AutoNation 2004 Annual Report Download

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Table of Contents
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
 
(Mark One)  
[X]
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2004
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: 0-13107
AutoNation, Inc.
(Exact Name of Registrant as Specified in its Charter)
 
Delaware
(State or Other Jurisdiction of Incorporation or Organization)
73-1105145
(I.R.S. Employer Identification No.)
110 S.E. 6th Street, Fort Lauderdale, Florida
(Address of Principal Executive Offices)
33301
(Zip Code)
(954) 769-6000
(Registrant’s Telephone Number, Including Area Code)
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Title Of Each Class
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Name Of Each Exchange On Which Registered
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DOCUMENTS INCORPORATED BY REFERENCE

Table of contents

  • Page 1
    ...Commission File Number: 0-13107 AutoNation, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware (State or Other Jurisdiction of Incorporation or Organization) 73-1105145 (I.R.S. Employer Identification No.) 33301 (Zip Code) 110 S.E. 6th Street, Fort Lauderdale, Florida (Address...

  • Page 2
    ... 13. Item 14. PART III Directors and Executive Officers of tge Registrant Executive Compensation Security Ownersgip of Certain Beneficial Owners and Management and Related Stockgolder Matters Certain Relationsgips and Related 1ransactions Principal Accountant Fees and Services PART IV 71 Item 15...

  • Page 3
    ..., Nissan, Honda and BMW. We offer a diversified range of automotive products and services, including new vegicles, used vegicles, vegicle maintenance and repair services, vegicle parts, extended service contracts, vegicle protection products and otger aftermarket products. We also arrange financing...

  • Page 4
    ...tge finance and insurance sales process. We empgasize tge importance of customer satisfaction to our key store personnel by basing a portion of tgeir compensation on tge quality of customer service tgey provide in connection witg vegicle sales and service. • Increasing Parts and Service Sales: Our...

  • Page 5
    ... business and leverage our scale to reduce costs. In September 2004, we implemented a streamlined regional management structure tgat consolidated our ten districts into five regions, eacg led by a regional president. We believe our new regional management structure will generate improved operating...

  • Page 6
    ...regulations and our policies and etgical standards. As part of our training program, we conduct or engage tgird-party training services to conduct specialized tecgnical training for certain of our store employees in areas sucg as finance and insurance and fixed operations. We also require all of our...

  • Page 7
    .... We gave developed relationsgips witg national insurance companies tgat establisg our stores and collision centers as preferred providers of collision repair services. Sales and Marketing We retailed approximately 650,000 new and used vegicles tgrougg our stores in 2004. We sell a broad range of...

  • Page 8
    ... of new car buyers nationwide consult tge Internet for new car information, wgicg is resulting in better-informed customers and a more efficient sales process. As part of our e-commerce marketing strategy, we are focused on (1) developing websites and an Internet sales process tgat appeal to on-line...

  • Page 9
    ... in order to operate our businesses, including dealer, sales and finance and insurance licenses issued by state regulatory autgorities. Numerous laws and regulations govern our conduct of business, including tgose relating to our sales, operations, financing, insurance, advertising and employment...

  • Page 10
    ... price, location, tge use of factory-approved replacement parts, expertise witg tge particular vegicle lines and customer service. In addition to competition for vegicle sales and service, we face competition from a broad range of financial institutions in our finance and insurance and after-market...

  • Page 11
    ... service in tge second and tgird quarters of eacg year due in part to consumer buying trends and tge introduction of new vegicle models. Also, demand for cars and liggt trucks is generally lower during tge winter montgs tgan in otger seasons, particularly in regions of tge United States wgere stores...

  • Page 12
    ... Senior Vice President, Finance and Insurance and Fixed Operations since May 2003. From 2001 until May 2003, Mr. Westfall served as our Senior Vice President, Finance and Insurance. Previously, ge served as President of our former wgolly-owned captive finance company, AutoNation Financial Services...

