<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
AutoNation, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
AutoNation(TM) LOGO
April 14, 2000
Dear Stockholder:
We are pleased to invite you to attend the 2000 Annual Meeting of
Stockholders of AutoNation, Inc. to be held at 11:00 a.m. on Tuesday, May 16,
2000, at The Broward Center for the Performing Arts, Au Rene Theater, 201 S.W.
Fifth Avenue, Fort Lauderdale, Florida 33312.
The accompanying Notice of Annual Meeting and Proxy Statement describe the
specific matters to be acted upon at the meeting. We will also report on the
progress of AutoNation, Inc. and provide an opportunity for stockholders to ask
questions of general interest.
Whether you own a few or many shares of AutoNation stock and whether or not
you plan to attend the meeting in person, it is important that your shares be
represented at the Annual Meeting. PLEASE DATE AND SIGN YOUR PROXY CARD AND
RETURN IT IN THE ENCLOSED ENVELOPE AS SOON AS POSSIBLE. The Board of Directors
unanimously recommends that stockholders vote FOR each of the matters described
in the Proxy Statement to be presented at the Annual Meeting.
We look forward to seeing you on May 16th in Fort Lauderdale. Thank you.
Sincerely,
/s/ WAYNE
H. Wayne Huizenga
Chairman of the Board
<PAGE> 3
AutoNation(TM) LOGO
AUTONATION TOWER
110 S.E. SIXTH STREET
FORT LAUDERDALE, FLORIDA 33301
NOTICE OF THE 2000 ANNUAL MEETING OF STOCKHOLDERS
TO THE STOCKHOLDERS OF AUTONATION, INC.:
The 2000 Annual Meeting of Stockholders of AutoNation, Inc. will be held at
11:00 a.m. on Tuesday, May 16, 2000, at The Broward Center for the Performing
Arts, Au Rene Theater, 201 S.W. Fifth Avenue, Fort Lauderdale, Florida 33312, to
consider and take action with respect to the following matters:
(1) The election of Directors for the ensuing year;
(2) The ratification of the appointment of Arthur Andersen LLP as our
independent public accountants for 2000; and
(3) Such other business as may properly come before the Annual Meeting or
any adjournment thereof.
The record date for the Annual Meeting is the close of business on March
31, 2000. Accordingly, only stockholders of record at the close of business on
March 31, 2000 are entitled to notice of and to vote at the Annual Meeting or
any adjournment thereof.
You are cordially invited to attend the Annual Meeting in person. EVEN IF
YOU PLAN TO ATTEND IN PERSON, YOU ARE REQUESTED TO DATE, SIGN AND RETURN THE
ENCLOSED PROXY AT YOUR EARLIEST CONVENIENCE. You may revoke your proxy at any
time prior to its use.
By Order of the Board of Directors,
/s/ Jonathan P. Ferrando
Jonathan P. Ferrando
Senior Vice President,
General Counsel and Secretary
April 14, 2000
PLEASE DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT
PROMPTLY IN THE ENVELOPE PROVIDED FOR THAT PURPOSE.
<PAGE> 4
AUTONATION, INC.
AUTONATION TOWER
110 S.E. SIXTH STREET
FORT LAUDERDALE, FLORIDA 33301
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of AutoNation, Inc., a Delaware corporation
("AutoNation" or the "Company"), for use at the 2000 Annual Meeting of
Stockholders of the Company, or any postponement or adjournment thereof (the
"Annual Meeting"). The Annual Meeting will be held at 11:00 a.m. on Tuesday, May
16, 2000, at The Broward Center for the Performing Arts, Au Rene Theater, 201
S.W. Fifth Avenue, Fort Lauderdale, Florida 33312.
This Proxy Statement, the Notice of Annual Meeting, the proxy card and the
Company's Annual Report to Stockholders were mailed to stockholders of the
Company on or about April 14, 2000.
RECORD DATE
Only stockholders of record at the close of business on March 31, 2000 (the
"Record Date") are entitled to vote at the Annual Meeting.
SHARES OUTSTANDING AND VOTING RIGHTS
The only voting stock of the Company outstanding is its common stock, par
value $.01 per share (the "Common Stock"). As of the close of business on the
Record Date, there were 361,124,289 shares of Common Stock outstanding. Each
share of Common Stock issued and outstanding is entitled to one vote in each of
the matters properly presented at the Annual Meeting.
PROXY PROCEDURE
Proxies properly executed and returned in a timely manner will be voted at
the Annual Meeting in accordance with the directions noted thereon. If no
direction is indicated, they will be voted for the election of the nominees
named herein as Directors, for the proposal to ratify the appointment of Arthur
Andersen LLP as our independent public accountants for 2000, as set forth in the
Notice of Annual Meeting, and in accordance with the judgment of the persons
acting under the proxies on other matters presented for a vote. Any stockholder
giving a proxy has the power, at any time before it is voted, to revoke it in
person at the Annual Meeting, by written notice to the Secretary of the Company
at the address set forth above or by delivery to the Secretary of the Company of
a proxy with a later date.
Votes cast by proxy or in person at the Annual Meeting will be tabulated by
the inspectors of election appointed for the meeting and will be counted in
determining whether or not a quorum is present. A proxy submitted by a
stockholder may indicate that all or a portion of the shares represented by such
proxy are not being voted by such stockholder with respect to a particular
matter ("non-voted shares"). Non-voted shares with respect to a particular
matter will not be considered shares present and entitled to vote on such
matter, although such shares may be considered present and entitled to vote for
other purposes and will be counted for purposes of determining the presence of a
quorum. Shares voting to abstain as to a particular matter, and directions to
"withhold authority" to vote for Directors, will be considered present and
entitled to vote with respect to such matter and will therefore have the effect
of a vote against such matter.
VOTING REQUIREMENTS
Each Director will be elected by the affirmative vote of a plurality of the
votes cast by the holders of shares of Common Stock present at the Annual
Meeting, in person or by proxy, and entitled to vote on the election of
Directors. The affirmative vote of the holders of a majority of the shares of
Common Stock present in person or by proxy and entitled to vote at the Annual
Meeting is required for the ratification of Arthur
<PAGE> 5
Andersen LLP as our independent public accountants for 2000 and for the approval
of each other matter duly brought to a vote at the Annual Meeting.
COSTS OF SOLICITATION
In addition to soliciting proxies by mail, certain employees of the Company
may also solicit proxies personally, by telephone or otherwise, but such persons
will not be compensated for such services. As is customary, the Company will
reimburse brokerage firms, banks, fiduciaries, voting trustees and other
nominees for forwarding the soliciting material to each beneficial owner of
stock held of record by them. The Company has retained Georgeson Shareholder
Communications Inc. to assist with the solicitation of proxies for a fee not to
exceed $8,500, plus reimbursement for out-of-pocket expenses. The entire cost of
the solicitation will be borne by the Company.
BIOGRAPHICAL INFORMATION REGARDING DIRECTORS
Set forth below is biographical information for each member of the
Company's Board of Directors, each of whom is a nominee for election as a
Director at the Annual Meeting.
