| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
(e) On April 24, 2019, Sonic Automotive, Inc. (the “Company”) held its 2019 annual meeting of stockholders (the “Annual Meeting”). At the Annual Meeting, the Company’s stockholders approved the amendment and restatement of the Sonic Automotive, Inc. 2012 Stock Incentive Plan (as amended and restated, the “2012 Stock Incentive Plan”). The 2012 Stock Incentive Plan was adopted by the Company’s Board of Directors (the “Board”) on February 13, 2019, subject to stockholder approval. Upon stockholder approval at the Annual Meeting, the 2012 Stock Incentive Plan became effective as of April 24, 2019.
The 2012 Stock Incentive Plan was first adopted by the Board on February 22, 2012 and approved by the Company’s stockholders at the 2012 annual meeting of stockholders. The 2012 Stock Incentive Plan was then amended and restated by the Board effective as of February 11, 2015 and approved by the Company’s stockholders at the 2015 annual meeting of stockholders. This second amendment and restatement of the 2012 Stock Incentive Plan includes the following changes:
| | • | | increasing the number of shares of the Company’s Class A Common Stock authorized for issuance under the 2012 Stock Incentive Plan from 4,000,000 to 6,000,000, reflecting an increase of 2,000,000 shares; |
| | • | | extending the term of the 2012 Stock Incentive Plan until February 22, 2027, allowing an additional five years for the 2012 Stock Incentive Plan; and |
| | • | | updating the 2012 Stock Incentive Plan in connection with certain changes in applicable tax law and other minor revisions. |
As noted above, the Company has reserved for issuance under the 2012 Stock Incentive Plan an aggregate of 6,000,000 shares of the Company’s Class A Common Stock, $0.01 par value per share (“Class A Common Stock”), that may be granted in connection with awards under the 2012 Stock Incentive Plan. Shares of Class A Common Stock covered by awards that expire or are forfeited, canceled, settled in cash or otherwise terminated without the delivery of the full number of covered shares will be available for further awards under the 2012 Stock Incentive Plan to the extent of such expiration, forfeiture, cancellation, cash settlement, etc. However, shares of Class A Common Stock subject to an award that are (i) withheld or retained by the Company in payment of the exercise or purchase price of an award (including shares withheld or retained by the Company or not issued in connection with the net settlement or net exercise of an award) or (ii) tendered to, withheld or retained by the Company in payment of tax withholding obligations relating to an award will not become available again for awards under the 2012 Stock Incentive Plan.
The 2012 Stock Incentive Plan authorizes a variety of types of equity-based awards to employees (including the principal executive officer, principal financial officer and other named executive officers) and consultants providing services to the Company. Specifically, awards under the 2012 Stock Incentive Plan may be granted in the form of incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units and other stock awards.
Unless terminated earlier by the Board, the 2012 Stock Incentive Plan will terminate at 11:59 p.m. on February 22, 2027; provided, that no incentive stock options may be granted under the 2012 Stock Incentive Plan on or after February 22, 2022, and no awards may be made under the 2012 Stock Incentive Plan after its termination.
