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Michael T. Kestner
Chair of the Board
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Peter Kelly
Chief Executive Officer
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Proposal: To elect the director nominee designated by Ignition Parent LP (“Apax Investor”) to the Board of Directors.
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| The holders of shares of common stock and shares of Series A Preferred Stock, voting together as a single class, are being asked to consider and vote on the following items: | | |||
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Proposal: To elect each of the other seven director nominees to the Board of Directors.
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Proposal: To approve, on an advisory basis, executive compensation.
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Proposal: To approve an amendment and restatement of the KAR Auction Services, Inc. Amended and Restated 2009 Omnibus Stock and Incentive Plan.
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Proposal: To ratify the appointment of KPMG LLP as our independent registered public accounting firm for 2024.
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| | | | To transact any other business as may properly come before the meeting or any adjournments or postponements thereof. | |
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TABLE OF CONTENTS
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PROXY STATEMENT SUMMARY
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NYSE Symbol
KAR
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Time
9:00 a.m. EDT
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Date
June 7, 2024
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Meeting Location
Online at
www.virtualshareholder
meeting.com/KAR2024 |
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PROPOSAL
1
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Election of the director nominee designated by the Apax Investor.
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The Board recommends a vote “FOR”.
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See page 8 for additional
information. |
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PROPOSAL
2
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Election of each of the other seven director nominees.
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The Board recommends a vote “FOR”.
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See page 9 for additional
information. |
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PROPOSAL
3
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Approval, on an advisory basis, of executive compensation.
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The Board recommends a vote “FOR”.
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See page 24 for additional information.
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PROPOSAL
4
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Approval of an amendment and restatement of the KAR Auction Services, Inc. Amended and Restated 2009 Omnibus Stock and Incentive Plan.
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The Board recommends a vote “FOR”.
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See page 65 for additional information.
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PROPOSAL
5
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Ratification of the appointment of KPMG LLP as our independent registered public accounting firm for 2024.
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The Board recommends a vote “FOR”.
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See page 72 for additional information.
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1
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Name
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Age
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Director
Since |
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Independent
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Primary Occupation
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Committee
Membership* |
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Roy Mackenzie
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52
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2020
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✓
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| | Partner of Apax Partners, LP | | |
CC
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Carmel Galvin
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55
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2020
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✓
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| | Chief People Officer at Klaviyo, Inc. | | |
CC (Chair), NCGC
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J. Mark Howell
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59
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2014
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✓
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Managing Director of Mintaka Ventures, LLC
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AC (Chair), RC (Chair)
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Stefan Jacoby
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66
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2019
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✓
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| | Non-Executive Director of McLaren Group | | |
CC, NCGC
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Peter Kelly
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55
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2021
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| | | | | Chief Executive Officer of OPENLANE | | | | |
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Michael T. Kestner**
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70
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2013
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✓
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Automotive Industry and Building Products Consultant
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AC, RC
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Sanjeev Mehra
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65
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2021
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✓
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| | Managing Partner of Periphas Capital, LP | | |
CC
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Mary Ellen Smith
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64
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2019
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✓
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Former Corporate Vice President of Worldwide Business Operations at Microsoft Corporation
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AC, RC
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BOARD DIVERSITY & EXPERIENCE
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40%
of our director nominees are
women/ethnically diverse |
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90%
of our director nominees were
born outside the U.S. |
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40%
of our director nominees are
age 55 or under |
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40%
of our director nominees are
current or former CEOs |
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75%
of our directors have digital
leadership experience |
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100%
of our directors have executive
leadership experience |
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BOARD TENURE & REFRESHMENT
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5 years
average tenure of
director nominees
6 directors
added to the Board
in past 5 years |
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We understand the importance of Board refreshment as our industry changes and our business strategy evolves.
In the last five years, we have added five new independent directors (six new directors overall), providing fresh perspectives and a diversity of skills and experience. At the same time, we believe that we benefit from having seasoned directors on our Board who are well-versed in the Company’s business and help facilitate the transfer of institutional knowledge.
We believe the average tenure for our independent directors of approximately five years reflects the balance the Board seeks between different perspectives brought by long-serving and new directors.
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2
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Increased total revenue 8%
to $1.6 billion
(continuing operations)
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Grew gross profit 13%
to more than $777 million
exclusive of depreciation and amortization
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Completed
brand and platform
consolidation
to deliver an OPENLANE-branded, fully integrated digital marketplace
in each of our principal geographies (US, Canada and Europe) |
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Continued disciplined cost management,
surpassing
annual run rate reduction goals
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$24 billion
value of vehicles sold
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3
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Annual Elections: Our directors are elected annually for one-year terms.
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Majority Voting: We maintain a majority voting standard for uncontested director elections with a policy for directors to tender their resignation if less than a majority of the votes cast are in their favor.
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Director and Committee Independence: Seven of our eight director nominees are independent, and all committees of our Board of Directors (the “Board”) are comprised entirely of independent directors.
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Executive Sessions: Our independent directors meet in executive session at each regularly scheduled Board meeting.
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Independent Chair: We have an independent Chair of the Board who presides over the executive sessions of the independent directors and serves as the principal liaison between the independent directors and our CEO.
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Diversity: Female and minority directors compromise approximately 40% of our director nominees.
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Board Refreshment: Demonstrated commitment to Board refreshment (in the past five years, six new directors have joined the Board) and committee refreshment.
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Annual Board and Committee Evaluations: The Board and its committees each evaluates its performance each year.
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Director Education: Comprehensive director orientation and ongoing director education and access to management, outside advisors, and third-party programs and training resources.
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Robust Director Equity Ownership and Retention Requirements: The stock ownership guideline for our non-employee directors is five times their annual cash retainer. All shares of our common stock granted to non-employee directors must be held for three years after vesting while serving as a director.
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Robust Executive Equity Ownership Requirements: The stock ownership guideline for our CEO is six times his annual base salary and, for the remaining executive officers, three times annual base salary. Executive officers are required to hold 60% of vested shares, net of taxes, until stock ownership guidelines are met.
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Anti-Hedging and Pledging Policies: Our directors and executive officers are prohibited from hedging or pledging Company stock.
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Annual Management and CEO Evaluation and Succession Planning Review: Our Board conducts an annual evaluation and review of our CEO and each executive officer’s performance, development and succession plan.
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Board Strategy and Risk Oversight: Our Board has deep experience in the area of strategy development and risk oversight.
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Board ESG Oversight: The Nominating and Corporate Governance Committee assists the Board in its oversight of environmental, social and governance (ESG) matters.
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4
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Pay for performance: Our annual incentive program is 100% performance based and our annual equity incentive program is 90% performance based.
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Independent Compensation Committee: All of the members of our Compensation Committee are independent under NYSE rules.
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Independent compensation consultant: The Compensation Committee retains its own independent compensation consultant to evaluate and review our executive compensation program and practices.
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“Double-trigger” equity vesting: Accelerated vesting of assumed or replaced equity awards upon a change in control of the Company is only permitted if an executive experiences a qualifying termination of employment in connection with or following such change in control.
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Robust equity ownership requirements: The stock ownership guideline for our CEO is six times his annual base salary, and three times annual base salary for the other executive officers. Executive officers are required to hold 60% of vested shares, net of taxes, until stock ownership guidelines are met.
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Maximum payout caps: The Compensation Committee sets maximum amounts that may be payable for annual cash incentive compensation and PRSUs.
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Annual compensation risk assessment: Each year we perform an assessment of any risks that could result from our compensation programs and practices.
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Clawback policy: Our clawback policy provides for the mandatory recovery and cancellation of an executive officer’s cash and equity incentive compensation in the event we are required to prepare an accounting restatement.
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Stockholder alignment: We reward performance that meets or exceeds the performance goals that the Compensation Committee establishes with the objective of increasing stockholder value.
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Pay dividends on unvested equity awards: Dividend equivalents and cash are accrued on PRSUs and RSUs, respectively, but are only paid out if, and to the extent that, the underlying PRSUs and RSUs vest.
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Provide excise tax gross-ups: We do not provide “golden parachute” excise tax gross-ups.
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Provide excessive perquisites: We provide a limited number of perquisites that are designed to support a competitive total compensation package.
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Allow hedging or pledging of the Company’s securities: We prohibit hedging, pledging and short sales of Company stock by our directors and executive officers.
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Reprice stock options: Stock option exercise prices are set equal to the grant date market price and cannot be repriced or discounted without stockholder approval.
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Provide pension benefits or supplemental retirement plans: We do not maintain a defined benefit pension or supplemental retirement plans for our executive officers.
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5
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6
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7
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Nominee for Election as Director to Be Elected by Holders of Series A Preferred Stock
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| Roy Mackenzie | | ||||||
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Independent Director
since June 2020
Age: 52
Current Board Committees:
Compensation Committee |
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| Career Highlights | | ||||||
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Partner at Apax Partners, LP (“Apax”), a private equity advisory firm, since January 2003, and also serves on the Investment Committees for the Apax Buyout Funds and Apax Global Alpha.
•
Director of Trade Me Ltd, Vyaire Medical, Inc., and Duck Creek Technologies, Inc., each in connection with investments by funds advised by Apax.
•
Previously served as a director of several companies in connection with investments by funds advised by Apax, including Sophos Group plc, King Digital Entertainment plc, Exact Software NV, Epicor Software, Inc., and NXP Semiconductors NV.
•
Holds an MBA from Stanford Graduate School of Business and a M.Eng in Electrical Engineering from Imperial College, London.
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Other Public and Registered Investment Company Directorships in Last Five Years: Director of Duck Creek Technologies, Inc. since April 2016. Partner at Apax since 2003. Director of Sophos Group PLC from May 2015 to March 2020.
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| Skills and Qualifications | | ||||||
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Extensive experience working closely with management teams to build successful technology companies.
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Substantial experience in evaluating companies’ strategies, operations and financial performance, which provides important perspectives and insights.
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Deep technology expertise.
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Current and prior public board service brings valuable skills and perspectives to our Board.
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| Mr. Mackenzie is a director who was designated by the Apax Investor under the terms of the Apax Investment Agreement. Only the holders of Series A Preferred Stock may vote on the election of Mr. Mackenzie as a director at the 2024 annual meeting. | |
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The Board of Directors recommends a vote FOR the election of the foregoing nominee to the Board of Directors.
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8
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Nominees for Election as Directors to Be Elected by Holders of Common Stock and Series A Preferred Stock, Voting Together as a Single Class
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| Carmel Galvin | | ||||||
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Independent Director
since February 2020 Age: 55
Current Board Committees:
Compensation Committee (Chair) and Nominating and Corporate Governance Committee |
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| Career Highlights | | ||||||
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•
Chief People Officer of Klaviyo, Inc., a marketing automation platform technology company, since April 15, 2024.
•
Chief People Officer at Stripe, Inc., a payment software services and solutions company from January 2021 to January 2024.
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Chief Human Resources Officer (“CHRO”) and Senior Vice President, People and Places, at Autodesk, Inc., a multinational software corporation, from March 2018 to January 2021.
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CHRO and Senior Vice President at Glassdoor, Inc., a job listing platform, from April 2016 to February 2018.
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CHRO and Senior Vice President at Advent Software, Inc., an investment management software company, from October 2014 to April 2016.
•
Vice President of Talent & Culture Development for Deloitte New-venture Accelerator (DNA), from May 2013 to October 2014.
•
Provided human resources consulting services from January 2011 to April 2013 at Front Arch, Inc. and from September 2009 to December 2011 at Corporate Leadership Council (CLC), Corporate Executive Board.
•
Managing Director, Global Head of Human Resources at Moody’s Analytics (formerly Moody’s KMV) from November 2004 to March 2008 and Vice President, Global Head of Human Resources at Barra, Inc. from September 1995 to June 2002.
•
Graduate of Trinity College Dublin (BA) and University College Dublin (MBS).
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| Skills and Qualifications | | ||||||
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More than 25 years of talent and culture leadership experience with global organizations in the technology and online sectors.
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Extensive experience in helping transform global companies, including leading diversity and inclusion, employee engagement and culture management efforts at companies with varied locations, languages and cultures.
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Significant experience with executive compensation programs and practices, including working directly with boards and compensation committees on compensation, talent and succession planning initiatives.
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Provides diverse international perspective.
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| J. Mark Howell | | ||||||
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Independent Director
since December 2014 Age: 59
Current Board Committees:
Audit Committee (Chair) and Risk Committee (Chair) |
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| Career Highlights | | ||||||
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Managing Director of Mintaka Ventures, LLC, a firm focused on private investments, since August 2021.
