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

4)	Proposed maximum aggregate value of transactions: ________________________________________________

5)	Total fee paid: ______________________________________________________________________________

1)	Amount previously paid: ______________________________________________________________________

2)	Form, Schedule or Registration Statement No.: _____________________________________________________

3)	Filing Party: ________________________________________________________________________________

4)	Date Filed: _________________________________________________________________________________

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•	to elect as Directors the nine nominees named in the attached proxy statement;

•	to conduct an advisory (non-binding) vote on executive compensation;

•	to conduct an advisory (non-binding) vote on the frequency (either one, two or three years) of future advisory (non-binding) votes on executive compensation;

•	to consider and act upon a proposal to approve the 2017 Incentive Award Plan;

•	to ratify the appointment of Ernst & Young LLP, as independent auditors for the fiscal year ending December 31, 2017;

•	to consider and act upon a shareholder proposal, if properly presented at the Annual Meeting; and

•	to transact such other business as may properly come before the meeting or any adjournments thereof.

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(1)	To elect as Directors the nine nominees named in this proxy statement;

(2)	To conduct an advisory (non-binding) vote on executive compensation;

(3)	To conduct an advisory (non-binding) vote on the frequency (either one, two or three years) of future advisory (non-binding) votes on executive compensation;

(4)	To consider and act upon a proposal to approve the 2017 Incentive Award Plan;

(5)	To ratify the appointment of Ernst & Young LLP, as independent auditors for the fiscal year ending December 31, 2017;

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(6)	A shareholder proposal entitled “Special Shareowner Meetings,” if properly presented.

(1)

Via Mail: You may vote by properly completing and signing the enclosed proxy card and returning the card in the enclosed, postage-paid envelope. Please specify your choices on the proxy card by marking the appropriate boxes. Shares will be voted in accordance with your written instructions; however, it is not necessary to mark any boxes if you wish to vote in accordance with the Board’s recommendations, outlined further below. Mark, sign and date your proxy card and return it in the postage-paid envelope provided or send it to O’Reilly Automotive, Inc. Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

(2)	Via the Internet: You may vote on the Internet by visiting www.proxyvote.com. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and create an electronic voting instruction form.

(3)	Via Telephone: Using any touch-tone telephone, you may vote your shares by dialing toll-free to 1-800-690-6903. Have your proxy card in hand when calling and follow the instructions.

(1)	FOR the election as Directors the nine nominees named in this proxy statement;

(2)	FOR the approval, by an advisory (non-binding) vote of the 2016 compensation of the Company’s Named Executive Officers;

(3)	For the selection, by an advisory (non-binding) vote, of future advisory (non-binding) votes on executive compensation every “ONE YEAR” (annually);

(4)	FOR the proposal to approve the 2017 Incentive Award Plan;

(5)	FOR the ratification of the selection of Ernst & Young LLP, as the Company’s independent auditors for the fiscal year ending December 31, 2017; and

(6)	AGAINST the shareholder proposal entitled “Special Shareowner Meetings,” if properly presented.

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(1)	Proxies marked “ABSTAIN” will be deemed to be represented at the Annual Meeting and considered in determining whether the requisite number of affirmative votes are cast on such matter.

(2)	A broker non-vote occurs when a broker has not received voting instructions from the beneficial owner of shares, and the broker does not have, or declines to exercise, discretionary authority to vote those shares.

(3)	Cumulative voting is not allowed for Election of Directors.

(4)	“Shares present and entitled to vote” includes shares represented in person or by proxy at the Annual Meeting.

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(1)

As reflected on such beneficial owner’s Schedule 13G/A dated, February 7, 2017, provided to the Company in accordance with the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These securities are owned by various individual and institutional investors, which T. Rowe Price Associates, Inc. (“Price Associates”) serves as investment advisor with power to direct investments and/or sole power to vote the securities. For purposes of the reporting requirements of the Exchange Act, Price Associates is deemed to be beneficial owner of such securities; however, Price Associates expressly disclaims that it is, in fact, the beneficial owner of such securities. Of the 10,706,518 shares reported, Price Associates claimed sole voting power of 3,034,028 shares, no shared voting power, sole dispositive power of 10,706,518 shares and no shared dispositive power. Price Associates acts as investment manager to collective trust accounts and directs the voting of such shares.