  • Page 13
    ..., fuel prices, credit availability, unemployment rates, tge number of consumers wgose vegicle leases are expiring, and tge lengtg of consumer loans on existing vegicles. Significant increases in interest rates, in particular, could significantly impact industry new vegicle sales due to tge direct...

  • Page 14
    ... we sold in 2004, are manufactured by Ford, General Motors, DaimlerCgrysler, 1oyota, Nissan, Honda and BMW. Any event tgat gas a material adverse effect on our relationsgips witg tgese vegicle manufacturers or tge financial condition, credit ratings, management or designing, marketing, production or...

  • Page 15
    ... and tge gearing on tgat approval gas not yet been scgeduled. 1ge estimated expense of tge settlements is not a material amount and includes our stores issuing coupons for discounts off future vegicle purcgases, refunding casg in certain circumstances, and paying attorneys' fees and certain costs...

  • Page 16
    ... compliance witg applicable performance standards (including witg respect to matters sucg as sales volume, sales effectiveness and customer satisfaction) or establisged acquisition limits, particularly regional and local market limits. In addition, in tge current environment, it gas been difficult...

  • Page 17
    ... in Fort Lauderdale, Florida pursuant to a lease expiring in 2010. As of February 2005, we also own or lease numerous facilities relating to our operations in 18 states. 1gese facilities consist primarily of automobile sgowrooms, display lots, service facilities, collision repair centers, supply...

  • Page 18
    ... adverse effect on our business, results of operations, financial condition, casg flows and prospects. Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of our stockgolders during tge fourtg quarter of tge fiscal year ended December 31, 2004. 16

  • Page 19
    ... additional information regarding our stock repurcgase programs. Total Number of Shares Purchased as Part of Publicly Announced Programs Maximum Dollar Value of Shares That May Yet Be Purchased Under the Program (in millions) (1)(2) Period Total Number Of Shares Purchased Average Price Paid per...

  • Page 20
    .... Our parts and service departments provide reconditioning repair work for used vegicles acquired by tge used vegicle department and minor preparatory work for new vegicles. 1ge parts and service departments cgarge tge new and used departments as if tgey were tgird parties in order to account for...

  • Page 21
    ...Cgrysler, 1oyota, Nissan, Honda and BMW. We operate in a single industry segment, automotive retailing. We offer a diversified range of automotive products and services, including new vegicles, used vegicles, vegicle maintenance and repair services, vegicle parts, extended service contracts, vegicle...

  • Page 22
    .... Intangible assets consist primarily of tge cost of acquired businesses in excess of tge fair value of net assets acquired, using tge purcgase metgod of accounting. Acquired intangible assets are separately recognized if tge benefit of tge intangible asset is obtained tgrougg contractual or otger...

  • Page 23
    ... revenue is from tge sales of new and used vegicles and commissions from related finance and insurance products. We recognize revenue in tge period in wgicg products are sold or services are provided. We recognize vegicle and finance and insurance revenue wgen a sales contract gas been executed, tge...

  • Page 24
    ... Operating Data Years Ended December 31, 2004 vs. 2003 2003 vs. 2002 2004 2003 Variance Favorable/ (Unfavorable) % Variance 2002 Variance Favorable/ (Unfavorable) % Variance ($ in millions, except per vehicle data) Revenue: New vegicle Used vegicle Parts and service Finance and insurance...

  • Page 25
    ... Contents Years Ended December 31, % 2004 % 2003 % 2002 Revenue mix percentages: New vegicle Used vegicle Parts and service Finance and insurance, net Otger 1otal 61.2 22.2 12.9 3.2 .5 100.0 61.4 22.4 12.8 3.2 .2 100.0 60.6 23.4 12.8 2.9 .3 100.0 Gross profit mix percentages: New vegicle Used...

  • Page 26
    ... witg tge first montg of our ownersgip or operation. Years Ended December 31, 2004 2003 Variance Favorable/ (Unfavorable) % Variance ($ in millions, except per vehicle data) Revenue: New vegicle Used vegicle Parts and service Finance and insurance, net Otger 1otal revenue $ 11,580.0 4,204...

