FORM
OF AUTONATION, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this “Agreement”)
is entered into as of this
(the “Date of Grant”), by and between AUTONATION, INC.,
a Delaware corporation (together with its subsidiaries and
affiliates, the “Company”), and the designated Company
associate (“Optionee”) who accepts the grant of
employee stock options made hereby, and agrees to be bound by this
Agreement, through Merrill Lynch’s Benefits OnLine System
(the “BOL System”). This Agreement shall be of no
force and effect unless Optionee has accepted this Agreement on the
BOL System by
.
A. The
Company has established the AutoNation, Inc. 2008 Employee Equity
and Incentive Plan (the “Plan”), a copy of which is
attached as Exhibit A hereto, in order to provide
incentive to valued employees of the Company; and
B. The
Executive Compensation Subcommittee of the Board of Directors of
the Company (the “Committee”) has approved the grant to
Optionee of a non-qualified employee stock option to purchase from
the Company shares of the Company’s common stock, par value
$0.01 per share (“Common Stock”), on the terms and
conditions set forth in this Agreement.
NOW
THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, and intending to be
legally bound hereby, the parties hereby agree as
follows:
1.
Definitions . Schedule 1 sets forth a Glossary
of terms that are used herein. All capitalized terms used but not
defined in this Agreement shall have the meanings given to them in
the Glossary or the Plan.
2.
Grant of Option . Subject to the terms and conditions of
this Agreement and the terms and conditions of the Plan, Optionee
is hereby granted under the Plan the right and option (the
“Option”) to purchase from the Company all or any part
of the number of shares of Common Stock set forth for Optionee on
the BOL System under the Grant Information tab (for the Date of
Grant), at the exercise price of $
per share. The Option shall not be treated as an incentive stock
option under Section 422 of the Internal Revenue Code of 1986,
as amended.
3.
Term . The term of the Option shall commence on the date of
this Agreement and expire ten (10) years from the date of this
Agreement, subject to the terms and conditions hereof and the terms
and conditions of the Plan, as may be amended from time to
time.
4.
Vesting . Except as otherwise provided herein or in the
Plan, the Option shall vest in four equal annual installments, 25%
on the first anniversary of the Date of Grant, 25% on the second
anniversary of the Date of Grant, 25% on the third anniversary of
the Date of Grant, and 25% on the fourth anniversary of the Date of
Grant, subject to continuous employment by Optionee with the
Company as of each such date.
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5.
Termination of Option if Employment is Terminated Due to a
Change in Ownership of Subsidiary or Affiliate or Spin-Off .
For purposes of clarification, if Optionee ceases to be an employee
of the Company or any Subsidiary or Affiliate of the Company
following a Change in Ownership or Spin-Off of the Subsidiary,
Affiliate or business unit by which Optionee is employed (whether
because of the termination of employment of Optionee or because the
corporation or other entity by which Optionee was employed ceases
to be a Subsidiary or Affiliate of the Company or otherwise), then
the Option shall immediately terminate.
6.
Optionee Bound by Terms of Plan . Optionee hereby
acknowledges receipt of a copy of the Plan and agrees to be bound
by all of the terms, conditions and provisions thereof (including,
without limitation, the termination of the Option in the event of a
termination of the Optionee’s employment with the Company for
Cause). For purposes of clarification, the Optionee hereby
acknowledges that in the event of a termination of the
Optionee’s employment with the Company for Cause at a time
when the Optionee is eligible for Retirement (as such term is
defined in the Plan), both the Option and any other stock options
to acquires shares of Company stock previously granted to the
Optionee shall be forfeited and terminate immediately.
7.
Governing Law . This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida,
without regard to its principles of conflict of laws. The parties
agree that any action, suit or proceeding arising out of or
relative to this Agreement or the relationship of Optionee and the
Company shall be instituted only in the State or federal courts
located in Broward County in the State of Florida, and each party
waives any objection that such party may now o
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