(3)	As reflected on such beneficial owner’s Schedule 13G/A dated February 10, 2017, provided to the Company in accordance with the Exchange Act. Of the 5,847,964 shares reported, The Vanguard Group claimed sole voting power of 147,626 shares, shared voting power of 19,003 shares, sole dispositive power of 5,847,964 shares and shared dispositive power of 166,940 shares.

(3)	As reflected on such beneficial owner's Schedule 13G/A dated January 25, 2017, provided to the Company in accordance with the Exchange Act. Of the 5,738,448 shares reported, BlackRock, Inc. claimed sole voting power of 4,952,128 shares, no shared voting power, sole dispositive power of 5,738,448 shares and no shared dispositive power.

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*	denotes less than 1.0%

(a)	With respect to each person, assumes the exercise of all stock options held by such person that were exercisable within 60 days of February 28, 2017.

(b)

The stated number of directly owned shares includes 2,720 restricted shares awarded under the Company’s long-term incentive compensation plans. The stated number of indirectly owned shares includes 583,503 shares controlled by Mr. O’Reilly as trustee of a trust for the benefit of his children, 270,069 shares held in a Grantor Retained Annuity Trust (“GRAT”) and 7,624 shares held in the O’Reilly Employee Savings Plus Plan with T. Rowe Price Investment Services, Inc. (“T. Rowe Price”) as trustee.

(c)	The stated number of indirectly owned shares includes 99,533 shares owned by Mr. O’Reilly’s spouse, 31,140 shares held in a GRAT and 10,375 shares held in a Charitable Remainder Annuity Trust. Of Mr. O’Reilly’s directly owned shares, 4,002 shares, and 99,533 shares of Mr. O’Reilly’s indirectly owned shares, which are held by Mr. O’Reilly’s spouse, are pledged against margin loans.

(d)	The stated number of indirectly owned shares includes 65,028 shares held in a GRAT and 23,520 shares controlled by Mr. O’Reilly in a family registered partnership. Of Mr. O’Reilly’s directly owned shares, 62,500 shares are pledged against margin loans.

(e)	The stated number of indirectly owned shares is held in a GRAT.

(f)	The stated number of directly owned shares includes 1,101 restricted shares awarded under the Company’s Director Stock Plan.

(g)	The stated number of directly owned shares includes 1,101 restricted shares awarded under the Company’s Director Stock Plan. The stated number of indirectly owned shares is owned by Mr. Lederer’s spouse.

(h)	The stated number of directly owned shares includes 603 shares held in the O’Reilly Employee Stock Purchase Plan. The stated number of indirectly owned shares includes 8,006 shares held in a GRAT and 5,009 shares held in the O’Reilly Employee Savings Plus Plan with T. Rowe Price as trustee.

(i)	The stated number of directly owned shares includes 3,085 shares held in the O’Reilly Employee Stock Purchase Plan. The stated number of indirectly owned shares is held in the O’Reilly Employee Savings Plus Plan with T. Rowe Price as trustee.

(j)	The stated number of directly owned shares includes 2,978 shares held in the O’Reilly Employee Stock Purchase Plan. The stated number of indirectly owned shares is held in the O’Reilly Employee Savings Plus Plan with T. Rowe Price as trustee.

(k)	The stated number of directly owned shares includes 1,744 shares held in the O’Reilly Employee Stock Purchase Plan. The stated number of indirectly owned shares is held in the O’Reilly Employee Savings Plus Plan with T. Rowe Price as trustee.

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•	Serves as a liaison among other Directors, with the Company’s management, between Board committees and the Board;

•	Presides at Board meetings in the absence of the Chairman of the Board, or at the request of the Chairman of the Board;

•	Ensures Board leadership in the absence or incapacitation of the Chairman of the Board;

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•	Chairs executive sessions involving only the independent Directors, develops the agenda for executive sessions to ensure that independent Directors have adequate opportunities for these meetings to be held and adequate time to discuss issues and communicates with the Company’s management, as appropriate, the results of the executive sessions;

•	Consults with the Chairman of the Board as to the appropriate schedules and agendas of Board meetings to ensure there is sufficient time available for serious discussion of appropriate topics proposed by the independent Directors;