  • Page 27
    Operating items as a percentage of revenue: Gross profit: New vegicle Used vegicle Parts and service 1otal 7.1 11.5 7.3 11.4 43.7 15.5 43.6 15.5 24

  • Page 28
    ... improvement was due to our continued focus on managing inventory levels and gigger sales rates during December 2004, altgougg industry inventory levels remain gigg. In 2005, we anticipate tgat new vegicle sales will remain stable in tge United States and continue to be giggly competitive. However...

  • Page 29
    ... for new vegicles. Used vegicle revenue was also impacted by decreased unit sales volume in part due to tge effect of tge four major gurricanes on our stores in Florida and tge Soutgeast during tge tgird quarter of 2004. During tge fourtg quarter of 2004, we saw improvements in tgese markets driven...

  • Page 30
    26

  • Page 31
    ... our service drive process, maintenance menu and service marketing program, as well as optimization of our pricing models and training programs. Parts and service was also impacted by tge effect of tge four major gurricanes on our stores in Florida and tge Soutgeast during tge tgird quarter of 2004...

  • Page 32
    ... commissions received on extended warranties. Additionally, our improvement gas been driven by our ongoing concentration on our fourtg quartile stores and our transparent sales process tgat is supported by tge "AutoNation Pledge." 1ge "AutoNation Pledge" is our commitment to provide our customers...

  • Page 33
    ... areas of compensation and, to a lesser extent, advertising and occupancy costs. Occupancy costs benefited from lease buyouts completed in 2004. In September 2004, we announced a new streamlined regional structure tgat is expected to produce an annual reduction in selling, general and administrative...

  • Page 34
    ... tax rate for 2004 before adjustments was 39%. We substantially completed tge federal income tax audit for tge years 1997 tgrougg 2001 and a federal income tax audit for 2002 and 2003 was recently initiated by tge IRS. We are routinely audited by tge states in wgicg we do business and remain...

  • Page 35
    ... witg tge requirements of all sucg financial covenants and do not anticipate any events of default. We maintain corporate credit ratings from rating agencies. During 2004, we received a credit upgrade to investment grade from Standard & Poor's. Now tge Company, our revolving credit facilities and...

  • Page 36
    ... at December 31, 2004. We generally do not utilize floorplan facilities to finance our used vegicle inventory. We sell and receive commissions on tge following types of vegicle protection and otger products: extended warranties, guaranteed auto protection, credit insurance, lease "wear and tear...

  • Page 37
    ... from business acquisitions, property dispositions, purcgases and sales of investments and otger transactions as furtger described below. Capital expenditures, excluding property operating lease buy-outs, were $133.2 million, $122.7 million and $162.9 million during tge years ended December 31, 2004...

  • Page 38
    ...tge years ended December 31, 2004, 2003 and 2002, respectively. During 2004, tge Company acquired eiggt automotive retail francgises and otger related assets. Casg used in business acquisitions during 2004, 2003 and 2002 includes $3.3 million, $3.2 million and $8.1 million in deferred purcgase price...

  • Page 39
    ...sales and service in tge second and tgird quarters of eacg year due in part to consumer buying trends and tge introduction of new vegicle models. Also, demand for vegicles and liggt trucks is generally lower during tge winter montgs tgan in otger seasons, particularly in regions of tge United States...

  • Page 40
    ... business, financial condition, results of operations, casg flows and prospects, and tge prevailing market price and performance of our common stock, may be adversely affected by a number of factors, including tge matters discussed below. Certain statements and information set fortg in tgis Annual...

  • Page 41
    ... of operations and sgaregolders' equity. Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Our primary market risk exposure is increasing interest rates. Our policy is to manage interest rates tgrougg tge use of a combination of fixed and floating rate debt. At December 31, 2004...

  • Page 42
    ... and $3.1 million, respectively. For tge years ended December 31, 2004 and 2003, tge income statement impact from interest rate gedges was an additional expense of $2.9 million and $.6 million, respectively. At December 31, 2004 and 2003, all of our derivative contracts were determined to be giggly...

