AutoNation 1998 Annual Report Download - page 87

representative) may exercise the Incentive Stock Option.
10. ADJUSTMENTS. The number of shares subject to this Plan and to
Options granted under this Plan shall be adjusted as follows: (a) in the event
that the number of outstanding shares of Common Stock is changed by any stock
dividend, stock split or combination of shares, the number of shares subject to
this Plan and to Options granted hereunder shall be proportionately adjusted;
(b) in the event of any merger, consolidation or reorganization of the Company
with any other corporation or corporations, there shall be substituted, on an
equitable basis, for each share of Common Stock then subject to this Plan,
whether or not at the time subject to outstanding Options, the number and kind
of shares of stock or other securities to which the holders of shares of Common
Stock will be entitled pursuant to the transaction; and (c) in the event of any
other relevant change in the capitalization of the Company, an equitable
adjustment shall be made in the number of shares of Common Stock then subject to
this Plan, whether or not then subject to outstanding Options. In the event of
any such adjustment, the Exercise Price per share shall be proportionately
adjusted.
11. AMENDMENT OF PLAN. This Plan may from time to time be amended or
discontinued by action of the Board of Directors of the Company, provided that
(i) no such amendment or discontinuance shall change or impair any Options
previously granted without the consent of the Optionee, (ii) the provisions of
this Plan relating to the amount of shares which may be subject to Options, the
Automatic Grant Dates and/or the Exercise Price shall not be amended more than
once every six months, other than to comply with Title I of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or the Code, and or
the rules thereunder and (iii) any amendment which would (A) materially increase
the benefits accruing to the participants under this Plan, (B) materially
increase the number of securities which may be issued under this Plan, and/or
(C) materially modify the requirements as to the eligibility for participation
in this Plan shall require the approval of the stockholders of the Company,
unless such approval is not required by Rule 16b-3 under the Securities Exchange
Act of 1934, as amended (the "1934 Act"), or any other federal regulations.
4
5
12. CASH PROCEEDS. Any cash proceeds received by the Company from the
sale of shares pursuant to the Options granted under this Plan shall be used for
general corporate purposes.
13. NO IMPAIRMENT OF RIGHTS. Nothing in this Plan or any automatic
grant made pursuant to this Plan shall be construed or interpreted so as to
affect adversely or otherwise impair the Company's right to remove any Optionee
from service on the Board of Directors of the Company at any time in accordance
with the Company's Bylaws or any provisions of applicable law.
14. HOLDING PERIOD. Anything contained in this Plan to the contrary
notwithstanding, any disposition of an Option otherwise permitted by the terms
of this Plan, or of the Common Stock acquired upon exercise of an Option, shall
be subject to compliance with the requirements of paragraph (c) (1) of Rule
16b-3 or its successors promulgated under the 1934 Act, applicable to such
disposition, and any date, period or procedure specified or referred to in this
Plan with respect to any such disposition shall be adjusted, if necessary, so as
to give effect to this Section 14.
15. COMPLIANCE WITH RULE 16b-3. This Plan is intended to comply with
all applicable conditions of Rule 16b-3 or its successors promulgated under the
1934 Act, regardless of whether such conditions are set forth in this Plan. To
the extent any provision of this Plan or action of this Plan administrators
fails to so comply, it shall be deemed null and void, to the extent permitted by
law and deemed advisable by this Plan administrators.