•	Advises the Chairman of the Board on the conduct of Board meetings to facilitate teamwork and communication among independent and non-independent Directors;

•	Together with the Chairman of the Board, collaborates with the Company’s management to determine the information and materials provided to the Directors, so that the independent Directors have adequate resources, especially by way of full, timely and relevant information, to support their decision-making responsibilities;

•	Entitled to request materials from and receive notice of, and attend all, meetings of Board committees;

•	Collaborates with the Chairman of the Board and Corporate Governance/Nominating Committee on Board succession planning;

•	Is available to advise committee chairpersons in fulfilling their designated roles and responsibilities to the Board;

•	Acts as the focal point on the Board concerning issues such as corporate governance and suggestions from independent Directors and monitors and coordinates with the Company’s management on corporate governance issues and developments;

•	Collaborates with the Corporate Governance/Nominating Committee to ensure a succession plan is in place for the Company’s Chief Executive Officer;

•	Collaborates with the Board to guide the Company’s management on strategic issues and long-term planning;

•	Consults with the Chairman of the Board on such matters as are pertinent to the Board and the Company;

•	Is available for direct communication and consultation with shareholders, upon request through Board approved procedures; and

•	Performs such other duties as the Board or Chairman of the Board may delegate, from time to time.

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Number of Members:	Five

Members:	John R. Murphy (Chairman), Jay D. Burchfield, Thomas T. Hendrickson, Paul R. Lederer, Ronald Rashkow

Number of Meetings During 2016:	Eight

Number of Members:	Three

Members:	Jay D. Burchfield (Chairman), Paul R. Lederer, Ronald Rashkow

Number of Meetings During 2016:	Four

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Number of Members:	Three

Members:	Paul R. Lederer (Chairman), Jay D. Burchfield, John R. Murphy

Number of Meetings During 2016:	Four

(i)	to establish criteria for the selection of Directors and to recommend to the Board the nominees for Director in connection with the Company's Annual Meeting of the shareholders;

(ii)	to take a leadership role in shaping the Company's corporate governance policies and to issue and implement the Corporate Governance Principles of the Company;

(iii)	to develop and coordinate annual evaluations of the Board, its committees and its members;

(iv)	to advise the Board regarding long-term Board succession; and

(v)	to adhere to all legal standards required by the SEC and Nasdaq.

•	a candidate’s qualification as “independent” under the federal securities laws and the rules and regulations of the SEC and Nasdaq applicable to the Board and each of its committees;

•	depth, breadth and diversity of experience within the Company’s industry and otherwise;

•	commitments outside of the Board and the ability to devote adequate time to Board and committee matters;

•	special areas of expertise;

•	accounting and financial knowledge;

•	willingness to apply sound and independent business judgment;

•	leadership ability;

•	experience in developing and assessing business strategies;

•	corporate governance expertise;

•	risk management skills; and

•	for incumbent members of the Board, the past performance of the incumbent director.

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(i)	the name and address of record of the shareholder who intends to make the nomination;

(ii)	the class and number of shares of the capital stock that are beneficially owned by the shareholder on the date of such notice;

(iii)	the name, age, business and residential addresses, and principal occupation or employment of each proposed nominee;

(iv)	a description of all arrangements or understandings between the shareholder and each nominee, and other arrangements or understandings known to the shareholder, pursuant to which the nomination or nominations are to be made by the shareholder;

(v)	any other information regarding each proposed nominee that would be required to be included in a proxy statement filed with the SEC; and

(vi)	the written consent of each proposed nominee being so named to serve as a Director of the Company.

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(a)

Stock awards granted to Directors represent restricted shares, which vest in equal annual installments over a three-year period commencing on the first anniversary of the award. The dollar value of stock awards represents the grant-date fair value of the awards based on the closing market price of the Company’s common stock on the date of the award. Please see Note 9 “Share-Based Compensation and Benefit Plans” to the Company’s Consolidated Financial Statements included on its Annual Report in Form 10-K for the fiscal year ended December 31, 2016, for further discussion of the accounting used in calculating share-based compensation expenses in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”). The table below summarizes the Directors’ outstanding stock option and restricted share awards as of December 31, 2016:

(i)	Option awards granted to Directors become 100% exercisable with respect to the covered shares six months from the date of grant and expire after seven years.

