DEF 14A of Openlane, Inc., Apr 26, 2024

DEF 14A of Openlane, Inc.

Filed Apr 26, 2024 · FY20230001104659-24-052239

Open on EDGAR

  1. Board Nominees

    Board Nominees

  2. Board Nominees

    | Name | Age | Director Since | Independent | Primary Occupation | Committee Membership* | | Roy Mackenzie | 52 | 2020 | ✓ | Partner of Apax Partners, LP | CC | | Carmel Galvin | 55 | 2020 | ✓ | Chief People Officer at Klaviyo, Inc. | CC (Chair), NCGC | | J. Mark Howell | 59 | 2014 | ✓ | Managing Director of Mintaka Ventures, LLC | AC (Chair), RC (Chair) | | Stefan Jacoby | 66 | 2019 | ✓ | Non-Executive Director of McLaren Group | CC, NCGC | | Peter Kelly | 55 | 2021 | | Chief Executive Officer of OPENLANE | | | Michael T. Kestner** | 70 | 2013 | ✓ | Automotive Industry and Building Products Consultant | AC, RC | | Sanjeev Mehra | 65 | 2021 | ✓ | Managing Partner of Periphas Capital, LP | CC | | Mary Ellen Smith | 64 | 2019 | ✓ | Former Corporate Vice President of Worldwide Business Operations at Microsoft Corporation | AC, RC |

  3. Board Nominees

    * AC=Audit Committee CC=Compensation Committee NCGC=Nominating and Corporate Governance Committee RC=Risk Committee ** Chair of the Board If Mr. Jacoby and Ms. Smith are re-elected by the stockholders, we expect Mr. Jacoby to serve as Chair of the Nominating and Corporate Governance Committee and Ms. Smith to join the Nominating and Corporate Governance Committee immediately following the 2024 annual meeting. As described on page 18, we expect the Risk Committee’s responsibilities to be reallocated following the 2024 annual meeting, with the Board having three standing committees on a go-forward basis.

  4. Board Nominees

    | BOARD DIVERSITY & EXPERIENCE | | | | 40% of our director nominees are women/ethnically diverse | 90% of our director nominees were born outside the U.S. | 40% of our director nominees are age 55 or under | | 40% of our director nominees are current or former CEOs | 75% of our directors have digital leadership experience | 100% of our directors have executive leadership experience |

  5. Board Nominees

    | BOARD TENURE & REFRESHMENT | | | 5 years average tenure of director nominees 6 directors added to the Board in past 5 years | 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. |

  6. Board Nominees

    | | 2 |

  7. WHAT WE DO

    | | 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. |

  8. WHAT WE DON’T DO

    | | 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. |

  9. Information Regarding the Nominees for Election to the Board

    Information Regarding the Nominees for Election to the Board The following information is furnished with respect to each nominee for election as a director. All of the nominees were elected by the stockholders at last year’s annual meeting. For so long as the Apax Investor meets certain beneficial ownership conditions as detailed in the Apax Investment Agreement, the Apax Investor has the right to designate one director to the Board. The Apax Investor has designated Roy Mackenzie for election in 2024 for a term expiring at the 2025 annual meeting. Consistent with the Apax Investment Agreement, our Board now nominates, and recommends, Mr. Mackenzie for election in 2024 for a term expiring at the 2025 annual meeting. The appointment of the Apax Investor designee will be voted on by the holders of Series A Preferred Stock at each annual meeting until the Apax Investor ceases to meet certain beneficial ownership conditions as detailed in the Apax Investment Agreement. Each of the nominees has consented to being named in this proxy statement and to serve as a director if elected. If Roy Mackenzie shall not be available for election as a director at the 2024 annual meeting, it is intended that shares represented by the accompanying proxy will be voted for the election of a substitute nominee designated by the Apax Investor. If any of the other seven nominees is unavailable to stand for election as a director, your proxy holders will have the authority and discretion to vote for another nominee proposed by the Board or the Board may reduce the number of directors to be elected at the 2024 annual meeting. The ages of the nominees are as of the date of the 2024 annual meeting, June 7, 2024.