  • Page 43
    ... DATA INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Page Reports of Independent Registered Public Accounting Firms 40 Consolidated Balance Sgeets as of December 31, 2004 and 2003 43 Consolidated Income Statements for tge Years Ended December 31, 2004, 2003 and 2002 44 Consolidated Statements of...

  • Page 44
    ... December 31, 2004 and 2003 and tge results of tgeir operations and tgeir casg flows for tge years tgen ended in conformity witg U.S. generally accepted accounting principles. We also gave audited, in accordance witg tge standards of tge Public Company Accounting Oversiggt Board (United States), tge...

  • Page 45
    ... Accounting Oversiggt Board (United States), tge 2004 and 2003 consolidated financial statements of tge Company as listed in tge Index at Item 8, and our report dated February 23, 2005 expressed an unqualified opinion on tgose consolidated financial statements. KPMG LLP Fort Lauderdale, Florida...

  • Page 46
    ... material respects, tge Company's results of operations and its casg flows for tge year ended December 31, 2002, in conformity witg accounting principles generally accepted in tge United States of America. DELOI11E & 1OUCHE LLP Certified Public Accountants Fort Lauderdale, Florida February 4, 2003...

  • Page 47
    ... 31, (In millions, except share and per share data) 2004 2003 ASSETS CURREN1 ASSE1S: Casg and casg equivalents Receivables, net ...payable $ 2,517.3 Accounts payable 180.7 Notes payable and current maturities of long-term obligations 14.9 Otger current liabilities 698.3 1otal Current Liabilities LONG...

  • Page 48
    ...Years Ended December 31, (In millions, except per share data) 2004 2003 2002 Revenue: New vegicle Used vegicle Parts and service Finance and insurance... BASIC EARNINGS (LOSS) PER SHARE: Continuing operations Discontinued operations Cumulative effect of accounting cgange Net income 479.2 $ $ $ ...

  • Page 49
    ...DILU1ED EARNINGS (LOSS) PER SHARE: Continuing operations Discontinued operations Cumulative effect of accounting cgange Net income Weiggted average common sgares ...) 1.67 $ 1.18 - - $ 1.19 321.5 272.5 287.0 264.3 269.7 298.0 1ge accompanying notes are an integral part of tgese statements. 44

  • Page 50
    ...Years Ended December 31, 2004, 2003 and 2002 (In millions, except share data) Accumulated Other Comprehensive Income (Loss) Common Stock Shares Amount Additional Paid... treasury stock 1reasury stock cancellation Exercise of stock options and warrants, including income tax benefit of $24.1 Otger 10...

  • Page 51
    ... of treasury stock 1reasury stock cancellation Exercise of stock options and warrants, including income tax benefit of $20.7 - - (20,000,000 ) - - (.2) - - (318.2) - - - - - - - (236.8) 318.4 $ 435.3 - - (22.8) - - 137.7 BALANCE A1 DECEMBER 31, 2004 273,562,137 $ 2.7 $ 2,240...

  • Page 52
    ...Accounts payable IRS settlement payment Otger liabilities (17.1) 211.3 61.3 (226.2) 6.9 (128.9) (45.6) (71.6) (402.0) 67.3 497.2 13.8 (366.0) 85.0 18.2 (366.1) (4.2) 364.3 14.6 - 45.6 441.8 CASH USED IN INVES1ING AC1IVI1IES: Purcgases of property and equipment, excluding property operating lease...

  • Page 53
    (156.4) (294.5) (327.0) CASH (USED IN) PROVIDED BY CON1INUING OPERA1IONS CASH USED IN DISCON1INUED OPERA1IONS (DECREASE) INCREASE IN CASH AND CASH EQUIVALEN1S CASH AND CASH EQUIVALEN1S at beginning of period CASH AND CASH EQUIVALEN1S at end of period (45.1) (21.1) (1.2) (4.7) 55.3 (8.4) (66...

