AutoNation 2006 Annual Report Download - page 113

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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 or property 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 and kind of shares of stock or other securities or property
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.
12. 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, and
(ii) 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 applicable law.
13. 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.
14. 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.
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.
16. EFFECTIVE DATE. This Plan shall take effect on the date it is approved by the stockholders of the Company (the “Effective Date”) and shall expire
on the 10th anniversary of the date of such approval; provided that the expiration of the Plan shall not affect Options outstanding on the date of such
expiration, which Options shall continue to remain outstanding in accordance with their terms.
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