•
President and Chief Executive Officer of Conexus Indiana, Indiana’s advanced manufacturing and logistics initiative sponsored by Central Indiana Corporate Partnership, Inc., from January 2018 to August 2021.
•
Chief Operating Officer of Angie’s List, Inc., a national local services consumer review service and marketplace, from March 2013 to September 2017. Angie’s List, Inc. was acquired in 2017 and merged into ANGI Homeservices Inc.
•
President, Ingram Micro North America Mobility of Ingram Micro Inc., a technology distribution company, from 2012 to 2013.
•
President, BrightPoint Americas of BrightPoint, Inc., a distributor of mobile devices for phone companies, including Chief Operating Officer, Executive Vice President and Chief Financial Officer, from 1994 to 2012. BrightPoint, Inc. was sold to Ingram Micro Inc. in 2012.
•
Vice President and Corporate Controller of ADESA from August 1992 to July 1994, now a wholly owned subsidiary of the Company.
•
Audit Staff and Senior Staff at Ernst & Young LLP.
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Graduate of the University of Notre Dame (BBA in Accounting).
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| Skills and Qualifications | | ||||||
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Extensive senior leadership experience at internet-based and technology-driven companies provides valuable insight as the Company continues to advance its digital transformation.
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Significant executive leadership experience in the public company sector.
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Provides unique, in-depth knowledge of the Company and its industry as a former employee of ADESA.
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Substantial financial experience. Certified Public Accountant with experience in public accounting and public companies.
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Cybersecurity Certification: Mr. Howell earned a CERT Certificate in Cybersecurity Oversight from the National Association of Corporate Directors and the Software Engineering Institute of Carnegie Mellon University.
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9
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| Stefan Jacoby | | | | | |||
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Independent Director
Since June 2019 Age: 66
Current Board Committees:
Compensation Committee and Nominating and Corporate Governance Committee |
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| Career Highlights | | ||||||
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•
Non-Executive Director of McLaren Group, a UK automotive, motorsport, and technology company, since September 2021; and consultant in the automotive industry since January 2018.
•
Executive Vice President of General Motors Company, a multinational company that designs, manufactures and markets vehicles worldwide, and President of GM International Operations, from August 2013 to January 2018.
•
Chief Executive Officer and President of Volvo Car Corporation, a multinational vehicle manufacturer and marketer, from August 2010 to October 2012.
•
Served in several capacities at Volkswagen AG, a multinational automotive manufacturing company, between 2004 and 2010, most recently serving as Chief Executive Officer and President of Volkswagen Group of America from 2007 to 2010 and as Executive Vice President of Group Marketing and Sales at Volkswagen AG from 2004 to 2007.
•
Chief Executive Officer and President of Mitsubishi Motors Europe, the European headquarters of automotive manufacturer Mitsubishi Motors, from 2001 to 2004.
•
Served in a variety of finance and leadership roles at Volkswagen AG from 1985 to 2001.
•
Graduate of the University of Cologne, Germany.
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| Skills and Qualifications | | ||||||
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More than 30 years of broad international experience in the automotive industry, including senior management positions with global automakers in Germany, Japan, the Netherlands, Sweden, Singapore and the United States.
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Deep insights and understanding of the macro trends and technologies rapidly transforming the automotive industry, including mobility as a service and autonomous vehicles.
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Extensive knowledge of customer experience and retail structures. Expansive experience in finance, sales and marketing has given him a deep understanding of the impact of both areas on profitability and successful market growth.
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Strong leadership skills in managing and motivating people for establishing momentum for growth and change, building high performance teams in transformative periods and recruiting and retaining senior management.
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| Peter Kelly | | | | | |||
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Director
since April 2021 Age: 55
Chief Executive Officer
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| Career Highlights | | ||||||
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Chief Executive Officer of the Company since April 2021.
•
President of the Company from January 2019 to March 2021.
•
President of Digital Services of the Company from December 2014 to January 2019 and Chief Technology Officer of the Company from June 2013 to January 2019.
•
President and Chief Executive Officer of OPENLANE US, Inc. (“OPENLANE US”), a subsidiary of the Company, from February 2011 to June 2013.
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President and Chief Financial Officer of OPENLANE US from February 2010 to February 2011.
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Co-founded OPENLANE US in 1999, and served in a number of executive roles at OPENLANE US from 1999 to 2010.
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Prior to his work with OPENLANE US, managed engineering, construction and procurement projects for Taylor Woodrow, a U.K.-based construction and development firm, from 1989 to 1997.
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Graduate of the University College Dublin (Engineering) and Stanford University (MBA).
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| Skills and Qualifications | | ||||||
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More than 20 years of experience in the Company’s industry, with unique insights gained as a co-founder and executive of a digital auction start-up and subsequently as a senior executive of the Company, leading our digital services and technology teams and offerings.
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As former President and now Chief Executive Officer, Mr. Kelly has a thorough and in-depth understanding of the Company’s business and industry, including its employees, business units, customers and digital opportunities, which provides an additional perspective to the Board. Mr. Kelly’s entrepreneurial mindset provides further unique perspective.
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Deep insights into the businesses and technologies rapidly transforming the Company’s business and industry.
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Strong leadership skills and technology expertise.
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10
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| Michael T. Kestner | | | | | |||
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Independent Director
since December 2013 Chair of the Board since April 2023 Age: 70
Current Board Committees:
Audit Committee and Risk Committee |
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| Career Highlights | | ||||||
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•
Consultant in the building products and automotive industry since December 2015.
•
Chief Financial Officer of Building Materials Holding Corporation, a building products company, from August 2013 to December 2015.
•
Partner in FocusCFO, LLC, a consulting firm providing part time CFO services, from April 2012 to August 2013.
•
Executive Vice President, Chief Financial Officer and a director of Hilite International, Inc., an automotive supplier of powertrain parts, from October 1998 to July 2011.
•
Chief Financial Officer of Sinter Metals, Inc., a supplier of powder metal precision components, from 1995 to 1998.
•
Served in various capacities at Banc One Capital Partners, Wolfensohn Ventures LP and as a senior audit manager at KPMG LLP.
•
Graduated from Southeast Missouri State University.
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| Skills and Qualifications | | ||||||
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Extensive business, management, and operational experience as a senior leader in the automotive industry both domestically and internationally provides him with valuable leadership skills and additional insight into business, financial and strategic matters that are important to the Company.
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Brings valuable experience and perspective from serving over 20 years as a CFO of public and private companies, including in the areas of accounting and financial reporting, internal controls and procedures, compliance, risk management, investor relations, capital markets, strategic cost initiatives, complex financial transactions, and mergers, acquisitions and divestitures.
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Extensive experience in financial analysis and financial statement preparation.
|
| |||
|
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| |
Certified Public Accountant with experience in public accounting and public companies.
|
|
| Sanjeev Mehra | | | | | |||
|
![]() |
| |
Independent Director
since October 2021 Age: 65
Current Board Committees:
Compensation Committee |
| |||
| Career Highlights | | ||||||
|
•
Managing Partner of Periphas Capital, LP, a private equity investing firm focused on making investments in technology enabled business services, consumer and industrial companies, since founding the firm in 2017.
•
Previously served in a variety of positions at Goldman, Sachs & Co. (“Goldman”) from 1986 to 2017, including Partner from 1998 to 2016, and held a range of other senior positions, including vice chairman of the global private equity business, and prior to that, co-head of the Americas private equity business.
•
Founding member of Goldman’s Principal Investment Area (“PIA”), the firm’s private investing arm of its Merchant Banking Division, and served on the PIA Investment Committee from 1998 to 2017.
•
Has served on the board of directors of over 25 companies, including on the Board of the Company from 2007 until 2013.
•
Received his MBA from Harvard Business School and a BA from Harvard College.
Other Public and Registered Investment Company Directorships in Last Five Years: CEO and Director of Periphas Capital Partnering Corporation from September 2020 to January 2023. Director of Aramark from 2007 to 2019.
|
| ||||||
| Skills and Qualifications | | ||||||
|
![]() |
| |
Extensive experience in advising companies and working closely with management teams to foster growth, transformational change and operational efficiency.
|
| |||
|
![]() |
| |
Substantial experience in evaluating companies’ strategies, operations and financial performance, which provides important perspectives and insights.
|
| |||
|
![]() |
| |
Former service on the Company’s Board provides unique, in depth knowledge of the Company and its industry.
|
| |||
|
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| |
Current and prior public board service brings valuable skills and perspectives to our Board, including extensive time serving as a lead independent director and chairman of board committees.
|
|
|
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| |
11
|
|
| Mary Ellen Smith | | | | | |||
|
![]() |
| |
Independent Director
since October 2019 Age: 64
Current Board Committees:
Audit Committee and Risk Committee |
| |||
| Career Highlights | | ||||||
|
•
Corporate Vice President of Worldwide Business Operations of Microsoft Corporation (“Microsoft”), a technology company, from July 2013 to January 2024.
•
Vice President, Worldwide Operations of Microsoft from 2011 to July 2013, General Manager, Worldwide Commercial Operations of Microsoft from 2010 to 2011, and General Manager and President of Microsoft Licensing, GP from 2006 to 2010.
•
Served in several roles at Hewlett-Packard Company from 1996 to 2006, including Vice President, Volume Direct and Teleweb, Americas Region, from 2004 to 2006, and Vice President, Worldwide Customer Operations from 2002 to 2004.
•
Graduate of Bowling Green State University (BS) and Wright State University (MBA). Earned certificates of completion from Stanford University’s Executive Program and Directors’ Consortium Program.
|
| ||||||
| Skills and Qualifications | | ||||||
|
![]() |
| |
Over 30 years of broad and extensive operational and leadership experience in the technology industry with a deep focus on global operations strategy and execution, business transformation change management, global manufacturing, supply chain and logistics.
|
| |||
|
![]() |
| |
Deep expertise in digital business transformation, change management in transforming business processes from physical to digital supply chain and operations delivering highly impactful business model and cost improvements.
|
| |||
|
![]() |
| |
Extensive knowledge in leading through growth and expansion by building future operating performance models for new businesses in emerging markets and more broadly, worldwide.
|
| |||
|
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| |
Extensive knowledge and broad business skills supporting customer experience enhancements, compliance enhancements, oversight, risk mitigation and management. Highly skilled in finance, sales and marketing support with a deep understanding of business model operations and drivers of profitability.
|
| |||
|
![]() |
| |
Significant leadership skills leading highly impactful and performing teams and managing people. A proven leader championing diversity and inclusion in corporate culture for all dimensions of diversity.
|
| |||
|
![]() |
| |
Risk and Cybersecurity Certifications: Ms. Smith earned a Qualified Risk Director designation and a Certificate in Cyber Risk Governance from the DCRO Institute.
|
|
|
![]() |
| |
The Board of Directors recommends a vote FOR the election of each of the foregoing seven nominees to the Board of Directors.
|
|
|
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| |
12
|
|
|
BOARD STRUCTURE AND CORPORATE GOVERNANCE
|
|
|
Board Meetings and Executive Sessions
|
| |
•
Has the authority to call meetings of the independent directors, and calls and develops the agenda for executive sessions of the independent directors.
