Annual report pursuant to Section 13 and 15(d)

Commitments and Contingencies (Tables)

v2.4.0.6
Commitments and Contingencies (Tables)
 12 Months Ended
Dec. 31, 2012
Commitments and Contingencies [Abstract]  
Summary of lease exit accruals

A summary of the activity of these operating lease accruals consists of the following:

 

         
    (In thousands)  

Balance, December 31, 2011

   $ 39,118  

Lease exit expense(1)

     4,286  

Payments(2)

     (8,764 ) 

Lease buyout(3)

     (1,657 ) 
   

 

 

  

Balance, December 31, 2012

   $ 32,983  
   

 

 

  

 

(1) Expense of approximately $0.4 million is recorded in interest expense, other, net. A benefit of approximately $0.4 million is recorded in selling, general and administrative expenses. Expense of approximately $4.3 million is recorded to income (loss) from operations and the sale of dealerships in the accompanying Consolidated Statements of Income.

 

(2) Amount is recorded as an offet to rent expense in selling, general and administrative expenses, with approximately $1.3 million in continuing operations and $7.4 million as a reduction to income (loss) from operations and the sale of dealerships in the accompanying Consolidated Statements of Income.

 

(3) Amount represents write-off of accrual related to an early lease buyout agreement which was completed and paid, relieving Sonic of any future lease obligation.
Minimum future lease payments for both continuing and discontinued operations

Minimum future lease payments for facility leases and future receipts from subleases as required under non-cancelable operating leases for both continuing and discontinued operations based on current interest rates in effect are as follows:

 

                 

Year Ending December 31,

   Future
Minimum
Lease Payments,
Net		     Receipts
from Future
Subleases		  
    (In thousands)  

2013

   $ 104,159     $ (19,243 ) 

2014

     91,735       (19,013 ) 

2015

     78,793       (17,445 ) 

2016

     75,090       (15,095 ) 

2017

     68,261       (9,700 ) 

Thereafter

     230,977       (33,388 ) 
Financial covenants related to amended subordination and guaranty agreement

The required financial covenants related to the amended subordination and guaranty agreement are as follows:

 

                                 
    Covenant  
    Minimum
Consolidated
Liquidity
Ratio		     Minimum
Consolidated
Fixed Charge
Coverage
Ratio		     Maximum
Consolidated
Total Lease
Adjusted Leverage
Ratio		     Minimum
EBTDAR to
Rent Ratio		  

Required ratio

     1.05       1.20       5.50       1.50  

December 31, 2012 actual

     1.15       1.69       3.94       3.14