AutoZone 2013 Annual Report Download - page 14

Proxy
In determining the independence of our directors, the Board considers relationships involving directors and
their immediate family members that are relevant under applicable laws and regulations, the listing standards of
the New York Stock Exchange, and the standards contained in our Corporate Governance Principles (listed
above). The Board relies on information from Company records and questionnaires completed annually by each
director.
As part of its most recent independence determinations, the Board noted that AutoZone does not have, and
did not have during fiscal 2013, significant commercial relationships with companies at which Board members
served as officers or directors, or in which Board members or their immediate family members held an
aggregate of 10% or more direct or indirect interest.
The Board considered the fact that Mr. Jordan is the Chairman of the Board, President and Chief Executive
Officer and a member of the board of directors of First Horizon National Corporation, parent company of First
Tennessee Bank, which
• participates in one of AutoZone’s supplier confirmed receivables programs (under which some AutoZone
vendors are borrowers, but AutoZone is not);
• has established a Daylight Overdraft line which allows AutoZone to make large payments early in the
morning creating a “daylight” overdraft which is rectified at the end of the day;
• acts as Trustee for AutoZone’s pension plan;
• offers brokerage services to AutoZone employees exercising stock options, and
• holds various AutoZone deposit accounts.
During fiscal 2013, First Horizon National Corporation did business with AutoZone in arm’s length
transactions which were not, individually or cumulatively, material to either AutoZone or First Horizon National
Corporation and which did not materially benefit Mr. Jordan, either directly or indirectly.
The Board also considered the fact that Mr. Brooks is a member of the board of directors of Southwest
Airlines. During fiscal 2013, AutoZone purchased airline tickets from Southwest Airlines which were not,
individually or cumulatively, material to either AutoZone or Southwest Airlines and which did not materially
benefit Mr. Brooks, either directly or indirectly.
The Board also reviewed donations made by the Company to not-for-profit organizations with which Board
members or their immediate family members were affiliated by membership or service or as directors or
trustees.
Based on its review of the above matters, the Board determined that none of Messrs. Brooks, Graves,
Guimaraes, Hyde, Jordan, McKenna, Mrkonic, or Nieto or Ms. Goodspeed or Gove has a material relationship
with the Company and that all of them are independent within the meaning of the AutoZone Corporate
Governance Principles and applicable law and listing standards. The Board also determined that Mr. Rhodes is
not independent since he is an employee of the Company.
Board Leadership Structure
Our Board believes that having a combined Chairman/CEO, independent members and chairs for each of
our Board committees and a Lead Director currently provides the best board leadership structure for AutoZone.
This structure, together with our other corporate governance practices, provides strong independent oversight of
management while ensuring clear strategic alignment throughout the Company. Our Lead Director is a non-
employee director who is elected by the Board. Earl G. Graves, Jr., a director since 2002, currently serves as our
Lead Director.
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