SAH 2019 Proxy Statement

&25325$7( *29(51$1&( $1' %2$5' 2) ',5(&7256 'LUHFWRU ,QGHSHQGHQFH %HFDXVH 0HVVUV 2 %UXWRQ 6PLWK % 6FRWW 6PLWK 'DYLG %UXWRQ 6PLWK DQG 0DUFXV * 6PLWK WKH ³6PLWK IDPLO\´ GLUHFWO\ RU LQGLUHFWO\ KROG RU FRQWURO PRUH WKDQ RI WKH YRWLQJ SRZHU RI 6RQLF¶V &RPPRQ 6WRFN 6RQLF TXDOLILHV DV D ³FRQWUROOHG FRPSDQ\´ IRU SXUSRVHV RI WKH 1<6( UXOHV DQG WKHUHIRUH LV QRW UHTXLUHG WR FRPSO\ ZLWK DOO RI WKH UHTXLUHPHQWV RI WKRVH UXOHV LQFOXGLQJ WKH UHTXLUHPHQW WKDW D OLVWHG FRPSDQ\ KDYH D PDMRULW\ RI LQGHSHQGHQW GLUHFWRUV 1HYHUWKHOHVV 6RQLF LV FRPPLWWHG WR KDYLQJ LWV %RDUG PHPEHUVKLS LQ IDYRU RI LQGHSHQGHQW GLUHFWRUV DV HYLGHQFHG E\ 6RQLF¶V &RUSRUDWH *RYHUQDQFH *XLGHOLQHV ZKLFK SURYLGH WKDW LW LV GHVLUDEOH WKDW DQ\ QRQ HPSOR\HH GLUHFWRU EH TXDOLILHG DV DQ ³LQGHSHQGHQW GLUHFWRU´ XQGHU WKH 6HFXULWLHV DQG ([FKDQJH &RPPLVVLRQ UXOHV DQG UHJXODWLRQV WKH ³6(& UXOHV´ DQG WKH 1<6( UXOHV 7KH %RDUG EHOLHYHV WKDW D PDMRULW\ RI LWV PHPEHUV DUH LQGHSHQGHQW XQGHU WKH DSSOLFDEOH 1<6( UXOHV DQG 6(& UXOHV 7KH 1<6( UXOHV SURYLGH WKDW D GLUHFWRU GRHV QRW TXDOLI\ DV ³LQGHSHQGHQW´ XQOHVV WKH ERDUG RI GLUHFWRUV DIILUPDWLYHO\ GHWHUPLQHV WKDW WKH GLUHFWRU KDV QR PDWHULDO UHODWLRQVKLS ZLWK WKH FRPSDQ\ HLWKHU GLUHFWO\ RU DV D SDUWQHU VWRFNKROGHU RU RIILFHU RI DQ RUJDQL]DWLRQ WKDW KDV D UHODWLRQVKLS ZLWK WKH FRPSDQ\ 7KH 1<6( UXOHV UHFRPPHQG WKDW D ERDUG RI GLUHFWRUV FRQVLGHU DOO RI WKH UHOHYDQW IDFWV DQG FLUFXPVWDQFHV LQ GHWHUPLQLQJ WKH PDWHULDOLW\ RI D GLUHFWRU¶V UHODWLRQVKLS ZLWK D FRPSDQ\ 7KH %RDUG KDV DGRSWHG &DWHJRULFDO 6WDQGDUGV IRU 'HWHUPLQDWLRQ RI 'LUHFWRU ,QGHSHQGHQFH WKH ³&DWHJRULFDO 6WDQGDUGV´ WR DVVLVW WKH %RDUG LQ GHWHUPLQLQJ ZKHWKHU D GLUHFWRU KDV D PDWHULDO UHODWLRQVKLS WKDW ZRXOG LPSDLU WKH GLUHFWRU¶V LQGHSHQGHQFH 7KH &DWHJRULFDO 6WDQGDUGV HVWDEOLVK WKUHVKROGV DW ZKLFK GLUHFWRUV¶ UHODWLRQVKLSV ZLWK WKH &RPSDQ\ DUH GHHPHG WR EH QRW PDWHULDO DQG WKHUHIRUH VKDOO QRW GLVTXDOLI\ DQ\ GLUHFWRU RU QRPLQHH IURP EHLQJ FRQVLGHUHG ³LQGHSHQGHQW ´ 7KH &DWHJRULFDO 6WDQGDUGV DUH DYDLODEOH RQ 6RQLF¶V ZHEVLWH www.sonicautomotive.com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¶V GHDOHUVKLS VXEVLGLDULHV 7KH %RDUG DQG WKH 1&* &RPPLWWHH GHWHUPLQHG WKDW )LUVW +RUL]RQ GLG QRW KDYH DQ DJUHHPHQW ZLWK 6RQLF WR VHUYH DV D SUHIHUUHG OHQGHU WR 6RQLF¶V GHDOHUVKLS VXEVLGLDULHV DQG WKDW WKH OHYHO RI DXWR ORDQ UHIHUUDO EXVLQHVV EHWZHHQ 6RQLF¶V GHDOHUVKLS VXEVLGLDULHV DQG )LUVW +RUL]RQ LQ ZDV LQVLJQLILFDQW WR ERWK 6RQLF DQG )LUVW +RUL]RQ DQG ZHOO EHORZ WKH WKUHVKROGV LQ WKH &DWHJRULFDO 6WDQGDUGV $V D UHVXOW RI WKLV HYDOXDWLRQ WKH %RDUG GHWHUPLQHG WKRVH UHODWLRQVKLSV WKDW GR H[LVW RU GLG H[LVW ZLWKLQ WKH ODVW WKUHH \HDUV H[FHSW IRU 0HVVUV 2 %UXWRQ 6PLWK¶V % 6FRWW 6PLWK¶V 'DYLG %UXWRQ 6PLWK¶V DQG :LOOLDP 5 %URRNV¶ DOO IDOO ZHOO EHORZ WKH WKUHVKROGV LQ WKH &DWHJRULFDO 6WDQGDUGV &RQVHTXHQWO\ WKH %RDUG RI 'LUHFWRUV GHWHUPLQHG WKDW HDFK RI 0HVVUV %HON 'RRODQ +DUULV +HOOHU DQG 7D\ORU LV DQ LQGHSHQGHQW GLUHFWRU XQGHU WKH &DWHJRULFDO 6WDQGDUGV WKH 1<6( UXOHV DQG WKH 6(& UXOHV 7KH %RDUG DOVR GHWHUPLQHG WKDW HDFK PHPEHU RI WKH $XGLW &RPSHQVDWLRQ DQG 1&* &RPPLWWHHV VHH PHPEHUVKLS LQIRUPDWLRQ EHORZ XQGHU ³  %RDUG &RPPLWWHHV´ LV LQGHSHQGHQW LQFOXGLQJ WKDW HDFK PHPEHU RI WKH $XGLW &RPPLWWHH LV ³LQGHSHQGHQW´ DV WKDW WHUP LV GHILQHG XQGHU 5XOH $ E LL RI WKH ([FKDQJH $FW DQG WKDW HDFK PHPEHU RI WKH &RPSHQVDWLRQ &RPPLWWHH LV DQ ³RXWVLGH GLUHFWRU´ DV GHILQHG XQGHU 6HFWLRQ P RI