•
Presides at all meetings of the Board at which the Chair of the Board is not present (if not the same person), including executive sessions of the independent directors.
|
|
|
Meeting Agendas, Schedules and Materials
|
| |
•
Reviews, in consultation with the Chair (if not the same person) and the CEO:
•
agendas for Board meetings;
•
meeting schedules to assure there is sufficient time for discussion of all agenda items; and
•
information sent to the Board, including the quality, quantity, appropriateness and timeliness of such information.
|
|
|
Board/Director Communications
|
| |
•
Serves as principal liaison on Board-wide issues among the independent directors and the Chair (if not the same person) and the CEO and facilitates communication generally among directors.
|
|
|
Stockholder
Communications |
| |
•
If requested by stockholders, ensures that he or she is available, when appropriate, for consultation and direct communication.
|
|
|
Chair and CEO Performance Evaluations
|
| |
•
Together with the Compensation Committee, conducts an annual evaluation of the Chair (if not the same person) and the CEO, including an annual evaluation of his or her respective interactions with the independent directors.
|
|
|
Outside Advisors
and Consultants |
| |
•
Recommends to the independent directors the retention of advisors and consultants who report directly to the Board, and, upon approval by the independent directors, retains such advisors and consultants.
|
|
|
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| |
13
|
|
|
![]() |
| |
14
|
|
|
7
|
| |
meetings held
in 2023 |
| |
Independence and financial literacy: Each member of the Audit Committee is “financially literate” under the NYSE rules, and each of Messrs. Howell and Kestner has been designated as an “audit committee financial expert” as defined by the SEC. In addition, the Board has determined that each member of the Audit Committee meets the standards of “independence” established by the NYSE and is “independent” under the independence standards for audit committee members adopted by the SEC.
|
|
|
5
|
| |
meetings held
in 2023 |
| |
Independence: Each member of the Compensation Committee is independent under the NYSE rules (including the enhanced independence requirements for compensation committee members).
|
|
|
4
|
| |
meetings held
in 2023 |
| |
Independence: Each member of the Nominating and Corporate Governance Committee is independent under the NYSE rules.
|
|
|
![]() |
| |
15
|
|
|
4
|
| |
meetings held
in 2023 |
| |
Independence: Each member of the Risk Committee is independent under the NYSE rules.
|
|
|
![]() |
| |
16
|
|
|
![]() |
| |
17
|
|
|
Document
|
| |
Purpose/Application
|
|
| Code of Business Conduct and Ethics | | | Applies to all of the Company’s employees, officers and directors, including those officers responsible for financial reporting. | |
|
Code of Ethics for Principal Executive
and Senior Financial Officers |
| | Applies to the Company’s principal executive officer, principal financial officer, principal accounting officer and such other persons who are designated by the Board. | |
| Corporate Governance Guidelines | | | Contains general principles regarding the functions of the Board and its committees. | |
| Committee Charters | | | Apply to the following Board committees, as applicable: Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Risk Committee. | |
| Lead Independent Director Charter | | | Sets forth a clear mandate and significant authority and responsibilities for the Lead Independent Director or independent Chair of the Board. | |
|
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| |
18
|
|
|
DIRECTOR COMPENSATION
|
|
|
Components of Director Compensation Program For 2023 Service
|
| |
Annual Amount
|
| |
Form of Payment(1)
|
|
| Annual Cash Retainer(2) | | |
$85,000
|
| |
Cash
|
|
| Annual Stock Retainer(3) | | |
$170,000
|
| |
Restricted Stock
|
|
| Lead Independent Director Fee | | |
$37,500
|
| |
Cash
|
|
| Independent Chair Fee | | |
$100,000
|
| |
Cash
|
|
| Audit Committee Chair Fee | | |
$25,000
|
| |
Cash
|
|
| Compensation Committee Chair Fee | | |
$20,000
|
| |
Cash
|
|
| Nominating and Corporate Governance and Risk Committee Chair Fee | | |
$10,000
|
| |
Cash
|
|
| Audit Committee Membership Fee | | |
$7,500
|
| |
Cash
|
|
|
![]() |
| |
19
|
|
|
Name
|
| |
Fees Earned
or Paid in Cash(1) |
| |
Stock Awards(2)
|
| |
Total
|
|
| Carmel Galvin | | |
$105,000
|
| |
$170,003
|
| |
$275,003
|
|
| James P. Hallett(3) | | |
$63,750
|
| |
$191,744
|
| |
$255,494
|
|
| Mark E. Hill | | |
$95,000
|
| |
$170,003
|
| |
$265,003
|
|
| J. Mark Howell | | |
$115,625
|
| |
$170,003
|
| |
$285,628
|
|
| Stefan Jacoby | | |
$85,000
|
| |
$170,003
|
| |
$255,003
|
|
| Michael T. Kestner | | |
$181,250
|
| |
$170,003
|
| |
$351,253
|
|
| Roy Mackenzie(4) | | |
—
|
| |
—
|
| |
—
|
|
| Sanjeev Mehra(4) | | |
—
|
| |
—
|
| |
—
|
|
| Mary Ellen Smith | | |
$92,500
|
| |
$170,003
|
| |
$262,503
|
|
|
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| |
20
|
|
|
Name
|
| |
Unvested Shares
and Dividend Equivalents(1) |
| |
Deferred Phantom
Shares and Dividend Equivalents(2) |
|
| Carmel Galvin | | |
11,032
|
| |
25,222
|
|
| James P. Hallett | | |
11,032
|
| |
—
|
|
| Mark E. Hill | | |
11,032
|
| |
69,605
|
|
| J. Mark Howell | | |
11,032
|
| |
38,548
|
|
| Stefan Jacoby | | |
11,032
|
| |
17,672
|
|
| Michael T. Kestner | | |
11,032
|
| |
55,203
|
|
| Roy Mackenzie | | |
—
|
| |
—
|
|
| Sanjeev Mehra | | |
—
|
| |
—
|
|
| Mary Ellen Smith | | |
11,032
|
| |
14,964
|
|
|
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| |
21
|
|
|
BENEFICIAL OWNERSHIP OF COMPANY STOCK
|
|
| | | |
Common Stock
Beneficially Owned |
| |
Series A Preferred Stock
Beneficially Owned |
| | ||||||||
|
Name of Beneficial Owner
|
| |
Number of
Shares(1) |
| |
Percent of
Class(2) |
| |
Number of
Shares |
| |
Percent of
Class |
| | ||
| 5% BENEFICIAL OWNERS | | | | | | | | | | | | | | | ||
|
Ignition Acquisition Holdings LP(3)
|
| |
—(4)
|
| |
—(4)
|
| |
576,645
|
| |
90.91%
|
| | ||
|
Periphas Kanga Holdings, LP(5)
|
| |
—(4)
|
| |
—(4)
|
| |
57,660
|
| |
9.09%
|
| | ||
|
BlackRock, Inc.(6)
|
| |
17,594,104
|
| |
16.25%
|
| |
|
| |
|
| | ||
|
The Vanguard Group(7)
|
| |
12,264,053
|
| |
11.32%
|
| | | | | | | | ||
|
Burgundy Asset Management Ltd.(8)
|
| |
8,690,866
|
| |
8.02%
|
| |
|
| |
|
| | ||
|
Dimensional Fund Advisors LP(9)
|
| |
7,059,387
|
| |
6.52%
|
| | | | | | | | ||
| NAMED EXECUTIVE OFFICERS, DIRECTORS AND DIRECTOR NOMINEES | | | | | | | | | | | | | | |||
|
Scott A. Anderson(10)
|
| |
35,885
|
| |
*
|
| |
|
| |
|
| | ||
|
James Coyle(10)
|
| |
72,186
|
| |
*
|
| | | | | | | | ||
|
Justin Davis(10)
|
| |
54,647
|
| |
*
|
| |
|
| |
|
| | ||
|
Carmel Galvin
|
| |
36,255
|
| |
*
|
| | | | | | | | ||
|
James P. Hallett(10)
|
| |
873,117
|
| |
*
|
| |
|
| |
|
| | ||
|
Mark E. Hill(11)
|
| |
128,838
|
| |
*
|
| | | | | | | | ||
|
J. Mark Howell
|
| |
64,880
|
| |
*
|
| |
|
| |
|
| | ||
|
Stefan Jacoby
|
| |
47,971
|
| |
*
|
| | | | | | | | ||
|
Peter J. Kelly(10)
|
| |
617,406
|
| |
*
|
| |
|
| |
|
| | ||
|
Michael T. Kestner
|
| |
77,157
|
| |
*
|
| | | | | | | | ||
|
Brad Lakhia(10)
|
| |
26,791
|
| |
*
|
| |
|
| |
|
| | ||
|
Roy Mackenzie(3)
|
| |
—
|
| |
—
|
| |
576,645
|
| |
90.91%
|
| | ||
|
Sanjeev Mehra(5)
|
| |
—
|
| |
—
|
| |
57,660
|
| |
9.09%
|
| | ||
|
James E. Money(10)
|
| |
78,935
|
| |
*
|
| | | | | | | | ||
|
Mary Ellen Smith
|
| |
55,307
|
| |
*
|
| |
|
| |
|
| | ||
|
Sriram Subrahmanyam(10)
|
| |
127,163
|
| |
*
|
| | | | | | | | ||
|
Executive officers, directors and director nominees as a group (19 persons)(12)
|
| |
2,515,699
|
| |
2.32%
|
| | | | | | | |
|
![]() |
| |
22
|
|
|
![]() |
| |
23
|
|
|
![]() |
|
|
![]() |
| |
The Board of Directors recommends that you vote FOR the advisory vote to approve executive compensation.
|
|
|
![]() |
| |
24
|
|
|
COMPENSATION DISCUSSION AND ANALYSIS
|
|
|
Name
|
| |
Title*
|
|
|
Peter J. Kelly
|
| |
Chief Executive Officer
|
|
|
Brad S. Lakhia
|
| |
Executive Vice President and Chief Financial Officer
|
|
|
Scott A. Anderson
|
| |
Chief Accounting Officer; Former Interim Chief Financial Officer
|
|
|
James P. Coyle
|
| |
Executive Vice President and President, North American Marketplaces
|
|
|
Sriram (“Srisu”) Subrahmanyam
|
| | Executive Vice President, Operations and President, Services and International Markets | |
|
James E. Money
|
| |
Former President of Automotive Finance Corporation (“AFC”)
|
|
|
Justin Davis
|
| |
Former President of BacklotCars
|
|
|
![]() |
| |
Executive Summary (pages 26−27)
|
|
|
![]() |
| |
Compensation Philosophy and Objectives (page 28)
|
|
|
![]() |
| |
The Role of the Compensation Committee and the Executive Officers in Determining Executive Compensation (pages 28−29)
|
|
|
![]() |
| |
Elements Used to Achieve Compensation Philosophy and Objectives (pages 30−40)
|
|
|
![]() |
| |
Compensation Policies and Other Information (pages 41−42)
|
|
|
![]() |
| |
Results of Say on Pay Votes at 2023 Annual Meeting (page 42)
|
|
|
![]() |
| |
25
|
|
|
![]() |
| |
Increased total revenue 8%
to $1.6 billion
(continuing operations)
|
|
|
Grew gross profit 13%
to more than $777 million
exclusive of depreciation and amortization
|
| |
![]() |
|
![]() |
|
Completed
brand and platform
consolidation
to deliver an OPENLANE-branded, fully integrated digital marketplace
in each of our principal geographies (US, Canada and Europe) |
|
|
Continued disciplined cost management,
surpassing
annual run rate reduction goals
|
| |
![]() |
|
|
![]() |
| |
$24 billion
value of vehicles sold
|
|
|
![]() |
| |
26
|
|
|
![]() |
| |
Pay for performance: Our annual incentive program is 100% performance based and our annual equity incentive program is 90% performance based.
|
|
|
![]() |
| |
Independent Compensation Committee: All of the members of our Compensation Committee are independent under NYSE rules.
|
|
|
![]() |
| |
Independent compensation consultant: The Compensation Committee retains its own independent compensation consultant to evaluate and review our executive compensation program and practices.
|
|
|
![]() |
| |
“Double-trigger” equity vesting: Accelerated vesting of assumed or replaced equity awards upon a change in control of the Company is only permitted if an executive experiences a qualifying termination of employment in connection with or following such change in control.
|
|
|
![]() |
| |
Robust equity ownership requirements: The stock ownership guideline for our CEO is six times his annual base salary, and three times annual base salary for the other executive officers. Executive officers are required to hold 60% of vested shares, net of taxes, until stock ownership guidelines are met.
|
|
|
![]() |
| |
Maximum payout caps: The Compensation Committee sets maximum amounts that may be payable for annual cash incentive compensation and PRSUs.
|
|
|
![]() |
| |
Annual compensation risk assessment: Each year we perform an assessment of any risks that could result from our compensation programs and practices.
|
|
|
![]() |
| |
Clawback policy: Our clawback policy provides for the mandatory recovery and cancellation of an executive officer’s cash and equity incentive compensation in the event we are required to prepare an accounting restatement.
|
|
|
![]() |
| |
Stockholder alignment: We reward performance that meets or exceeds the performance goals that the Compensation Committee establishes with the objective of increasing stockholder value.
|
|
|
![]() |
| |
Pay dividends on unvested equity awards: Dividend equivalents and cash are accrued on PRSUs and RSUs, respectively, but are only paid out if, and to the extent that, the underlying PRSUs and RSUs vest.
|
|
|
![]() |
| |
Provide excise tax gross-ups: We do not provide “golden parachute” excise tax gross-ups.
|
|
|
![]() |
| |
Provide excessive perquisites: We provide a limited number of perquisites that are designed to support a competitive total compensation package.
|
|
|
![]() |
| |
Allow hedging or pledging of the Company’s securities: We prohibit hedging, pledging and short sales of Company stock by our directors and executive officers.
|
|
|
![]() |
| |
Reprice stock options: Stock option exercise prices are set equal to the grant date market price and cannot be repriced or discounted without stockholder approval.
|
|
|
![]() |
| |
Provide pension benefits or supplemental retirement plans: We do not maintain a defined benefit pension or supplemental retirement plans for our executive officers.
|
|
|
![]() |
| |
27
|
|
|
![]() |
| |
28
|
|
| 2023 Proxy Comparator Group | | | | | | | |
|
ACV Auctions Inc.