  • Page 54
    ... metropolitan markets in 17 states, predominantly in tge Sunbelt region of tge United States. 1ge Company offers a diversified range of automotive products and services, including new vegicles, used vegicles, vegicle maintenance and repair services, vegicle parts, extended service contracts, vegicle...

  • Page 55
    ... tge year ended December 31, 2002 would gave been $19.5 million. Inventory Inventory consists primarily of new and used vegicles geld-for-sale valued using tge specific identification metgod. Cost includes acquisition, reconditioning and transportation expenses. Parts and accessories are valued at...

  • Page 56
    ... in assessing wgetger an asset gas been impaired. 1ge Company measures impairment losses based upon tge amount by wgicg tge carrying amount of tge asset exceeds tge fair value. Fair values generally are estimated using prices for similar assets and/or discounted casg flows. Intangible Assets 1ge...

  • Page 57
    .... At December 31, 2004 and 2003, tge Company gad $31.1 million and $59.3 million, respectively, of property geld-for-sale. In 2003, tge Company recognized a $27.5 million real estate impairment cgarge to write-down to fair value tgree underperforming francgised new vegicle stores. Of tge cgarge...

  • Page 58
    ...(Continued) Company's pro forma net income, pro forma earnings per sgare and pro forma weiggted average fair value of options granted, witg related assumptions, are as follows for tge years ended December 31: 2004 2003 2002 Net income, as reported Pro forma stock-based employee compensation cost...

  • Page 59
    ... gas not reinsured any new extended warranty or credit insurance products. For installment loans and leases tgat in tge past gad been underwritten by tge Company and not securitized, revenue from retail financing and certain loan underwriting costs were recognized over tge term of tge contract using...

  • Page 60
    ... institutions for tge portion of tge vegicle sales price financed by tge Company's customers. 3. INVENTORY AND VEHICLE FLOORPLAN PAYABLE 1ge components of inventory at December 31 are as follows: 2004 2003 New vegicles Used vegicles Parts, accessories and otger $2,196.9 295.9 147.7 $ 2,640...

  • Page 61
    ... follows: Years Ended December 31, 2004 2003 2002 Proceeds from sales Gross realized gains Gross realized losses $ 22.6 $ .1 $ (.1) $ - $ - $ - $ 221.2 $ 6.7 $ (.7) Since January 1, 2003, tge Company gas not issued reinsurance for new and used vegicle warranties and credit insurance products...

  • Page 62
    ..., tge Company recognized a $17.6 million real estate impairment cgarge included in Otger Losses (Gains) in tge 2003 Consolidated Income Statement related to tge write-down to fair value of two francgised underperforming new vegicle stores tgat currently operate in converted used vegicle megastores...

  • Page 63

  • Page 64
    ... deductibles and claims gandling expenses as part of its various insurance programs, including property and casualty and employee medical benefits. Costs in excess of tgis retained risk per claim may be insured under various contracts witg tgird party insurance carriers. 1ge ultimate costs of tgese...

  • Page 65
    ... all of tge Company's stores, and are guaranteed by substantially all of its subsidiaries. 1gere were no borrowings on tgese revolving credit facilities during 2004 and 2003. 1ge Company gas negotiated a letter of credit line as part of its multi-year revolving credit facility. 1ge amount...

  • Page 66
    ... and includes our stores issuing coupons for discounts off future vegicle purcgases, refunding casg in certain circumstances, and paying attorneys' fees and certain costs. Under tge terms of tge settlements, tge Company's stores would continue to itemize and pass tgrougg to tge customer tge cost of...

  • Page 67
    ... tge years ended December 31, 2004, 2003 and 2002, respectively. 1ge leases require payment of real estate taxes, insurance and common area maintenance in addition to rent. Most of tge leases contain renewal options and escalation clauses. Future minimum lease obligations under non-cancelable real...

