as the Company shall designate by written notice to the Grantee; and if to the Grantee at the address set forth below or to such other address as the Grantee shall designate by written notice to the company. Any notice given hereunder shall be deemed to have been given at the time of receipt thereof by the party to whom such notice is given.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

PENSKE AUTOMOTIVE GROUP, INC.

By:

EX-12

Exhibit 12

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

	Three Months Ended
	March 31,					Year Ended December 31,
	2012			2011		2011			2010			2009			2008			2007
Income from continuing operations before undistributed earnings of equity method investments, amortization of capitalized interest, and taxes	$	77.1			52.2		248.6			188.8			123.2			(555.3	)		177.8
Less undistributed earnings of equity method investments	$	(4.4	)		—		(25.5	)		(20.6	)		(13.8	)		(16.5	)		(4.1	)
Plus distributed earnings of equity method investments	$	10.9			8.1		9.2			9.9			21.3			3.5			6.2
Plus amortization of capitalized interest	$	0.2			0.2		0.8			0.8			0.8			0.8			0.6
	$	83.8			60.5		233.1			178.9			131.5			(567.5	)		180.5
Plus:
Fixed charges:
Other interest expense (includes amortization of deferred financing costs)	$	12.2			11.3		44.6			48.9			55.1			54.3			55.2
Debt discount amortization	$	—			1.7		1.7			8.6			13.0			14.0			13.0
Floor plan interest expense	$	9.7			6.9		28.1			33.6			34.1			61.7			70.5
Capitalized interest	$	0.2			—		0.7			0.5			0.9			4.8			5.5
Interest factor in rental expense	$	14.6			13.9		56.1			53.6			51.9			50.8			48.0
Total fixed charges	$	36.7			33.8		131.2			145.2			155.0			185.6			192.2
Less:
Capitalized interest	$	0.2			—		0.7			0.5			0.9			4.8			5.5
Earnings	$	120.3			94.3		363.6			323.6			285.6			(386.7	)		367.2
Ratio of earnings to fixed charges (a)		3.3			2.8		2.8			2.2			1.8			—			1.9

(a) In the year ended December 31, 2008, earnings were insufficient to cover fixed charges by $534.2 million due to a non-cash impairment charge of $643.5 million.

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Roger S. Penske, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Penske Automotive Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Roger S. Penske

Roger S. Penske

Chief Executive Officer

May 4, 2012

EX-31.2

Exhibit 31.2

CERTIFICATION

I, David K. Jones, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Penske Automotive Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ David K. Jones

David K. Jones

Chief Financial Officer

May 4, 2012

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Penske Automotive Group, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2012, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Roger S. Penske and David K. Jones, Principal Executive Officer and Principal Financial Officer, respectively, of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Roger S. Penske

Roger S. Penske

Chief Executive Officer

May 4, 2012

/s/ David K. Jones

David K. Jones

Chief Financial Officer

May 4, 2012

A signed original of this written statement required by Section 906 has been provided to Penske Automotive Group, Inc. and will be retained by Penske Automotive Group, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Business Combinations (Details Textual)	3 Months Ended
	Mar. 31, 2012 Franchise	Mar. 31, 2011 Franchise
Business Combinations (Textual) [Abstract]
Number of franchises acquired	13	3

XML

Segment Information (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Revenues and adjusted segment income by reportable segment
Total revenues	$ 3,242,288	$ 2,751,036
Segment Income	77,082	52,150
Retail [Member]
Revenues and adjusted segment income by reportable segment
Total revenues	3,242,288	2,751,036
Segment Income	73,248	51,026
PAG Investments [Member]
Revenues and adjusted segment income by reportable segment
Segment Income	$ 3,834	$ 1,124

XML

Commitments and Contingent Liabilities (Detail Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012
Commitments and Contingent Liabilities (Textual) [Abstract]
Lease period, minimum	5 years
Lease period, maximum	20 years
Letters of credit outstanding	$ 19,072
Surety bonds posted	13,718
Limited partnership interest in Penske Truck Leasing Co.	9.00%
Gecc [Member]
Loss Contingencies [Line Items]
Annual fee pay for acting as co-obligor	950
Percentage of interest agreed to indemnify if GECC required to make any payments of principal or interest	9.00%
Holdings [Member]
Loss Contingencies [Line Items]
Senior unsecured notes issued	700,000
Senior subordinated convertible notes, interest rate	3.80%
Subsidiary Contributed Capital	700,000
Subsidiary of limited liability company or limited partnership ownership interest given in exchange of amount received percentage	21.50%
Funds Used To Reduce Outstanding Debt	700,000
Guarantee of Indebtedness of Others [Member] | Gecc [Member]
Loss Contingencies [Line Items]
Percentage of required principal repayment included in maximum amount of Company's potential obligations to GECC under agreement	9.00%
Percentage of interest payments included in maximum amount of Company's potential obligations	9.00%
Percentage Of Required Principal Repayment Included In Maximum Amount Of Companys Potential Obligations Value	$ 63,100

XML

Interim Financial Statements (Details 2) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011
Summary of fair value of subordinated notes
Net carrying amount of the liability component	$ 861,894	$ 850,191
7.75% senior subordinated notes due 2016 [Member]
Summary of fair value of subordinated notes
Net carrying amount of the liability component	375,000	375,000
Net fair amount of the liability component	393,075
3.5% senior subordinated convertible notes due 2026 [Member]
Summary of fair value of subordinated notes
Net carrying amount of the liability component	63,324	63,324
Net fair amount of the liability component	$ 68,889

XML

Business Combinations (Tables)

3 Months Ended

Mar. 31, 2012

Business Combinations [Abstract]

Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed

	March 31,
	2012			2011
Accounts receivable	$	16,976		$	953
Inventory		79,650			7,923
Property and equipment		32,593			1,671
Goodwill		31,566			7,038
Franchise Value		23,426			—
Other assets		—			628
Current liabilities		(49,290	)		(2,491	)
Non-current liabilities		(26,815	)		—
Total consideration		108,106			15,722
Seller financed/assumed debt		—			(1,711	)
Cash used in dealership acquisitions	$	108,106		$	14,011

Summary of unaudited consolidated pro forma results of operations

	Three Months Ended March 31,
	2012		2011
Revenues	$	3,258,179	$	2,908,036
Income from continuing operations		49,878		39,347
Net income		46,704		36,842
Income from continuing operations per diluted common share	$	0.55	$	0.43
Net income per diluted common share	$	0.52	$	0.40

XML

Consolidating Condensed Financial Information (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011	Mar. 31, 2011	Dec. 31, 2010
CONDENSED CONSOLIDATING BALANCE SHEET
Cash and cash equivalents	$ 31,768	$ 28,490	$ 40,435	$ 19,705
Accounts receivable, net	492,653	440,273
Inventories	1,770,235	1,581,586
Other current assets	91,869	80,269
Assets held for sale	29,075	67,776
Total current assets	2,415,600	2,198,394
Property and equipment, net	915,081	857,587
Intangible assets	1,201,566	1,134,180
Equity method investments	288,242	298,640
Other long-term assets	14,276	13,498
Total assets	4,834,765	4,502,299
Floor plan notes payable	1,114,070	977,548
Floor plan notes payable - non-trade	701,242	700,571
Accounts payable	297,705	220,708
Accrued expenses	258,455	201,579
Current portion of long-term debt	13,264	3,414
Liabilities held for sale	29,928	45,852
Total current liabilities	2,414,664	2,149,672
Long-term debt	848,630	846,777
Deferred tax liabilities	222,409	217,902
Other long-term liabilities	166,865	147,535
Total liabilities	3,652,568	3,361,886
Total equity	1,182,197	1,140,413
Total liabilities and equity	4,834,765	4,502,299
Eliminations [Member]
CONDENSED CONSOLIDATING BALANCE SHEET
Accounts receivable, net	(318,778)	(297,782)
Total current assets	(318,778)	(297,782)
Other long-term assets	(1,367,480)	(1,360,808)
Total assets	(1,686,258)	(1,658,590)
Accrued expenses	(318,778)	(297,782)
Total current liabilities	(318,778)	(297,782)
Long-term debt	(37,026)	(38,073)
Total liabilities	(355,804)	(335,855)
Total equity	(1,330,454)	(1,322,735)
Total liabilities and equity	(1,686,258)	(1,658,590)
Penske Automotive Group [Member]
CONDENSED CONSOLIDATING BALANCE SHEET
Accounts receivable, net	318,778	305,386
Other current assets	2,395	2,306
Total current assets	321,173	307,692
Property and equipment, net	4,853	6,730
Equity method investments	240,655	246,658
Other long-term assets	1,377,436	1,369,182
Total assets	1,944,117	1,930,262
Floor plan notes payable - non-trade	89,049	90,892
Accounts payable	462	1,633
Accrued expenses	85
Total current liabilities	89,596	92,525
Long-term debt	672,324	697,324
Total liabilities	761,920	789,849
Total equity	1,182,197	1,140,413
Total liabilities and equity	1,944,117	1,930,262
Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING BALANCE SHEET
Cash and cash equivalents	9,975	27,063	33,957	15,212
Accounts receivable, net	253,077	283,193
Inventories	975,050	903,264
Other current assets	41,248	40,411
Assets held for sale	1,434	23,296
Total current assets	1,280,784	1,277,227
Property and equipment, net	561,108	548,644
Intangible assets	705,484	701,452
Other long-term assets	(2,400)	3,389
Total assets	2,544,976	2,530,712
Floor plan notes payable	589,517	560,999
Floor plan notes payable - non-trade	328,378	344,304
Accounts payable	109,964	112,975
Accrued expenses	142,818	99,492
Current portion of long-term debt	3,689	3,414
Liabilities held for sale	524	7,850
Total current liabilities	1,174,890	1,129,034
Long-term debt	74,774	77,060
Deferred tax liabilities	195,710	198,348
Other long-term liabilities	96,985	93,328
Total liabilities	1,542,359	1,497,770
Total equity	1,002,617	1,032,942
Total liabilities and equity	2,544,976	2,530,712
Non-Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING BALANCE SHEET
Cash and cash equivalents	21,793	1,427	6,478	4,493
Accounts receivable, net	239,576	149,476
Inventories	795,185	678,322
Other current assets	48,226	37,552
Assets held for sale	27,641	44,480
Total current assets	1,132,421	911,257
Property and equipment, net	349,120	302,213
Intangible assets	496,082	432,728
Equity method investments	47,587	51,982
Other long-term assets	6,720	1,735
Total assets	2,031,930	1,699,915
Floor plan notes payable	524,553	416,549
Floor plan notes payable - non-trade	283,815	265,375
Accounts payable	187,279	106,100
Accrued expenses	434,330	399,869
Current portion of long-term debt	9,575
Liabilities held for sale	29,404	38,002
Total current liabilities	1,468,956	1,225,895
Long-term debt	138,558	110,466
Deferred tax liabilities	26,699	19,554
Other long-term liabilities	69,880	54,207
Total liabilities	1,704,093	1,410,122
Total equity	327,837	289,793
Total liabilities and equity	$ 2,031,930	$ 1,699,915

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Earnings Per Share (Details) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Reconciliation of number of shares used in calculation of basic and diluted earning per share
Weighted average number of common shares outstanding	90,306	92,472
Effect of non-participatory equity compensation	32	82
Weighted average number of common shares outstanding, including effect of dilutive securities	90,338	92,554
Earnings Per Share (Textual) [Abstract]
Anti dilutive shares related to senior subordinated convertible notes included in calculation of diluted earnings per share	0	0

XML

Business Combinations (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Mar. 31, 2011
Summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed
Accounts receivable	$ 16,976	$ 953
Inventory	79,650	7,923
Property and equipment	32,593	1,671
Goodwill	31,566	7,038
Franchise value	23,426
Other assets		628
Current liabilities	(49,290)	(2,491)
Non-current liabilities	(26,815)
Total Consideration	108,106	15,722
Seller financed/assumed debt		(1,711)
Cash used in dealership acquisitions	$ 108,106	$ 14,011