H. WAYNE HUIZENGA, age 62, has served as Chairman of the Board of the
Company since August 1995. He also served as Chief Executive Officer of the
Company from August 1995 until October 1996, and as Co-Chief Executive Officer
from October 1996 until September 1999. Since May 1998, Mr. Huizenga has been
Chairman of the Board of Republic Services, Inc., a solid waste services company
formerly owned by the Company, and he served as its Chief Executive Officer from
May 1998 until December 1998. Since September 1996, Mr. Huizenga has been
Chairman of the Board of Boca Resorts, Inc., a leisure, recreation and
entertainment company which owns and operates several luxury resort hotels and
other facilities and the Florida Panthers professional sports franchise. Since
January 1995, Mr. Huizenga also has been Chairman of the Board of Extended Stay
America, Inc., an operator of extended stay lodging facilities. From April 1987
through September 1994, Mr. Huizenga served as the Chairman of the Board and
Chief Executive Officer of Blockbuster Entertainment Corporation. In September
1994, Blockbuster merged with Viacom, Inc., a diversified entertainment and
communications company. From September 1994 until October 1995, Mr. Huizenga
served as the Vice Chairman of Viacom, and also served as the Chairman of the
Board of Blockbuster Entertainment Group, a division of Viacom. In 1971, Mr.
Huizenga co-founded Waste Management, Inc., and he served in various capacities,
including as President, Chief Operating Officer and director, from its inception
until 1984. Mr. Huizenga owns the Miami Dolphins professional sports franchise,
as well as Pro Player Stadium, in South Florida and is a director of
theglobe.com, an Internet company, and NationsRent, Inc., a national equipment
rental company.
MICHAEL J. JACKSON, age 51, has served as Chief Executive Officer and as a
Director of the Company since September 1999. From April 1997 until September
1999, Mr. Jackson served as President of Mercedes-Benz USA, Inc., a North
American operating unit of DaimlerChrysler, a multinational automotive
manufacturing company. From October 1998 until September 1999, Mr. Jackson also
served as Mercedes-Benz USA's Chief Executive Officer. From July 1990 until
March 1997, Mr. Jackson served in various capacities at Mercedes-Benz USA,
including as Executive Vice President immediately prior to his appointment as
President of Mercedes-Benz USA. Mr. Jackson was also the managing partner from
March 1979 to July 1990 of Euro Motorcars of Bethesda, Maryland, a regional
group that owned and operated eleven automotive dealership franchises, including
Mercedes-Benz and other brands of automobiles. Prior to joining Euro Motorcars,
Mr. Jackson was a District Manager for Mercedes-Benz of North America. Mr.
Jackson also serves as a director of Riggs National Bank.
HARRIS W. HUDSON, age 57, has served as a Director of the Company since
August 1995, and has served as Vice Chairman of the Company since October 1996.
From August 1995 until October 1996, Mr. Hudson served as President of the
Company. Since May 1998, Mr. Hudson has served as Vice Chairman and Secretary of
Republic Services. From May 1995 until August 1995, Mr. Hudson served as a
consultant to the Company. Mr. Hudson founded Hudson Management Corporation, a
solid waste collection company, in 1983 and served as its Chairman of the Board,
Chief Executive Officer and President from its inception until it was
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<PAGE> 6
acquired by Republic Services in August 1995. From 1964 until 1982, Mr. Hudson
served as Vice President of Waste Management of Florida, Inc., a subsidiary of
Waste Management, and its predecessor. Mr. Hudson also serves as a director of
Boca Resorts, Inc. and NationsRent, Inc.
ROBERT J. BROWN, age 65, has served as a Director of the Company since May
1997. Mr. Brown has served as Chairman and Chief Executive Officer of B&C
Associates, Inc., a management consulting, marketing research and public
relations firm, since 1973. Mr. Brown also serves as a director of Duke Energy
Corporation, First Union Corporation and Sonoco Products Company.
J.P. BRYAN, age 60, has served as a Director of the Company since May 1991.
From January 1995 until February 1998, Mr. Bryan served as President and Chief
Executive Officer of Gulf Canada Resources, Ltd., which is engaged in oil and
gas exploration and production. Since 1981, Mr. Bryan has served as the Chairman
of the Board of Torch Energy Advisors, Inc., an outsourcing and service provider
to the oil and gas industry, and served as its Chief Executive Officer from 1981
until 1996. From 1990 until 1995, Mr. Bryan served as Chairman and Chief
Executive Officer of Nuevo Energy Company, a company involved in the oil and gas
industry. From 1990 until 1996, Mr. Bryan served as Chairman and Chief Executive
Officer of Bellwether Exploration Company, an oil and gas exploration company.
Mr. Bryan also serves on the Board of Directors of Bellwether Exploration.
RICK L. BURDICK, age 48, has been a Director of the Company since May 1991.
Since 1988, Mr. Burdick has been a partner in Akin, Gump, Strauss, Hauer & Feld,
L.L.P., a global full service law firm. Mr. Burdick serves as a member of Akin,
Gump's Management Committee and the practice manager of the firm's Corporate and
Securities Section. Mr. Burdick also serves as a director of Century Business
Services, Inc., a provider of outsourced business services to small and
medium-sized companies in the United States.
MICHAEL G. DEGROOTE, age 66, has been a Director of the Company since 1991
and served as the Vice Chairman of the Board of Directors of the Company from
August 1995 until October 1996. Mr. DeGroote served as the Chairman of the Board
and President of the Company from August 1991 until August 1995, and as the
Chief Executive Officer of the Company from May 1991 until August 1995. Since
April 1995, Mr. DeGroote has served as Chairman of the Board of Century Business
Services. Mr. DeGroote also served as the President and Chief Executive Officer
of Century Business Services from April 1995 until October 1996, and from
November 1997 until April 1999. Since April 1999, Mr. DeGroote has served as
Chief Executive Officer of Century Business Services.
GEORGE D. JOHNSON, JR., age 57, has served as a Director of the Company
since November 1995. Since January 1995, Mr. Johnson has served as President and
Chief Executive Officer of Extended Stay America. From August 1993 until January
1995, Mr. Johnson served in various executive positions with Blockbuster,
including as President of the Consumer Products Division, and as a director of
Blockbuster prior to its merger with Viacom. From July 1987 until August 1993,
Mr. Johnson was the managing general partner of WJB Video Limited Partnership,
which became the largest Blockbuster franchisee. Mr. Johnson serves as a
director of Extended Stay America, Duke Energy Corporation and Boca Resorts,
Inc.
JOHN J. MELK, age 63, has served as a Director of the Company since August
1995. Mr. Melk has been Chairman and Chief Executive Officer of H2O Plus, Inc.,
a bath and skin care product manufacturer and retail distributor, since 1988.
Mr. Melk also serves as a director of Extended Stay America. Additionally, he is
Chairman of Fisher Island Holdings, which owns the development rights of Fisher
Island, Florida. Mr. Melk has been a private investor in various businesses
since March 1984 and prior to March 1984 he held various positions with Waste
Management and its subsidiaries, including President of Waste Management
International, plc., a subsidiary of Waste Management. From February 1987 until
March 1989 and from May 1993 until September 1994, Mr. Melk served as a director
of Blockbuster. He also served as the Vice Chairman of Blockbuster from February
1987 until March 1989.