(ii)

Represents restricted shares granted on May 7, 2014, May 6, 2015, and May 4, 2016. The restricted shares granted on May 7, 2014, vest in one installment of 251 shares on May 7, 2017. The restricted shares granted on May 6, 2015, vest in two installments of 192 shares each on May 6, 2017, and May 6, 2018. The restricted shares granted on May 4, 2016, vest in three installments of 156 shares on May 4, 2017, and 155 shares each on May 4, 2018, and May 4, 2019.

(b)	The “All Other Compensation” column included personal benefit valued at less than $10,000, which consisted of personal use of the Company plane.

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•	David O'Reilly - Chairman of the Board

•	Greg L. Henslee - Chief Executive Officer

•	Greg D. Johnson - Executive Vice President of Supply Chain (Co-President as of February 7, 2017)

•	Jeff M. Shaw - Executive Vice President of Store Operations and Sales (Co-President as of February 7, 2017)

•	Tom McFall - Chief Financial Officer and Executive Vice President

•	recruiting and retaining qualified Team Members;

•	the career development and progression of Team Members;

•	management succession, in conjunction with the Company’s Corporate Governance/Nominating Committee; and

•	employment practices.

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(a)	Calculated based on the change in sales of stores open at least one year and exclude sales of specialty machinery, sales to independent parts stores and sales to Team Members.

(b)	Calculated as net income plus interest expense, divided by the sum of average debt and average equity, less average cash.

(c)	Calculated as net cash provided by operating activities less capital expenditures for the period.

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(a)	The “Salary” column includes the portion of salary deferred at NEO’s election under the Company’s Profit Sharing and Savings Plan and/or Deferred Compensation Plan.

(b)

The “Stock Awards” column refers to restricted share awards granted in 2014, 2015 and 2016, as further discussed in the “Long-term, stock-based incentives” section of the “Compensation Discussion and Analysis” portion of this proxy statement. All restricted shares awarded vest in equal installments over a three-year period commencing on the first anniversary of the award. The dollar value of stock awards represents the grant-date fair value of the awards based on the closing market price of the Company’s common stock on the date of the award. Please see Note 9 “Share-Based Compensation and Benefit Plans” to the Company’s Consolidated Financial Statements included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2016, for further discussion of the accounting used in calculating share-based compensation expenses in accordance with ASC 718.

(c)

The “Option Awards” column refers to the option awards granted to the NEOs, which become exercisable with respect to 25% of the covered shares one year from the date of grant; 50% exercisable two years from the date of grant; 75% exercisable three years from the date of grant and the remainder become exercisable four years from the date of grant. The amounts recognized in the above table reflect the grant date fair value of stock option awards granted during 2016, 2015 and 2014. During the fiscal years ended December 31, 2016, 2015 and 2014, no option awards were forfeited by the named executives. The grant date fair value of option awards was determined using the Black-Scholes option-pricing model. The Black-Scholes model requires the use of assumptions, including expected volatility, expected life, the risk free rate and the expected dividend yield. Please see Note 9 “Share-Based Compensation and Benefit Plans” to the Company’s Consolidated Financial Statements included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2016, for further discussion of these assumptions and the accounting used in calculating share-based compensation expenses in accordance with ASC 718.

(d)	The “Non-Equity Incentive Plan Compensation” column refers to the cash payouts under the Company’s annual performance incentive plan, which is paid in the year following the plan year. Detailed descriptions of the annual performance incentive plan can be found in the “Incentive compensation plan” section of the “Compensation Discussion and Analysis” portion of this proxy statement.

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(e)	The “All Other Compensation” column includes the following:

(i)	The “Perquisites and Personal Benefits” column for each NEO for each year included perquisites and personal benefits valued at less than $10,000 for each benefit, which consisted of, for certain NEOs but not necessarily all, personal use of the Company plane and/or club dues.

(f)	Greg D. Johnson became a NEO during the year ended December 31, 2015.