XML

Consolidating Condensed Financial Information (Details 2) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash from continuing operating activities	$ 125,304	$ 9,812
Investing activities:
Purchase of equipment and improvements	(26,466)	(20,843)
Dealership acquisitions net, including repayment of sellers' floor plan notes payable of $36,906 and $5,862, respectively	(108,106)	(14,011)
Other		3,490
Net cash from continuing investing activities	(134,572)	(31,364)
Financing activities:
Net borrowings (repayments) of other long-term debt	9,766	6,711
Net borrowings (repayments) of floor plan notes payable non-trade	671	29,419
Proceeds from exercises of options, including excess tax benefit		1,645
Repurchase of common stock	(8,522)
Dividends	(8,973)
Net cash from continuing financing activities	(7,058)	37,775
Net cash from discontinued operations	19,604	4,507
Net change in cash and cash equivalents	3,278	20,730
Cash and cash equivalents, beginning of period	28,490	19,705
Cash and cash equivalents, end of period	31,768	40,435
Penske Automotive Group [Member]
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash from continuing operating activities	44,856	(1,050)
Investing activities:
Purchase of equipment and improvements	(518)	(595)
Net cash from continuing investing activities	(518)	(595)
Financing activities:
Net borrowings (repayments) of other long-term debt	(25,000)
Net borrowings (repayments) of floor plan notes payable non-trade	(1,843)
Proceeds from exercises of options, including excess tax benefit		1,645
Repurchase of common stock	(8,522)
Dividends	(8,973)
Net cash from continuing financing activities	(44,338)	1,645
Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash from continuing operating activities	5,903	64,251
Investing activities:
Purchase of equipment and improvements	(18,101)	(7,641)
Dealership acquisitions net, including repayment of sellers' floor plan notes payable of $36,906 and $5,862, respectively		(12,331)
Net cash from continuing investing activities	(18,101)	(19,972)
Financing activities:
Net borrowings (repayments) of other long-term debt	(963)	(11,469)
Net borrowings (repayments) of floor plan notes payable non-trade	(15,926)	(38,324)
Distributions from (to) parent	636	3,899
Net cash from continuing financing activities	(16,253)	(45,894)
Net cash from discontinued operations	11,363	20,360
Net change in cash and cash equivalents	(17,088)	18,745
Cash and cash equivalents, beginning of period	27,063	15,212
Cash and cash equivalents, end of period	9,975	33,957
Non-Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
Net cash from continuing operating activities	74,545	(53,389)
Investing activities:
Purchase of equipment and improvements	(108,106)	(12,607)
Dealership acquisitions net, including repayment of sellers' floor plan notes payable of $36,906 and $5,862, respectively	(115,953)	(1,680)
Other		3,490
Net cash from continuing investing activities	(120,976)	(10,797)
Financing activities:
Net borrowings (repayments) of other long-term debt	35,729	18,180
Net borrowings (repayments) of floor plan notes payable non-trade	18,440	67,743
Distributions from (to) parent	(636)	(3,899)
Net cash from continuing financing activities	53,533	82,024
Net cash from discontinued operations	8,241	(15,853)
Net change in cash and cash equivalents	20,366	1,985
Cash and cash equivalents, beginning of period	1,427	4,493
Cash and cash equivalents, end of period	$ 21,793	$ 6,478

XML

Equity (Detail Textual) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2012
Equity (Textual) [Abstract]
Repurchased shares	350,000
Repurchased shares, total price	$ 8,522
Repurchased shares, average price	$ 24.35

XML

Consolidated Condensed Statement of Equity (Unaudited) (USD $) In Thousands, except Share data	Total	Total Stockholders' Equity Attributable to Penske Automotive Group	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Non-controlling Interest
Balance at Dec. 31, 2011	$ 1,140,413	$ 1,135,985	$ 9	$ 702,335	$ 459,375	$ (25,734)	$ 4,428
Balance, shares at Dec. 31, 2011			90,277,356
Equity compensation	1,769	1,769		1,769
Equity compensation, shares			394,689
Distributions to non-controlling interests	(197)						(197)
Foreign currency translation	9,926	9,926				9,926
Repurchase of common stock	(8,522)	(8,522)		(8,522)
Repurchase of common stock, shares	(350,000)		(350,000)
Dividends	(8,973)	(8,973)			(8,973)
Other	775	775				775
Net income	47,006	46,818			46,818		188
Balance at Mar. 31, 2012	$ 1,182,197	$ 1,177,778	$ 9	$ 695,582	$ 497,220	$ (15,033)	$ 4,419
Balance, shares at Mar. 31, 2012			90,322,045

XML

Long-Term debt (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011
Long Term Debt
Long-term Debt	$ 861,894	$ 850,191
Less: current portion	(13,264)	(3,414)
Net long-term debt	848,630	846,777
US Credit Agreement Revolving Credit Line [Member]
Long Term Debt
Long-term Debt	107,000	132,000
US Credit Agreement Term Loan [Member]
Long Term Debt
Long-term Debt	127,000	127,000
UK Credit Agreement Revolving Credit Line [Member]
Long Term Debt
Long-term Debt	63,832	59,060
UK Credit Agreement Term Loan [Member]
Long Term Debt
Long-term Debt	45,480
UK Credit Agreement Overdraft Line of Credit [Member]
Long Term Debt
Long-term Debt		13,333
7.75% senior subordinated notes due 2016 [Member]
Long Term Debt
Long-term Debt	375,000	375,000
3.5% senior subordinated convertible notes due 2026 [Member]
Long Term Debt
Long-term Debt	63,324	63,324
Mortgages [Member]
Long Term Debt
Long-term Debt	74,831	75,684
Other Debt Securities [Member]
Long Term Debt
Long-term Debt	$ 5,427	$ 4,790

XML

Segment Information (Tables)

3 Months Ended

Mar. 31, 2012

Segment Information [Abstract]

Revenues and adjusted segment income by reportable segment

Three Months Ended March 31

			PAG
	Retail		Investments		Total
Revenues
2012	$	3,242,288	$	—	$	3,242,288
2011		2,751,036		—		2,751,036
Segment income
2012		73,248		3,834		77,082
2011		51,026		1,124		52,150

XML

Long-Term Debt (Tables)

3 Months Ended

Mar. 31, 2012

Long-Term Debt [Abstract]

Long Term Debt

	March 31,			December 31,
	2012			2011
U.S. credit agreement—revolving credit line	$	107,000		$	132,000
U.S. credit agreement—term loan		127,000			127,000
U.K. credit agreement—revolving credit line		63,832			59,060
U.K. credit agreement—term loan		45,480			—
U.K. credit agreement—overdraft line of credit		—			13,333
7.75% senior subordinated notes due 2016		375,000			375,000
3.5% senior subordinated convertible notes due 2026, net of debt discount		63,324			63,324
Mortgage facilities		74,831			75,684
Other		5,427			4,790
Total long-term debt		861,894			850,191
Less: current portion		(13,264	)		(3,414	)
Net long-term debt	$	848,630		$	846,777

XML

Long-Term Debt (Details Textual)	3 Months Ended		3 Months Ended		3 Months Ended			3 Months Ended				3 Months Ended					3 Months Ended				3 Months Ended			3 Months Ended
	Mar. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Mar. 31, 2012 US Credit Agreement Revolving Credit Line [Member] USD ($)	Dec. 31, 2011 US Credit Agreement Revolving Credit Line [Member] USD ($)	Mar. 31, 2012 US Credit Agreement Revolving Credit Line [Member] Minimum [Member]	Mar. 31, 2012 US Credit Agreement Term Loan [Member] USD ($)	Dec. 31, 2011 US Credit Agreement Term Loan [Member] USD ($)	Mar. 31, 2012 US Credit Agreement Term Loan [Member] Maximum [Member]	Mar. 31, 2012 UK Credit Agreement Revolving Credit Line [Member] USD ($)	Mar. 31, 2012 UK Credit Agreement Revolving Credit Line [Member] GBP (£)	Dec. 31, 2011 UK Credit Agreement Revolving Credit Line [Member] USD ($)	Mar. 31, 2012 UK Credit Agreement Revolving Credit Line [Member] Maximum [Member]	Mar. 31, 2012 UK Credit Agreement Revolving Credit Line [Member] Minimum [Member]	Mar. 31, 2012 UK Credit Agreement Term Loan [Member] GBP (£)	Mar. 31, 2012 UK Credit Agreement Term Loan [Member] USD ($)	Jan. 31, 2012 UK Credit Agreement Term Loan [Member] GBP (£)	Mar. 31, 2012 UK Credit Agreement Term Loan [Member] Maximum [Member]	Mar. 31, 2012 UK Credit Agreement Term Loan [Member] Minimum [Member]	Mar. 31, 2012 UK Credit Agreement Overdraft Line of Credit [Member] GBP (£)	Dec. 31, 2011 UK Credit Agreement Overdraft Line of Credit [Member] USD ($)	Mar. 31, 2012 7.75% senior subordinated notes due 2016 [Member] USD ($)	Dec. 31, 2011 7.75% senior subordinated notes due 2016 [Member] USD ($)	Dec. 31, 2006 7.75% senior subordinated notes due 2016 [Member] USD ($)	Mar. 31, 2012 3.5% senior subordinated convertible notes due 2026 [Member] USD ($)	Mar. 31, 2011 3.5% senior subordinated convertible notes due 2026 [Member]	Dec. 31, 2011 3.5% senior subordinated convertible notes due 2026 [Member] USD ($)	Mar. 31, 2012 Mortgages [Member] USD ($)	Dec. 31, 2011 Mortgages [Member] USD ($)	Mar. 31, 2012 UK Credit Agreement [Member] USD ($)	Mar. 31, 2012 UK Credit Agreement [Member] GBP (£)	Mar. 31, 2012 US Credit Agreement Letter of Credit [Member] USD ($)
Long-Term Debt (Textual) [Abstract]
Maximum credit available under US and UK credit agreement			$ 375,000,000							£ 100,000,000						£ 30,000,000															$ 10,000,000
Line of credit basis spread on variable rate					2.50%			2.50%				3.00%	1.35%				4.325%	2.675%	1.75%
Debt instrument redemption rate of principal																					103.875%			100.00%
Debt instrument redemption rate of principal exceeded																								120.00%
Incremental interest rate for uncollateralized borrowings in excess of maximum limit			1.00%
Term loan outstanding under credit agreement			107,000,000			127,000,000								28,500,000	45,480,000														63,824,000	40,000,000	500,000
Repayment of term loan														1,500,000
Final payment														7,500,000
Demand over draft line of credit																			10,000,000
Senior unsecured notes issued																							375,000,000
Convertible notes prior period																								6 months
Senior subordinated convertible notes, interest rate																					7.75%		7.75%	3.50%
Outstanding Convertible senior notes																								63,324,000
Conversion rate of convertible notes																								42.7796
Conversion principal amount																								1,000
Conversion price per share																								$ 23.38
Closing price of common stock																								$ 28.05
Conversion Period																								10 days
Payment of cash, common stock or a combination of two, if conversion value exceed																								1,000,000
Annual effective interest rate on liability component																								3.50%	8.25%
Long-term Debt	$ 861,894,000	$ 850,191,000	$ 107,000,000	$ 132,000,000		$ 127,000,000	$ 127,000,000		$ 63,832,000		$ 59,060,000				$ 45,480,000					$ 13,333,000	$ 375,000,000	$ 375,000,000		$ 63,324,000		$ 63,324,000	$ 74,831,000	$ 75,684,000
Dates on which holders of the convertible notes may require the company to purchase	April 1, 2026

XML

Consolidating Condensed Financial Information (Tables)

3 Months Ended

Mar. 31, 2012

Consolidating Condensed Financial Information [Abstract]