IRENE B. ROSENFELD, age 46, has served as a Director of the Company since
March 1999. Ms. Rosenfeld has been President of Kraft Canada, Inc., a subsidiary
of Kraft Foods, Inc., a diversified food company, since 1996. From 1991 until
1996, Ms. Rosenfeld served in various executive positions with Kraft Foods,
including
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<PAGE> 7
as Executive Vice President/General Manager of the Desserts and Snacks Division
from 1994 until 1996 and as Executive Vice President/General Manager of the
Beverages Division from 1991 until 1994. Ms. Rosenfeld also serves on the Board
of Directors of the Food and Consumer Products Manufacturers of Canada and is a
Trustee of Cornell University.
Mr. Hudson is married to Mr. Huizenga's sister. Otherwise, there is no
family relationship between any of the Directors of the Company.
BOARD OF DIRECTORS
The business and affairs of the Company are managed under the direction of
the Board of Directors. The Board establishes overall corporate policies for the
Company, reviews the performance of management in executing the business
strategy and managing the day-to-day operations of the Company, and is
responsible for the overall performance of the Company. The Directors are kept
informed of the Company's operations at meetings of the Board and Board
committees, through reports and analyses presented to the Board, and by
discussions with management. Significant communications between the Directors
and management also occur apart from meetings of the Board and Board committees.
MEETINGS OF THE BOARD OF DIRECTORS
The Company's Board of Directors held 12 meetings during 1999. Each
incumbent Director attended at least 75% of the aggregate of the total number of
meetings of the Board of Directors and the total number of meetings held by all
committees of the Board of Directors on which he or she served.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors has established three standing committees to assist
it in discharging its responsibilities: the Executive Committee, the Audit
Committee and the Compensation Committee.
The Executive Committee consists of Messrs. Huizenga, Hudson and Jackson.
The Executive Committee has full authority to exercise all the powers of the
Board of Directors between meetings of the Board of Directors, except as
reserved by the Board of Directors and as limited by Delaware law. The Executive
Committee took 36 actions by unanimous written consent in lieu of meetings
during 1999.
The Audit Committee consists of Messrs. Bryan, Burdick and Melk and Ms.
Rosenfeld. The Audit Committee reviews the Company's accounting functions,
operations and management, its financial reporting process and the adequacy and
effectiveness of its internal controls and internal auditing methods and
procedures. The Audit Committee also recommends to the Board the appointment of
the independent public accountants for the Company. The Audit Committee held
seven meetings during 1999.
The Compensation Committee consists of Messrs. Bryan and Johnson and Ms.
Rosenfeld. The Compensation Committee reviews the Company's compensation
philosophy and programs, exercises authority with respect to the payment of
salaries and incentive compensation to Directors and officers, and administers
the Company's employee stock option plans. The Compensation Committee held six
meetings during 1999.
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<PAGE> 8
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The following statement made by the Compensation Committee shall not be
deemed incorporated by reference by any general statement incorporating by
reference the Proxy Statement into any filing under the Securities Act of 1933,
as amended, or the Securities Exchange Act of 1934, as amended, except to the
extent that the Company specifically incorporates such statement by reference;
and, further, such statement shall not otherwise be deemed filed under either of
such Acts.
COMPENSATION PHILOSOPHY
The Compensation Committee is responsible for administering the Company's
executive officer compensation program. The compensation program adopted for the
Company's executive officers in 1999, which was based in part on a competitive
market analysis conducted by independent compensation consultants, consists of
three primary elements:
- an annual base salary;
- an annual bonus dependent on both Company and individual performance
during the year; and
- periodic grants of stock options designed to align management's interests
with those of stockholders of the Company.
The Company's compensation program for executive officers is designed to
attract, motivate, reward and retain highly-skilled executives who have the
talent and experience necessary to advance the short- and long-term interests of
stockholders of the Company. The Compensation Committee believes that this
approach effectively serves the best interests of stockholders of the Company by
tying a significant portion of incentive compensation to the achievement of
goals that are aligned with goals of the Company's stockholders.
To the extent possible, the Compensation Committee considers the
anticipated tax treatment of various payments and benefits when determining
executive compensation. The Compensation Committee endeavors to administer the
executive compensation program in a manner that maximizes the tax deductibility
of compensation paid to the Company's executives under Internal Revenue Code
Section 162(m) to the extent practicable. However, the Compensation Committee
believes that the Company must attract and retain highly-skilled executives to
manage the Company and, in some circumstances, the loss of a tax deduction may
be a necessary and appropriate trade-off for the Company. None of the Named
Officers (as defined in the section headed "Executive and Director
Compensation"), other than Michael E. Maroone, President and Chief Operating
Officer of the Company, received compensation in excess of the $1 million limit
for deductibility under Section 162(m). The Compensation Committee believes it
was appropriate to pay Mr. Maroone a bonus in 1999, even though it resulted in
the loss of a tax deduction for a small portion of his salary and bonus, in
light of his extraordinary service to the Company during a year in which the
Company redefined its strategic direction and installed a new senior management
team. Due to ambiguities and uncertainties as to the application of Section
162(m) and other tax laws and other factors beyond the Compensation Committee's
control, no assurance can be given that compensation that is intended to satisfy
the requirements for deductibility under Section 162(m) does in fact do so.
The following is a summary of the considerations underlying each component
of compensation paid to the Company's executive officers in 1999.
BASE SALARY
The Compensation Committee determines base salaries for the Company's
executive officers on an annual basis and takes into account such factors as:
the level and scope of such executive officer's responsibilities; compensation
levels of similarly positioned executives in comparable companies, as reflected
in a market analysis conducted by independent compensation consultants; the
performance of the business area of the Company for which such executive officer
is responsible; and certain qualitative factors such as the executive officer's
leadership ability. The Compensation Committee attempts to set each executive
officer's annual base salary at the median of such salaries at comparable
companies in order to attract and retain a high
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<PAGE> 9
quality management team. For 1999, the Compensation Committee believes that
executive officers' base salaries were set in a manner consistent with this
policy.
INCENTIVE BONUS
In 1999 the Compensation Committee adopted, and the Company's stockholders
approved, the 1999 Senior Executive Bonus Plan, which provides for a
performance-based bonus program for executives who are designated as "covered
employees" under Section 162(m) of the Internal Revenue Code.
Under the 1999 Senior Executive Bonus Plan, the Compensation Committee
establishes specific annual "performance goals" and sets target awards for
participants, who are selected based on the likelihood that they will have a
significant impact on the Company's performance. The Compensation Committee's
objective is to create a direct link between pay and performance for senior
executives. Participants selected with respect to one particular plan year are
not guaranteed or assured of selection as to any subsequent year. The
Compensation Committee may choose from among the following factors, or any
combination of the following, as it deems appropriate, to set the performance
goals applicable to a particular participant: (a) total stockholder return; (b)
growth in revenue, sales, net income, stock price and/or earnings per share; (c)
return on assets, net assets and/or capital; (d) return on stockholders' equity;
(e) customer satisfaction indices and (f) growth in same-store sales. Such
performance goals must be established while actual performance relative to the
target remains substantially uncertain within the meaning of Section 162(m). At
the time that the performance goals are selected for a particular participant,
the Compensation Committee also establishes an objective formula or standard for
calculating the amount of the target award. The maximum annual target award
payable to any particular participant under the plan is $2 million, although the
Compensation Committee has absolute discretion to eliminate or reduce the amount
of any award under the Plan.