  10. Information Regarding the Nominees for Election to the Board

    | | 7 |

  11. Information Regarding the Nominees for Election to the Board

    | Nominee for Election as Director to Be Elected by Holders of Series A Preferred Stock |

  12. Information Regarding the Nominees for Election to the Board

    | Roy Mackenzie | | | | Independent Director since June 2020 Age: 52 Current Board Committees: Compensation Committee | | Career Highlights | | | • 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. | | | 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. | | | Skills and Qualifications | | | | Extensive experience working closely with management teams to build successful technology companies. | | | Substantial experience in evaluating companies’ strategies, operations and financial performance, which provides important perspectives and insights. | | | Deep technology expertise. | | | Current and prior public board service brings valuable skills and perspectives to our Board. | | 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. | |

  13. Information Regarding the Nominees for Election to the Board

    | | The Board of Directors recommends a vote FOR the election of the foregoing nominee to the Board of Directors. |

  14. Information Regarding the Nominees for Election to the Board

    Proxies solicited by the Board of Directors will be voted “FOR” the election of the director nominee named in this proxy statement and on the proxy card unless stockholders specify a contrary vote.

  15. Information Regarding the Nominees for Election to the Board

    | | 8 |

  16. Information Regarding the Nominees for Election to the Board

    | Nominees for Election as Directors to Be Elected by Holders of Common Stock and Series A Preferred Stock, Voting Together as a Single Class |

  17. Information Regarding the Nominees for Election to the Board

    | Carmel Galvin | | | | Independent Director since February 2020 Age: 55 Current Board Committees: Compensation Committee (Chair) and Nominating and Corporate Governance Committee | | Career Highlights | | | • 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. • 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. • CHRO and Senior Vice President at Glassdoor, Inc., a job listing platform, from April 2016 to February 2018. • 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). | | | Skills and Qualifications | | | | More than 25 years of talent and culture leadership experience with global organizations in the technology and online sectors. | | | 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. | | | Significant experience with executive compensation programs and practices, including working directly with boards and compensation committees on compensation, talent and succession planning initiatives. | | | Provides diverse international perspective. |

  18. Information Regarding the Nominees for Election to the Board

    | J. Mark Howell | | | | Independent Director since December 2014 Age: 59 Current Board Committees: Audit Committee (Chair) and Risk Committee (Chair) | | Career Highlights | | | • 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. • Graduate of the University of Notre Dame (BBA in Accounting). | | | Skills and Qualifications | | | | Extensive senior leadership experience at internet-based and technology-driven companies provides valuable insight as the Company continues to advance its digital transformation. | | | Significant executive leadership experience in the public company sector. | | | Provides unique, in-depth knowledge of the Company and its industry as a former employee of ADESA. | | | Substantial financial experience. Certified Public Accountant with experience in public accounting and public companies. | | | 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. |

  19. Information Regarding the Nominees for Election to the Board

    | | 9 |

  20. Information Regarding the Nominees for Election to the Board

    | Stefan Jacoby | | | | Independent Director Since June 2019 Age: 66 Current Board Committees: Compensation Committee and Nominating and Corporate Governance Committee | | Career Highlights | | | • 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. | | | Skills and Qualifications | | | | 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. | | | Deep insights and understanding of the macro trends and technologies rapidly transforming the automotive industry, including mobility as a service and autonomous vehicles. | | | 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. | | | 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. |

  21. Information Regarding the Nominees for Election to the Board

    | Peter Kelly | | | | Director since April 2021 Age: 55 Chief Executive Officer | | Career Highlights | | | • 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. • President and Chief Financial Officer of OPENLANE US from February 2010 to February 2011. • Co-founded OPENLANE US in 1999, and served in a number of executive roles at OPENLANE US from 1999 to 2010. • 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. • Graduate of the University College Dublin (Engineering) and Stanford University (MBA). | | | Skills and Qualifications | | | | 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. | | | 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. | | | Deep insights into the businesses and technologies rapidly transforming the Company’s business and industry. | | | Strong leadership skills and technology expertise. |