CarGurus, Inc. CarMax, Inc. Cars.com Inc. Carvana Co. Copart, Inc. |
| |
CoStar Group, Inc.
Equifax Inc. Etsy, Inc. Fair Isaac Corporation Gentex Corporation |
| |
IAA, Inc.
Ritchie Bros. Auctioneers Incorporated Rush Enterprises, Inc. TripAdvisor, Inc. Vroom, Inc. |
|
|
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| |
29
|
|
| | | |
Element
|
| |
Key
Characteristics |
| |
Why We Pay
This Element |
| |
How We
Determine Amount |
| |
2023
Decisions |
|
Fixed
|
| | |
Base salary
|
| |
Fixed compensation component payable in cash. Reviewed annually and adjusted when appropriate.
|
| |
Attract and retain skilled and experienced executives. Compensate for performance of daily job responsibilities.
|
| |
Base salaries are based on individual performance, experience, skills, job scope, tenure, review of competitive pay practices and base salary as a percentage of total compensation.
|
| |
Four named executive officers received a salary increase in 2023. See page 32.
|
|
At Risk
|
| | |
Annual cash incentive awards
|
| |
Variable compensation component payable in cash based on performance against annually established targets.
|
| |
Motivate and reward for the successful achievement of pre-determined performance objectives aligned with our key annual objectives.
|
| |
Award opportunities are based on individual performance, experience, job scope and review of competitive pay practices. Target annual incentive amount is set as a percentage of base salary.
|
| |
Actual award payouts were based on a combination of the achievement of Adjusted EBITDA (80%) and cost reduction goals (20%). OPENLANE Adjusted EBITDA performance and the Company’s performance against its cost reduction goals resulted in a payout of 117.1% of the target award for named executive officers whose payout is based on the performance of OPENLANE and 102% for Mr. Money, whose payout is based on the performance of both OPENLANE and AFC. See page 35.
|
|
|
Performance-based
restricted stock units (PRSUs) |
| |
PRSUs vest at the end of a three-year performance period.
|
| |
Motivate and reward executives for performance on key long-term measures. Align the interests of executives with long-term stockholder value.
|
| |
Award opportunities are based on individual’s ability to impact future results, job scope, individual performance and review of competitive pay practices. PRSU awards generally made up approximately 50% of the value of the aggregate long term incentives under the 2023 executive compensation program.
|
| |
The Compensation Committee granted PRSUs to each named executive officer in 2023 (except Mr. Anderson). See page 36. 2023 PRSU awards are earned based on a combination of three-year (i) Cumulative Adjusted EBITDA (75%) and (ii) Relative TSR (25%) performance through December 31, 2025.
|
| |||
|
Performance-based stock options
The performance-based hurdles require achieving and maintaining a minimum stock price appreciation threshold as an additional vesting condition.
|
| |
Become eligible to vest and become exercisable in 25% increments, each upon the later to occur of (i) the first four anniversaries of the grant date, respectively, and (ii) the attainment of a closing price of the Company’s common stock at or above, for each respective 25% increment, $5, $10, $15, and $20 over the exercise price, for twenty consecutive trading days.
|
| |
Align the interests of executives with long term stockholder value; further incentivizes our executives to drive long-term stockholder value creation; no options will vest and become exercisable without achievement of pre-established performance goals.
|
| |
Award opportunities are based on individual performance, experience, job scope and review of competitive pay practices. Performance-based stock options made up 40% of the value of the aggregate long term incentives granted to named executives in 2021 (except for Messrs. Lakhia and Anderson) to apply to the 2023 executive compensation program.
|
| |
The Compensation Committee granted performance-based stock options to each of the named executive officers in 2021 (except for Messrs. Lakhia and Anderson), which covered stock option grants that would have otherwise been granted in 2023. Therefore no additional stock options were granted in 2023, except to Mr. Lakhia who joined OPENLANE in 2023. To-date, no performance-based hurdles have been achieved and therefore the stock options remain unvested and unexercisable. See pages 35-36.
|
| |||
|
Time-based
stock options |
| |
Vest and become exercisable in equal installments on each of the first four anniversaries of the grant date.
|
| |
Incentivizes performance by linking realized compensation over long-term appreciation in stock price.
|
| |
Award opportunities are based on individual performance, experience, job scope and review of competitive pay practices. Time-based stock options made up 10% of the value of the aggregate long term incentives granted to named executives in 2021 (except for Messrs. Lakhia and Anderson) to apply to the 2023 executive compensation program.
|
| |
The Compensation Committee granted time-based stock options to the named executive officers in 2021 (except for Messrs. Lakhia and Anderson), which covered stock options that would have otherwise been granted in 2023. Therefore no additional stock options were granted in 2023, except to Mr. Lakhia who joined OPENLANE in 2023. See pages 35-36.
|
|
|
![]() |
| |
30
|
|
|
![]() |
| |
31
|
|
|
Name
|
| |
Base Salary
|
| |
% Change
|
| |
Effective Date
|
|
| Peter Kelly | | |
$773,000
|
| |
0%
|
| |
N/A
|
|
| Brad Lakhia | | |
$575,000
|
| |
N/A
|
| |
April 17, 2023
|
|
| Scott Anderson | | |
$358,280
|
| |
4%
|
| |
March 19, 2023
|
|
|
James Coyle
|
| |
$520,000
|
| |
4%
|
| |
March 19, 2023
|
|
|
$600,000
|
| |
15%
|
| |
July 25, 2023
|
| |||
| Srisu Subrahmanyam | | |
$468,000
|
| |
0%
|
| |
N/A
|
|
| Jim Money | | |
$442,000
|
| |
4%
|
| |
March 19, 2023
|
|
| Justin Davis | | |
$450,000
|
| |
44%
|
| |
March 19, 2023
|
|
|
Name
|
| |
Base Salary
|
| |
% Change
|
| |
Effective Date
|
|
| Peter Kelly | | |
$773,000
|
| |
0%
|
| |
N/A
|
|
| Brad Lakhia | | |
$575,000
|
| |
0%
|
| |
N/A
|
|
| Scott Anderson | | |
$367,237
|
| |
2.5%
|
| |
March 31, 2024
|
|
| James Coyle | | |
$600,000
|
| |
0%
|
| |
N/A
|
|
| Srisu Subrahmanyam | | |
$468,000
|
| |
0%
|
| |
N/A
|
|
| Jim Money | | |
$442,000
|
| |
0%
|
| |
N/A
|
|
| Justin Davis | | |
$450,000
|
| |
0%
|
| |
N/A
|
|
|
![]() |
| |
32
|
|
| | | | | | |
Annual Incentive Opportunity
|
| |
Annual Incentive Goal Weighting %
|
| ||||||||||||
|
Name
|
| |
Base
Salary |
| |
Threshold % of
Base Salary |
| |
Target % of
Base Salary |
| |
Maximum % of
Base Salary |
| |
2023 OPENLANE
Adjusted EBITDA |
| |
2023 AFC
Adjusted EBITDA |
| |
2023 Cost
Reduction |
|
| Peter Kelly | | |
$773,000
|
| |
62.5
|
| |
125
|
| |
250
|
| |
80
|
| |
|
| |
20
|
|
| Brad Lakhia(1) | | |
$575,000
|
| |
37.5
|
| |
75
|
| |
150
|
| |
80
|
| | | | |
20
|
|
| Scott Anderson(2) | | |
$355,373
|
| |
30
|
| |
60
|
| |
120
|
| |
80
|
| |
|
| |
20
|
|
| James Coyle(2) | | |
$550,849
|
| |
50
|
| |
100
|
| |
200
|
| |
80
|
| | | | |
20
|
|
| Srisu Subrahmanyam | | |
$468,000
|
| |
50
|
| |
100
|
| |
200
|
| |
80
|
| |
|
| |
20
|
|
| Jim Money(2) | | |
$438,414
|
| |
50
|
| |
100
|
| |
200
|
| |
40
|
| |
40
|
| |
20
|
|
| Justin Davis(2) | | |
$420,888
|
| |
50
|
| |
100
|
| |
200
|
| |
80
|
| |
|
| |
20
|
|
|
![]() |
| |
33
|
|
| | | | | | |
2023 Targets
|
| |
Performance Leverage
(% of Target Goal) |
| |
Payout Leverage
(% of Target Payout) |
| ||||||||||||||||||
| | | |
Weighting
|
| |
Threshold
|
| |
Target
|
| |
Maximum
|
| |
Threshold
|
| |
Target
|
| |
Maximum
|
| |
Threshold
|
| |
Target
|
| |
Maximum
|
|
|
2023 Adjusted EBITDA
|
| |
80%
|
| |
$234
|
| |
$275
|
| |
$316
|
| |
85%
|
| |
100%
|
| |
115%
|
| |
50%
|
| |
100%
|
| |
200%
|
|
|
2023 Cost Reduction
|
| |
20%
|
| |
$(40)
|
| |
$(50)
|
| |
$(60)
|
| |
80%
|
| |
100%
|
| |
120%
|
| |
50%
|
| |
100%
|
| |
200%
|
|
|
![]() |
| |
34
|
|
| | | |
Target
|
| |
Actual
|
| ||||||||||||
|
Name
|
| |
Target
Annual Incentive Award(1) |
| |
% of Adjusted
EBITDA Target Award Earned (80% Weighting) |
| |
% of Cost
Reduction Target Award Earned (20% Weighting) |
| |
% of One
Marketplace Target Award Earned(2) |
| |
% of
Total Target Award Earned |
| |
2023 Payout
(Actual Annual Incentive Award) |
|
| Peter Kelly | | |
$966,250
|
| |
96.3%
|
| |
200%
|
| |
—
|
| |
117.1%
|
| |
$1,131,220
|
|
| Brad Lakhia | | |
$306,010
|
| |
96.3%
|
| |
200%
|
| |
—
|
| |
117.1%
|
| |
$358,256
|
|
| Scott Anderson | | |
$213,224
|
| |
96.3%
|
| |
200%
|
| |
—
|
| |
117.1%
|
| |
$249,628
|
|
| James Coyle | | |
$700,849
|
| |
96.3%
|
| |
200%
|
| |
100%
|
| |
117.1%
|
| |
$794,897
|
|
| Srisu Subrahmanyam | | |
$468,000
|
| |
96.3%
|
| |
200%
|
| |
—
|
| |
117.1%
|
| |
$547,902
|
|
| Jim Money | | |
$438,414
|
| |
77.4%
|
| |
200%
|
| |
—
|
| |
102.0%
|
| |
$447,182
|
|
| Justin Davis | | |
$420,888
|
| |
96.3%
|
| |
200%
|
| |
—
|
| |
117.1%
|
| |
$492,747
|
|
|
![]() |
| |
35
|
|
|
Name
|
| |
Target PRSUs(1)
|
| |
Value of Target
PRSUs at Grant(2) |
|
| Peter Kelly | | |
300,566
|
| |
$4,250,003
|
|
| Brad Lakhia | | |
64,060
|
| |
$950,010
|
|
| Scott Anderson | | |
—
|
| |
—
|
|
| James Coyle | | |
37,863
|
| |
$550,014
|
|
| Srisu Subrahmanyam | | |
31,825
|
| |
$450,006
|
|
| Jim Money | | |
24,753
|
| |
$350,007
|
|
| Justin Davis | | |
24,753
|
| |
$350,007
|
|
|
![]() |
| |
36
|
|
|
Relative TSR Percentile vs. S&P SmallCap 600 Companies
|
| |
Number of PRSUs Vesting
|
|
|
Below Threshold: Below 30th percentile
|
| |
0% of Target
|
|
|
Threshold: 30th percentile
|
| |
50% of Target
|
|
|
Target: 50th percentile
|
| |
100% of Target
|
|
|
Maximum: Greater than or equal to 70th percentile
|
| |
200% of Target
|
|
|
Name
|
| |
Number of
Performance-Based Stock Options |
| |
Value of
Performance-Based Stock Options at Grant(1) |
| |
Number of
Time-Based Stock Options |
| |
Value of
Time-Based Stock Options at Grant |
|
| Brad Lakhia | | |
212,886
|
| |
$1,520,006
|
| |
53,222
|
| |
$380,005
|
|
|
![]() |
| |
37
|
|
|
Name
|
| |
Number of RSUs
|
| |
Value of RSUs at Grant
|
|
| Scott Anderson | | |
8,487
|
| |
$120,006
|
|
|
![]() |
| |
38
|
|
|
Cumulative Operating Adjusted Net Income Per
Share During the Measurement Period |
| |
Number of PRSUs Vesting
|
|
|
Below Threshold: Below $3.04
|
| |
0% of Target
|
|
|
Threshold: $3.04
|
| |
50% of Target
|
|
|
Target: $3.80
|
| |
100% of Target
|
|
|
Maximum: Greater than or equal to $4.56
|
| |
200% of Target
|
|
|
![]() |
| |
39
|
|
|
![]() |
| |
40
|
|
Title
|
| |
Stock Ownership Guideline
|
| |
![]() |
|
CEO
Other Executive Officers |
| |
6 times annual base salary
3 times annual base salary |
| |
|
![]() |
| |
41
|
|
|
![]() |
| |
42
|
|
|
COMPENSATION COMMITTEE REPORT
|
|
|
![]() |
| |
43
|
|
|
ANALYSIS OF RISK IN THE COMPANY’S
COMPENSATION STRUCTURE |
|
|
![]() |
| |
44
|
|
|
SUMMARY COMPENSATION TABLE FOR 2023
|
|
Name and
Principal Position(1) |
| |
Year(2)
|
| |
Salary
|
| |
Bonus(3)
|
| |
Stock
Awards(4) |
| |
Option
Awards(5) |
| |
Non-Equity
Incentive Plan Compensation(6) |
| |
All Other
Compensation(7) |
| |
Total
|
|
Peter Kelly
Chief Executive Officer
|
| |
2023
|
| |
$773,000
|
| |
|
| |
$4,783,508
|
| |
|
| |
$1,131,220
|
| |
$33,627
|
| |
$6,721,355
|
|
|
2022
|
| |
$767,692
|
| |
|
| |
$6,005,505
|
| |
|
| |
$216,024
|
| |
$39,001
|
| |
$7,028,222
|
| ||
|
2021
|
| |
$709,616
|
| |
|
| |
$1,500,001
|
| |
$5,942,947
|
| |
$237,566
|
| |
$30,747
|
| |
$8,420,877
|
| ||
Brad Lakhia