CONDENSED CONSOLIDATING BALANCE SHEET

CONDENSED CONSOLIDATING BALANCE SHEET

March 31, 2012

	Total Company		Eliminations			Penske Automotive Group		Guarantor Subsidiaries			Non-Guarantor Subsidiaries
	(In thousands)
Cash and cash equivalents	$	31,768	$	—		$	—	$	9,975		$	21,793
Accounts receivable, net		492,653		(318,778	)		318,778		253,077			239,576
Inventories		1,770,235		—			—		975,050			795,185
Other current assets		91,869		—			2,395		41,248			48,226
Assets held for sale		29,075		—			—		1,434			27,641
Total current assets		2,415,600		(318,778	)		321,173		1,280,784			1,132,421
Property and equipment, net		915,081		—			4,853		561,108			349,120
Intangible assets		1,201,566		—			—		705,484			496,082
Equity method inves tments		288,242		—			240,655		—			47,587
Other long-term assets		14,276		(1,367,480	)		1,377,436		(2,400	)		6,720
Total assets	$	4,834,765	$	(1,686,258	)	$	1,944,117	$	2,544,976		$	2,031,930
Floor plan notes payable	$	1,114,070	$	—		$	—	$	589,517		$	524,553
Floor plan notes payable — non-trade		701,242		—			89,049		328,378			283,815
Accounts payable		297,705		—			462		109,964			187,279
Accrued expenses		258,455		(318,778	)		85		142,818			434,330
Current portion of long-term debt		13,264		—			—		3,689			9,575
Liabilities held for sale		29,928		—			—		524			29,404
Total current liabilities		2,414,664		(318,778	)		89,596		1,174,890			1,468,956
Long-term debt		848,630		(37,026	)		672,324		74,774			138,558
Deferred tax liabilities		222,409		—			—		195,710			26,699
Other long-term liabilities		166,865		—			—		96,985			69,880
Total liabilities		3,652,568		(355,804	)		761,920		1,542,359			1,704,093
Total equity		1,182,197		(1,330,454	)		1,182,197		1,002,617			327,837
Total liabilities and equity	$	4,834,765	$	(1,686,258	)	$	1,944,117	$	2,544,976		$	2,031,930

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2011

						Penske
	Total					Automotive		Guarantor		Non-Guarantor
	Company		Eliminations			Group		Subsidiaries		Subsidiaries
	(In thousands)
Cash and cash equivalents	$	28,490	$	—		$	—	$	27,063	$	1,427
Accounts receivable, net		440,273		(297,782	)		305,386		283,193		149,476
Inventories		1,581,586		—			—		903,264		678,322
Other current assets		80,269		—			2,306		40,411		37,552
Assets held for sale		67,776		—			—		23,296		44,480
Total current assets		2,198,394		(297,782	)		307,692		1,277,227		911,257
Property and equipment, net		857,587		—			6,730		548,644		302,213
Intangible assets		1,134,180		—			—		701,452		432,728
Equity method investments		298,640		—			246,658		—		51,982
Other long-term assets		13,498		(1,360,808	)		1,369,182		3,389		1,735
Total assets	$	4,502,299	$	(1,658,590	)	$	1,930,262	$	2,530,712	$	1,699,915
Floor plan notes payable	$	977,548	$	—		$	—	$	560,999	$	416,549
Floor plan notes payable — non-trade		700,571		—			90,892		344,304		265,375
Accounts payable		220,708		—			1,633		112,975		106,100
Accrued expenses		201,579		(297,782	)		—		99,492		399,869
Current portion of long-term debt		3,414		—			—		3,414		—
Liabilities held for sale		45,852		—			—		7,850		38,002
Total current liabilities		2,149,672		(297,782	)		92,525		1,129,034		1,225,895
Long-term debt		846,777		(38,073	)		697,324		77,060		110,466
Deferred tax liabilities		217,902		—			—		198,348		19,554
Other long-term liabilities		147,535		—			—		93,328		54,207
Total liabilities		3,361,886		(335,855	)		789,849		1,497,770		1,410,122
Total equity		1,140,413		(1,322,735	)		1,140,413		1,032,942		289,793
Total liabilities and equity	$	4,502,299	$	(1,658,590	)	$	1,930,262	$	2,530,712	$	1,699,915

CONDENSED CONSOLIDATING STATEMENT OF INCOME

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended March 31, 2012

							Penske
	Total						Automotive			Guarantor			Non-Guarantor
	Company			Eliminations			Group			Subsidiaries			Subsidiaries
	(In thousands)
Revenues	$	3,242,288		$	—		$	—		$	1,842,665		$	1,399,623
Cost of sales		2,735,695			—			—			1,545,231			1,190,464
Gross profit		506,593			—			—			297,434			209,159
Selling, general and administrative expenses		398,637			—			4,595			239,699			154,343
Depreciation		13,349			—			362			7,146			5,841
Operating income (loss)		94,607			—			(4,957	)		50,589			48,975
Floor plan interest expense		(9,725	)		—			(2,198	)		(3,866	)		(3,661	)
Other interest expense		(12,210	)		—			(7,563	)		(910	)		(3,737	)
Equity in earnings of affiliates		4,410						3,760						650
Equity in earnings of subsidiaries		—			(87,852	)		87,852			—			—
Income (loss) from continuing operations before income taxes		77,082			(87,852	)		76,894			45,813			42,227
Income taxes		(26,902	)		30,736			(26,902	)		(20,557	)		(10,179	)
Income (loss) from continuing operations		50,180			(57,116	)		49,992			25,256			32,048
(Loss) income from discontinued operations, net of tax		(3,174	)		3,174			(3,174	)		(1,622	)		(1,552	)
Net income (loss)		47,006			(53,942	)		46,818			23,634			30,496
Less: Income attributable to the non-controlling interests		188			—			—			—			188
Net income (loss) attributable to Penske Automotive Group common stockholders		46,818			(53,942	)		46,818			23,634			30,308
Other comprehensive income (loss), net of tax		10,701			—			1,009			(234	)		9,926
Comprehensive income attributable to Penske Automotive Group common stockholders	$	57,519		$	(53,942	)	$	47,827		$	23,400		$	40,234

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended March 31, 2011

							Penske
	Total						Automotive			Guarantor			Non-Guarantor
	Company			Eliminations			Group			Subsidiaries			Subsidiaries
	(In thousands)
Revenues	$	2,751,036		$	—		$	—		$	1,564,740		$	1,186,296
Cost of sales		2,311,791			—			—			1,303,486			1,008,305
Gross profit		439,245			—			—			261,254			177,991
Selling, general and administrative expenses		355,391			—			4,949			215,973			134,469
Depreciation		11,798			—			285			6,324			5,189
Operating income (loss)		72,056			—			(5,234	)		38,957			38,333
Floor plan interest expense		(6,925	)		—			(133	)		(3,919	)		(2,873	)
Other interest expense		(11,285	)		—			(6,416	)		(611	)		(4,258	)
Debt discount amortization		(1,718	)		—			(1,718	)		—			—
Equity in earnings (losses) of affiliates		22			—			1,231			—			(1,209	)
Equity in earnings of subsidiaries		—			(64,350	)		64,350			—			—
Income (loss) from continuing operations before income taxes		52,150			(64,350	)		52,080			34,427			29,993
Income taxes		(15,670	)		19,362			(15,670	)		(10,989	)		(8,373	)
Income (loss) from continuing operations		36,480			(44,988	)		36,410			23,438			21,620
(Loss) income from discontinued operations, net of tax		(2,483	)		2,483			(2,483	)		(2,301	)		(182	)
Net income (loss)		33,997			(42,505	)		33,927			21,137			21,438
Less: Income attributable to the non-controlling interests		70			—			—			—			70
Net income (loss) attributable to Penske Automotive Group common stockholders		33,927			(42,505	)		33,927			21,137			21,368
Other comprehensive income (loss), net of tax		16,522			—			(663	)		282			16,903
Comprehensive income attributable to Penske Automotive Group common stockholders	$	50,449		$	(42,505	)	$	33,264		$	21,419		$	38,271

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2012

				Penske
	Total			Automotive			Guarantor			Non-Guarantor
	Company			Group			Subsidiaries			Subsidiaries
				(In thousands)
Net cash from continuing operating activities	$	125,304		$	44,856		$	5,903		$	74,545
Investing activities:
Purchase of equipment and improvements		(26,466	)		(518	)		(18,101	)		(7,847	)
Dealership acquisitions, net		(108,106	)		—			—			(108,106	)
Net cash from continuing investing activities		(134,572	)		(518	)		(18,101	)		(115,953	)
Financing activities:
Net borrowings (repayments) of other long-term debt		9,766			(25,000	)		(963	)		35,729
Net borrowings (repayments) of floor plan notes payable — non-trade		671			(1,843	)		(15,926	)		18,440
Repurchase of common stock		(8,522	)		(8,522	)		—			—
Dividends		(8,973	)		(8,973	)		—			—
Distributions from (to) parent		—			—			636			(636	)
Net cash from continuing financing activities		(7,058	)		(44,338	)		(16,253	)		53,533
Net cash from discontinued operations		19,604			—			11,363			8,241
Net change in cash and cash equivalents		3,278			—			(17,088	)		20,366
Cash and cash equivalents, beginning of period		28,490			—			27,063			1,427
Cash and cash equivalents, end of period	$	31,768		$	—		$	9,975		$	21,793

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2011

				Penske
	Total			Automotive			Guarantor			Non-Guarantor
	Company			Group			Subsidiaries			Subsidiaries
				(In thousands)
Net cash from continuing operating activities	$	9,812		$	(1,050	)	$	64,251		$	(53,389	)
Investing activities:
Purchase of equipment and improvements		(20,843	)		(595	)		(7,641	)		(12,607	)
Dealership acquisitions, net		(14,011	)		—			(12,331	)		(1,680	)
Other		3,490			—			—			3,490
Net cash from continuing investing activities		(31,364	)		(595	)		(19,972	)		(10,797	)
Financing activities:
Net borrowings (repayments) of other long-term debt		6,711			—			(11,469	)		18,180
Net borrowings (repayments) of floor plan notes payable — non-trade		29,419			—			(38,324	)		67,743
Proceeds from exercises of options, including excess tax benefit		1,645			1,645			—			—
Distributions from (to) parent		—			—			3,899			(3,899	)
Net cash from continuing financing activities		37,775			1,645			(45,894	)		82,024
Net cash from discontinued operations		4,507			—			20,360			(15,853	)
Net change in cash and cash equivalents		20,730			—			18,745			1,985
Cash and cash equivalents, beginning of period		19,705			—			15,212			4,493
Cash and cash equivalents, end of period	$	40,435		$	—		$	33,957		$	6,478

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Interim Financial Statements (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Combined financial information regarding entities accounted for as discontinued operations
Revenues	$ 45,942	$ 129,462
Pre-tax loss	(11,458)	(5,147)
Gain on disposal	$ 10,160	$ 1,071

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Consolidated Condensed Statements of Cash Flows (Unaudited) (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Consolidated Condensed Statements of Cash Flows [Abstract]
Repayment of sellers' floor plan notes payable, dealership acquisitions	$ 36,906	$ 5,862

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Interim Financial Statements (Details 1) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011
Balance Sheet information regarding entities accounted for as discontinued operations
Inventories	$ 24,052	$ 39,185
Other assets	5,023	28,591
Total assets	29,075	67,776
Floor plan notes payable (including non-trade)	22,730	36,186
Other liabilities	7,198	9,666
Total liabilities	$ 29,928	$ 45,852

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Intangible Assets (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012
Summary of the changes in the carrying amount of goodwill and franchise value
Goodwill, Beginning Balance	$ 905,721
Goodwill, additions	31,566
Goodwill, foreign currency translation	9,821
Goodwill, Ending Balance	947,108
Franchise value, Beginning Balance	228,459
Franchise value, Additions	23,426
Franchise value, foreign currency translation	2,573
Franchise value, Ending Balance	$ 254,458