For 1999, the Compensation Committee determined that the performance goals
had not been achieved under the Plan and, accordingly, no awards were made under
the plan. However, the Compensation Committee did make a discretionary cash
bonus award to one Plan participant, Michael E. Maroone, for extraordinary
services to the Company, as described above. This bonus is reflected in the
Summary Compensation Table.
STOCK OPTIONS
The Compensation Committee believes that awarding stock options to
executive officers of the Company will assure that such officers maintain a
continuing focus on the long-term performance of the Company. Accordingly, in
1999 stock option awards were granted to each of the Company's executive
officers. The Company's stock option plans provide the means by which executive
officers can build an investment in the Common Stock and align their long-term
financial interests with those of the Company's stockholders. Stock options
granted by the Company generally vest in equal installments over four years and
have an exercise price equal to the closing price of the Common Stock on the day
immediately preceding the grant.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Mr. Jackson was appointed Chief Executive Officer by the Board of Directors
in September 1999. Mr. Huizenga served as the Company's Co-Chief Executive
Officer from October 1996 through September 1999. Mr. Berrard was Co-Chief
Executive Officer and President of the Company from October 1996 until September
1999.
In 1999, Mr. Jackson's annual base salary was established at $1 million.
Mr. Jackson's base salary was based upon an assessment of competitive market
data of comparable companies, as described above. In September 1999, the Board
approved a grant of options to Mr. Jackson under the Company's 1995 Employee
Stock Option Plan to purchase one million shares of Common Stock exercisable at
$11.75 per share. The options have a ten-year term, will vest over four years,
and none are presently exercisable.
Prior to 1998, Mr. Huizenga did not draw a base salary. In 1998, Mr.
Huizenga's base salary was established at $1 million per year, based upon an
assessment of competitive market data of comparable companies, as described
above. He received no cash bonus, having all of his incentive opportunity
delivered in stock-based compensation. In January 1999, the Compensation
Committee granted options to Mr. Huizenga
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<PAGE> 10
under the Company's 1998 Employee Stock Option Plan to purchase 800,000 shares
of Common Stock exercisable at $15.9375 per share. The options have a ten-year
term and are fully vested and presently exercisable in full.
In 1999, Mr. Berrard's annual base salary was $1 million, based upon an
assessment of competitive market data of comparable companies, as described
above. In 1999, the Compensation Committee selected Mr. Berrard to participate
in the 1999 Senior Executive Bonus Plan. However, pursuant to Mr. Berrard's
Separation Agreement, Mr. Berrard did not receive a performance bonus in 1999.
Consistent with its objective of tying a large portion of senior executives'
compensation to the performance of the Company's Common Stock, in January 1999
the Compensation Committee granted options to Mr. Berrard under the Company's
1998 Employee Stock Option Plan to purchase 800,000 shares of Common Stock
exercisable at $15.9375 per share. The options have a ten-year term and were
scheduled to vest over four years. At the time of his separation from the
Company, the Compensation Committee vested all of Mr. Berrard's options
immediately and granted him the right to exercise such options through the
remaining respective option terms. All of Mr. Berrard's options are presently
exercisable in full.
The Compensation Committee believes that tying a large portion of the
remuneration of the Chief Executive Officer to the performance of the Company's
Common Stock will enhance the long-term performance of the Company by providing
Mr. Jackson the incentive to grow the Company's stock price and bring the
Company to increased levels of profitability in future years. The Compensation
Committee believes that Mr. Jackson's compensation, as described above,
represents a fair compensation structure for his services as the Chief Executive
Officer of the Company.
Compensation Committee:
J.P. Bryan (Chairman)
George D. Johnson, Jr.
Irene B. Rosenfeld
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Messrs. Bryan, Melk and Johnson and Ms. Rosenfeld served as members of the
Compensation Committee during 1999. Mr. Johnson has served as the President and
Chief Executive Officer of Extended Stay America, and Mr. Huizenga has served as
the Chairman of the Board of Extended Stay America, since January 1995.
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<PAGE> 11
PERFORMANCE GRAPH
The following graph and table compare the cumulative total stockholder
return on the Common Stock from December 31, 1994 through December 31, 1999 with
the Standard & Poor's 500 Stock Index and the Russell 1000 Producer Durables
Index. The Company has created this comparison using data supplied by the
Compustat Services unit of Standard & Poor's Corporation. The comparisons
reflected in the graph and table are not intended to forecast the future
performance of the Common Stock and may not be indicative of such future
performance. The graph and table assume an investment of $100 in the Common
Stock and each index on December 31, 1994, as well as the reinvestment of
dividends.
<TABLE>
<CAPTION>
RUSSELL 1000 PRODUCER
AUTONATION, INC. S&P 500 DURABLES
---------------- ------- ---------------------
<S> <C> <C> <C>
1994 100.00 100.00 100.00
1995 1063.65 137.58 136.18
1996 1836.57 169.17 166.48
1997 1372.82 225.60 213.16
1998 875.97 290.08 270.80
1999 544.72 351.12 341.61
</TABLE>
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<PAGE> 12
EXECUTIVE AND DIRECTOR COMPENSATION
The following tables set forth information with respect to each person who
(a) served as the Company's Chief Executive Officer during the year ended
December 31, 1999, (b) was one of the four other most highly compensated
executive officers of the Company at December 31, 1999, whose total annual
salary and bonus exceeded $100,000 for the year, or (c) would have been among
the four other most highly compensated executive officers of the Company at
December 31, 1999, but was no longer employed by the Company at such date
(collectively, the "Named Officers").
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
------------
SECURITIES
ANNUAL COMPENSATION UNDERLYING
---------------------------------------------- OPTIONS TO
OTHER ANNUAL PURCHASE ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION(1) COMMON STOCK COMPENSATION
- --------------------------- ---- ---------- -------- --------------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
H. Wayne Huizenga........................ 1999 $1,000,000 $ -- $ -- 800,000 $ 9,694(3)
(Chairman and Former Co-Chief 1998 1,000,000 -- -- 750,000 30,684(3)
Executive Officer)(2) 1997 -- -- -- 1,524,017 --
Michael J. Jackson....................... 1999 250,000 250,000 27,615(5) 1,000,000 77,425(6)
(Chief Executive Officer)(4)
Steven R. Berrard........................ 1999 753,846 -- 149,013(8) 800,000 247,233(9)
(Former Co-Chief Executive 1998 1,000,000 400,000 -- 450,000 1,144(3)
Officer)(7) 1997 369,673 100,000 -- 614,410 1,530(3)
Michael E. Maroone....................... 1999 783,654 321,563 -- 1,000,000 1,073(3)
(President and Chief 1998 398,462 100,000 -- 225,000 870(3)
Operating Officer) 1997 255,769 100,000 -- 362,000 1,275(3)
Michael S. Karsner....................... 1999 497,596 131,250 -- 100,000 604(3)
(President and Chief Executive 1998 365,225 93,750 -- 110,000 640(3)
Officer of ANC Rental Corporation, 1997 337,820 81,250 97,704(5) 10,000 137,595(10)
and Former Senior Vice President and
Chief Financial Officer of the Company)
James O. Cole............................ 1999 447,596 118,125 -- 100,000(11) 1,160(3)
(Former Senior Vice President, 1998 321,626 81,250 -- 88,385(12) 2,124(3)
General Counsel and Secretary) 1997 193,750 145,000 138,052(5) 160,000(13) 236,400(14)
James J. Donahue......................... 1999 278,461 73,500 3,963(5) 80,000 8,836(15)
(Senior Vice President -- 1998 212,115 50,000 -- 27,195 298(3)
Corporate Communications) 1997 127,694 18,225 144(5) 14,085 7,610(16)
John Costello............................ 1999 461,538 250,000(17) 45,681(5) 250,000(18) 2,187,362(19)
(Former President) 1998 24,615 -- -- 750,000(18) --
1997 -- -- -- -- --
</TABLE>
- ------------------------
(1) Except as disclosed below, the aggregate total value of perquisites and
other personal benefits, securities or property did not equal $50,000 or
ten percent (10%) of the annual salary and bonus for any Named Officer
during the fiscal year indicated.