Executive Vice President and Chief Financial Officer
|
| |
2023
|
| |
$398,077
|
| |
$500,000
|
| |
$1,497,198
|
| |
$1,851,047
|
| |
$358,256
|
| |
$20,511
|
| |
$4,625,089
|
|
|
|
| |||||||||||||||||||||||
Scott Anderson
Chief Accounting Officer and Former Interim Chief Financial Officer
|
| |
2023
|
| |
$355,100
|
| |
$150,000
|
| |
$120,006
|
| |
|
| |
$249,628
|
| |
$28,828
|
| |
$903,562
|
|
|
|
| |||||||||||||||||||||||
James Coyle
Executive Vice President and President, North American Marketplaces
|
| |
2023
|
| |
$548,923
|
| | | | |
$621,077
|
| | | | |
$794,897
|
| |
$33,690
|
| |
$1,998,587
|
|
|
2022
|
| |
$500,000
|
| |
$800,000
|
| |
$1,177,215
|
| | | | | | | |
$32,930
|
| |
$2,510,145
|
| ||
|
2021
|
| |
$84,615
|
| | | | |
$375,003
|
| |
$1,462,417
|
| |
$22,228
|
| |
$5,069
|
| |
$1,913,332
|
| ||
|
|
| |||||||||||||||||||||||
Srisu Subrahmanyam
Executive Vice President, Operations and President, Services & International Markets
|
| |
2023
|
| |
$468,000
|
| |
|
| |
$506,495
|
| |
|
| |
$547,902
|
| |
$35,060
|
| |
$1,557,457
|
|
|
2022
|
| |
$463,846
|
| |
|
| |
$1,252,218
|
| |
|
| |
$104,435
|
| |
$33,900
|
| |
$1,854,399
|
| ||
|
|
| |||||||||||||||||||||||
Jim Money
Former President of AFC
|
| |
2023
|
| |
$438,077
|
| | | | |
$393,944
|
| | | | |
$447,182
|
| |
$37,140
|
| |
$1,316,343
|
|
|
|
| |||||||||||||||||||||||
Justin Davis
Former President of BacklotCars
|
| |
2023
|
| |
$418,154
|
| |
|
| |
$393,944
|
| |
|
| |
$492,747
|
| |
$18,766
|
| |
$1,323,611
|
|
|
2022
|
| |
$309,231
|
| |
|
| |
$976,665
|
| |
|
| |
$52,217
|
| |
$19,306
|
| |
$1,357,419
|
| ||
|
2021
|
| |
$278,077
|
| |
|
| |
$1,250,011
|
| |
$1,003,133
|
| |
$51,681
|
| |
$10,933
|
| |
$2,593,835
|
|
|
![]() |
| |
45
|
|
|
![]() |
| |
46
|
|
|
GRANTS OF PLAN-BASED AWARDS FOR 2023
|
|
| | |
Estimated Future Payouts
Under Non-Equity Incentive Plan Awards(1) |
| |
Estimated Future Payouts
Under Equity Incentive Plan Awards(2) |
| | | | | | | | | | | | | | | | | | | | | | | | | ||||||||||||||||||||||||||||||||||||
Name
(a) |
| |
Grant
Date (b) |
| |
Threshold
($)(c)(1) |
| |
Target
($)(d)(1) |
| |
Maximum
($)(e)(1) |
| |
Threshold
(#)(f)(2) |
| |
Target
(#)(g)(2) |
| |
Maximum
(#)(h)(2) |
| |
All Other
Stock Awards: Number of Shares of Stock or Units (#)(i)(3) |
| |
All Other
Option Awards: Number of Securities Underlying Options (#)(j)(4) |
| |
Exercise
Price of Option Awards ($)(k)(5) |
| |
Grant Date
Fair Value of Stock Awards ($)(l)(6) |
| |||||||||||||||||||||||||||||||||
Peter Kelly
|
| | | | — | | | | | | 483,125 | | | | | | 966,250 | | | | | | 1,932,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 150,283 | | | | | | 300,566 | | | | | | 601,132 | | | | | | | | | | | | | | | | | | | | | | | | 4,783,508 | | | ||
Brad Lakhia
|
| | | | — | | | | | | 153,005 | | | | | | 306,010 | | | | | | 612,020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 5/5/2023 | | | | | | | | | | | | | | | | | | | | | | | | 32,030 | | | | | | 64,060 | | | | | | 128,120 | | | | | | | | | | | | | | | | | | | | | | | | 1,097,188 | | | ||
| | | 5/5/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 26,973 | | | | | | | | | | | | | | | | | | 400,010 | | | ||
| | | 5/5/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 212,886 | | | | | | | | | | | | | | | | | | | | | | | | 14.83 | | | | | | 1,471,042 | | | ||
| | | 5/5/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 53,222 | | | | | | 14.83 | | | | | | 380,005 | | | ||
Scott Anderson
|
| | | | — | | | | | | 106,612 | | | | | | 213,224 | | | | | | 426,448 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 8,487 | | | | | | | | | | | | | | | | | | 120,006 | | | ||
James Coyle
|
| | | | — | | | | | | 275,425 | | | | | | 700,849 | | | | | | 1,101,698 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 13,261 | | | | | | 26,521 | | | | | | 53,042 | | | | | | | | | | | | | | | | | | | | | | | | 422,082 | | | ||
| | | 8/4/2023 | | | | | | | | | | | | | | | | | | | | | | | | 5,671 | | | | | | 11,342 | | | | | | 22,684 | | | | | | | | | | | | | | | | | | | | | | | | 198,995 | | | ||
Srisu Subrahmanyam
|
| | | | — | | | | | | 234,000 | | | | | | 468,000 | | | | | | 936,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 15,913 | | | | | | 31,825 | | | | | | 63,650 | | | | | | | | | | | | | | | | | | | | | | | | 506,495 | | | ||
Jim Money
|
| | | | — | | | | | | 219,207 | | | | | | 438,414 | | | | | | 876,828 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 12,377 | | | | | | 24,753 | | | | | | 49,506 | | | | | | | | | | | | | | | | | | | | | | | | 393,944 | | | ||
Justin Davis
|
| | | | — | | | | | | 210,444 | | | | | | 420,888 | | | | | | 841,776 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | 2/24/2023 | | | | | | | | | | | | | | | | | | | | | | | | 12,377 | | | | | | 24,753 | | | | | | 49,506 | | | | | | | | | | | | | | | | | | | | | | | | 393,944 | | |
|
![]() |
| |
47
|
|
|
![]() |
| |
48
|
|
|
OUTSTANDING EQUITY AWARDS
AT FISCAL YEAR-END 2023 |
|
| | | | | | | | | | | | | | |
Option Awards
|
| |
Stock Awards
|
| |||||||||||||||||||||||||||||||||||||||||||||
Name
(a) |
| |
Grant
Year |
| |
Number of
Securities Underlying Unexercised Options Exercisable (#)(b) |
| |
Number of
Securities Underlying Unexercised Options Unexercisable (#)(c) |
| |
Equity
Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)(d) |
| |
Option
Exercise Price ($)(e) |
| |
Option
Expiration Date (f) |
| |
Number of
Shares or Units of Stock That Have Not Vested (#)(g) |
| |
Market
Value of Shares or Units of Stock That Have Not Vested ($)(h) |
| |
Equity
Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(i) |
| |
Equity
Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(j) |
| | ||||||||||||||||||||||||||||||||
Peter Kelly
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2021 | | | | | | 59,289(1) | | | | | | 59,289(1) | | | | | | | | | | | | 13.81 | | | | | | 03/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 474,309(2) | | | | | | 13.81 | | | | | | 03/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | 88,062(3) | | | | | | 88,063(3) | | | | | | | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 704,501(4) | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 108,343(5) | | | | | | 1,604,560(5) | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 99,025(6) | | | | | | 1,466,560(6) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 300,566(7) | | | | | | 4,451,382(7) | | | | ||||
Brad Lakhia
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2023 | | | | | | | | | | | | 53,222(8) | | | | | | | | | | | | 14.83 | | | | | | 05/05/2033 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | 212,886(9) | | | | | | 14.83 | | | | | | 05/05/2033 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 26,973(10) | | | | | | 399,470(10) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 64,060(7) | | | | | | 948,729(7) | | | | ||||
Scott Anderson
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,816(11) | | | | | | 26,895(11) | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 542(11) | | | | | | 8,027(11) | | | | | | | | | | | | | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4,041(11) | | | | | | 59,847(11) | | | | | | | | | | | | | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6,609(6) | | | | | | 97,879(6) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 8,333(11) | | | | | | 123,412(11) | | | | | | | | | | | | | | | | ||||
James Coyle
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2021 | | | | | | 35,377(12) | | | | | | 35,378(12) | | | | | | | | | | | | 14.66 | | | | | | 11/05/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 283,019(13) | | | | | | 14.66 | | | | | | 11/05/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 10,158(5) | | | | | | 150,440(5) | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 40,000(6) | | | | | | 592,400(6) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 26,521(7) | | | | | | 392,776(7) | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 11,342(7) | | | | | | 167,975(7) | | | | ||||
Srisu Subrahmanyam
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2021 | | | | | | 17,787(1) | | | | | | 17,787(1) | | | | | | | | | | | | 13.81 | | | | | | 03/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 142,293(2) | | | | | | 13.81 | | | | | | 03/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | 26,419(3) | | | | | | 26,419(3) | | | | | | | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 211,350(4) | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 12,189(5) | | | | | | 180,519(5) | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 40,000(6) | | | | | | 592,400(6) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 31,825(7) | | | | | | 471,328(7) | | | | ||||
Jim Money
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2021 | | | | | | 9,881(1) | | | | | | 9,882(1) | | | | | | | | | | | | 13.81 | | | | | | 03/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 79,052(2) | | | | | | 13.81 | | | | | | 03/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | 14,677(3) | | | | | | 14,677(3) | | | | | | | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 117,417(4) | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6,772(5) | | | | | | 100,293(5) | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 39,654(6) | | | | | | 587,276(6) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 24,753(7) | | | | | | 366,592(7) | | | | ||||
Justin Davis
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||
| | | 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 4,526(1) | | | | | | 67,030(1) | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | 19,569(3) | | | | | | 19,570(3) | | | | | | | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | 156,556(4) | | | | | | 18.23 | | | | | | 06/04/2031 | | | | | | | | | | | | | | | | | | | | | | | | | | | | ||||
| | | 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 35,656(14) | | | | | | 528,065(14) | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 6,772(5) | | | | | | 100,293(5) | | | | ||||
| | | 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 30,000(6) | | | | | | 444,300(6) | | | | | | | | | | | | | | | | ||||
| | | 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 24,753(7) | | | | | | 366,592(7) | | | |
|
![]() |
| |
49
|
|
|
![]() |
| |
50
|
|
|
![]() |
| |
51
|
|
|
OPTION EXERCISES AND STOCK VESTED DURING
FISCAL YEAR 2023 |
|
| | | |
Option Awards
|
| |
Stock Awards
|
| ||||||
|
Name
(a) |
| |
Number of
Shares Acquired on Exercise (#)(b) |
| |
Value Realized
on Exercise ($)(c) |
| |
Number of
Shares Acquired on Vesting (#)(d)(1) |
| |
Value Realized
on Vesting ($)(e) |
|
|
Peter Kelly
|
| |
—
|
| |
—
|
| |
56,032
|
| |
840,847(2)
|
|
|
Brad Lakhia
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
Scott Anderson
|
| |
—
|
| |
—
|
| |
8,608
|
| |
125,690
|
|
|
James Coyle
|
| |
—
|
| |
—
|
| |
20,000
|
| |
301,800
|
|
|
Srisu Subrahmanyam
|
| |
—
|
| |
—
|
| |
21,124
|
| |
317,884(2)
|
|
|
Jim Money
|
| |
—
|
| |
—
|
| |
21,748
|
| |
326,833(2)
|
|
|
Justin Davis
|
| |
—
|
| |
—
|
| |
19,526
|
| |
290,574
|
|
|
![]() |
| |
52
|
|
|
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN
CONTROL |
|
| |
Award
Type |
| | |
Termination or Change in Control Scenario*
|
| |
| |
Options
|
| | |
Voluntary Termination or Termination for Cause: If voluntary, vested options remain exercisable for 90 days (or earlier expiration date); if for Cause, all vested and unvested options are cancelled. (For the 2021 option awards, 90 days is specified as the 3 month anniversary.)