  22. Information Regarding the Nominees for Election to the Board

    | | 10 |

  23. Information Regarding the Nominees for Election to the Board

    | Michael T. Kestner | | | | Independent Director since December 2013 Chair of the Board since April 2023 Age: 70 Current Board Committees: Audit Committee and Risk Committee | | Career Highlights | | | • 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. | | | Skills and Qualifications | | | | 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. | | | 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. | | | Extensive experience in financial analysis and financial statement preparation. | | | Certified Public Accountant with experience in public accounting and public companies. |

  24. Information Regarding the Nominees for Election to the Board

    | 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. | | | 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. |

  25. Information Regarding the Nominees for Election to the Board

    | | 11 |

  26. Information Regarding the Nominees for Election to the Board

    | 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. | | | 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. |

  27. Information Regarding the Nominees for Election to the Board

    | | The Board of Directors recommends a vote FOR the election of each of the foregoing seven nominees to the Board of Directors. |

  28. Information Regarding the Nominees for Election to the Board

    Proxies solicited by the Board of Directors will be voted “FOR” the election of each of the seven director nominees named in this proxy statement and on the proxy card unless stockholders specify a contrary vote.

  29. Information Regarding the Nominees for Election to the Board

    | | 12 |

  30. Information Regarding the Nominees for Election to the Board

    | BOARD STRUCTURE AND CORPORATE GOVERNANCE |

  31. Stockholder Engagement

    | DIRECTOR COMPENSATION |

  32. Stockholder Engagement

    We use a combination of cash and stock-based incentive compensation to attract and retain independent, qualified candidates to serve on the Board. The Board makes all director compensation determinations after considering the recommendations of the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee reviews director compensation annually, assisted periodically by an independent compensation consultant (most recently by ClearBridge Compensation Group LLC (“ClearBridge”) in February 2023). In setting director compensation, we consider various factors including market comparison studies and trends, the responsibilities of directors generally, including committee chairs, and the significant amount of time that directors expend in fulfilling their duties. In establishing the non-employee director compensation recommendations, the Nominating and Corporate Governance Committee utilized a balance of cash and equity, with the majority of the compensation delivered through equity grants. Pursuant to the Omnibus Plan, non-employee directors are not eligible to receive aggregate compensation, including equity awards and cash fees, exceeding $750,000 in total value in any calendar year. Directors who also serve as employees of the Company do not receive payment for service as directors. Messrs. Mackenzie and Mehra have each agreed not to receive compensation for their service as directors. Our current director compensation program became effective in 2019 and was based in part on a review by ClearBridge in October 2018 of our director compensation program and those of the Company’s then current proxy comparator group (which was also used in executive compensation benchmarking). In February 2023, in consultation with ClearBridge and after review of market and current proxy comparator group data, the Nominating and Corporate Governance Committee recommended, and the Board agreed, that the annual stock retainer be increased from $130,000 to $170,000, effective June 2023, and an independent Chair of the Board cash retainer of $100,000 be implemented, effective April 2023. Except for an increase in the Lead Independent Director retainer (from $30,000 to $37,500) in 2021, there have been no other increases in compensation paid to our directors from those retainer amounts approved in October 2018.

