AutoNation 2006 Annual Report Download - page 114

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Exhibit 10.18
AUTONATION, INC.
SENIOR EXECUTIVE INCENTIVE BONUS PLAN
1. Purpose. The purpose of the AutoNation, Inc. Senior Executive Incentive Bonus Plan is to align the interests of Company management with those of the
shareholders of the Company by encouraging management to achieve goals intended to increase shareholder value.
2. Definitions. The following terms, as used herein, shall have the following meanings:
(a) “Award” shall mean an incentive compensation award, granted pursuant to the Plan, which is contingent upon the attainment of Performance Factors
with respect to a Performance Period.
(b) “Board” shall mean the Board of Directors of the Company.
(c) “Code” shall mean the Internal Revenue Code of 1986, as amended.
(d) “Committee” shall mean the Executive Compensation Subcommittee of the Board or such other committee or subcommittee as may be appointed by the
Board to administer the Plan in accordance with Section 3 of the Plan.
(e) “Common Stock” shall mean the common stock of the Company, par value $.01 per share.
(f) “Company” shall mean AutoNation, Inc., a Delaware corporation, or any successor corporation.
(g) “Disability” shall mean permanent disability as determined pursuant to the long-term disability plan or policy of the Company or its Subsidiaries in
effect at the time of such disability and applicable to a Participant.
(h) “Effective Date” shall mean January 1, 2007.
(i) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.
(j) “Executive Officer” shall mean an officer of the Company or its Subsidiaries who is an “executive officer” within the meaning of Rule 3b-7 promulgated
under the Exchange Act.
(k) “Participant” shall mean an Executive Officer or other key employee who is, pursuant to Section 4 of the Plan, selected to participate herein.
(l) “Performance Factors” shall mean the criteria and objectives, determined by the Committee, which must be met during the applicable Performance
Period as a condition of the Participant’s receipt of payment with respect to an Award. Performance Factors may include any or all of the following or any
combination thereof: net income (before or after taxes); operating income; gross margin; earnings before all or any of interest, taxes, depreciation and/or
amortization (“EBIT”, “EBITA” or “EBITDA”); revenue; unit sales; cash flow; return on equity; return on assets; return on capital; asset management (e.g.,
inventory and receivable levels);