Sidney DeBoer

About Sidney B. DeBoer

Founder and Chairman of the Board of Lithia Motors (took LAD public in 1996); former CEO and Secretary (1968–2011) and Executive Chairman through 2015. Age 81, board service dates back to 1968 (28 years post‑IPO tenure shown in the proxy), with education at Stanford University and the University of Oregon. Core credentials: pioneering public auto retail operator with deep industry leadership and longstanding governance role as Board Chair.

Past Roles

External Roles

Board Governance

• Independence and structure

  • Role: Chairman of the Board; not independent; not assigned to Audit, Compensation, or Nominating & Governance committees (committees are 100% independent).
  • Company policy: Directors not considered independent if on the Board ≥15 years and no independent service allowed after age 79, which structurally precludes Mr. DeBoer’s independence.
  • Board independence: 75% independent directors; committee independence: 100%. Lead Independent Director in 2024 was David J. Robino (Board to appoint new LID for 2025–2026).

• Attendance and engagement

  • Board held 15 meetings and committees held 20 meetings in 2024; each incumbent director attended at least 80% of Board and applicable committee meetings; all directors then in office attended the 2024 Annual Meeting.

• Governance metrics | Metric | 2024 Value | |---|---| | Board meetings | 15 | | Committee meetings | 20 | | Independent directors | 75% | | Committee independence | 100% | | Director attendance threshold | ≥80% for each incumbent director |

Fixed Compensation

• 2024 Director compensation (calendar year amounts) | Component | Amount (USD) | |---|---| | Fees Earned or Paid in Cash | $160,000 | | Stock Awards (grant-date fair value) | $183,100 | | Total | $343,100 |

• Non-employee director program (2024–2025 service year) | Element | Terms | |---|---| | Cash retainer | $100,000; paid in 12 monthly installments | | Committee chair fees | +$25,000 per chair role | | Chairman/Lead Independent fee | +$35,000 (increased by $5,000 vs prior year) | | Equity grant | RSUs valued at $195,000 (up $15,000 vs prior year), number based on 20-day average closing price pre‑grant | | Vesting | RSUs vest 25% after each regularly scheduled quarterly Board meeting over one year |

• Additional related compensation arrangements (related-party/legacy) | Arrangement | Terms | |---|---| | Transition Agreement (2015) | Annual payments of $1,050,000 for prior services plus $42,000 vehicle allowance; continues until earlier of death or 12/31/2035 | | Split-dollar life insurance | Four whole-life policies; Company pays premiums through earlier of death or 12/31/2035; each policy worth $3,727,600 at maturity; Company to receive greater of cash surrender value or cumulative premiums | | Aircraft access | Permitted to use Company’s FlexJet access for personal travel with full reimbursement of flight-related incremental costs | | Director Service Agreement | Paid the same director compensation as other non-employee directors while serving on the Board |

Performance Compensation

• Director equity awards are time-based RSUs (no performance metrics); grants occur immediately after the annual meeting and vest quarterly over one year if service continues. | Equity Element | 2024 Detail | |---|---| | RSU grant (director program) | $195,000 grant value; time-based; vests 25% each quarter post-annual meeting | | 2024 stock awards reported (Mr. DeBoer) | $183,100 grant-date fair value (calendar-year recognition) | | Performance metrics | None disclosed for director RSUs (service-based vesting only) |

Other Directorships & Interlocks

• No other public company directorships or interlocks for Mr. DeBoer are disclosed in the 2025 proxy biography; philanthropic boards listed above.

Expertise & Qualifications

• Founder of LAD; decades-long auto retail operating leadership; recognized pioneer in public auto retail; deep company familiarity. Education at Stanford University and University of Oregon.

Equity Ownership

Related-Party Transactions and Potential Conflicts

• Family relationships: Mr. DeBoer is the father of CEO Bryan B. DeBoer and of Mark DeBoer (VP of Real Estate). In 2024, Mark DeBoer received $360,000 salary, $320,000 incentive compensation, and $12,973 in other compensation.
• Change-in-control definition includes carve-outs excluding transfers to the “Sidney B. DeBoer Trust” and DeBoer family trust arrangements from triggering a “Change in Control,” a structural entrenchment consideration.
• Audit Committee/Board reviews related-party transactions >$120,000; directors and NEOs must disclose conflicts via questionnaires under the Code of Business Conduct and Ethics.

Say-on-Pay & Shareholder Feedback (context for governance tone)

Governance Assessment

• Strengths

  • Strong committee independence (100%), with clear separation of Board Chair and Lead Independent Director; robust director ownership, anti-hedging/pledging policies.
  • Documented Board/committee activity (15/20 meetings) and ≥80% attendance by incumbents; all directors attended the 2024 annual meeting.
  • Shareholder engagement and responsiveness (metric adjustments in executive LTI; consistent say-on-pay support trend).

• Risk indicators and red flags

  • Non-independence due to age (81) and very long tenure; Board policy itself precludes independence beyond 79 years and ≥15 years of service.
  • Family ties to CEO and another senior executive, elevating potential conflicts of interest and information flow concerns.
  • Ongoing material legacy payments under the Transition Agreement through as late as 2035 ($1.05M/year plus $42k vehicle allowance) and Company-paid premiums on four split-dollar policies; personal aircraft access (reimbursed), collectively increasing perceived related-party exposure.
  • Change-in-control definition carve-outs referencing DeBoer family trusts could weaken minority shareholder protections in certain control scenarios.

• Implications

  • While committee processes and ownership/hedging safeguards are strong, concentrated family influence and legacy financial arrangements heighten governance risk perceptions. Investors may seek continued reinforcement of robust Lead Independent Director oversight, transparent related-party review, and careful handling of control definitions to sustain confidence.