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Consolidated Condensed Balance Sheets (Unaudited) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011
ASSETS
Cash and cash equivalents	$ 31,768	$ 28,490
Accounts receivable, net of allowance for doubtful accounts of $2,171 and $2,161	492,653	440,273
Inventories	1,770,235	1,581,586
Other current assets	91,869	80,269
Assets held for sale	29,075	67,776
Total current assets	2,415,600	2,198,394
Property and equipment, net	915,081	857,587
Goodwill	947,108	905,721
Franchise value	254,458	228,459
Equity method investments	288,242	298,640
Other long-term assets	14,276	13,498
Total assets	4,834,765	4,502,299
LIABILITIES AND EQUITY
Floor plan notes payable	1,114,070	977,548
Floor plan notes payable - non-trade	701,242	700,571
Accounts payable	297,705	220,708
Accrued expenses	258,455	201,579
Current portion of long-term debt	13,264	3,414
Liabilities held for sale	29,928	45,852
Total current liabilities	2,414,664	2,149,672
Long-term debt	848,630	846,777
Deferred tax liabilities	222,409	217,902
Other long-term liabilities	166,865	147,535
Total liabilities	3,652,568	3,361,886
Commitments and contingent liabilities
Penske Automotive Group stockholders' equity:
Preferred Stock, $0.0001 par value; 100 shares authorized; none issued and outstanding
Common Stock, $0.0001 par value, 240,000 shares authorized; 90,322 shares issued and outstanding at March 31, 2012; 90,277 shares issued and outstanding at December 31, 2011	9	9
Additional paid-in-capital	695,582	702,335
Retained earnings	497,220	459,375
Accumulated other comprehensive loss	(15,033)	(25,734)
Total Penske Automotive Group stockholders' equity	1,177,778	1,135,985
Non-controlling interest	4,419	4,428
Total equity	1,182,197	1,140,413
Total liabilities and equity	4,834,765	4,502,299
Non-voting Common Stock, $0.0001 par value, 7,125 shares authorized; none issued and outstanding
Penske Automotive Group stockholders' equity:
Common Stock, $0.0001 par value, 240,000 shares authorized; 90,322 shares issued and outstanding at March 31, 2012; 90,277 shares issued and outstanding at December 31, 2011
Class C Common Stock, $0.0001 par value, 20,000 shares authorized; none issued and outstanding
Penske Automotive Group stockholders' equity:
Common Stock, $0.0001 par value, 240,000 shares authorized; 90,322 shares issued and outstanding at March 31, 2012; 90,277 shares issued and outstanding at December 31, 2011

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Interest Rate Swaps (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2012 Forward Starting Interest Rate Swap Agreements [Member]	Jan. 31, 2011 Floating Rate Floor Plan Debt [Member]
Derivative [Line Items]
Portion of floating rate floor plan debt fixed by swap agreements	$ 100,000		$ 300,000	$ 300,000
Interest rate swap, fixed	1.55%		2.135%	3.67%
Interest Rate Swaps (Textual) [Abstract]
Estimated liabilities of swaps designated as hedging instruments, fair value	16,322
Estimated assets of swaps designated as hedging instruments, fair value		351
Increase in the weighted average interest rate on floor plan borrowings due to the swaps	0.40%
Hedge ineffectiveness recorded	$ 0	$ 0

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Consolidated Condensed Statements of Comprehensive Income (Unaudited) (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Consolidated Condensed Statements of Comprehensive Income [Abstract]
Unrealized loss net of tax benefit	$ 822	$ (139)
Interest expense, net of tax provision	$ 669	$ 46

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Inventories (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011
Inventories Net
Total inventories	$ 1,770,235	$ 1,581,586
New vehicle
Inventories Net
Total inventories	1,206,234	1,058,371
Used vehicle
Inventories Net
Total inventories	480,910	442,991
Parts accessories and other [Member]
Inventories Net
Total inventories	$ 83,091	$ 80,224

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Interim Financial Statements (Policies)

3 Months Ended

Mar. 31, 2012

Interim Financial Statements [Abstract]

Business overview

Business Overview

Penske Automotive Group, Inc. (the “Company”) is the second largest automotive retailer headquartered in the U.S. as measured by total revenue. As of March 31, 2012, the Company operated 335 retail franchises, of which 168 franchises are located in the U.S. and 167 franchises are located outside of the U.S. The franchises outside the U.S. are located primarily in the U.K. Each of the Company’s dealerships offers a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, the Company generates higher-margin revenue at each of its dealerships through maintenance and repair services and the sale and placement of higher-margin products, such as third-party finance and insurance products, third-party extended service contracts and replacement and aftermarket automotive products. The Company also holds a 9.0% limited partnership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading transportation services provider.

During the three months ended March 31, 2012, we acquired the Agnew Group in the United Kingdom, representing thirteen franchises, and two other franchises. We also were awarded three franchises, including Nissan/Infiniti in San Francisco and Mini in Marin, CA, and disposed of three franchises, including Jaguar Land Rover in Gatwick, England and Lexus in Scottsdale, Arizona.

In April 2012, we acquired a 7% interest in NPA Holdco, LLC, an auctioneer of powersport vehicles for $3,000. Transportation Resource Partners, a related party, recently acquired a controlling interest in this company on the same financial terms as our investment.

Basis of Presentation

Basis of Presentation

The following unaudited consolidated condensed financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in the Company’s annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of March 31, 2012 and December 31, 2011 and for the three month periods ended March 31, 2012 and 2011 is unaudited, but includes all adjustments which the management of the Company believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities which have been treated as discontinued operations through March 31, 2012, and the results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2011, which are included as part of the Company’s Annual Report on Form 10-K.

In June 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-05, Presentation of Comprehensive Income, which requires the presentation of components of other comprehensive income with the components of net income. The adoption of this pronouncement on January 1, 2012 had no impact on our consolidated financial position or results of operations.

Discontinued Operations

Discontinued Operations

The Company accounts for dispositions in its retail operations as discontinued operations when it is evident that the operations and cash flows of a franchise being disposed of will be eliminated from on-going operations and that the Company will not have any significant continuing involvement in its operations.

In evaluating whether the cash flows of a dealership in its Retail reportable segment will be eliminated from ongoing operations, the Company considers whether it is likely that customers will migrate to similar franchises that it owns in the same geographic market. The Company’s consideration includes an evaluation of the brands sold at other dealerships it operates in the market and their proximity to the disposed dealership. When the Company disposes of franchises, it typically does not have continuing brand representation in that market. If the franchise being disposed of is located in a complex of Company owned dealerships, the Company does not treat the disposition as a discontinued operation if it believes that the cash flows previously generated by the disposed franchise will be replaced by expanded operations of the remaining or replacement franchises.

Combined financial information regarding entities accounted for as discontinued operations follows:

	Three Months Ended March 31,
	2012			2011
Revenues	$	45,942		$	129,462
Pre-tax loss		(11,458	)		(5,147	)
Gain on disposal		10,160			1,071
	March 31,			December 31,
	2012			2011
Inventories	$	24,052		$	39,185
Other assets		5,023			28,591
Total assets	$	29,075		$	67,776
Floor plan notes payable (including non-trade)	$	22,730		$	36,186
Other liabilities		7,198			9,666
Total liabilities	$	29,928		$	45,852

Estimates

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, debt, floor plan notes payable, and interest rate swaps used to hedge future cash flows. Other than our subordinated notes, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. A summary of the fair value of the subordinated notes, based on quoted, level one market data, follows:

	March 31, 2012
	Carrying Value		Fair Value
7.75% senior subordinated notes due 2016	$	375,000	$	393,075
3.5% senior subordinated convertible notes due 2026		63,324		68,889

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Inventories (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Inventories (Textual) [Abstract]
Interest credits and advertising assistance	$ 6,201	$ 7,927

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Inventories (Tables)

3 Months Ended

Mar. 31, 2012

Inventories [Abstract]

Inventories Net

	March 31,		December 31,
	2012		2011
New vehicles	$	1,206,234	$	1,058,371
Used vehicles		480,910		442,991
Parts, accessories and other		83,091		80,224
Total inventories	$	1,770,235	$	1,581,586

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Consolidated Condensed Statements of Cash Flows (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Operating Activities:
Net income	$ 47,006	$ 33,997
Adjustments to reconcile net income to net cash from continuing operating activities:
Depreciation	13,349	11,798
Debt discount amortization		1,718
Earnings of equity method investments	(4,410)	(22)
Loss from discontinued operations, net of tax	3,174	2,483
Deferred income taxes	4,880	6,358
Changes in operating assets and liabilities:
Accounts receivable	(35,364)	(29,178)
Inventories	(108,999)	(38,497)
Floor plan notes payable	136,522	34,352
Accounts payable and accrued expenses	83,160	(2,993)
Other	(14,014)	(10,204)
Net cash from continuing operating activities	125,304	9,812
Investing Activities:
Purchase of equipment and improvements	(26,466)	(20,843)
Dealership acquisitions net, including repayment of sellers' floor plan notes payable of $36,906 and $5,862, respectively	(108,106)	(14,011)
Other		3,490
Net cash from continuing investing activities	(134,572)	(31,364)
Financing Activities:
Proceeds from borrowings under U.S. credit agreement revolving credit line	194,300	16,500
Repayments under U.S. credit agreement revolving credit line	(219,300)	(16,500)
Net borrowings of other long-term debt	34,766	6,711
Net borrowings of floor plan notes payable - non-trade	671	29,419
Repurchase of common stock	(8,522)
Dividends	(8,973)
Proceeds from exercises of options, including excess tax benefit		1,645
Net cash from continuing financing activities	(7,058)	37,775
Discontinued operations:
Net cash from discontinued operating activities	(3,638)	3,522
Net cash from discontinued investing activities	34,769	2,265
Net cash from discontinued financing activities	(11,527)	(1,280)
Net cash from discontinued operations	19,604	4,507
Net change in cash and cash equivalents	3,278	20,730
Cash and cash equivalents, beginning of period	28,490	19,705
Cash and cash equivalents, end of period	31,768	40,435
Cash paid for:
Interest	14,061	11,079
Income taxes	7,740	9,093
Seller financed/assumed debt		$ 4,865

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Consolidated Condensed Balance Sheets (Unaudited) (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Mar. 31, 2012	Dec. 31, 2011
Allowance for doubtful accounts	$ 2,171	$ 2,161
Preferred Stock, par value	$ 0.0001	$ 0.0001
Preferred Stock, shares authorized	100	100
Preferred Stock, shares issued
Preferred Stock, shares outstanding
Common Stock, par value	$ 0.0001	$ 0.0001
Common Stock, shares authorized	240,000	240,000
Common Stock, shares issued	90,322	90,277
Common Stock, shares outstanding	90,322	90,277
Non-voting Common Stock, $0.0001 par value, 7,125 shares authorized; none issued and outstanding
Common Stock, par value	$ 0.0001	$ 0.0001
Common Stock, shares authorized	7,125	7,125
Common Stock, shares issued
Common Stock, shares outstanding
Class C Common Stock, $0.0001 par value, 20,000 shares authorized; none issued and outstanding
Common Stock, par value	$ 0.0001	$ 0.0001
Common Stock, shares authorized	20,000	20,000
Common Stock, shares issued
Common Stock, shares outstanding

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Interest Rate Swaps

3 Months Ended

Mar. 31, 2012

Interest Rate Swaps [Abstract]

Interest Rate Swaps

8. Interest Rate Swaps

The Company periodically uses interest rate swaps to manage interest rate risk associated with the Company’s variable rate floor plan debt. The Company is party to interest rate swap agreements through December 2014 pursuant to which the LIBOR portion of $300,000 of the Company’s floating rate floor plan debt is fixed at 2.135% and $100,000 of the Company’s floating rate floor plan debt is fixed at a rate of 1.55%. The Company may terminate these agreements at any time, subject to the settlement of the then current fair value of the swap arrangements.

Through January 2011, the Company was party to interest rate swap agreements pursuant to which the LIBOR portion of $300,000 of the Company’s floating rate floor plan debt was fixed at 3.67%.