Termination Without Cause or for Good Reason: Unless otherwise specified in an award agreement, vested options remain exercisable for 90 days (or until earlier expiration date). (For the 2021 option awards, 90 days is specified as the 3 month anniversary.)
Death or Disability: Vested options remain exercisable for 1 year (or until earlier expiration date). Unvested options vest in full, with performance awards remaining subject to performance achievement. For the 2021 option awards, performance must be achieved within 1 year of death/disability, with options remaining exercisable for the earlier of 1 year from death/disability and the original expiration date.
Retirement: Vested options remain exercisable for 1 year (or until earlier expiration date), except for the 2021 option awards which remain exercisable until the original expiration date. Unvested options are forfeited, except for the 2021 option awards which continue to vest in accordance with the applicable vesting schedule and remain subject to performance requirements.
Effect of Change in Control: Single trigger vesting with committee discretion to cash out or substitute with successor awards, except for the 2021 option awards which have double trigger vesting for options assumed or replaced and single trigger vesting for options that are not assumed or replaced, with performance measured at the time of the change in control under each scenario.
|
| |
| |
PRSUs
|
| | |
Voluntary Termination or Termination for Cause: Automatic forfeiture.
Without Cause or for Good Reason: Prorated portion of the PRSUs vest based on the Company’s actual performance during the performance period and the number of full months he was employed during such performance period.
Death or Disability: Full vesting of the PRSUs based on the Company’s actual performance during the performance period.
Retirement: If attaining age 65 and at least 5 years of service with the Company and its affiliates (“normal retirement”), full vesting of the PRSUs based on the Company’s actual performance during the performance period. If attaining age 55 with at least 10 years of service with the Company and its affiliates (“early retirement”), prorated portion of the PRSUs based on the Company’s actual performance during the performance period and the number of full months worked through the retirement date plus a credit of an additional 12 months.
Effect of Change in Control: Double trigger vesting at target performance level for PRSUs that are assumed or replaced; single trigger vesting at the target performance level for PRSUs that are not assumed or replaced.
|
| |
| |
RSUs
|
| | |
Voluntary Termination or Termination for Cause: Forfeiture of any unvested RSUs.
Without Cause or for Good Reason: For the RSUs granted in December 2022 (“2022 RSUs”), any unvested RSUs will continue to vest in full as scheduled. For all other RSUs, forfeiture of any unvested RSUs.
Death or Disability: Full, immediate vesting of any unvested RSUs.
Retirement: If “normal retirement,” any unvested RSUs will continue to vest in full as scheduled. If “early retirement,” a prorated portion of any unvested RSUs scheduled to vest in the 12 months following the retirement date (but, for the 2022 RSUs, a portion of those scheduled to vest on the next vesting date) will continue to vest as originally scheduled, along with a prorated portion of such RSUs which, for the 2022 RSUs, is based on the number of full months since the most recent of the grant date and a scheduled vesting date, and, for all other RSUs, is based on the number of full months he was employed since the most recent anniversary of the grant date (after giving 12 months vesting credit following the date of retirement).
Effect of Change in Control: Double trigger vesting for any RSUs that are assumed or replaced; single trigger vesting for any RSUs that are not assumed or replaced.
|
| |
|
![]() |
| |
53
|
|
| |
Termination or Change in Control Scenario
|
| |
| |
Death, Disability, Voluntary Termination (with or without Good Reason) or Termination by the Company (for Cause or without Cause): Annual cash incentive awards are treated as described in the executive’s employment agreement with the Company, to the extent applicable. See “Employment Agreements with Named Executive Officers” below for more information.
Retirement: Unless otherwise specified in an employment agreement, an executive receives a prorated amount of the incentive award based on actual performance for the performance period.
Effect of Change in Control: Unless otherwise determined by the administrator of the Omnibus Plan or as evidenced in an award agreement, pro rata payment based on actual performance, in the administrator’s discretion.
|
| |
|
![]() |
| |
54
|
|
|
POTENTIAL PAYMENTS UPON TERMINATION
OR CHANGE IN CONTROL TABLE |
|
|
Named Executive Officer and
Triggering Event |
| |
Cash
Severance |
| |
Non-Equity
Incentive Pay(1) |
| |
Options(2)
|
| |
PRSUs(3)
|
| |
RSUs(4)
|
| |
Life
Insurance(5) |
| |
Total
|
|
| Peter Kelly | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Death
|
| |
$43,207(8)
|
| |
$1,131,220
|
| |
$59,289
|
| |
$7,660,487
|
| |
$1,466,560
|
| |
$800,000
|
| |
$11,160,763
|
|
|
•
Disability(6)
|
| |
$43,207(8)
|
| |
$1,131,220
|
| |
$59,289
|
| |
$7,660,487
|
| |
$1,466,560
|
| |
—
|
| |
$10,360,763
|
|
|
•
Retirement(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
$6,176,688
|
| |
$1,158,024
|
| |
—
|
| |
$7,334,712
|
|
|
•
Voluntary / for Cause
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Termination w/o Cause or for Good
Reason
|
| |
$3,521,707(9)
|
| |
$1,131,220
|
| |
—
|
| |
$3,623,197
|
| |
$1,466,560
|
| |
—
|
| |
$9,742,684
|
|
|
•
CIC (single trigger)
|
| |
—
|
| |
$1,131,220
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
$1,131,220
|
|
|
•
Termination after CIC (double trigger)
|
| |
$3,521,707(10)
|
| |
$1,131,220
|
| |
$59,289
|
| |
$7,660,487
|
| |
$1,466,560
|
| |
—
|
| |
$13,839,263
|
|
| Brad Lakhia | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Death
|
| |
$43,207(8)
|
| |
$358,256
|
| |
—
|
| |
$948,729
|
| |
$399,470
|
| |
$800,000
|
| |
$2,549,662
|
|
|
•
Disability(6)
|
| |
$43,207(8)
|
| |
$358,256
|
| |
—
|
| |
$948,729
|
| |
$399,470
|
| |
—
|
| |
$1,749,662
|
|
|
•
Retirement(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Voluntary / for Cause
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Termination w/o Cause or for Good
Reason
|
| |
$1,364,722(9)
|
| |
$358,256
|
| |
—
|
| |
$316,243
|
| |
—
|
| |
—
|
| |
$2,039,221
|
|
|
•
CIC (single trigger)
|
| |
—
|
| |
$358,256
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
$358,256
|
|
|
•
Termination after CIC (double trigger)
|
| |
$1,805,227(10)
|
| |
$358,256
|
| |
—
|
| |
$948,729
|
| |
$399,470
|
| |
—
|
| |
$3,511,682
|
|
| Scott Anderson | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Death
|
| |
$28,805(8)
|
| |
$249,628
|
| |
—
|
| |
—
|
| |
$316,060
|
| |
$716,560
|
| |
$1,311,053
|
|
|
•
Disability(6)
|
| |
$28,805(8)
|
| |
$249,628
|
| |
—
|
| |
—
|
| |
$316,060
|
| |
—
|
| |
$594,493
|
|
|
•
Retirement(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
$241,788
|
| |
—
|
| |
$241,788
|
|
|
•
Voluntary / for Cause
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Termination w/o Cause or for Good
Reason
|
| |
$600,309(9)
|
| |
$249,628
|
| |
—
|
| |
—
|
| |
$97,879
|
| |
—
|
| |
$947,816
|
|
|
•
CIC (single trigger)
|
| |
—
|
| |
$249,628
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
$249,628
|
|
|
•
Termination after CIC (double trigger)
|
| |
$600,309(10)
|
| |
$249,628
|
| |
—
|
| |
—
|
| |
$316,060
|
| |
—
|
| |
$1,165,997
|
|
| James Coyle | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Death
|
| |
$43,100(8)
|
| |
$794,897
|
| |
$5,307
|
| |
$861,616
|
| |
$592,400
|
| |
$800,000
|
| |
$3,097,320
|
|
|
•
Disability(6)
|
| |
$43,100(8)
|
| |
$794,897
|
| |
$5,307
|
| |
$861,616
|
| |
$592,400
|
| |
—
|
| |
$2,297,320
|
|
|
•
Retirement(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Voluntary / for Cause
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Termination w/o Cause or for Good
Reason
|
| |
$1,769,360(9)
|
| |
$794,897
|
| |
—
|
| |
$387,489
|
| |
$592,400
|
| |
—
|
| |
$3,544,146
|
|
|
•
CIC (single trigger)
|
| |
—
|
| |
$794,897
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
$794,897
|
|
|
•
Termination after CIC (double trigger)
|
| |
$2,344,780(10)
|
| |
$794,897
|
| |
$5,307
|
| |
$861,616
|
| |
$592,400
|
| |
—
|
| |
$4,599,000
|
|
| Srisu Subrahmanyam | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Death
|
| |
$42,495(8)
|
| |
$547,902
|
| |
$17,787
|
| |
$832,366
|
| |
$592,400
|
| |
$800,000
|
| |
$2,832,950
|
|
|
•
Disability(6)
|
| |
$42,495(8)
|
| |
$547,902
|
| |
$17,787
|
| |
$832,366
|
| |
$592,400
|
| |
—
|
| |
$2,032,950
|
|
|
•
Retirement(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Voluntary / for Cause
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
|
|
•
Termination w/o Cause or for Good
Reason
|
| |
$1,446,495(9)
|
| |
$547,902
|
| |
—
|
| |
$397,802
|
| |
$592,400
|
| |
—
|
| |
$2,984,599
|
|
|
•
CIC (single trigger)
|
| |
—
|
| |
$547,902
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
$547,902
|
|
|
•
Termination after CIC (double trigger)
|
| |
$1,914,495(10)
|
| |
$547,902
|
| |
$17,787
|
| |
$832,366
|
| |
$592,400
|
| |
—
|
| |
$3,904,950
|
|
| Jim Money | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Retirement(7)
|
| |
—
|
| |
—
|
| |
—
|
| |
$550,973
|
| |
$680,463
|
| |
—
|
| |
$1,231,436
|
|
| Justin Davis | | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
•
Termination w/o Cause
|
| |
$240,103(9)
|
| |
—
|
| |
—
|
| |
$305,469
|
| |
$472,200
|
| |
—
|
| |
$1,017,772
|
|
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
![]() |
| |
55
|
|
|
![]() |
| |
56
|
|
|
![]() |
| |
57
|
|
|
![]() |
| |
58
|
|
|
![]() |
| |
59
|
|
|
![]() |
| |
60
|
|
|
CEO PAY RATIO
|
|
|
![]() |
| |
61
|
|
|
PAY VERSUS PERFORMANCE
|
|
| Year | | | Summary Compensation Table Total for First PEO ($)(1)(2) | | | Summary Compensation Table Total for Second PEO ($)(1)(2) | | | Compensation Actually Paid to First PEO ($)(1)(3) | | | Compensation Actually Paid to Second PEO ($)(1)(3) | | | Average Summary Compensation Table Total for Non-PEO NEOs ($)(1)(4) | | | Average Compensation Actually Paid to Non-PEO NEOs ($)(1)(3) | | | Value of Initial Fixed $100 Investment Based On: | | | Net Income ($ Millions)(7) | | | EBITDA ($ Millions)(8) | | |||
| Total Shareholder Return ($)(5) | | | Peer Group Total Shareholder Return ($)(6) | | |||||||||||||||||||||||||||
| 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | ( | | | | |
| 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2020 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Summary Compensation Table (“SCT”) Total for PEO and Non-PEO NEOs | | | 2023 PEO | | | 2023 Non-PEO NEOs | |
SCT Total | | | $ | | | $ | |
Adjustments for stock awards and option awards | | | | | | | |
(Deduct): Aggregate value for stock awards and option awards included in SCT Total for the covered fiscal year | | | $( | | | $( | |
Add: Fair value at year end of awards granted during the covered fiscal year that were outstanding and unvested at the covered fiscal year end | | | $ | | | $ | |