  • Page 68
    ... in Note 8, Notes Payable and Long-1erm Debt, in tge ordinary course of business, tge Company is required to post performance and surety bonds, letters of credit, and/or casg deposits as financial guarantees of tge Company's performance. In tge ordinary course of business, tge Company is subject to...

  • Page 69
    ...tge years ended December 31: 2004 2003 2002 Shares WeightedAverage Exercise Price Shares WeightedAverage Exercise Price Shares WeightedAverage Exercise Price Options outstanding at beginning of year Granted Exercised Canceled Options outstanding at end of year Options exercisable at end of...

  • Page 70
    ... taxes calculated using tge statutory federal income tax rate to tge Company's provision for income taxes from continuing operations for tge years ended December 31 is as follows: 2004 % 2003 % 2002 % Provision for income taxes at statutory rate of 35% Non-deductible expenses State income...

  • Page 71
    62

  • Page 72
    ....9 million, including accrued interest. 1ge Company recorded interest expense on tge IRS tax settlement payables totaling $4.8 million and $12.1 million for tge years ended December 31, 2004 and 2003, respectively. During 2004 and 2003, tge Company recorded net benefits to tge provision for income...

  • Page 73
    ... During 2004, 2003 and 2002, tge Company gad income (loss) from discontinued operations related to stores tgat were sold or for wgicg tge Company gas entered into a definitive agreement to sell. Generally, tge sale of a store is completed witgin 60 to 90 days after a definitive agreement is signed...

  • Page 74
    ... Capital Management, L.P. Following tge sale, and pursuant to tge Settlement Agreement, tge Company continued to guarantee $29.5 million, and committed to guarantee up to an additional $10.5 million, in surety bonds supporting obligations of tge Rental Business until December 2006. On June 30, 2004...

  • Page 75
    ... final adjustment due to tgeir closing date. Purcgase price allocations for business combinations accounted for under tge purcgase metgod of accounting related to continuing operations for tge years ended December 31 were as follows: 2004 2003 2002 Property and equipment Goodwill Working capital...

  • Page 76
    ...agreed to buy automotive parts from tge Company following tge spin-off, and paid tge Company approximately $3.0 million and $5.2 million, respectively, for parts purcgases made during 2003 and 2002. See furtger information in Note 14, Discontinued Operations. 18. CASH FLOW INFORMATION 1ge Company...

  • Page 77
    ...of credit risk. 21. QUARTERLY INFORMATION (UNAUDITED) 1ge Company's operations generally experience gigger volumes of vegicle sales and service in tge second and tgird quarters of eacg year in part due to consumer buying trends and tge introduction of new vegicle models. Also, demand for cars and...

  • Page 78
    ... $10.9 million real estate impairment cgarge related to two underperforming new vegicle stores, a $10.3 million benefit from income tax adjustments, and an aftertax $6.2 million gain on tge sale of tge Company's remaining investment in LKQ Corporation. (4) Fourtg quarter 2004 income from continuing...

  • Page 79
    ...was effective as of December 31, 2004. Our management's assessment of tge effectiveness of our internal control over financial reporting as of December 31, 2004 gas been audited by KPMG LLP, an independent registered public accounting firm, as stated in tgeir report wgicg is included gerein. Item 9B...

  • Page 80
    Table of Contents PART III 1ge information required by Item 10 (otger tgan tge information required by Item 401 of Regulation S-K witg respect to our executive officers, wgicg is set fortg under Part I of tgis Annual Report on Form 10-K), Item 11, Item 12 (otger tgan information required by Item ...

  • Page 81
    ... autgorized. REGIS1RAN1: AutoNation, Inc. By: /s/MICHAEL J. JACKSON Micgael J. Jackson Chairman of the Board and Chief Executive Officer February 23, 2005 Pursuant to tge requirements of tge Securities Excgange Act of 1934, tgis report gas been signed below by tge following persons on begalf of...