The Company used Level 2 inputs to estimate the fair value of the interest rate swap agreements. As of March 31, 2012 and 2011, the fair value of the swaps designated as hedging instruments was estimated to be a liability of $16,322 and an asset of $351, respectively.

During the three months ended March 31, 2012 and 2011, there was no hedge ineffectiveness recorded on the Company’s income statement. During the three months ended March 31, 2012, the swaps increased the weighted average interest rate on the Company’s floor plan borrowings by approximately 40 basis points. The impact of the swaps on the weighted average interest rate of the Company’s floor plan borrowings during the three months ended March 31, 2011 was insignificant.

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Document and Entity Information	3 Months Ended
	Mar. 31, 2012	Apr. 15, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	PENSKE AUTOMOTIVE GROUP, INC.
Entity Central Index Key	0001019849
Document Type	10-Q
Document Period End Date	Mar. 31, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q1
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		90,322,045

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Commitments and Contingent Liabilities

3 Months Ended

Mar. 31, 2012

Commitments and Contingent Liabilities [Abstract]

Commitments and Contingent Liabilities

9. Commitments and Contingent Liabilities

The Company is involved in litigation which may relate to claims brought by governmental authorities, issues with customers, and employment related matters, including class action claims and purported class action claims. As of March 31, 2012, the Company is not party to any legal proceedings, including class action lawsuits, that, individually or in the aggregate, are reasonably expected to have a material adverse effect on the Company’s results of operations, financial condition or cash flows. However, the results of these matters cannot be predicted with certainty, and an unfavorable resolution of one or more of these matters could have a material adverse effect on the Company’s results of operations, financial condition or cash flows.

The Company has historically structured its operations so as to minimize ownership of real property. As a result, the Company leases or subleases substantially all of its facilities. These leases are generally for a period between five and 20 years, and are typically structured to include renewal options at the Company’s election. Pursuant to the leases for some of the Company’s larger facilities, the Company is required to comply with specified financial ratios, including a “rent coverage” ratio and a debt to EBITDA ratio, each as defined. For these leases, non-compliance with the ratios may require the Company to post collateral in the form of a letter of credit. A breach of the other lease covenants gives rise to certain remedies by the landlord, the most severe of which include the termination of the applicable lease and acceleration of the total rent payments due under the lease. As of March 31, 2012, the Company was in compliance with all covenants under these leases.

The Company has sold a number of dealerships to third parties and, as a condition to certain of those sales, remains liable for the lease payments relating to the properties on which those businesses operate in the event of non-payment by the buyer. The Company is also party to lease agreements on properties that it no longer uses in its retail operations that it has sublet to third parties. The Company relies on subtenants to pay the rent and maintain the property at these locations. In the event the subtenant does not perform as expected, the Company may not be able to recover amounts owed to it and the Company could be required to fulfill these obligations.

The Company holds a 9.0% limited partnership interest in PTL. In April and May 2012, PTL refinanced a significant amount of its indebtedness. As part of that refinancing, the Company and the other PTL partners created a new company (“Holdings”), which, together with General Electric Capital Corporation (“GECC”), co-issued $700,000 of 3.8% senior unsecured notes due 2019 to certain investors through an offering pursuant to Rule 144A of the Securities Act of 1933, as amended (the “Holdings Bonds”). A wholly-owned subsidiary of Holdings contributed $700,000 derived from the net proceeds from the offering of the Holdings Bonds and a portion of its cash on hand to PTL in exchange for a 21.5% limited partner interest in PTL. PTL used the $700,000 of funds to reduce its outstanding debt owed to GECC. GECC agreed to be a co-obligor of the Holdings Bonds in order to achieve lower interest rates on the Holdings Bonds.

Additional capital contributions from the members may be required to fund interest and principal payments on the Holdings Bonds. In addition, the Company has agreed to indemnify GECC for 9.0% of any principal or interest that GECC is required to pay as co-obligor, and pay GECC an annual fee of approximately $950 for acting as co-obligor. The maximum amount of the Company’s potential obligations to GECC under this agreement are 9% of the required principal repayment due in 2019 (which is expected to be $63,100) and 9% of interest payments under the Holdings Bonds, plus fees and default interest, if any.

The Company has $19,072 of letters of credit outstanding as of March 31, 2012, and has posted $13,718 of surety bonds in the ordinary course of business.

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Consolidated Condensed Statements of Income (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Revenue:
Total revenues	$ 3,242,288	$ 2,751,036
Cost of sales:
Total cost of sales	2,735,695	2,311,791
Gross profit	506,593	439,245
Selling, general and administrative expenses	398,637	355,391
Depreciation	13,349	11,798
Operating income	94,607	72,056
Floor plan interest expense	(9,725)	(6,925)
Other interest expense	(12,210)	(11,285)
Debt discount amortization		(1,718)
Equity in earnings of affiliates	4,410	22
Income from continuing operations before income taxes	77,082	52,150
Income taxes	(26,902)	(15,670)
Income from continuing operations	50,180	36,480
Loss from discontinued operations, net of tax	(3,174)	(2,483)
Net income	47,006	33,997
Less: Income attributable to non-controlling interests	188	70
Net income attributable to Penske Automotive Group common stockholders	46,818	33,927
Basic earnings per share attributable to Penske Automotive Group common stockholders:
Continuing operations	$ 0.56	$ 0.39
Discontinued operations	$ (0.04)	$ (0.03)
Net income attributable to Penske Automotive Group common stockholders	$ 0.52	$ 0.37
Shares used in determining basic earnings per share	90,306	92,472
Diluted earnings per share attributable to Penske Automotive Group common stockholders:
Continuing operations	$ 0.55	$ 0.39
Discontinued operations	$ (0.04)	$ (0.03)
Net income attributable to Penske Automotive Group common stockholders	$ 0.52	$ 0.37
Shares used in determining diluted earnings per share	90,338	92,554
Amounts attributable to Penske Automotive Group common stockholders:
Income from continuing operations	50,180	36,480
Less: Income attributable to non-controlling interests	188	70
Income from continuing operations, net of tax	49,992	36,410
Loss from discontinued operations, net of tax	(3,174)	(2,483)
Net income attributable to Penske Automotive Group common stockholders	46,818	33,927
New vehicle
Revenue:
Total revenues	1,578,319	1,385,556
Cost of sales:
Total cost of sales	1,446,281	1,275,804
Used vehicle
Revenue:
Total revenues	969,732	791,734
Cost of sales:
Total cost of sales	891,327	726,619
Finance and insurance, net
Revenue:
Total revenues	79,894	66,463
Service and parts
Revenue:
Total revenues	369,727	341,542
Cost of sales:
Total cost of sales	156,525	146,649
Fleet and wholesale vehicle
Revenue:
Total revenues	244,616	165,741
Cost of sales:
Total cost of sales	$ 241,562	$ 162,719

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Business Combinations

3 Months Ended

Mar. 31, 2012

Business Combinations [Abstract]

Business Combinations

3. Business Combinations

The Company acquired thirteen and three franchises during the three months ended March 31, 2012 and 2011, respectively, in its retail operations. The Company’s financial statements include the results of operations of the acquired dealerships from the date of acquisition. The fair value of the assets acquired and liabilities assumed have been recorded in the Company’s consolidated condensed financial statements, and may be subject to adjustment pending completion of final valuation. A summary of the aggregate consideration paid and the aggregate amounts of the assets acquired and liabilities assumed for the three months ended March 31, 2012 and 2011 follows:

	March 31,
	2012			2011
Accounts receivable	$	16,976		$	953
Inventory		79,650			7,923
Property and equipment		32,593			1,671
Goodwill		31,566			7,038
Franchise Value		23,426			—
Other assets		—			628
Current liabilities		(49,290	)		(2,491	)
Non-current liabilities		(26,815	)		—
Total consideration		108,106			15,722
Seller financed/assumed debt		—			(1,711	)
Cash used in dealership acquisitions	$	108,106		$	14,011

In addition, in March 2012 the Company formed a joint venture which acquired a BMW/Mini dealership in Monza, Italy, a suburb of Milan.

The following unaudited consolidated pro forma results of operations of the Company for the three months ended March 31, 2012 and 2011 give effect to acquisitions consummated during 2012 and 2011 as if they had occurred on January 1, 2011:

	Three Months Ended March 31,
	2012		2011
Revenues	$	3,258,179	$	2,908,036
Income from continuing operations		49,878		39,347
Net income		46,704		36,842
Income from continuing operations per diluted common share	$	0.55	$	0.43
Net income per diluted common share	$	0.52	$	0.40

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Inventories

3 Months Ended

Mar. 31, 2012

Inventories [Abstract]

Inventories

2. Inventories

Inventories consisted of the following:

	March 31,		December 31,
	2012		2011
New vehicles	$	1,206,234	$	1,058,371
Used vehicles		480,910		442,991
Parts, accessories and other		83,091		80,224
Total inventories	$	1,770,235	$	1,581,586

The Company receives non-refundable credits from certain vehicle manufacturers that reduce cost of sales when the vehicles are sold. Such credits amounted to $6,201 and $7,927 during the three months ended March 31, 2012 and 2011, respectively.

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Interim Financial Statements (Tables)

3 Months Ended

Mar. 31, 2012

Interim Financial Statements [Abstract]

Combined financial information regarding entities accounted for as discontinued operations

	Three Months Ended March 31,
	2012			2011
Revenues	$	45,942		$	129,462
Pre-tax loss		(11,458	)		(5,147	)
Gain on disposal		10,160			1,071

Balance Sheet information regarding entities accounted for as discontinued operations

	March 31,		December 31,
	2012		2011
Inventories	$	24,052	$	39,185
Other assets		5,023		28,591
Total assets	$	29,075	$	67,776
Floor plan notes payable (including non-trade)	$	22,730	$	36,186
Other liabilities		7,198		9,666
Total liabilities	$	29,928	$	45,852

Summary of fair value of subordinated notes

	March 31, 2012
	Carrying Value		Fair Value
7.75% senior subordinated notes due 2016	$	375,000	$	393,075
3.5% senior subordinated convertible notes due 2026		63,324		68,889

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Equity

3 Months Ended

Mar. 31, 2012

Equity [Abstract]

Equity

10. Equity

Share Repurchase

During the first quarter of 2012, the Company repurchased 350,000 shares of our outstanding common stock for $8,522, or an average of $24.35, under a program approved by the Company’s Board of Directors.

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Earnings Per Share

3 Months Ended

Mar. 31, 2012

Earnings Per Share [Abstract]

Earnings Per Share

6. Earnings Per Share

Basic earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, including outstanding unvested restricted stock awards which contain rights to non-forfeitable dividends. Diluted earnings per share is computed using net income attributable to Penske Automotive Group common stockholders and the number of weighted average shares of voting common stock outstanding, adjusted for any dilutive effects. The Company has senior subordinated convertible notes outstanding which, under certain circumstances discussed in Note 7, may be converted to voting common stock. As of March 31, 2012 and March 31, 2011, no shares related to the senior subordinated convertible notes were included in the calculation of diluted earnings per share because the effect of such securities was anti-dilutive. A reconciliation of the number of shares used in the calculation of basic and diluted earnings per share for the three months ended March 31, 2012 and 2011 follows:

	Three Months Ended
	March 31,
	2012		2011
Weighted average number of common shares outstanding		90,306		92,472
Effect of non-participatory equity compensation		32		82
Weighted average number of common shares outstanding,including effect of dilutive securities		90,338		92,554

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Intangible Assets

3 Months Ended

Mar. 31, 2012

Intangible Assets [Abstract]

Intangible Assets

4. Intangible Assets

Following is a summary of the changes in the carrying amount of goodwill and franchise value during the three months ended March 31, 2012:

			Franchise
	Goodwill		Value
Balance, January 1, 2012	$	905,721	$	228,459
Additions		31,566		23,426
Foreign currency translation		9,821		2,573
Balance, March 31, 2012	$	947,108	$	254,458

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Floor Plan Notes Payable - Trade and Non-trade

3 Months Ended

Mar. 31, 2012

Floor Plan Notes Payable - Trade and Non-trade [Abstract]

Floor Plan Notes Payable - Trade and Non-trade

5. Floor Plan Notes Payable — Trade and Non-trade

The Company finances substantially all of its new and a portion of its used vehicle inventories under revolving floor plan arrangements with various lenders, including the captive finance companies associated with automotive manufacturers. In the U.S., substantially all of our floor plan arrangements are due on demand; however, the Company has not historically been required to repay floor plan advances prior to the sale of the vehicles that have been financed. The Company typically makes monthly interest payments on the amount financed. Outside of the U.S., substantially all of the floor plan arrangements are payable on demand or have an original maturity of 90 days or less and the Company is generally required to repay floor plan advances at the earlier of the sale of the vehicles that have been financed or the stated maturity.

