Penske Automotive (PAG) 8-KPenske Automotive Group Reports Record Results

On February 6, 2023, we, Penske Truck Leasing Corporation, PTL GP, LLC and MBK USA Commercial Vehicles Inc. (“Mitsui MBK”) amended the Seventh Amended and Restated Agreement of Limited Partnership of Penske Truck Leasing Co., L.P. (the “PTS Partnership Agreement”). Penske Transportation Solutions (“PTS”) is the universal brand name for Penske Truck Leasing Co., L.P.'s various business lines. We hold a 28.9% ownership interest in PTS, with the remaining 41.1% owned by subsidiaries of Penske Corporation and 30.0% owned by Mitsui MBK. The PTS Partnership Agreement was amended principally to augment PTS' governance to replace a six-member advisory committee with an eleven-member advisory board. We retain the right to appoint one advisory board member and appointed Robert H. Kurnick, Jr., our President. Lisa Davis, one of our directors, was also appointed to the expanded advisory board. The amendments also authorize the advisory board to appoint committees with such powers and authority of the advisory board granted to the committee by the advisory board. We are entitled to designate a non-voting observer to all committees as long as we retain the right to appoint an advisory board member.

The PTS Partnership Agreement continues to provide us with the right to pro rata quarterly distributions equal to at least 50% of PTS' consolidated net income, as well as specified minority rights which require our and/or Mitsui MBK's consent for certain actions taken by PTS as specified in the PTS Partnership Agreement. We may to transfer our directly owned interests in PTS with the unanimous consent of the other partners, or if we provide the remaining partners with a right of first offer to acquire our interests, except that we may transfer up to 9.02% of our interest to Penske Corporation without complying with the right of first offer to the remaining partners. We and Penske Corporation have previously agreed that (1) in the event of any transfer by Penske Corporation of their partnership interests to a third party, we will be entitled to “tag-along” by transferring a pro rata amount of our partnership interests on similar terms and conditions, and (2) Penske Corporation is entitled to a right of first refusal in the event of any transfer of our partnership interests, subject to the terms of the PTS Partnership Agreement. Additionally, PTS has agreed to indemnify the general partner for any actions in connection with managing PTS, except those taken in bad faith or in violation of the PTS Partnership Agreement.

The PTS Partnership Agreement allows Penske Corporation to give notice to require PTS 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, and, beginning in 2025, we and Mitsui MBK continue to have a similar right to require PTS to begin an initial public offering of equity securities, subject to certain limitations, as soon as reasonably practicable.

The foregoing description of the PTS Partnership Agreement, as amended, is qualified in its entirety by reference to Amendment No. 1 to the PTS Partnership Agreement, a copy of which is filed as an exhibit and incorporated by reference herein, and the PTS Partnership Agreement, a copy of which is filed as exhibit 10.3 to our Current Report on Form 8-K filed with the Securities and Exchange Commission on September 8, 2017 and is incorporated herein by reference.

Pursuant to the stockholders agreement, which expires March 26, 2030, the Penske companies agreed to vote their shares for two directors who are representatives of Mitsui as long as Mitsui owns in excess of 20% of our

We are party to a license agreement with an affiliate of Penske Corporation for a license of the “Penske Automotive” name. This agreement provides us with a perpetual license of the name “Penske Automotive” and related trade names so long as Penske Corporation and its affiliates own in excess of 20% of our outstanding common stock and we adhere to the other terms of the license agreement. From time to time, we enter into arrangements with PTS and/or other Penske Corporation affiliates and third-party vendors in order to achieve the benefits of scale or synergy opportunities as between the companies. These arrangements are reviewed by the Board in accordance with our written related party transaction policy. For example, we aggregate several Penske entities in connection with sourcing certain telecommunications services to achieve the benefits of scale.

On December 16, 2021, we entered into a Services Agreement with Mitsui under which Mitsui employee Kota Odagiri, one of our directors, assists us in strategic development of business opportunities and relationships in transportation related industries and the evaluation of new technologies in the automotive and trucking sectors.

On February 8, 2023, we issued a press release announcing our fourth quarter and full year 2022 financial results and other information. A copy of the press release is furnished as Exhibit 99.1.

The information set forth in Item 2.02 is incorporated into this Item 7.01 by reference.

Investors and others should note that we announce material financial information using our company website (www.penskeautomotive.com), our investor relations website (investors.penskeautomotive.com), SEC filings, press releases, public conference calls, and webcasts. Information about Penske Automotive Group, Inc. ("Penske Automotive"), its business, and its results of operations may also be announced by posts on the following social media channels:

The information that we post on these social media channels could be deemed to be material information. As a result, we encourage investors, the media, and others interested in Penske Automotive to review the information that we post on these social media channels. These channels may be updated from time to time on Penske Automotive's investor relations website.