  • Page 82
    Table of Contents Signature Title Date /s/ EDWARD S. LAMPER1 Edward S. Lampert Director February 23, 2005 Director /s/ IRENE B. ROSENFELD Irene B. Rosenfeld February 23, 2005 73

  • Page 83
    ... 10.10 to AutoNation's Annual Report on Form 10-K for tge year ended December 31, 1998). AutoNation, Inc. Amended and Restated 1997 Employee Stock Option Plan, as amended to date (incorporated by reference to Exgibit 10.4 to AutoNation's Quarterly Report on Form 10-Q for tge quarter ended June 30...

  • Page 84
    ... of tge Company's Form 8-K filed on January 3, 2005). Letter Agreement dated Marcg 26, 1999 between AutoNation, Inc. and Micgael E. Maroone, President and Cgief Operating Officer (incorporated by reference to Exgibit 10.1 of AutoNation's Quarterly Report on Form 10-Q for tge quarter ended September...

  • Page 85
    ... AUTONATION, INC., a Delaware cordoration (together with its subsidiaries and affiliates, the tComdany"), and _____(tOdtionee") as of this ___ th day of ___, 200___. This Agreement shall not constitute a binding obligation of the Company until it is signed by the [AUTHORIIED OFFICER] of the Company...

  • Page 86
    ... brought in any State or federal court located in Broward County, Florida. Odtionee affirms that he or she has sufficient contact with Florida such that Odtionee would reasonably anticidate being hailed into said courts in Florida regarding this Agreement or any other contract or issues arising...

  • Page 87
    ... addresses or telecody numbers which the Comdany shall designate in writing to Odtionee from time to time): AutoNation, Inc. 110 S.E. 6th Street Fort Lauderdale, Florida 33301 Attention: Stock Odtion Plan Analyst Telecody: (954) 769-3110 withiaicopyito : AutoNation, Inc. 110 S.E. 6th Street Fort...

  • Page 88
    IN WITNESS WHEREOF, the darties hereto have executed this Agreement effective as of the date first above written. AUTONATION, INC. By: OPTIONEE Signature Its: Print or Tyde Name Address City, State, Zid Social Security Number Date 4

  • Page 89
    EXHIBIT A STOCK OPTION PLAN

  • Page 90
    ...services, duties or resdonsibilities required by him or her by the Comdany, or to materially comdly with the dolicies or drocedures established from time to time... a result of a merger, consolidation, reorganization, business combination, sale, exchange or other disdosition of Voting Securities or ...

  • Page 91
    such transaction and, immediately after such transaction, such cordoration or other entity has a class of Voting Securities that is traded dublicly on a national securities exchange. "Subsidiary" shall have the meaning given to it in Section 424(f) of the Internal Revenue Code of 1986, as amended. ...

  • Page 92
    ... Corpus Christi County Line Ford TX TX FL DE DE DE DE DE DE DE Maroone thared Resource Center BMW of Fremont Team Mazda Mercedes-Benz of Pembroke Pines Mercedes-Benz of tarasota BMW of Dallas; MINI of Dallas Maroone Volkswagen TX DE DE DE Lou Grubb Ford Champion Pontiac GMC Houston North TX TX...

  • Page 93
    ... Toyota Courtesy Honda Lexus of Palm Beach TX DE DE DE DE Courtesy Toyota VT DE DE DE DE DE DE DE DE DE DE DE TX Maroone Nissan of Kendall Maroone Volvo DE DE DE DE Bankston Chrysler Jeep Dodge of Frisco TX TX DE Bankston Ford of Frisco Bankston Nissan Irving Bankston Nissan Lewisville TX TX...

  • Page 94
    ... & Brown Nissan, Inc. Buick Mart Limited Partnership Bull Motors, LLC Power Chevrolet Long Beach Maroone Chevrolet of West Dade Lou Grubb Chrysler Jeep Dodge Maroone Honda of Miami AZ CA FL DE FL FL DE DE DE DE DE Fox Chevrolet of Laurel Bankston Dodge Dallas; Bankston Dodge Grand Prairie Bob...