The floor plan agreements grant a security interest in substantially all of the assets of the Company’s dealership subsidiaries, and in the U.S. are guaranteed by the Company. Interest rates under the floor plan arrangements are variable and increase or decrease based on changes in the prime rate, defined London Interbank Offered Rate (“LIBOR”), the Finance House Bank Rate, or the Euro Interbank Offer Rate. The Company classifies floor plan notes payable to a party other than the manufacturer of a particular new vehicle, and all floor plan notes payable relating to pre-owned vehicles, as floor plan notes payable — non-trade on its consolidated condensed balance sheets and classifies related cash flows as a financing activity on its consolidated condensed statements of cash flows.

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Long-Term Debt

3 Months Ended

Mar. 31, 2012

Long-Term Debt [Abstract]

Long-Term Debt

7. Long-Term Debt

Long-term debt consisted of the following:

	March 31,			December 31,
	2012			2011
U.S. credit agreement—revolving credit line	$	107,000		$	132,000
U.S. credit agreement—term loan		127,000			127,000
U.K. credit agreement—revolving credit line		63,832			59,060
U.K. credit agreement—term loan		45,480			—
U.K. credit agreement—overdraft line of credit		—			13,333
7.75% senior subordinated notes due 2016		375,000			375,000
3.5% senior subordinated convertible notes due 2026, net of debt discount		63,324			63,324
Mortgage facilities		74,831			75,684
Other		5,427			4,790
Total long-term debt		861,894			850,191
Less: current portion		(13,264	)		(3,414	)
Net long-term debt	$	848,630		$	846,777

U.S. Credit Agreement

The Company is party to a credit agreement with Mercedes-Benz Financial Services USA LLC and Toyota Motor Credit Corporation, as amended (the “U.S. Credit Agreement”), which provides for up to $375,000 in revolving loans for working capital, acquisitions, capital expenditures, investments and other general corporate purposes, a non-amortizing term loan with a remaining balance of $127,000, and for an additional $10,000 of availability for letters of credit, through September 2014. The revolving loans bear interest at a defined LIBOR plus 2.50%, subject to an incremental 1.00% for uncollateralized borrowings in excess of a defined borrowing base. The term loan, which bears interest at defined LIBOR plus 2.50%, may be prepaid at any time, but then may not be re-borrowed.

The U.S. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by the Company’s domestic subsidiaries and contains a number of significant covenants that, among other things, restrict the Company’s ability to dispose of assets, incur additional indebtedness, repay other indebtedness, pay dividends, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. The Company is also required to comply with specified financial and other tests and ratios, each as defined in the U.S. Credit Agreement including: a ratio of current assets to current liabilities, a fixed charge coverage ratio, a ratio of debt to stockholders’ equity and a ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”). A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of the amounts owed. As of March 31, 2012, the Company was in compliance with all covenants under the U.S. Credit Agreement.

The U.S. Credit Agreement also contains typical events of default, including change of control, non-payment of obligations and cross-defaults to the Company’s other material indebtedness. Substantially all of the Company’s domestic assets are subject to security interests granted to lenders under the U.S. Credit Agreement. As of March 31, 2012, $127,000 of term loans, and $500 of letters of credit and $107,000 of revolver borrowings were outstanding under the U.S. Credit Agreement.

U.K. Credit Agreement

The Company’s subsidiaries in the U.K. (the “U.K. subsidiaries”) are party to a £100,000 revolving credit agreement with the Royal Bank of Scotland plc (RBS) and BMW Financial Services (GB) Limited, and an additional £10,000 demand overdraft line of credit with RBS (collectively, the “U.K. credit agreement”) to be used for working capital, acquisitions, capital expenditures, investments and general corporate purposes through November 2015. The revolving loans bear interest between defined LIBOR plus 1.35% and defined LIBOR plus 3.0% and the demand overdraft line of credit bears interest at the Bank of England Base Rate plus 1.75%. As of March 31, 2012, outstanding loans under the U.K. credit agreement amounted to £40,000 ($63,824).

The U.K. Credit Agreement is fully and unconditionally guaranteed on a joint and several basis by our U.K. subsidiaries, and contains a number of significant covenants that, among other things, restrict the ability of our U.K. subsidiaries to pay dividends, dispose of assets, incur additional indebtedness, repay other indebtedness, create liens on assets, make investments or acquisitions and engage in mergers or consolidations. In addition, our U.K. subsidiaries are required to comply with defined ratios and tests, including: a ratio of earnings before interest, taxes, amortization, and rental payments (“EBITAR”) to interest plus rental payments, a measurement of maximum capital expenditures, and a debt to EBITDA ratio. A breach of these requirements would give rise to certain remedies under the agreement, the most severe of which is the termination of the agreement and acceleration of any amounts owed. As of March 31, 2012, our U.K. subsidiaries were in compliance with all covenants under the U.K. credit agreement.

The U.K. credit agreement also contains typical events of default, including change of control and non-payment of obligations and cross-defaults to other material indebtedness of our U.K. subsidiaries. Substantially all of our U.K. subsidiaries’ assets are subject to security interests granted to lenders under the U.K. credit agreement.

In January 2012, our U.K. subsidiaries entered into a separate agreement with RBS, as agent for National Westminster Bank plc, providing for a £30,000 term loan which was used for working capital and an acquisition. The term loan is repayable in £1,500 quarterly installments through 2015 with a final payment of £7,500 due December 31, 2015. The term loan bears interest between 2.675% and 4.325%, depending on the U.K. subsidiaries’ ratio of net borrowings to earnings before interest, taxes, depreciation and amortization (as defined). As of March 31, 2012, the amount outstanding under the U.K. term loan was £28,500 ($45,480).

7.75% Senior Subordinated Notes

In December 2006, the Company issued $375,000 aggregate principal amount of 7.75% senior subordinated notes (the “7.75% Notes”) due 2016. The 7.75% Notes are unsecured senior subordinated notes and are subordinate to all existing and future senior debt, including debt under the Company’s credit agreements, mortgages and floor plan indebtedness. The 7.75% Notes are guaranteed by substantially all of the Company’s wholly-owned domestic subsidiaries on an unsecured senior subordinated basis. Those guarantees are full and unconditional and joint and several. The Company can redeem all or some of the 7.75% Notes at its option at specified redemption prices (currently 103.875% of the principal amount of the notes). Upon certain sales of assets or specific kinds of changes of control the Company is required to make an offer to purchase the 7.75% Notes. The 7.75% Notes also contain customary negative covenants and events of default. As of March 31, 2012, the Company was in compliance with all negative covenants and there were no events of default.

Senior Subordinated Convertible Notes

The Company currently has $63,324 of Convertible Notes outstanding. The Company issued the Convertible Notes in January 2006, and the notes mature on April 1, 2026, unless earlier converted, redeemed or purchased, as discussed below. The Convertible Notes are unsecured senior subordinated obligations and are subordinate to all future and existing debt under the Company’s credit agreements, mortgages and floor plan indebtedness. The Convertible Notes are guaranteed on an unsecured senior subordinated basis by substantially all of the Company’s wholly-owned domestic subsidiaries. The guarantees are full and unconditional and joint and several. The Convertible Notes also contain customary negative covenants and events of default. As of March 31, 2012, the Company was in compliance with all negative covenants and there were no events of default.

Holders of the Convertible Notes may convert them based on a conversion rate of 42.7796 shares of the Company’s common stock per $1,000 principal amount of the Convertible Notes (which is equal to a conversion price of approximately $23.38 per share), subject to adjustment, only under the following circumstances: (1) in any quarterly period, if the closing price of our common stock for twenty of the last thirty trading days in the prior quarter exceeds $28.05 (subject to adjustment), (2) for specified periods, if the trading price of the Convertible Notes falls below specific thresholds, (3) if the Convertible Notes are called for redemption, (4) if specified distributions to holders of our common stock are made or specified corporate transactions occur, (5) if a fundamental change (as defined) occurs, or (6) during the ten trading days prior to, but excluding, the maturity date.

Upon conversion of the Convertible Notes, for each $1,000 principal amount of the Convertible Notes, a holder will receive an amount in cash, equal to the lesser of (i) $1,000 or (ii) the conversion value, determined in the manner set forth in the indenture covering the Convertible Notes, of the number of shares of common stock equal to the conversion rate. If the conversion value exceeds $1,000, the Company will also deliver, at its election, cash, common stock or a combination of cash and common stock with respect to the remaining value deliverable upon conversion. The Company will pay additional cash interest commencing with six-month periods beginning on April 1, 2011, if the average trading price of a Convertible Note for certain periods in the prior six-month period equals 120% or more of the principal amount of the Convertible Notes.

The Company may redeem the Convertible Notes, in whole or in part at any time or from time to time, for cash at a redemption price of 100% of the principal amount of the Convertible Notes to be redeemed, plus any accrued and unpaid interest to the applicable redemption date, plus any applicable conversion premium.

On issuance of the Convertible Notes, the Company recorded a debt discount which was amortized as additional interest expense through March 31, 2011. The annual effective interest rate on the liability component was 8.25% through March 31, 2011. Beginning April 1, 2011, the annual effective interest rate was 3.5%.

Mortgage Facilities

The Company is party to several mortgages which bear interest at defined rates and require monthly principal and interest payments. These mortgage facilities also contain typical events of default, including non-payment of obligations, cross-defaults to the Company’s other material indebtedness, certain change of control events, and the loss or sale of certain franchises operated at the properties. Substantially all of the buildings and improvements on the properties financed pursuant to the mortgage facilities are subject to security interests granted to the lender. As of March 31, 2012, the Company owed $74,831 of principal under our mortgage facilities.

