AutoNation 2006 Annual Report Download - page 99

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Committee such powers and authorities related to the administration of the Plan, as set forth in Section 2(a) above, as the Board shall determine, consistent
with the Certificate of Incorporation and Bylaws of the Company and applicable law. The Board may remove members, add members, and fill vacancies on
the Committee from time to time, all in accordance with the Company’s Certificate of Incorporation and Bylaws, and with applicable law. The majority vote of
the Committee, or acts reduced to or approved in writing by a majority of the members of the Committee, shall be the valid acts of the Committee.
(c) NO LIABILITY. No member of the Board or of the Committee shall be liable for any action or determination made in good faith with respect to the Plan
or any Option granted or Option Agreement entered into hereunder.
(d) DELEGATION TO THE COMMITTEE. In the event that the Plan or any Option granted or Option Agreement entered into hereunder provides for any
action to be taken by or determination to be made by the Board, such action may be taken by or such determination may be made by the Committee if the
power and authority to do so has been delegated to the Committee by the Board as provided for in Section 2(b) above. Unless otherwise expressly determined
by the Board, any such action or determination by the Committee shall be final and conclusive.
3. STOCK
The stock that may be issued pursuant to Options granted under the Plan shall be shares of common stock, $.01 par value, of the Company (the
“Stock”), which shares may be treasury shares or authorized but unissued shares. The number of shares of Stock that may be issued pursuant to Options
granted under the Plan shall not exceed in the aggregate 30,000,000 shares, subject to adjustment as provided in Section 17 below. If any Option expires,
terminates, or is terminated or canceled for any reason prior to exercise in full, the shares of Stock that were subject to the unexercised portion of such Option
shall be available for future Options granted under the Plan. Further, Stock issued under the Plan through the settlement, assumption or substitution of
outstanding awards or obligations to grant future awards as a condition of the Company acquiring another entity shall not reduce the maximum number of
shares of Stock available for delivery.
4. ELIGIBILITY
(a) EMPLOYEES. Options may be granted under the Plan to any employee of the Company, a Subsidiary or any other entity of which on the relevant date
at least a majority of the securities or other ownership interest having ordinary voting power (absolutely or contingently) for the election of directors or other
persons performing similar functions (“Voting Securities”) are at the time owned directly or indirectly by the Company or any Subsidiary (an “Affiliate”),
including any such employee who is an officer or director of the Company, a Subsidiary or an Affiliate, as the Board shall determine and designate from time
to time prior to expiration or termination of the Plan. The maximum number of shares of Stock subject to Options that may be granted during any calendar
year under the Plan to any executive officer or other employee of the Company or any Subsidiary or Affiliate whose compensation is or may be subject to Code
§162(m) is 5,000,000 shares (subject to adjustment as provided in Section 17 hereof).
2