Add (Deduct): Year-over-year change in fair value at covered fiscal year end of awards granted in any prior fiscal year that were outstanding and unvested at the covered fiscal year end | | | $ | | | $ | |
Add: Vesting date fair value of awards granted and vested during the covered fiscal year | | | | | | $ | |
Add (Deduct): Change as of the vesting date (from the end of the prior fiscal year) in fair value of awards granted in any prior fiscal year for which vesting conditions were satisfied during the covered fiscal year | | | $ | | | $ | |
(Deduct): Fair value at end of prior fiscal year of awards granted in any prior fiscal year that failed to meet the applicable vesting conditions during the covered fiscal year | | | $( | | | $( | |
Add: Dividends or other earnings paid on awards in the covered fiscal year prior to vesting if not otherwise included in the SCT Total for the covered fiscal year | | | | | | | |
CAP Amounts (as calculated) | | | $ | | | $ | |
|
![]() |
| |
62
|
|
|
![]() |
| |
63
|
|
|
![]() |
| |
64
|
|
|
![]() |
| |
65
|
|
| | | |
2021
|
| |
2022
|
| |
2023
|
|
| Burn Rate(1) | | |
2.06%
|
| |
1.48%
|
| |
1.24%
|
|
| Overhang(2) | | |
—
|
| |
—
|
| |
9.20%
|
|
| Number of shares available for future grants: | | |
2,525,901
|
|
| Number of granted but unvested full-value awards:(1) | | |
3,506,268
|
|
| Number of granted but unexercised stock options: | | |
4,555,407
|
|
| Weighted average exercise price of outstanding stock options: | | |
$15.94
|
|
| Weighted average remaining term of outstanding stock options: | | |
7.2 years
|
|
|
Plan Category
|
| |
Number of
securities to be issued upon exercise of outstanding options, warrants and rights(1) |
| |
Weighted
average exercise price of outstanding options, warrants and rights(2) |
| |
Number of securities
remaining available for future issuance under equity compensation plans (excluding securities reflected in first column)(3) |
|
| Equity compensation plans approved by security holder(s) | | |
8,167,992
|
| |
$15.82
|
| |
3,718,228
|
|
| Equity compensation plans not approved by security holders | | |
—
|
| |
—
|
| |
—
|
|
| Total | | |
8,167,992
|
| |
$15.82
|
| |
3,718,228
|
|
|
![]() |
| |
66
|
|
|
![]() |
| |
67
|
|
|
![]() |
| |
68
|
|
|
![]() |
| |
69
|
|
|
![]() |
| |
70
|
|
|
Name and Position
|
| |
Stock Options
|
|
| Peter J. Kelly, Chief Executive Officer | | |
1,473,513
|
|
| Brad S. Lakhia, Executive Vice President and Chief Financial Officer | | |
266,108
|
|
| Scott A. Anderson, Chief Accounting Officer and Former Interim Chief Financial Officer | | |
—
|
|
| James P. Coyle, Executive Vice President and President, North American Marketplaces | | |
353,774
|
|
| Sriram Subrahmanyam, Executive Vice President, Operations and President, Services & International Markets | | |
442,055
|
|
| James E. Money, Former President of AFC | | |
230,764
|
|
| Justin T. Davis, Former President of BacklotCars | | |
39,139
|
|
| All current executive officers as a group | | |
590,826
|
|
| All current non-employee directors as a group | | |
738,691
|
|
| All employees, excluding all current executive officers, as a group | | |
414,280
|
|
|
![]() |
| |
The Board of Directors recommends that you vote FOR the approval of the amended and restated Omnibus Plan.
|
|
|
![]() |
| |
71
|
|
|
![]() |
| |
The Board of Directors recommends that you vote FOR the ratification of the appointment of KPMG as our independent registered public accounting firm for 2024.
|
|
|
![]() |
| |
72
|
|
|
REPORT OF THE AUDIT COMMITTEE
|
|
|
![]() |
| |
73
|
|
|
FEES PAID TO KPMG LLP
|
|
|
Fee Category
|
| |
2023
|
| |
2022
|
|
| Audit Fees(1) | | |
$2,894,145
|
| |
$2,942,959
|
|
| Audit-Related Fees(2) | | |
426,950
|
| |
1,099,265
|
|
| Tax Fees(3) | | |
110,000
|
| |
122,500
|
|
| All Other Fees(4) | | |
1,780
|
| |
1,905
|
|
|
Total Fees
|
| |
$3,432,875
|
| |
$4,166,629
|
|
|
AUDIT COMMITTEE PRE-APPROVAL POLICY
|
|
|
![]() |
| |
74
|
|
|
RELATED PERSON TRANSACTIONS
|
|
|
![]() |
| |
75
|
|
|
![]() |
| |
76
|
|
|
REQUIREMENTS, INCLUDING DEADLINES, FOR
SUBMISSION OF PROXY PROPOSALS |
|
|
![]() |
| |
77
|
|
|
QUESTIONS AND ANSWERS ABOUT THE PROXY
MATERIALS AND THE ANNUAL MEETING |
|
| Q: | | | Why am I receiving these materials? | |
|
A:
|
| |
We are providing these proxy materials to you in connection with the solicitation, by our Board, of proxies to be voted at the Company’s 2024 annual meeting of stockholders and at any adjournments or postponements thereof. Stockholders are invited to attend the 2024 annual meeting to be held via a live audio webcast on June 7, 2024 beginning at 9:00 a.m., Eastern Daylight Time, at www.virtualshareholdermeeting.com/KAR2024, where stockholders will be able to listen to the meeting live, submit questions and vote online. You will need the 16-digit control number provided on your Notice (as defined below under “Why did I receive a notice in the mail regarding the Internet availability of the proxy materials instead of a paper copy of the proxy materials?”), on your proxy card, or on the instructions that accompanied your proxy materials. Our proxy materials are first being distributed to stockholders on or about April 26, 2024.
|
|
| Q: | | | What proposals will be voted on, what is the Board’s voting recommendation, and what are the standards for determining whether a proposal has been approved? | |
|
A:
|
| | The holders of shares of Series A Preferred Stock are being asked to vote, as a separate class, on: | |
| | | |
•
Proposal No. 1: To elect one director (Roy Mackenzie) designated by the Apax Investor to serve until the 2025 annual meeting of stockholders and until such director’s successor is duly elected and qualified, or such director’s earlier death, resignation or removal.
|
|
| | | | The holders of shares of common stock and shares of Series A Preferred Stock, voting together as a single class, are being asked to consider and vote on the following items: | |
| | | |
•
Proposal No. 2: To elect seven directors to serve until the 2025 annual meeting of stockholders and until such director’s successor is duly elected and qualified, or such director’s earlier death, resignation or removal.
|
|
| | | |
•
Proposal No. 3: To approve, on an advisory basis, executive compensation.
|
|
| | | |
•
Proposal No. 4: To approve an amendment and restatement of the KAR Auction Services, Inc. Amended and Restated 2009 Omnibus Stock and Incentive Plan.
|
|
| | | |
•
Proposal No. 5: To ratify the appointment of KPMG LLP as our independent registered public accounting firm for 2024.
|
|
|
Proposal
|
| |
Voting Choices and
Board Recommendation |
| |
Voting
Standard |
| |
Effect of
Abstention |
| |
Effect of
Broker Non-Vote |
|
|
1.
Election of Director Nominee Designated
by the Apax Investor
|
| |
•
Vote “FOR” the nominee
•
Vote “AGAINST” the nominee
•
Abstain from voting for the nominee
The Board recommends a vote FOR the director nominee.
|
| |
More votes
“FOR” than “AGAINST” |
| | No effect | | |
No effect
|
|
|
2.
Election of
Directors
|
| |
•
Vote “FOR” all nominees
•
Vote “FOR” specific nominees
•
Vote “AGAINST” all nominees
•
Vote “AGAINST” specific nominees
•
Abstain from voting for all nominees
•
Abstain from voting for specific nominees
|
| |
More votes
“FOR” than “AGAINST” |
| | No effect | | |
No effect
|
|
| | | | The Board recommends a vote FOR each of the director nominees. | | |||||||||
|
3.
Advisory Vote to Approve Executive Compensation
|
| |
•
Vote “FOR” the advisory proposal
•
Vote “AGAINST” the advisory proposal
•
Abstain from voting on the advisory proposal
The Board recommends a vote FOR the advisory vote to approve executive compensation.
|
| |
Majority of the
shares present and entitled to vote |
| |
Vote
against |
| |
No effect
|
|
|
![]() |
| |
78
|
|
| | | | | | | ||||||||
|
4.
Approval of an Amendment and Restatement of the Omnibus Plan
|
| |
•
Vote “FOR” the amendment and restatement
•
Vote “AGAINST” the amendment and restatement
•
Abstain from voting on the amendment and restatement
The Board recommends a vote FOR the amended and restated Omnibus Plan.
|
| |
Majority of the
shares present and entitled to vote |
| |
Vote
against |
| |
No effect
|
|
|
5.
Ratification of
Independent Registered Accounting Firm
|
| |
•
Vote “FOR” the ratification
•
Vote “AGAINST” the ratification
•
Abstain from voting on the ratification
The Board recommends a vote FOR the ratification of the appointment of KPMG as our independent registered accounting firm for 2024.
|
| |
Majority of the
shares present and entitled to vote |
| |
Vote
against |
| |
Not
applicable |
|
| Q: | | | Who is entitled to vote? | |
|
A:
|
| |
Only holders of our common stock and/or Series A Preferred Stock outstanding as of the record date, which is the close of business on April 9, 2024, may vote at the 2024 annual meeting. Each share of our common stock is entitled to one vote on each matter properly brought before the 2024 annual meeting and on which holders of common stock are entitled to vote.
Each record holder of Series A Preferred Stock will have a number of votes equal to the largest number of whole shares of common stock into which such shares are convertible on the record date on each matter that is properly brought before the 2024 annual meeting and on which holders of Series A Preferred Stock are entitled to vote together with common stock as a single class. In addition, each holder of record of Series A Preferred Stock will have one vote for each share of Series A Preferred Stock on each matter that is properly brought before the 2024 annual meeting and on which holders of Series A Preferred Stock are entitled to vote separately, as a class.
These shares include shares that are:
•
held directly in your name as the stockholder of record; and
•
held for you as the beneficial owner through a broker, bank or other nominee, including shares purchased under the KAR Auction Services, Inc. Amended and Restated Employee Stock Purchase Plan (the “ESPP”).
On the record date, the Company had 108,302,011 shares of common stock issued and outstanding and 634,305 shares of Series A Preferred Stock issued and outstanding.
|
|
| Q: | | | Are there any requirements on how the holders of the Series A Preferred Stock must vote? | |
|
A:
|
| |
Under the Investment Agreement, at the 2024 annual meeting, Ignition Acquisition Holdings LP and Periphas are required to vote their shares of Series A Preferred Stock in favor of the seven director nominees who are also being voted on by holders of common stock, in favor of the “say on pay” proposal, in favor of the amendment and restatement of the Omnibus Plan and for ratification of the appointment of KPMG LLP as our independent registered public accounting firm for 2024, as described in these proxy materials. Ignition Acquisition Holdings LP and Periphas are entitled to vote at their discretion on the other proposals (if any) described in this proxy statement.
|
|
| Q: | | | What is the difference between holding shares as a stockholder of record and as a beneficial owner? | |
|
A:
|
| |
Stockholder of Record. If your shares are registered directly in your name with the Company’s transfer agent, Equiniti Trust Company, LLC (f/k/a American Stock Transfer & Trust Company, LLC), you are considered a “stockholder of record” with respect to those shares. As the stockholder of record, you have the right to grant your voting proxy directly to the Company or to vote in person online during the 2024 annual meeting.