(2) Mr. Huizenga's employment with the Company began in August 1995. Mr.
Huizenga served as the Company's Co-Chief Executive Officer until September
1999, at which time Mr. Jackson succeeded him as Chief Executive Officer.
Prior to 1998, he was not paid any cash salary or bonus.
(3) Imputed income from life insurance.
(4) Mr. Jackson began serving as the Company's Chief Executive Officer in
September 1999.
(5) Reimbursement by the Company for the payment of taxes.
(6) Includes $77,122 of relocation expenses and $303 of imputed income from
life insurance.
(7) Mr. Berrard served as the Company's Co-Chief Executive Officer until
September 1999.
(8) Imputed income from use of the Company's aircraft.
(9) Includes $246,154 of severance compensation and $1,079 of imputed income
from life insurance.
(10) Includes $136,803 of relocation expenses and $792 of imputed income from
life insurance.
(11) 75,000 of these options were canceled December 31, 1999 pursuant to Mr.
Cole's Separation Agreement.
(12) 44,192 of these options were canceled December 31, 1999 pursuant to Mr.
Cole's Separation Agreement.
(13) 40,000 of these options were canceled December 31, 1999 pursuant to Mr.
Cole's Separation Agreement.
(14) Includes $233,250 of relocation expenses and $3,150 of imputed income from
life insurance.
(15) Includes $8,620 of relocation expenses and $216 of imputed income from life
insurance.
(16) Includes $7,185 of relocation expenses and $425 of imputed income from life
insurance.
(17) Mr. Costello began serving as our President in December 1998. However, his
sign-on bonus was paid in 1999.
(18) These options were canceled pursuant to Mr. Costello's Separation
Agreement.
(19) Includes $2,100,000 paid as severance pursuant to Mr. Costello's Separation
Agreement, $84,870 of relocation expenses which were paid in 1999 and
$2,492 of imputed income from life insurance.
9
<PAGE> 13
TOTAL NUMBER OF OPTIONS GRANTED
OPTION GRANTS IN YEAR ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
------------------------------------------------- VALUE AT ASSUMED
NUMBER OF % OF TOTAL ANNUAL RATES OF STOCK
SECURITIES OPTIONS PRICE APPRECIATION
UNDERLYING GRANTED TO FOR OPTION TERM
OPTIONS EMPLOYEES IN EXERCISE EXPIRATION ------------------------
NAME GRANTED FISCAL YEAR PRICE DATE 5% 10%
- ---- ---------- ------------ -------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
H. Wayne Huizenga........................... 800,000 4.7% $15.9375 01/06/09 $8,018,407 $20,320,216
(Chairman and Former Co-Chief Executive
Officer)
Michael J. Jackson.......................... 1,000,000 5.8 11.75 09/24/09 7,389,512 18,726,474
(Chief Executive Officer)
Steven R. Berrard........................... 800,000 4.7 15.9375 01/06/09 8,018,407 20,320,216
(Former Co-Chief Executive Officer)
Michael E. Maroone.......................... 250,000 1.5 14.6875 07/29/09 2,309,223 5,852,023
(President and Chief Operating Officer) 750,000 4.3 15.9375 01/06/09 7,517,256 19,050,203
Michael S. Karsner.......................... 100,000 * 15.9375 01/06/09 1,002,301 2,540,027
(President and Chief Executive Officer of
ANC >Rental Corporation, and Former
Senior Vice President and Chief
Financial Officer of the Company)
James O. Cole............................... 100,000 * 15.9375 01/06/09(1) 1,002,301 2,540,027
(Former Senior Vice President, General
Counsel and Secretary)
James J. Donahue............................ 80,000 * 15.9375 01/06/09 801,848 2,031,968
(Senior Vice President --
Corporate Communications)
John Costello............................... 250,000 1.5 15.9375 (2) 2,505,753 6,350,068
(Former President)
</TABLE>
- ------------------------
* Less than 1%
(1) 75,000 of these options were canceled 12/31/99 pursuant to Mr. Cole's
Separation Agreement.
(2) These options were canceled pursuant to Mr. Costello's Separation Agreement.
10
<PAGE> 14
AGGREGATED OPTION EXERCISES IN YEAR ENDED DECEMBER 31, 1999 AND YEAR-END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1999 DECEMBER 31, 1999
ACQUIRED VALUE --------------------------- ---------------------------
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- ----------- -------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
H. Wayne Huizenga........................ -- -- 6,539,134 -- -- --
(Chairman and Former Co-Chief Executive
Officer)
Michael J. Jackson....................... -- -- -- 1,000,000 -- --
(Chief Executive Officer)
Steven R. Berrard........................ -- -- 2,792,982 -- -- --
(Former Co-Chief Executive Officer)
Michael E. Maroone....................... -- -- 237,250 1,349,750 -- --
(President and Chief Operating Officer)
Michael S. Karsner....................... -- -- 220,000 250,000 -- --
(President and Chief Executive Officer
of ANC Rental Corporation, and Former
Senior Vice President and Chief
Financial Officer of the Company)
James O. Cole............................ -- -- 102,097 87,096 -- --
(Former Senior Vice President, General
Counsel and Secretary)
James J. Donahue......................... -- -- 13,842 107,438 -- --
(Senior Vice President --
Corporate Communications)
John Costello............................ -- -- -- -- -- --
(Former President)
</TABLE>
NON-EMPLOYEE DIRECTOR COMPENSATION
In 1999, each Director who was not an employee of the Company received an
annual retainer of $25,000 for service on the Board of Directors. In addition,
non-employee Directors received $1,000 for each committee meeting attended and
for each Board meeting attended in excess of four annually.
The Company's 1995 Non-Employee Director Stock Option Plan (the "Director
Plan") provides for an annual grant of an option to purchase 20,000 shares of
Common Stock at the beginning of each fiscal year to each non-employee Director.
