Contingencies

3 Months Ended

Mar. 31, 2024

Commitments and Contingencies Disclosure [Abstract]

Contingencies

18. Contingencies

Legal and Other Claims

On July 31, 2023, Ann Fandozzi informed the Company’s Board of her intention to resign from her position as the Company’s Chief Executive Officer due to a disagreement with the Company regarding her compensation as Chief Executive Officer, as discussed in the Company’s August 2, 2023 press release. The Board accepted her verbal resignation and interpreted her subsequent conduct as affirmation of her resignation. The Company advised Ms. Fandozzi that it was accepting her resignation effective immediately and waiving any written procedural notice requirements under the Employment Agreement by and between Ritchie Bros. Auctioneers (Canada) Ltd. and Ms. Fandozzi, dated December 14, 2019. Ms. Fandozzi disputes that she tendered her resignation. The parties have agreed to mediate the dispute and the matter may take months to resolve. On February 21, 2024, Ms. Fandozzi resigned from the Company’s Board.

During the three months ended March 31, 2024, the Company recorded an expense of $1.3 million reflecting changes to the estimated fair value of certain share-based payment awards. Any changes to the estimated payment amount as a result of the settlement of the matter could be material.

The Company is subject to legal and other claims that arise in the ordinary course of its business. Management does not believe that the results of these claims will have a material effect on the Company’s consolidated balance sheet or consolidated income statement.

Guarantee Contracts

In the normal course of business, the Company will in certain situations guarantee to a consignor a minimum level of proceeds in connection with the sale at auction of that consignor’s equipment.

At March 31, 2024, there were $79.7 million of assets guaranteed under contract, of which 98% is expected to be sold prior to June 30, 2024, with the remainder to be sold by June 30, 2025 (at December 31, 2023: $67.5 million of which 70% was expected to be sold prior to the end of March 31, 2024 with the remainder to be sold by December 31, 2024).

The outstanding guarantee amounts are undiscounted and before estimated proceeds from sale at auction.