Beneficial Owner. If your shares are held in a brokerage account or by a bank or other nominee, you hold your shares in “street name” and are considered a “beneficial owner” with respect to those shares. These proxy materials are being forwarded to you by your broker or nominee who is considered the stockholder of record with respect to those shares. As the beneficial owner, you have the right to direct your broker on how to vote your shares and are also invited to attend the 2024 annual meeting.
|
|
|
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| |
79
|
|
|
Q:
|
| | How can I vote my shares and participate at the 2024 annual meeting? | |
|
A:
|
| |
Stockholders may participate in the 2024 annual meeting by visiting the following website: www.virtualshareholdermeeting.com/KAR2024. To participate in the 2024 annual meeting, you will need the 16-digit control number provided on your Notice, on your proxy card, or on the instructions that accompanied your proxy materials.
Stockholder of Record. Shares held directly in your name as the stockholder of record may be voted online during the 2024 annual meeting. If you choose to vote your shares online during the 2024 annual meeting, please follow the instructions provided on the Notice to log in to www.virtualshareholdermeeting.com/KAR2024. You will need the control number included on your Notice, on your proxy card, or on the instructions that accompanied your proxy materials.
Beneficial Owner. If you are a beneficial owner in street name and want to vote your shares online during the 2024 annual meeting, you may need to ask your bank, broker or other nominee to furnish you with a legal proxy and proof of beneficial ownership, such as your most recent account statement as of April 9, 2024, the record date, a copy of the voting instruction form provided by your broker, bank, trustee, or nominee, or other similar evidence of ownership. Follow the instructions from your broker or bank included with these proxy materials, or contact your broker or bank to request a proxy form.
If you hold both common stock and Series A Preferred Stock, you will need to vote, or authorize a proxy to vote, each class of stock separately. Please be sure to vote or authorize a proxy to vote for each class of stock separately so that all your votes can be counted. For more information, see “What if I hold both common stock and Series A Preferred Stock” below.
Even if you plan to attend the 2024 annual meeting, the Company strongly recommends that you vote your shares in advance as described below so that your vote will be counted if you later decide not to attend the 2024 annual meeting. See “How can I vote my shares without attending the 2024 annual meeting?” below.
The 2024 annual meeting will begin promptly at 9:00 a.m., Eastern Daylight Time. We encourage you to access the meeting prior to the start time. Please allow ample time for online check-in, which will begin at 8:45 a.m. Eastern Daylight Time.
We are holding the 2024 annual meeting online and providing Internet voting to provide expanded access and to allow you to vote your shares online during the annual meeting, with procedures designed to ensure the authenticity and correctness of your voting instructions. However, please be aware that you must bear any costs associated with your Internet access, such as usage charges from Internet access providers and telephone companies.
|
|
|
Q:
|
| | What if I hold both common stock and Series A Preferred Stock? | |
|
A:
|
| |
Some of our stockholders may hold both common stock and Series A Preferred Stock. If you are a holder of both common stock and Series A Preferred Stock, you can expect to receive separate sets of printed proxy materials.
You will need to vote, or authorize a proxy to vote, each class of stock separately in accordance with the instructions set forth herein and on the applicable proxy cards or voting instruction forms. Voting, or authorizing a proxy to vote, only your common stock will not also cause your shares of Series A Preferred Stock to be voted, and vice versa.
If you hold both common stock and Series A Preferred Stock, please be sure to vote or authorize a proxy to vote for each class of stock separately so that all your votes can be counted.
|
|
|
Q:
|
| | How can I vote my shares without attending the 2024 annual meeting? | |
|
A:
|
| |
Whether you hold your shares directly as the stockholder of record or beneficially in street name, you may vote without attending the 2024 annual meeting in one of the following manners:
By Internet. Go to www.proxyvote.com and follow the instructions. You will need the control number included on your proxy card or voting instruction form;
|
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By Telephone. Dial 1-800-690-6903. You will need the control number included on your proxy card or
voting instruction form; or
By Mail. Complete, date and sign your proxy card or voting instruction form and mail it using the enclosed, pre-paid envelope.
If you vote on the Internet or by telephone, you do not need to return your proxy card or voting instruction form. Internet and telephone voting for stockholders will be available 24 hours a day, and will close at 11:59 p.m., Eastern Daylight Time, on June 6, 2024.
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Q:
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| | If I am an employee holding shares pursuant to the ESPP, how will my shares be voted? | |
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A:
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Employees holding stock acquired through the ESPP will receive a voting instruction form covering all shares held in their individual account from Fidelity, the plan record keeper. The record keeper for the ESPP will vote your shares (i) in accordance with the specific instructions on your returned voting instruction form; or (ii) in its discretion, if you return a signed voting instruction form with no specific voting instructions.
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Q:
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| | What is the quorum requirement for the 2024 annual meeting? | |
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A:
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A quorum of stockholders is necessary to hold the 2024 annual meeting. A quorum at the 2024 annual meeting exists if stockholders entitled to cast a majority of the votes entitled to be cast at the 2024 annual meeting are present in person or represented by proxy. Abstentions and broker non votes are counted as present for establishing a quorum. A broker non-vote occurs on an item when a broker, bank or other nominee is not permitted to vote on that item absent instruction from the beneficial owner of the shares and no instruction is given.
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Q:
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| | What happens if I do not give specific voting instructions? | |
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A:
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Stockholder of Record. If you are a stockholder of record and you sign and return a proxy card without giving specific voting instructions, then the proxy holders will vote your shares in the manner recommended by the Board on all matters presented in this proxy statement and as the proxy holders may determine in their discretion with respect to any other matters properly presented for a vote at the 2024 annual meeting.
Beneficial Owner. If you are a beneficial owner of shares and do not provide the organization (e.g., broker, bank or other nominee) that holds your shares in “street name” with specific voting instructions, the organization that holds your shares may generally vote in its discretion on “routine” matters. If the organization that holds your shares does not receive instructions from you on how to vote your shares on “non-routine” matters, such organization cannot vote your shares and will inform the inspector of election that it does not have the authority to vote on these matters with respect to your shares. This is generally referred to as a “broker non-vote.” Therefore, we urge you to give voting instructions to your broker, bank or other nominee. Shares represented by such broker non-votes will be counted in determining whether there is a quorum. Because broker non-votes are not considered shares entitled to vote, they will have no effect on the outcome of any proposal other than reducing the number of shares present in person or by proxy and entitled to vote from which a majority is calculated.
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Routine Matters. The ratification of the appointment of KPMG as our independent registered public accounting firm for 2024 (Proposal No. 5) is considered a routine matter under applicable rules. A broker, bank or other nominee may generally vote on routine matters, and therefore no broker non votes will exist in connection with Proposal No. 5.
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Non Routine Matters. The election of directors (Proposals No. 1 & 2), the advisory vote to approve executive compensation (Proposal No. 3), and the approval of amending and restating our Omnibus Plan (Proposal No. 4) are each considered “non routine” matters under applicable rules are considered non routine matters under applicable rules. A broker, bank or other nominee cannot vote without instructions on non-routine matters, and therefore there may be broker non votes on Proposal No. 1, Proposal No. 2, Proposal No. 3 and Proposal No. 4.
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Q:
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| | What does it mean if I receive more than one proxy card or voting instruction form? | |
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A:
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It means your shares are registered differently or are in more than one account. Please provide voting instructions for all proxy and voting instruction forms you receive.
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Q:
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| | Who will count the vote? | |
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The votes will be counted by the inspector of elections appointed for the 2024 annual meeting.
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Q:
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| | Can I revoke my proxy or change my vote? | |
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Yes. You may revoke your proxy or change your voting instructions at any time prior to the vote at the 2024 annual meeting by:
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providing written notice of revocation to the Secretary of the Company at 11299 North Illinois Street, Suite 500, Carmel, Indiana 46032;
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delivering a valid, later-dated proxy or a later-dated vote on the Internet or by telephone; or
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attending the 2024 annual meeting online and voting during the meeting, which will automatically cancel any proxy previously granted.
Please note that your attendance at the 2024 annual meeting alone will not cause your previously granted proxy to be revoked unless you vote online during the 2024 annual meeting. If you wish to revoke your proxy, you must do so in sufficient time to permit the necessary examination and tabulation of the subsequent proxy or revocation before the vote is taken. Shares held in street name may be voted by you online during the 2024 annual meeting only if you obtain a signed proxy from the record holder giving you the right to vote such shares.
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Q:
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| | Who will bear the cost of soliciting proxies for the 2024 annual meeting? | |
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The Company pays the cost of soliciting your proxy and reimburses brokers and others for forwarding to you the proxy materials as beneficial owners of our common stock. The Company’s directors, officers and employees also may solicit proxies by mail, telephone and personal contact. They will not receive any additional compensation for these activities.
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Q:
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| | Why did I receive a notice in the mail regarding the Internet availability of the proxy materials instead of a paper copy of the proxy materials? | |
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This year, we are again taking advantage of the SEC rules that allow us to furnish our proxy materials over the Internet. As a result, most of our stockholders will be mailed a Notice of Internet Availability of Proxy Materials (“Notice”), rather than a full paper set of the proxy materials. The Notice includes information on how to access the proxy materials via the Internet as well as how to vote via the Internet. We believe this method of delivery will decrease printing and shipping costs, expedite distribution of proxy materials to you, and reduce our impact on the environment. Stockholders who receive the Notice but would like to receive a printed copy of the proxy materials in the mail should follow the instructions in the Notice for requesting such materials.
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Q:
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| | I share an address with another stockholder, and we received only one paper copy of the proxy materials. How may I obtain an additional copy of the proxy materials? | |
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We have adopted a procedure called “householding,” which the SEC has approved. Under this procedure, we may deliver a single copy of the Notice and, if applicable, this proxy statement and the Company’s Annual Report to multiple stockholders who share the same address unless we received contrary instructions from one or more of the stockholders.
This procedure reduces our printing and mailing costs and also reduces our impact on the environment. Stockholders who participate in householding will continue to be able to access and receive separate proxy cards. Upon written or oral request, a separate copy of the Notice or this proxy statement and the Company’s Annual Report, as requested, will be promptly delivered to any stockholder at a shared address to which we delivered a single copy of any of these documents. If you prefer to receive separate copies of the Notice, the proxy statement or Annual Report, contact Broadridge Financial Solutions, Inc. by calling 1-866-540-7095 or in writing at 51 Mercedes Way, Edgewood, New York 11717, Attention: Householding Department.
If you are a stockholder of record and are receiving more than one copy of the proxy materials at a single address and would like to participate in householding, please notify us by contacting Broadridge Financial Solutions, Inc. using the mailing address and phone number above. Stockholders who hold shares in “street name” may contact their broker, bank or other nominee to request information about householding.
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Q:
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| | How can I obtain a copy of OPENLANE’s Annual Report on Form 10-K? | |
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A:
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| | Copies of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2023, as filed with the SEC, are available to stockholders free of charge on our website at corporate.openlane.com under the “Investor Relations” tab, or by writing to OPENLANE, Inc., Investor Relations, 11299 North Illinois Street, Suite 500, Carmel, Indiana 46032. | |
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Q:
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| | Where can I find the voting results of the 2024 annual meeting? | |
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OPENLANE will announce preliminary voting results at the 2024 annual meeting and publish preliminary, or final results if available, in a Current Report on Form 8-K within four business days of the 2024 annual meeting.
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Q:
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| | How can I attend the 2024 annual meeting? | |
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The 2024 annual meeting will be a completely virtual meeting of stockholders, which will be conducted through a live audio webcast. There will be no physical meeting location. You are entitled to participate in the annual meeting only if you were a Company stockholder as of the close of business on April 9, 2024 or if you hold a valid proxy for the annual meeting.
You will be able to attend the 2024 annual meeting online and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/KAR2024. You also will be able to vote your shares online during the annual meeting.
To participate in the 2024 annual meeting, you will need the 16-digit control number included on your Notice, on your proxy card, or on the instructions that accompanied your proxy materials. Instructions on how to attend and participate in our online meeting, including how to demonstrate proof of stock ownership, are posted on the meeting website.
The meeting will begin promptly at 9:00 a.m., Eastern Daylight Time. We encourage you to access the meeting prior to the start time. Online access to the meeting will open at 8:45 a.m., Eastern Daylight Time, and you should allow ample time to log in to the meeting and test your device’s audio capabilities prior to the start of the meeting.
The webcast will be available for replay until midnight on June 6, 2025.
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Q:
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| | What if I have technical difficulties or trouble accessing the meeting? | |
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A:
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| | If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, please call the technical support number that will be posted on the virtual meeting log-in page at www.virtualshareholdermeeting.com/KAR2024. | |
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