All options granted under the Director Plan are fully vested and immediately
exercisable. Under the Director Plan, each grant of options to a non-employee
Director remains exercisable for a term of ten years from the grant date so long
as the Director remains a member of the Board. The options are exercisable at a
price per share equal to the closing price per share of Common Stock on The New
York Stock Exchange on the date immediately prior to the grant date. In
accordance with the Director Plan, on January 3, 2000, Messrs. Brown, Bryan,
Burdick, DeGroote, Johnson and Melk and Ms. Rosenfeld each received an automatic
grant of options to purchase 20,000 shares of Common Stock at an exercise price
of $9.25 per share.
EMPLOYMENT AND SEPARATION AGREEMENTS
On September 22, 1999, the Company entered into an Employment Agreement
with Mr. Jackson pursuant to which Mr. Jackson serves as Chief Executive
Officer. The agreement provides for Mr. Jackson's employment with the Company
beginning September 24, 1999 through September 24, 2002 (subject to earlier
termination for "cause"), at a base salary of $1,000,000 per year, subject to
future increases as determined by the Compensation Committee. The agreement also
provides for an annual bonus of up to 100% of Mr. Jackson's annual salary,
payable under the 1999 Senior Executive Bonus Plan upon the achievement of
11
<PAGE> 15
goals and objectives set during the first quarter of each year. Upon the
commencement of Mr. Jackson's employment, the Company granted to Mr. Jackson a
sign-on bonus in the amount of $250,000 and stock options with respect to a
total of 1,000,000 shares of the Common Stock. Such options vest in four equal
annual installments commencing on September 24, 2000 and have an exercise price
equal to $11.75 and a term expiring on September 24, 2009. Mr. Jackson will be
eligible to receive stock option grants in future years at the discretion of the
Compensation Committee of the Company's Board of Directors. Under the terms of
the agreement, if Mr. Jackson's employment is terminated by the Company for any
reason other than "cause," he is entitled to receive his annual base salary
until September 24, 2002, as well as the pro rata portion of his annual
performance bonus applicable to the period prior to the termination of his
employment. Additionally, upon a termination of Mr. Jackson's employment by the
Company without "cause," all stock options held by Mr. Jackson will continue to
vest during the 12-month period immediately following such termination, and he
shall have an additional two-month period from the end of such 12-month period
to exercise any vested options. The agreement also provides for certain Company
benefits during the term of his agreement, including for limited personal use of
the Company's corporate aircraft during his employment.
On June 24, 1999, the Company entered into a Separation Agreement with Mr.
Berrard. Mr. Berrard's agreement provides for the continued payment of his
annual base salary at a rate of $1,000,000 per year through September 24, 2002.
Under the terms of his agreement, Mr. Berrard did not receive any performance
bonus for 1999. Mr. Berrard's agreement also provides that, effective as of
September 24, 1999, all previously granted stock options vested in full. Such
options are exercisable through the duration of their original ten-year terms.
Effective as of December 31, 1999, the Company entered into a Separation
Agreement with Mr. Cole. Mr. Cole's agreement provides for the continued payment
of his annual base salary at the rate of $450,000 through June 30, 2001. Also,
pursuant to the agreement, Mr. Cole received a $118,125 bonus for fiscal 1999.
Mr. Cole's agreement provides that certain stock options granted to him will
continue to vest until June 30, 2000, and all such options vested through such
date will be exercisable through the duration of their original ten-year terms.
Any of Mr. Cole's other options will be canceled according to the terms of the
agreement. On July 30, 1999, the Company entered into a Separation Agreement
with Mr. Costello. Mr. Costello's agreement provides for a one-time severance
payment of $2,100,000, which was paid on July 30, 1999. Pursuant to Mr.
Costello's Separation Agreement, all options previously granted to him were
canceled on July 30, 1999.
By letter to Mr. Maroone dated March 26, 1999, the Company confirmed that
upon the termination of Mr. Maroone's employment with the Company, any stock
options granted to Mr. Maroone prior to March 26, 1999 would continue to vest in
accordance with their initial vesting schedule and would be exercisable through
the duration of their original ten-year terms. Also, by letter agreement dated
July 29, 1999, the Company confirmed Mr. Maroone's promotion to President and
Chief Operating Officer. The letter also confirmed Mr. Maroone's annual salary
of $850,000 and bonus of up to 70% of his annual salary based upon the
achievement of certain goals and objectives. The letter also confirmed a grant
of options to purchase 250,000 shares of Common Stock at an exercise price of
$14.6875 per share which options vest in four equal annual installments
beginning July 29, 2000.
12
<PAGE> 16
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The following is a summary of agreements and transactions among the Company
and certain related parties. It is the Company's policy that transactions with
related parties must be on terms that, on the whole, are no less favorable than
those that would be available from unrelated parties. Based on the Company's
experience in the industries in which it operates and the terms of its
transactions with unrelated parties, it is the Company's belief that all of the
transactions described below met that standard at the time the transactions were
effected.
The Miami Dolphins, a professional football team owned and controlled by
Mr. Huizenga, play their home games at Pro Player Stadium, a professional sports
stadium in South Florida which is owned and controlled by Mr. Huizenga
(collectively, the Miami Dolphins and Pro Player Stadium are referred to as the
"Stadium Entities"). In 1999, the Company and its subsidiaries paid an aggregate
of approximately $754,300 to the Stadium Entities pursuant to various licensing
and advertising agreements and subscriptions, in exchange for the use of
executive suites and club seats, and for various tickets and sponsorship,
marketing and advertising services. In addition, the Stadium Entities provided
signage within Pro Player Stadium with a fair market value of approximately
$140,000 at no cost to certain subsidiaries of the Company. The Company expects
most of the foregoing agreements and arrangements to continue in 2000.
In 1997, one of our subsidiaries entered into a license agreement with Boca
Resorts, Inc. (formerly Florida Panthers Holdings, Inc.) for the use of an
executive suite at the Broward County Arena, which is operated by a subsidiary
of Boca Resorts. The license agreement has a term of five years and provides for
the payment of $120,000 per year by the subsidiary commencing in 1998. In
September 1998, National Car Rental Company, a wholly-owned subsidiary of the
Company, entered into an agreement to purchase the naming rights to the Broward
County Arena, a sports facility owned by a subsidiary of Boca Resorts, for $2.2
million a year in exchange for having the arena named the "National Car Rental
Center." The agreement has a term of ten years and provides that the fees will
increase at a rate of 3% a year. In addition, National paid approximately
$309,000 for signage, tickets, sponsorship and the use of executive suites at
the arena. During 1999, the Company and its subsidiaries also made payments to
Boca Resorts totaling approximately $412,000 for hotel lodging accommodations.
Mr. Huizenga is the Chairman of the Board of Boca Resorts and beneficially owns
approximately 17.9% of its outstanding stock and controls a majority of its
voting interests.
During 1999, the Company engaged the law firm of Akin, Gump, Strauss, Hauer
& Feld, L.L.P. for legal services. Mr. Burdick is a partner in that law firm.
The Company expects this relationship to continue in 2000.
During 1999, the Company engaged the management consulting, marketing
research and public relations firm of B&C Associates, Inc. for management
consulting services in exchange for the payment of approximately $549,002. Mr.
Brown is the President, Chief Executive Officer and principal owner of B&C
Associates, Inc. The Company expects this relationship to continue in 2000.