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Interim Financial Statements (Details Textual) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012 Franchise	Mar. 31, 2011 Franchise
Business Acquisition [Line Items]
Number of acquired franchises representing Agnew Group in the UK	13	3
Interim Financial Statements (Textual) [Abstract]
Total number of owned and operated franchises	335
Number of owned and operated franchises in US	168
Number of owned and operated franchises outside US	167
Limited partnership interest in Penske Truck Leasing Co.	9.00%
Disposed franchises	3
Awarded franchises	3
Agnew Group [Member]
Business Acquisition [Line Items]
Number of acquired franchises representing Agnew Group in the UK	13
Number of other acquired franchises in the UK	2
NPA Holdco, LLC [Member]
Business Acquisition [Line Items]
Percentage of interest acquired NPA Holdco, LLC	7.00%
Amount of acquisition	3,000

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Consolidating Condensed Financial Information (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
CONDENSED CONSOLIDATING STATEMENT OF INCOME
Revenues	$ 3,242,288	$ 2,751,036
Cost of sales	2,735,695	2,311,791
Gross profit	506,593	439,245
Selling, general and administrative expenses	398,637	355,391
Depreciation	13,349	11,798
Operating income (Loss)	94,607	72,056
Floor plan interest expense	(9,725)	(6,925)
Other interest expense	(12,210)	(11,285)
Debt discount amortization		(1,718)
Equity in earnings (losses) of affiliates	4,410	22
Income (loss) from continuing operations before income taxes	77,082	52,150
Income taxes	(26,902)	(15,670)
Income (loss) from continuing operations	50,180	36,480
(Loss) income from discontinued operations, net of tax	(3,174)	(2,483)
Net income (loss)	47,006	33,997
Less: Income attributable to the non-controlling interests	188	70
Net income (loss) attributable to Penske Automotive Group common stockholders	46,818	33,927
Other comprehensive income (loss), net of tax	10,701	16,522
Comprehensive income attributable to Penske Automotive Group common stockholders	57,519	50,449
Eliminations [Member]
CONDENSED CONSOLIDATING STATEMENT OF INCOME
Equity in earnings of subsidiaries	(87,852)	(64,350)
Income (loss) from continuing operations before income taxes	(87,852)	(64,350)
Income taxes	30,736	19,362
Income (loss) from continuing operations	(57,116)	(44,988)
(Loss) income from discontinued operations, net of tax	3,174	2,483
Net income (loss)	(53,942)	(42,505)
Net income (loss) attributable to Penske Automotive Group common stockholders	(53,942)	(42,505)
Comprehensive income attributable to Penske Automotive Group common stockholders	(53,942)	(42,505)
Penske Automotive Group [Member]
CONDENSED CONSOLIDATING STATEMENT OF INCOME
Selling, general and administrative expenses	4,595	4,949
Depreciation	362	285
Operating income (Loss)	(4,957)	(5,234)
Floor plan interest expense	(2,198)	(133)
Other interest expense	(7,563)	(6,416)
Debt discount amortization		(1,718)
Equity in earnings (losses) of affiliates	3,760	1,231
Equity in earnings of subsidiaries	87,852	64,350
Income (loss) from continuing operations before income taxes	76,894	52,080
Income taxes	(26,902)	(15,670)
Income (loss) from continuing operations	49,992	36,410
(Loss) income from discontinued operations, net of tax	(3,174)	(2,483)
Net income (loss)	46,818	33,927
Net income (loss) attributable to Penske Automotive Group common stockholders	46,818	33,927
Other comprehensive income (loss), net of tax	1,009	(663)
Comprehensive income attributable to Penske Automotive Group common stockholders	47,827	33,264
Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING STATEMENT OF INCOME
Revenues	1,842,665	1,564,740
Cost of sales	1,545,231	1,303,486
Gross profit	297,434	261,254
Selling, general and administrative expenses	239,699	215,973
Depreciation	7,146	6,324
Operating income (Loss)	50,589	38,957
Floor plan interest expense	(3,866)	(3,919)
Other interest expense	(910)	(611)
Income (loss) from continuing operations before income taxes	45,813	34,427
Income taxes	(20,557)	(10,989)
Income (loss) from continuing operations	25,256	23,438
(Loss) income from discontinued operations, net of tax	(1,622)	(2,301)
Net income (loss)	23,634	21,137
Net income (loss) attributable to Penske Automotive Group common stockholders	23,634	21,137
Other comprehensive income (loss), net of tax	(234)	282
Comprehensive income attributable to Penske Automotive Group common stockholders	23,400	21,419
Non-Guarantor Subsidiaries [Member]
CONDENSED CONSOLIDATING STATEMENT OF INCOME
Revenues	1,399,623	1,186,296
Cost of sales	1,190,464	1,008,305
Gross profit	209,159	177,991
Selling, general and administrative expenses	154,343	134,469
Depreciation	5,841	5,189
Operating income (Loss)	48,975	38,333
Floor plan interest expense	(3,661)	(2,873)
Other interest expense	(3,737)	(4,258)
Equity in earnings (losses) of affiliates	650	(1,209)
Income (loss) from continuing operations before income taxes	42,227	29,993
Income taxes	(10,179)	(8,373)
Income (loss) from continuing operations	32,048	21,620
(Loss) income from discontinued operations, net of tax	(1,552)	(182)
Net income (loss)	30,496	21,438
Less: Income attributable to the non-controlling interests	188	70
Net income (loss) attributable to Penske Automotive Group common stockholders	30,308	21,368
Other comprehensive income (loss), net of tax	9,926	16,903
Comprehensive income attributable to Penske Automotive Group common stockholders	$ 40,234	$ 38,271

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Consolidating Condensed Financial Information

3 Months Ended

Mar. 31, 2012

Consolidating Condensed Financial Information [Abstract]

Consolidating Condensed Financial Information

12. Consolidating Condensed Financial Information

The following tables include condensed consolidating financial information as of March 31, 2012 and December 31, 2011 and for the three month periods ended March 31, 2012 and 2011 for Penske Automotive Group, Inc. (as the issuer of the Convertible Notes and the 7.75% Notes), guarantor subsidiaries and non-guarantor subsidiaries (primarily representing foreign entities). The condensed consolidating financial information includes certain allocations of balance sheet, income statement and cash flow items which are not necessarily indicative of the financial position, results of operations and cash flows of these entities on a stand-alone basis.

CONDENSED CONSOLIDATING BALANCE SHEET

March 31, 2012

	Total Company		Eliminations			Penske Automotive Group		Guarantor Subsidiaries			Non-Guarantor Subsidiaries
	(In thousands)
Cash and cash equivalents	$	31,768	$	—		$	—	$	9,975		$	21,793
Accounts receivable, net		492,653		(318,778	)		318,778		253,077			239,576
Inventories		1,770,235		—			—		975,050			795,185
Other current assets		91,869		—			2,395		41,248			48,226
Assets held for sale		29,075		—			—		1,434			27,641
Total current assets		2,415,600		(318,778	)		321,173		1,280,784			1,132,421
Property and equipment, net		915,081		—			4,853		561,108			349,120
Intangible assets		1,201,566		—			—		705,484			496,082
Equity method inves tments		288,242		—			240,655		—			47,587
Other long-term assets		14,276		(1,367,480	)		1,377,436		(2,400	)		6,720
Total assets	$	4,834,765	$	(1,686,258	)	$	1,944,117	$	2,544,976		$	2,031,930
Floor plan notes payable	$	1,114,070	$	—		$	—	$	589,517		$	524,553
Floor plan notes payable — non-trade		701,242		—			89,049		328,378			283,815
Accounts payable		297,705		—			462		109,964			187,279
Accrued expenses		258,455		(318,778	)		85		142,818			434,330
Current portion of long-term debt		13,264		—			—		3,689			9,575
Liabilities held for sale		29,928		—			—		524			29,404
Total current liabilities		2,414,664		(318,778	)		89,596		1,174,890			1,468,956
Long-term debt		848,630		(37,026	)		672,324		74,774			138,558
Deferred tax liabilities		222,409		—			—		195,710			26,699
Other long-term liabilities		166,865		—			—		96,985			69,880
Total liabilities		3,652,568		(355,804	)		761,920		1,542,359			1,704,093
Total equity		1,182,197		(1,330,454	)		1,182,197		1,002,617			327,837
Total liabilities and equity	$	4,834,765	$	(1,686,258	)	$	1,944,117	$	2,544,976		$	2,031,930

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2011

						Penske
	Total					Automotive		Guarantor		Non-Guarantor
	Company		Eliminations			Group		Subsidiaries		Subsidiaries
	(In thousands)
Cash and cash equivalents	$	28,490	$	—		$	—	$	27,063	$	1,427
Accounts receivable, net		440,273		(297,782	)		305,386		283,193		149,476
Inventories		1,581,586		—			—		903,264		678,322
Other current assets		80,269		—			2,306		40,411		37,552
Assets held for sale		67,776		—			—		23,296		44,480
Total current assets		2,198,394		(297,782	)		307,692		1,277,227		911,257
Property and equipment, net		857,587		—			6,730		548,644		302,213
Intangible assets		1,134,180		—			—		701,452		432,728
Equity method investments		298,640		—			246,658		—		51,982
Other long-term assets		13,498		(1,360,808	)		1,369,182		3,389		1,735
Total assets	$	4,502,299	$	(1,658,590	)	$	1,930,262	$	2,530,712	$	1,699,915
Floor plan notes payable	$	977,548	$	—		$	—	$	560,999	$	416,549
Floor plan notes payable — non-trade		700,571		—			90,892		344,304		265,375
Accounts payable		220,708		—			1,633		112,975		106,100
Accrued expenses		201,579		(297,782	)		—		99,492		399,869
Current portion of long-term debt		3,414		—			—		3,414		—
Liabilities held for sale		45,852		—			—		7,850		38,002
Total current liabilities		2,149,672		(297,782	)		92,525		1,129,034		1,225,895
Long-term debt		846,777		(38,073	)		697,324		77,060		110,466
Deferred tax liabilities		217,902		—			—		198,348		19,554
Other long-term liabilities		147,535		—			—		93,328		54,207
Total liabilities		3,361,886		(335,855	)		789,849		1,497,770		1,410,122
Total equity		1,140,413		(1,322,735	)		1,140,413		1,032,942		289,793
Total liabilities and equity	$	4,502,299	$	(1,658,590	)	$	1,930,262	$	2,530,712	$	1,699,915

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended March 31, 2012

							Penske
	Total						Automotive			Guarantor			Non-Guarantor
	Company			Eliminations			Group			Subsidiaries			Subsidiaries
	(In thousands)
Revenues	$	3,242,288		$	—		$	—		$	1,842,665		$	1,399,623
Cost of sales		2,735,695			—			—			1,545,231			1,190,464
Gross profit		506,593			—			—			297,434			209,159
Selling, general and administrative expenses		398,637			—			4,595			239,699			154,343
Depreciation		13,349			—			362			7,146			5,841
Operating income (loss)		94,607			—			(4,957	)		50,589			48,975
Floor plan interest expense		(9,725	)		—			(2,198	)		(3,866	)		(3,661	)
Other interest expense		(12,210	)		—			(7,563	)		(910	)		(3,737	)
Equity in earnings of affiliates		4,410						3,760						650
Equity in earnings of subsidiaries		—			(87,852	)		87,852			—			—
Income (loss) from continuing operations before income taxes		77,082			(87,852	)		76,894			45,813			42,227
Income taxes		(26,902	)		30,736			(26,902	)		(20,557	)		(10,179	)
Income (loss) from continuing operations		50,180			(57,116	)		49,992			25,256			32,048
(Loss) income from discontinued operations, net of tax		(3,174	)		3,174			(3,174	)		(1,622	)		(1,552	)
Net income (loss)		47,006			(53,942	)		46,818			23,634			30,496
Less: Income attributable to the non-controlling interests		188			—			—			—			188
Net income (loss) attributable to Penske Automotive Group common stockholders		46,818			(53,942	)		46,818			23,634			30,308
Other comprehensive income (loss), net of tax		10,701			—			1,009			(234	)		9,926
Comprehensive income attributable to Penske Automotive Group common stockholders	$	57,519		$	(53,942	)	$	47,827		$	23,400		$	40,234

CONDENSED CONSOLIDATING STATEMENT OF INCOME

Three Months Ended March 31, 2011

							Penske
	Total						Automotive			Guarantor			Non-Guarantor
	Company			Eliminations			Group			Subsidiaries			Subsidiaries
	(In thousands)
Revenues	$	2,751,036		$	—		$	—		$	1,564,740		$	1,186,296
Cost of sales		2,311,791			—			—			1,303,486			1,008,305
Gross profit		439,245			—			—			261,254			177,991
Selling, general and administrative expenses		355,391			—			4,949			215,973			134,469
Depreciation		11,798			—			285			6,324			5,189
Operating income (loss)		72,056			—			(5,234	)		38,957			38,333
Floor plan interest expense		(6,925	)		—			(133	)		(3,919	)		(2,873	)
Other interest expense		(11,285	)		—			(6,416	)		(611	)		(4,258	)
Debt discount amortization		(1,718	)		—			(1,718	)		—			—
Equity in earnings (losses) of affiliates		22			—			1,231			—			(1,209	)
Equity in earnings of subsidiaries		—			(64,350	)		64,350			—			—
Income (loss) from continuing operations before income taxes		52,150			(64,350	)		52,080			34,427			29,993
Income taxes		(15,670	)		19,362			(15,670	)		(10,989	)		(8,373	)
Income (loss) from continuing operations		36,480			(44,988	)		36,410			23,438			21,620
(Loss) income from discontinued operations, net of tax		(2,483	)		2,483			(2,483	)		(2,301	)		(182	)
Net income (loss)		33,997			(42,505	)		33,927			21,137			21,438
Less: Income attributable to the non-controlling interests		70			—			—			—			70
Net income (loss) attributable to Penske Automotive Group common stockholders		33,927			(42,505	)		33,927			21,137			21,368
Other comprehensive income (loss), net of tax		16,522			—			(663	)		282			16,903
Comprehensive income attributable to Penske Automotive Group common stockholders	$	50,449		$	(42,505	)	$	33,264		$	21,419		$	38,271

