AutoNation 1998 Annual Report Download - page 81

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purchase price of shares by delivery of a promissory note shall not be available
to any optionee who is a person described in Section 16(a) of the Securities
Exchange Act of 1934, as amended (the "1934 Act").
At any time of any exercise of an option, the Company may, if it shall
determine it necessary or desirable for any reason, require the optionee (or his
or her heirs, legatees, or legal representatives, as the case may be), as a
condition upon the exercise thereof, to deliver to the Company a written
representation of present intention to purchase the shares for investment and
not for distribution. In the event such representation is required to be
delivered, an appropriate legend may be placed upon each certificate delivered
to the optionee upon his or her exercise of part or all of the option and a stop
transfer order may be placed with the transfer agent. Each option shall also be
subject to the requirement that, if at any time the Company determines, in its
discretion, that the listing, registration or qualification of the shares
subject to the option upon any securities exchange or under any state or federal
law, or the consent or approval of any governmental regulatory body is necessary
or desirable as a condition of or in connection with, the issue or purchase of
shares thereunder, the option may not be exercised in whole or in part unless
such listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Company.
At the time of the exercise of any option the Committee may require, as
a condition of the exercise of such option, the optionee to (x) pay the Company
an amount equal to the amount of tax the Company may be required to withhold to
obtain a deduction for federal income tax purposes as a result of the exercise
of such option by the optionee or (y) make such other arrangements with the
Company which would enable the Company to pay such withholding tax, including,
without limitation, holding back a number of shares issuable upon exercise of
the option equal to the amount of such withholding tax, or permitting the
optionee to deliver a promissory note in a form specified by the Committee or
withhold taxes from other compensation payable to the optionee by the Company,
or (z) a combination of the foregoing.
3
4
8. TERMINATION OF RELATIONSHIP - EXERCISE THEREAFTER. In the event the
relationship between the Company and an optionholder is terminated for any
reason other than death, permanent disability or retirement, such optionholder's
options shall expire and all rights to purchase shares pursuant thereto shall
terminate immediately. The Committee may, in its sole discretion, permit any
option to remain exercisable for such period after such termination as the
Committee may prescribe, but in no event after the expiration date of the
option. Temporary absence from employment or as a consultant because of illness,
vacation, approved leaves of absence, and transfers of employment among the
Company and its subsidiaries shall not be considered to terminate employment or
consulting relationship or to interrupt continuous employment or consulting
relationship.
In the event of termination of said relationship because of death,
permanent disability (as that term is defined in Section 22 (e) (3) of the Code,
as now in effect or as subsequently amended), or retirement, the option may be
exercised in full, without regard to any installments established under Section
6 hereof, by the optionee or, if he is not living, by his heirs, legatees or
legal representative (as the case may be) during its specified term prior to
three years after the date of death, permanent disability or retirement, or such
longer period as the Committee may prescribe, but in no event after the
expiration of the date of the option.
9. TRANSFERABILITY OF OPTIONS. No option shall be assignable or
transferable by the optionee to whom it is granted, other than by will or the
laws of descent and distribution, except that, upon approval by the Board, the