(a)

The “Estimated Future Payouts Under Non-Equity Incentive Plan Awards” - “Target” column refers to the potential cash payouts under the Company’s annual performance incentive plan for its executive officers, including the NEOs, for 2016, which would be paid during 2017. The Compensation Committee approved the goals for the 2016 incentive plans in January of 2016. The payout amounts for each NEO for 2016 were reviewed and approved by the Compensation Committee and the Board in January of 2017, upon completion of the consolidated financial statements for the fiscal year ended December 31, 2016. The “Summary of Compensation” table details amounts actually paid under the 2016 annual performance incentive plans in the “Non-Equity Incentive Plan Compensation” column, which were paid in the year following the plan year. A detailed description of the annual performance incentive plan can be found in the “Incentive compensation plan” section of the “Compensation Discussion and Analysis” portion of this proxy statement.

(b)	The “All Other Stock Awards: Number of Shares of Stock or Units” column refers to restricted share awards granted to NEOs, which vest in three equal installments on January 28, 2017, 2018 and 2019.

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(c)

The “All Other Option Awards: Number of Securities Underlying Options” column refers to stock option awards granted to the NEOs, which become exercisable with respect to 25% of the covered shares one year from the date of grant; 50% exercisable two years from the date of grant; 75% exercisable three years from the date of grant, while the remainder become exercisable four years from the date of grant.

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(a)	Represents restricted shares granted on January 30, 2014, January 29, 2015, and January 28, 2016. The restricted shares granted on January 30, 2014, vest in one installment of 743 shares on January 30, 2017. The restricted shares granted on January 29, 2015, vest in two

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(b)	Represents stock options granted on January 31, 2013, which become exercisable in four equal installments on January 31, 2014, 2015, 2016 and 2017.

(c)	Represents stock options granted on January 30, 2014, which become exercisable in four equal installments on January 30, 2015, 2016, 2017 and 2018.

(d)	Represents stock options granted on January 29, 2015, which become exercisable in four equal installments on January 29, 2016, 2017, 2018 and 2019.

(e)	Represents stock options granted on January 28, 2016, which become exercisable in four equal installments on January 28, 2017, 2018, 2019 and 2020.

(a)	Reflects the vesting of restricted stock awards granted in 2013, 2014 and 2015. All restricted shares awarded vest in equal installments over a three-year period commencing on the first anniversary of the award.

(a)	All NEO contribution amounts have been included in the “Salary” column of the “Summary of Compensation” table.

(b)

All registrant contributions have been included in the “All Other Compensation” column of the “Summary of Compensation” table. NEOs must be employed on December 31 to receive that year's Company matching contribution, with the matching Contribution funded annually at the beginning of the year following the year in which the matching contribution was earned. At the beginning of 2017, Company matching contributions of $12,892, $18,000, $1,712, $8,925, and $14,277 were contributed for David O'Reilly, Greg L. Henslee, Greg D. Johnson, Jeff M. Shaw, and Tom McFall, respectively, for the fiscal year ended December 31, 2016.

(c)	Amounts included in the “Aggregate Earnings in Last Fiscal Year” column are not reported as compensation in the “Summary of Compensation” table.

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•	continuation of salary for two years and a payment equal to two times the NEO’s target bonus;

•	continuation of insurance coverage for two years;

•	any unpaid bonus for the immediately preceding year and a pro rata target bonus for the year of termination;

•	an amount equal to all earned but unused vacation days;

•	payment for outplacement services, up to $30,000 and not to exceed 24 months;

•	immediate vesting for all equity-based awards and immediate exercisability for 12 months for all outstanding stock options; and

•	all reasonable legal fees and expenses incurred in disputing the termination of the executive’s employment.

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•	whether the transaction is fair and reasonable to the Company;

•	the business reasons for the transaction;

•	whether the transaction would impair the independence of one or more of the Company’s Officers or Directors; and

•	whether the transaction is material, taking into account the significance of the transaction.

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•	A sale of shares of the Company’s common stock on February 16, 2016, made by John R. Murphy that was not reported until February 19, 2016.

•	A purchase of shares of the Company’s common stock on February 19, 2016, made by Jeffrey A. Lauro that was not reported until March 1, 2016.

•	An exercise and subsequent sale of shares of the Company’s common stock on May 27, 2016, made by Ronald Rashkow that was not reported until June 6, 2016.