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2012

				Penske
	Total			Automotive			Guarantor			Non-Guarantor
	Company			Group			Subsidiaries			Subsidiaries
				(In thousands)
Net cash from continuing operating activities	$	125,304		$	44,856		$	5,903		$	74,545
Investing activities:
Purchase of equipment and improvements		(26,466	)		(518	)		(18,101	)		(7,847	)
Dealership acquisitions, net		(108,106	)		—			—			(108,106	)
Net cash from continuing investing activities		(134,572	)		(518	)		(18,101	)		(115,953	)
Financing activities:
Net borrowings (repayments) of other long-term debt		9,766			(25,000	)		(963	)		35,729
Net borrowings (repayments) of floor plan notes payable — non-trade		671			(1,843	)		(15,926	)		18,440
Repurchase of common stock		(8,522	)		(8,522	)		—			—
Dividends		(8,973	)		(8,973	)		—			—
Distributions from (to) parent		—			—			636			(636	)
Net cash from continuing financing activities		(7,058	)		(44,338	)		(16,253	)		53,533
Net cash from discontinued operations		19,604			—			11,363			8,241
Net change in cash and cash equivalents		3,278			—			(17,088	)		20,366
Cash and cash equivalents, beginning of period		28,490			—			27,063			1,427
Cash and cash equivalents, end of period	$	31,768		$	—		$	9,975		$	21,793

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Three Months Ended March 31, 2011

				Penske
	Total			Automotive			Guarantor			Non-Guarantor
	Company			Group			Subsidiaries			Subsidiaries
				(In thousands)
Net cash from continuing operating activities	$	9,812		$	(1,050	)	$	64,251		$	(53,389	)
Investing activities:
Purchase of equipment and improvements		(20,843	)		(595	)		(7,641	)		(12,607	)
Dealership acquisitions, net		(14,011	)		—			(12,331	)		(1,680	)
Other		3,490			—			—			3,490
Net cash from continuing investing activities		(31,364	)		(595	)		(19,972	)		(10,797	)
Financing activities:
Net borrowings (repayments) of other long-term debt		6,711			—			(11,469	)		18,180
Net borrowings (repayments) of floor plan notes payable — non-trade		29,419			—			(38,324	)		67,743
Proceeds from exercises of options, including excess tax benefit		1,645			1,645			—			—
Distributions from (to) parent		—			—			3,899			(3,899	)
Net cash from continuing financing activities		37,775			1,645			(45,894	)		82,024
Net cash from discontinued operations		4,507			—			20,360			(15,853	)
Net change in cash and cash equivalents		20,730			—			18,745			1,985
Cash and cash equivalents, beginning of period		19,705			—			15,212			4,493
Cash and cash equivalents, end of period	$	40,435		$	—		$	33,957		$	6,478

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Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2012

Intangible Assets [Abstract]

Summary of the changes in the carrying amount of goodwill and franchise value

			Franchise
	Goodwill		Value
Balance, January 1, 2012	$	905,721	$	228,459
Additions		31,566		23,426
Foreign currency translation		9,821		2,573
Balance, March 31, 2012	$	947,108	$	254,458

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Segment Information (Details Textual)	3 Months Ended
	Mar. 31, 2012 Segment
Segment Information (Textual) [Abstract]
Number of reportable segments	2
Number of geographic operating segments	4

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Floor Plan Notes Payable - Trade and Non-trade (Details Textual)	3 Months Ended
	Mar. 31, 2012
Floor Plans Notes Payable - Trade and Non-trade (Textual) [Abstract]
Maturity period of floor plan arrangements outside the U.S. if not payable on demand	90 days or less

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Consolidated Condensed Statements of Comprehensive Income (Unaudited) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Consolidated Condensed Statements of Comprehensive Income [Abstract]
Net income	$ 47,006	$ 33,997
Other Comprehensive Income:
Foreign currency translation adjustment	9,926	16,852
Unrealized gain (loss) on interest rate swaps:
Unrealized gain(loss) arising during the period, net of tax benefit(provision) of $822 and ($139), respectively	(1,257)	212
Reclassification adjustment for loss included in floor plan interest expense, net of tax provision of $669, and $46, respectively	(1,023)	(70)
Unrealized gain (loss) on interest rate swaps, net of tax	(234)	282
Other adjustments to Comprehensive Income, net	1,009	(612)
Other Comprehensive Income Net of Taxes	10,701	16,522
Comprehensive Income	57,707	50,519
Less: Income attributable to non-controlling interests	188	70
Comprehensive income attributable to Penske Automotive Group common stockholders	$ 57,519	$ 50,449

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Interim Financial Statements

3 Months Ended

Mar. 31, 2012

Interim Financial Statements [Abstract]

Interim Financial Statements

1. Interim Financial Statements

Business Overview

Penske Automotive Group, Inc. (the “Company”) is the second largest automotive retailer headquartered in the U.S. as measured by total revenue. As of March 31, 2012, the Company operated 335 retail franchises, of which 168 franchises are located in the U.S. and 167 franchises are located outside of the U.S. The franchises outside the U.S. are located primarily in the U.K. Each of the Company’s dealerships offers a wide selection of new and used vehicles for sale. In addition to selling new and used vehicles, the Company generates higher-margin revenue at each of its dealerships through maintenance and repair services and the sale and placement of higher-margin products, such as third-party finance and insurance products, third-party extended service contracts and replacement and aftermarket automotive products. The Company also holds a 9.0% limited partnership interest in Penske Truck Leasing Co., L.P. (“PTL”), a leading transportation services provider.

During the three months ended March 31, 2012, we acquired the Agnew Group in the United Kingdom, representing thirteen franchises, and two other franchises. We also were awarded three franchises, including Nissan/Infiniti in San Francisco and Mini in Marin, CA, and disposed of three franchises, including Jaguar Land Rover in Gatwick, England and Lexus in Scottsdale, Arizona.

In April 2012, we acquired a 7% interest in NPA Holdco, LLC, an auctioneer of powersport vehicles for $3,000. Transportation Resource Partners, a related party, recently acquired a controlling interest in this company on the same financial terms as our investment.

Basis of Presentation

The following unaudited consolidated condensed financial statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and disclosures normally included in the Company’s annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the SEC rules and regulations. The information presented as of March 31, 2012 and December 31, 2011 and for the three month periods ended March 31, 2012 and 2011 is unaudited, but includes all adjustments which the management of the Company believes to be necessary for the fair presentation of results for the periods presented. The consolidated condensed financial statements for prior periods have been revised for entities which have been treated as discontinued operations through March 31, 2012, and the results for interim periods are not necessarily indicative of results to be expected for the year. These consolidated condensed financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2011, which are included as part of the Company’s Annual Report on Form 10-K.

In June 2011, the Financial Accounting Standards Board (“FASB”) issued ASU 2011-05, Presentation of Comprehensive Income, which requires the presentation of components of other comprehensive income with the components of net income. The adoption of this pronouncement on January 1, 2012 had no impact on our consolidated financial position or results of operations.

Discontinued Operations

The Company accounts for dispositions in its retail operations as discontinued operations when it is evident that the operations and cash flows of a franchise being disposed of will be eliminated from on-going operations and that the Company will not have any significant continuing involvement in its operations.

In evaluating whether the cash flows of a dealership in its Retail reportable segment will be eliminated from ongoing operations, the Company considers whether it is likely that customers will migrate to similar franchises that it owns in the same geographic market. The Company’s consideration includes an evaluation of the brands sold at other dealerships it operates in the market and their proximity to the disposed dealership. When the Company disposes of franchises, it typically does not have continuing brand representation in that market. If the franchise being disposed of is located in a complex of Company owned dealerships, the Company does not treat the disposition as a discontinued operation if it believes that the cash flows previously generated by the disposed franchise will be replaced by expanded operations of the remaining or replacement franchises.

Combined financial information regarding entities accounted for as discontinued operations follows:

	Three Months Ended March 31,
	2012			2011
Revenues	$	45,942		$	129,462
Pre-tax loss		(11,458	)		(5,147	)
Gain on disposal		10,160			1,071
	March 31,			December 31,
	2012			2011
Inventories	$	24,052		$	39,185
Other assets		5,023			28,591
Total assets	$	29,075		$	67,776
Floor plan notes payable (including non-trade)	$	22,730		$	36,186
Other liabilities		7,198			9,666
Total liabilities	$	29,928		$	45,852

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accounts requiring the use of significant estimates include accounts receivable, inventories, income taxes, intangible assets and certain reserves.

Fair Value of Financial Instruments

Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, debt, floor plan notes payable, and interest rate swaps used to hedge future cash flows. Other than our subordinated notes, the carrying amount of all significant financial instruments approximates fair value due either to length of maturity, the existence of variable interest rates that approximate prevailing market rates, or as a result of mark to market accounting. A summary of the fair value of the subordinated notes, based on quoted, level one market data, follows:

	March 31, 2012
	Carrying Value		Fair Value
7.75% senior subordinated notes due 2016	$	375,000	$	393,075
3.5% senior subordinated convertible notes due 2026		63,324		68,889

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2012

Earnings Per Share [Abstract]

Reconciliation of number of shares used in calculation of basic and diluted earning per share

	Three Months Ended
	March 31,
	2012		2011
Weighted average number of common shares outstanding		90,306		92,472
Effect of non-participatory equity compensation		32		82
Weighted average number of common shares outstanding,including effect of dilutive securities		90,338		92,554

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Business Combinations (Details 1) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2012	Mar. 31, 2011
Summary of unaudited consolidated pro forma results of operations
Revenues	$ 3,258,179	$ 2,908,036
Income from continuing operations	49,878	39,347
Net income	$ 46,704	$ 36,842
Income from continuing operations per diluted common share	$ 0.55	$ 0.43
Net income per diluted common share	$ 0.52	$ 0.40

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Segment Information

3 Months Ended

Mar. 31, 2012

Segment Information [Abstract]

Segment Information

11. Segment Information

The Company’s operations are organized by management into operating segments by line of business and geography. The Company has determined it has two reportable segments as defined in generally accepted accounting principles for segment reporting, including: (i) Retail, consisting of our automotive retail operations and (ii) PAG Investments, consisting of our investments in businesses other than automotive retail operations. The Retail reportable segment includes all automotive dealerships and all departments relevant to the operation of the dealerships and the retail automotive joint ventures. The individual dealership operations included in the Retail reportable segment have been grouped into four geographic operating segments, which have been aggregated into one reportable segment as their operations (A) have similar economic characteristics (all are automotive dealerships having similar margins), (B) offer similar products and services (all sell new and used vehicles, service, parts and third-party finance and insurance products), (C) have similar target markets and customers (generally individuals) and (D) have similar distribution and marketing practices (all distribute products and services through dealership facilities that market to customers in similar fashions).

Three Months Ended March 31

			PAG
	Retail		Investments		Total
Revenues
2012	$	3,242,288	$	—	$	3,242,288
2011		2,751,036		—		2,751,036
Segment income
2012		73,248		3,834		77,082
2011		51,026		1,124		52,150