During 1999, the Company purchased approximately $691,576 of pre-employment
drug screening hair testing services from Psychemedics Corporation. Mr. Melk was
a director of Psychemedics until November 1999 and owns approximately 9.8% of
Psychemedics' outstanding common stock. Mr. Huizenga owns approximately 11.1% of
Psychemedics outstanding common stock. The Company expects that it will continue
to utilize Psychemedics to perform customary pre-employment drug screenings in
2000.
During 1999, the Company purchased commercial advertisements on
SportsChannel Florida, a cable sports channel. In 1999, SportsChannel Florida
was 70% owned by Front Row Communications, which in turn is wholly owned by Mr.
Huizenga. The Company purchased approximately $601,516 worth of advertisements
on SportsChannel Florida during 1999. SportsChannel Florida was sold by Front
Row Communications in January 2000.
13
<PAGE> 17
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
Directors, executive officers and persons who beneficially own 10% or more of
the Common Stock to file with the Securities and Exchange Commission initial
reports of ownership and reports of changes in ownership of the Common Stock and
other equity securities of the Company. To the Company's knowledge, based solely
on a review of the copies of such reports furnished to the Company and written
representations that no other reports were required, during the year ended
December 31, 1999, all Section 16(a) filing requirements applicable to the
Company's Directors, executive officers and greater than 10% beneficial owners
were complied with, except that Mr. Maroone was late in reporting a stock option
grant in July 1999 and Patricia McKay was late in filing her initial report
after she was designated Controller and Acting Chief Financial Officer in
November 1999.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information as of March 23, 2000
with respect to the beneficial ownership of Common Stock by (1) each stockholder
of the Company who is known by the Company to be a beneficial owner of more than
5% of the Common Stock outstanding, (2) each Director of the Company, (3) each
current Named Officer and (4) all current Directors and executive officers of
the Company as a group. Share amounts and percentages shown for each individual,
entity or group in the table are adjusted to give effect to shares of Common
Stock that are not outstanding but may be acquired by such individual, entity or
group upon exercise of all options exercisable within 60 days of March 23, 2000.
However, shares of Common Stock underlying options are not deemed to be
outstanding for the purpose of computing the percentage of outstanding shares
beneficially owned by any other person.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED
NAME AND ADDRESS ----------------------
OF BENEFICIAL OWNER(1) NUMBER PERCENT
- ---------------------- ----------- -------
<S> <C> <C>
Subsidiaries of FMR Corp.(2)................................ 30,105,527 8.3%
82 Devonshire Street
Boston, MA 02109
Subsidiaries of Capital Group International, Inc.(3)........ 25,163,380 6.9%
11100 Santa Monica Blvd
Los Angeles, CA
Michael S. Egan(4).......................................... 21,504,910 5.9%
200 South Andrews Avenue
Fort Lauderdale, FL 33301
H. Wayne Huizenga(5)........................................ 31,436,282 8.5%
Harris W. Hudson(6)......................................... 20,028,350 5.5%
Michael G. DeGroote(7)...................................... 19,831,200 5.4%
Robert J. Brown(8).......................................... 160,200 *
J.P. Bryan(9)............................................... 150,000 *
Rick L. Burdick(10)......................................... 180,000 *
George D. Johnson, Jr.(11).................................. 1,099,321 *
John J. Melk(12)............................................ 1,147,001 *
Irene B. Rosenfeld(13)...................................... 70,000 *
Michael E. Maroone(14)...................................... 3,925,488 1.1%
James J. Donahue(15)........................................ 44,162 *
All directors and executive officers as a group (13
persons)(16).............................................. 78,105,587 20.9%
</TABLE>
(notes appear on next page)
14
<PAGE> 18
- ------------------------
* Less than 1 percent
(1) Except as otherwise indicated, the mailing address of each person or entity
named in the table is 110 S.E. Sixth Street, Fort Lauderdale, FL 33301.
(2) Includes: (a) 28,963,027 shares owned by Fidelity Management & Research
Company; (b) 936,100 shares owned by Fidelity Management Trust Company; (c)
206,400 shares owned by Fidelity International Limited. Fidelity Management
& Research and Fidelity Management Trust are wholly-owned subsidiaries of
FMR Corp. This information is based on a Schedule 13G filed by FMR Corp.
FMR Corp. and Fidelity International expressly disclaim that they are
acting as a "group" for purposes of Section 13(d) under the Exchange Act.
(3) Includes shares owned by Capital Guardian Trust Company, Capital
International Limited, Capital International S.A. and Capital International
Research and Management, Inc. d/b/a Capital International, Inc., each of
which is a wholly-owned subsidiary of Capital Group International, Inc.,
which disclaims beneficial ownership of any of the shares. This information
is based on the Schedule 13G filed by Capital Group International, Inc.
(4) The aggregate amount of Common Stock beneficially owned by Mr. Egan
consists of (a) 3,333 shares owned directly, (b) options to acquire 750,000
shares, (c) 17,222,912 shares owned by the Michael S. Egan Living Trust, of
which Mr. Egan is the sole trustee, and (d) an aggregate of 3,528,665
shares owned by certain trusts established for the benefit of members of
Mr. Egan's family. This information is based on a Schedule 13D filed by Mr.
Egan.
(5) The aggregate amount of Common Stock beneficially owned by Mr. Huizenga
consists of (a) 24,894,219 shares beneficially owned by Huizenga Investment
Limited Partnership, a Nevada limited partnership controlled by Mr.
Huizenga, (b) 2,929 shares owned directly, and (c) vested options to
purchase 6,539,134 shares.
(6) The aggregate amount of Common Stock beneficially owned by Mr. Hudson
consists of (a) 18,796,779 shares beneficially owned by Harris W. Hudson
Limited Partnership, a Nevada limited partnership controlled by Mr. Hudson,
and (b) options to purchase 1,231,571 shares. This information is based on
a Schedule 13D filed by Mr. Hudson.
(7) The aggregate amount of Common Stock beneficially owned by Mr. DeGroote
consists of (a) 19,631,200 shares owned by Westbury (Bermuda) Ltd., a
Bermuda corporation controlled by Mr. DeGroote, and (c) vested options to
purchase 200,000 shares. This information is based on a Schedule 13D filed
by Mr. DeGroote.
(8) The aggregate amount of Common Stock beneficially owned by Mr. Brown
consists of (a) 200 shares owned by Mr. Brown and his wife as joint tenants
and (b) vested options to purchase 160,000 shares.
(9) The aggregate amount of Common Stock beneficially owned by Mr. Bryan
consists of vested options to purchase 150,000 shares.
(10) The aggregate amount of Common Stock beneficially owned by Mr. Burdick
consists of (a) 80,000 shares owned directly, and (b) vested options to
purchase 100,000 shares.
(11) The aggregate amount of Common Stock beneficially owned by Mr. Johnson
consists of (a) 899,321 shares owned by GDJ, Jr. Investments Limited
Partnership, a Nevada limited partnership controlled by him, and (b) vested
options to purchase 200,000 shares.
(12) The aggregate amount of Common Stock beneficially owned by Mr. Melk
consists of (a) 122,001 shares owned directly by him, (b) 825,000 shares
owned by JJM Republic Limited Partnership, of which Mr. Melk is the general
partner and his three adult children are limited partners, and (c) vested
options to purchase 200,000 shares.