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•	reviewed and discussed with management the Company’s audited financial statements as of, and for the year ended, December 31, 2016;

•	discussed with the Company’s independent auditors the matters required to be discussed by Auditing Standard No. 1301, Communications with Audit Committees, as adopted by the Public Company Accounting Oversight Board (“PCAOB”); and

•	received from the independent auditors the written disclosures and the letter regarding the auditor’s independence required by PCAOB Ethics and Independence Rule 3526, Communication with Audit Committees Concerning Independence, and has discussed with the independent auditors their independence.

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•	recruiting and retaining qualified Team Members,

•	the career development and progression of the Company’s Team Members, and

•	observed industry practices.

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•

No Additional Shares Reserved. Approval of the 2017 Plan will not result in an increase in the number of shares authorized and reserved for issuance under the Company’s equity plans because the approval of additional shares is not being requested at this time. Instead, the number of shares of the Company’s common stock that remain available for issuance under the 2012 Plan will be reserved for issuance in connection with awards granted under the 2017 Plan. As of December 31, 2016, 5,094,283 shares of the Company’s common stock remained available for issuance under the 2012 Plan. In addition, shares that are subject to outstanding awards under the 2012 Plan but that terminate, expire, or would otherwise again be available for issuance under the 2012 Plan but for the termination of the 2012 Plan, will be available for issuance under the 2017 Plan.

•

Fungible Pool and Share Counting; No Liberal Share Recycling. For purposes of counting the number of shares granted or remaining available for grant under the 2017 Plan, any shares covered by stock options or stock appreciation rights will be counted against the share limit as one share for each share granted, and any shares covered by awards other than stock options or stock appreciation rights will be counted against the share limit as three shares for each share granted. The 2017 Plan provides that, if any shares covered by an award or to which an award relates are not purchased or are forfeited or if an award otherwise terminates without delivery of any shares, then, for every share subject to an award of stock options or stock appreciation rights, one share will be added back to the share limit and again become available for grant and, for every share subject to awards other than stock options or stock appreciation rights, three shares will be added back to the share limit and again become available for grant, while shares (a) tendered in payment of a stock option, (b) delivered or withheld by the Company to satisfy any tax withholding obligation, (c) repurchased by the Company with stock option proceeds or (d) subject to a stock-settled stock appreciation right or another award that were not issued upon the settlement of the award, in each case, will not be available for future grant.

•	No Evergreen Provision. There is no evergreen provision or automatic replenishment provision pursuant to which the shares authorized for issuance under the 2017 Plan are automatically replenished.

•	No Automatic Grants. The 2017 Plan does not provide for automatic grants to any participant.

•

Grant Limits. The number of shares of the Company’s common stock subject to stock options and stock appreciation rights awarded to any one participant during any calendar year may not exceed 1 million shares. Likewise, the number of shares of the Company’s common stock subject to awards other than options and stock appreciation rights awarded to any one participant during any calendar year may not exceed 1 million shares. Further, the number of shares of the Company’s common stock available for issuance under the 2017 Plan with respect to incentive stock options is 2 million in the aggregate.

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•

Compensation Limits. The amount of compensation to be paid to any one participant with respect to all cash-based awards that are intended to constitute performance-based compensation for purposes of Section 162(m) is $10 million in any calendar year. In addition, a non-employee director may not receive awards that, when taken together with cash fees and awards granted under any of the Company’s equity plans to such non-employee director, exceed $1 million in total value in any calendar year.

•	No Discounted Options. Stock options may not be granted with exercise prices lower than the fair market value of the underlying shares on the grant date.

•	Prohibition on Repricing. The 2017 Plan prohibits the repricing of stock options and stock appreciation rights without prior shareholder approval.

•	Minimum Vesting Requirements.  The 2017 Plan requires a one-year minimum vesting period for all awards, except in the case of death, disability, retirement or upon a change in control, as set forth in the 2017 Plan. The 2017 Plan also permits up to 5% of the shares available for issuance to be granted without regard to the minimum one-year vesting requirement.

•	Dividends and Divided Equivalents on Unvested Awards. The 2017 Plan provides that dividends and dividend equivalents on unvested awards will be paid to participants only after the vesting conditions applicable to the underlying awards have been satisfied and not during the service- or performance-based vesting period.