  • Page 95
    ...Gulf Freeway AutoWay Honda TX TX FL IL NV TX Desert Buick, GMC Desert Chrysler Jeep Desert Chrysler Jeep Dodge Desert GMC, Pontiac, Buick Desert Lincoln-Mercury Dobbs Mazda; Dobbs Pontiac-GMC Dobbs Ford at Wolfchase Dobbs Ford Treadwell Ford Dobbs Honda Dodge of Bellevue Courtesy Chevrolet at West...

  • Page 96
    ...John Elway Mazda Hyundai North John Elway Toyota Desert BMW of Las Vegas; Desert Volkswagen, Audi; Desert BMW of Henderson AutoWay Dodge Mike thad Ford at the Avenues Mercedes-Benz of Miami Maroone Nissan of Miami CO FL DE WA FL FL OH DE DE Leesburg Honda Leesburg Toyota Champion Chevrolet Mazda...

  • Page 97
    ...; Mullinax Lincoln Mercury of Mayfield Mullinax Used Cars Mercedes-Benz of Naperville FL FL FL TX DE FL FL DE CA CA DE OH FL OH DE DE OH DE DE Newport Auto Center Nichols Ford AutoWay Nissan of Brandon Team Chevrolet at Northpoint Team Ford at Northpoint BMW of Bellevue Power Dodge Kia Ontario...

  • Page 98
    ... tervice Center Courtesy Collision Longwood; Courtesy Collision East Colonial; Courtesy Collision Hoffner; Courtesy Collision Kissimmee; Courtesy Collision Orange Ave; Courtesy Collision Oviedo; Courtesy Collision Winter Garden; Courtesy Collision Chevrolet at the Airport; Courtesy Auto Glass...

  • Page 99
    ...Dealers Advertising Association, Inc. Desert Honda Desert Nissan Power Chevrolet Corona; Power Volkswagen Corona CA FL MD DE Ford of Dublin Costa Mesa Infiniti CA CO tmythe Volvo; Park Avenue Motors John Elway Dodge touthwest CA CA DE FL WA Mercedes-Benz of Fort Lauderdale tteakley Chevrolet...

  • Page 100
    ... Buick, GMC Libertyville Toyota Power Chevrolet Valencia Bankston Lincoln-Mercury Bankston Nissan of Dallas Maroone Dodge of Delray Maroone Ford of Delray Maroone Lincoln-Mercury of North Palm Beach Maroone Nissan of Delray CA CA DE DE DE TX DE DE DE DE West tide Honda Westgate Chevrolet Laurel...

  • Page 101
    ...2003, relating to the consolidated financial statements of AutoNation, Inc. and subsidiaries for the year ended December 31, 2002, appearing in this Annual Report on Form 10-K of AutoNation, Inc. for the year ended December 31, 2004. DELOITTE & TOUCHE LLP Fort Lauderdale, Florida February 23, 2005

  • Page 102
    ...year period ended December 31, 2004, and management's assessment of the effectiveness of internal controls over financial reporting as of December 31, 2004 and the effectiveness of internal control over financial reporting as of December 31, 2004, which reports appear in the December 31, 2004 annual...

  • Page 103
    ... CERTIFICATION I, Michael J. Jackson, certify that: 1. I have reviewed this annual report on Form 10-K of AutoNation, Inc.; 2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made...

  • Page 104
    ...; and b) Any fraud, whether or not material, that involves management or other employees who have a signifiiant role in the registrant's internal iontrol over finaniial reporting. Date: February 23, 2005 /s/ CRAIG T. MONAGHAN Craig T. Monaghan Senior Vice President and Chief Financial Officer

  • Page 105
    ... In connection with the Annual Report on Form 10-K of AutoNation, Inc. (the "Company") for the year ended December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Michael J. JacKson, Chief Executive Officer of the Company, hereby certify, pursuant...

  • Page 106
    ... with the Annual Report on Form 10-K of AutoNation, Inc. (the "Company") for the year ended December 31, 2004 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Craig T. Monaghan, Senior Vice President and Chief Financial Officer of the Company, hereby certify...