(13) The aggregate amount of Common Stock beneficially owned by Ms. Rosenfeld
consists of vested options to purchase 70,000 shares.
(14) The aggregate amount of Common Stock beneficially owned by Mr. Maroone
consists of (a) 3,353,988 shares beneficially owned by Michael Maroone
Family Partnership, a Nevada limited partnership controlled by Mr. Maroone,
and (b) vested options to purchase 571,500 shares.
(15) The aggregate amount of Common Stock beneficially owned by Mr. Donahue
consists of vested options to purchase 44,162 shares.
(16) The aggregate amount of Common Stock beneficially owned by all directors
and executive officers as a group includes vested options to purchase
9,543,867 shares. The aggregate amount of Common Stock beneficially owned
by all directors and executive officers as a group does not include Common
Stock or options beneficially held by Named Officers who are no longer
employed by the Company.
15
<PAGE> 19
PROPOSAL 1
ELECTION OF DIRECTORS
The Board of Directors currently consists of ten members. The persons named
below have been designated by the Board of Directors as nominees for election as
Directors for a term expiring at the Annual Meeting of Stockholders in 2001. All
nominees are currently serving as Directors. Each Director is elected by the
affirmative vote of a plurality of the votes cast by the shares of Common Stock
present, in person or by proxy, and entitled to vote thereon at the Annual
Meeting. It is the intention of the persons named in the enclosed form of proxy
to vote the proxies received by them for the election of the nominees named
below, unless authorization to do so is withheld or other contrary instructions
are indicated on the proxy. All of the nominees have indicated that they are
willing and able to serve as Directors. If prior to the Annual Meeting any
nominee becomes unable to serve, an event which is not anticipated by the Board
of Directors, the proxies will be voted for the election of such other person as
the Board of Directors may designate.
NOMINEES FOR DIRECTOR
H. Wayne Huizenga
Michael J. Jackson
Harris W. Hudson
Robert J. Brown
J.P. Bryan
Rick L. Burdick
Michael G. DeGroote
George D. Johnson, Jr.
John J. Melk
Irene B. Rosenfeld
Biographical information relating to each of these nominees for Director
appears above starting on page 2 of this Proxy Statement under the heading
"Biographical Information Regarding Directors."
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE ELECTION OF
EACH OF THE NOMINEES FOR DIRECTOR NAMED ABOVE. PROXY CARDS EXECUTED AND RETURNED
WILL BE SO VOTED UNLESS CONTRARY INSTRUCTIONS ARE INDICATED THEREON.
16
<PAGE> 20
PROPOSAL 2
RATIFICATION OF INDEPENDENT PUBLIC ACCOUNTANTS
The Board of Directors, upon recommendation of the Audit Committee, has
approved and recommends the appointment of Arthur Andersen LLP as independent
public accountants of the Company and its subsidiaries for the year ending
December 31, 2000.
Arthur Andersen LLP has served the Company in this capacity since May 1990.
A representative of Arthur Andersen LLP is expected to attend the Annual Meeting
and be available to respond to appropriate questions. The representative will
also be afforded an opportunity to make a statement, if he desires to do so.
Ratification of the Board of Directors' selection of Arthur Andersen LLP
will require the affirmative vote of the holders of a majority of the total
shares of Common Stock present at the Annual Meeting, in person or by proxy, and
entitled to vote thereon at the Annual Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE RATIFICATION
OF THE APPOINTMENT OF ARTHUR ANDERSEN LLP AS INDEPENDENT PUBLIC ACCOUNTANTS OF
THE COMPANY AND ITS SUBSIDIARIES FOR THE YEAR ENDING DECEMBER 31, 2000, AND
PROXIES EXECUTED AND RETURNED WILL BE SO VOTED UNLESS CONTRARY INSTRUCTIONS ARE
INDICATED THEREON.
STOCKHOLDER PROPOSALS
Any stockholder proposals intended to be presented at the 2001 Annual
Meeting must be received by the Company for inclusion in the proxy statement and
form of proxy relating to such meeting not later than December 15, 2000. It is
suggested that proponents submit their proposals by certified mail, return
receipt requested. Detailed information for submitting resolutions will be
provided upon written request to the Secretary of AutoNation, Inc., 110 S.E. 6th
Street, Fort Lauderdale, Florida 33301. No stockholder proposals were received
for inclusion in this Proxy Statement.
OTHER MATTERS
Management does not intend to present any other items of business and knows
of no other matters that will be brought before the Annual Meeting. However, if
any additional matters are properly brought before the Annual Meeting, the
persons named in the enclosed proxy shall vote the proxies in their discretion
in the manner they believe to be in the best interest of the Company. The
accompanying form of proxy has been prepared at the direction of the Board of
Directors and is being sent to you at the request of the Board of Directors. The
proxies named therein have been designated by your Board of Directors.
17
<PAGE> 21
PROXY
AUTONATION, INC.
This proxy is solicited on behalf of the Board of Directors
Michael J. Jackson and Jonathan P. Ferrando, each with power of
substitution, are hereby authorized to vote all shares of common stock which the
undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders of AutoNation, Inc. to be held on May 16, 2000, or any
postponements or adjournments thereof, as indicated on the reverse side.
THIS PROXY WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER
DIRECTED BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS GIVEN, THIS PROXY
WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES FOR DIRECTOR AND FOR PROPOSAL 2
SET FORTH ON THE OTHER SIDE. As to any other matter, said Proxies shall vote in
accordance with their best judgment.
The undersigned hereby acknowledges receipt of the Notice of the 2000
Annual Meeting of Stockholders, the Proxy Statement and the Annual Report for
the fiscal year ended December 31, 1999 furnished herewith.
Nominees: H. Wayne Huizenga, Michael J. Jackson, Harris W. Hudson,
Robert J. Brown, J.P. Bryan, Rick L. Burdick, Michael G.
DeGroote, George D. Johnson, Jr., John J. Melk and
Irene B. Rosenfeld.
(Continued and to be signed on reverse side)
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[X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
<TABLE>
<S> <C>
A vote FOR all nominees is recommended by the
Board of Directors
WITHHOLD
AUTHORITY to vote FOR all nominees A vote FOR is recommended by the Board of Directors
FOR all nominees for all nominees except as indicated
listed on reverse listed on reverse in space below FOR AGAINST ABSTAIN
1. Election of 2. Ratification of the
Directors [ ] [ ] [ ] appointment of Arthur [ ] [ ] [ ]
(See Reverse) Andersen LLP as
Independent Public
Accountants for 2000:
*INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark the
"Exceptions" box and write the name of such nominee(s) in the space provided below.
Exceptions ____________________________________________________________________
Please sign exactly as name appears hereon. When shares
are held by joint tenants, both should sign. If acting
as attorney, executor, trustee, or in any
representative capacity, sign name and title.
_______________________________________________________
SIGNATURE DATE
_______________________________________________________
SIGNATURE IF HELD JOINTLY DATE
PLEASE MARK, SIGN, DATE AND PROMPTLY RETURN THIS PROXY CARD USING THE ENCLOSED ENVELOPE.
</TABLE>
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