•	Awards Subject to Clawback. Awards granted under the 2017 Plan are subject to the Company’s clawback policy. A detailed description of the clawback policy can be found in the “Clawback policy” section of the “Compensation Discussion and Analysis” portion of this proxy statement.

•

Holding Period. Each of the Company’s executive officers will be required to hold at least 50% of his or her “covered shares” (generally, shares issuable under an award granted pursuant to the 2017 Plan, other shares used to satisfy taxes payable on such awards) until the earliest to occur of (a) 36 months from the grant date, (b) his or her compliance with the minimum ownership requirements of the Company’s stock ownership guidelines or (c) termination of his or her employment.

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•	designate eligible individuals to receive awards;

•	determine the type or types of awards to be granted;

•	determine the number of awards to be granted and the number of shares to which an award will relate;

•	determine the terms and conditions of any award granted;

•	decide all other matters that must be determined in connection with an award;

•	establish, adopt, or revise any rules and regulations as it may deem necessary or advisable to administer the 2017 Plan;

•	interpret, reconcile any inconsistency in, correct any defect in and supply any omission in the terms of, and any matter arising pursuant to, the 2017 Plan or any award agreement; and

•	make all other decisions and determinations that may be required pursuant to the 2017 Plan or as it deems necessary or advisable to administer the 2017 Plan.

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to provide for either (a) termination of any such award in exchange for an amount of cash, if any, equal to the amount that would have been attained upon the exercise of such award or realization of the participant’s rights, or (b) the replacement of such award with other rights or property selected by the Compensation Committee in its sole discretion having an aggregate value not exceeding the amount that could have been attained upon the exercise of such award or realization of the participant’s rights had such award been currently exercisable or payable or fully vested;

•	to provide that such award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or will be substituted for by similar stock options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices;

•	to make adjustments in the number and type of securities subject to outstanding awards and awards which may be granted in the future and/or in the terms, conditions and criteria included in such awards (including the grant or exercise price, as applicable);

•	to provide that such award will be exercisable or payable or fully vested with respect to all securities covered thereby; and

•	to provide that such award cannot be exercised after such event.

•	The number and type of securities subject to each outstanding award and/or the exercise price or grant price thereof, if applicable, will be equitably adjusted. The adjustment is non-discretionary, final and binding on the affected participant and the Company.

•	The Compensation Committee will make such equitable adjustments, if any, as the it may deem appropriate to reflect such equity restructuring with respect to the aggregate number and kind of shares that may be issued under the 2017 Plan (including, but not limited to, adjustments to the share limit and the individual award limits).

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(a)	Consists of fees and expenses billed for the audit of the Company’s consolidated financial statements, the audit of the effectiveness of internal control over financial reporting and the review of the Company’s quarterly reports on Form 10-Q for such year and reviews in connection with documents filed with the SEC.

(b)	Consists of fees and expenses billed for the annual audit of the Company’s employee benefit plans.

(c)	Consists of fees and expenses billed for tax advisory services, including compliance, planning and advice.

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•	The ability of certain stockholders to include director nominees in the Company’s proxy statements (as discussed further under “Future Proposals of Shareholders”);

•	The opportunity to elect directors annually using a majority voting standard;

•	The ability to recommend director candidates to the Corporate Governance/Nominating Committee, which considers those recommendations in the same manner as recommendations received from other sources (as discussed further under “Information Concerning the Board of Directors - Committees of the Board - Corporate Governance/Nominating Committee”);

•	The right to submit proposals for inclusion in the Company’s proxy statement for consideration at an annual meeting, subject to the rules and regulations of the SEC;

•	The opportunity to communicate directly with any member of the Board or Board committee; and

•	The opportunity to vote annually in the “say-on-pay” vote to express their views on executive compensation.

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(a)	Includes weighted average exercise price of outstanding stock options.

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•	24th consecutive year of positive comparable store sales increases

•	Comparable store sales increase of 4.8%

•	8% increase in sales to $8.59 billion

•	Gross profit increased to 52.5% of sales

•	Operating profit increased to 19.8% of sales

•	Net income increased 11% to $1.04 billion

•	Diluted EPS increased 17% to $10.73

•	Total store count increased to 4,829 stores in 47 states

•	Accounts payable to inventory ratio increased to 105.7%

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