  33. Cash and Stock Retainers

    | 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 |

  34. Cash and Stock Retainers

    (1) May elect to receive the annual cash retainer and committee membership fees in shares of our common stock. (2) One-fourth of the annual cash retainer is paid at the end of each quarter, provided that the director served as a director in such fiscal quarter. (3) Pursuant to our Policy on Granting Equity Awards, unless specifically provided otherwise by the Compensation Committee or the Board, annual grants for directors are effective on the date of the annual meeting at which the director was elected or re-elected. The annual restricted stock grant vests after one year (i.e., on the anniversary of the annual meeting), and is subject to forfeiture until vested. The number of shares of our common stock received is based on the value of the shares on the date of the restricted stock grant. Annual cash and stock retainers and any applicable fees described above are prorated for non-employee directors who begin such service on a date other than the date of the Company’s annual meeting of stockholders. Directors

  35. Director Compensation Paid in 2023

    Director Compensation Paid in 2023 The following table provides information regarding the fiscal 2023 compensation paid to our non-employee directors:

  36. Director Compensation Paid in 2023

    | 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 |

  37. Director Compensation Paid in 2023

    The amounts represent the $85,000 annual cash retainer paid to each non-employee director, plus an additional $75,000 paid to the Chair (prorated to reflect Chair service effective April 1, 2023 and including $9,375 for service as Lead Independent Director through March 31, 2023), an additional $25,000 paid to the Chair of the Audit Committee (prorated to reflect Mr. Kestner serving as Chair through March 31, 2023 and Mr. Howell serving as Chair thereafter), an additional $20,000 paid to the Chair of the Compensation Committee, an additional $10,000 paid to the Chair of the Nominating and Corporate Governance Committee and the Chair of the Risk Committee, and an additional $7,500 paid to members of the Audit Committee (other than the Chair). Pursuant to the Director Deferred Compensation Plan, Ms. Smith elected to defer her annual cash retainer and her Audit Committee membership fee in a deferred cash account.

  38. Director Compensation Paid in 2023

    | | 20 |

  39. Director Compensation Paid in 2023

    The amounts represent the aggregate grant date fair value, computed in accordance with the Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”), of shares of restricted stock awarded to each non-employee director as an annual stock retainer. Each non-employee director who was serving as a director after June 2, 2023, the date of our 2023 annual meeting, received 11,032 shares of restricted stock as an annual stock retainer in June 2023. In addition, Mr. Hallett received 1,466 shares of restricted stock which vested on June 2, 2023, to reflect his service as a non-employee director from April 1, 2023 through June 2, 2023. Pursuant to the Director Deferred Compensation Plan, Messrs. Howell and Kestner, and Mmes. Galvin and Smith each elected to receive 100% of his or her annual stock retainer in a deferred share account. Please see “Outstanding Director Awards” below for the aggregate number of stock awards outstanding at fiscal year-end for each non-employee director. (3) Mr. Hallett was employed by the Company through March 31, 2023, and was not entitled to receive any fees or other compensation for serving as a member of our Board through such date because he was employed by the Company. Mr. Hallett became a non-employee director on April 1, 2023, and received a prorated annual cash retainer and a prorated annual stock retainer to reflect his service as a non-employee director from April 1, 2023 through June 2, 2023. (4) Messrs. Mackenzie and Mehra each agreed to waive all non-employee director compensation in 2023. Mr. Kelly was not entitled to receive any fees or other compensation for serving as a member of our Board in 2023 because he was employed by the Company.

  40. Named Executive Officers

    Named Executive Officers Our named executive officers for the last completed fiscal year were (i) the chief executive officer; (ii) the two chief financial officers who served during the last completed fiscal year; (iii) each of the three other most highly compensated executive officers who were serving as executive officers at the end of the last completed fiscal year; and (iv) an additional individual who served as an executive officer during a portion of the last completed fiscal year but who was not serving as an executive officer at the end of the last completed fiscal year. Our named executive officers are:

  41. Named Executive Officers

    | 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 |

  42. Named Executive Officers

    * Mr. Anderson served as Interim Chief Financial Officer from January 1, 2023 to April 16, 2023 (Mr. Lakhia joined the Company on April 17, 2023); Mr. Money retired from the Company on April 1, 2024; Mr. Davis served as an executive officer until July 26, 2023 and separated from the Company on March 5, 2024. This Compensation Discussion and Analysis is organized into six sections:

  43. Named Executive Officers

    | | 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) |

  44. 2023 Pay For Performance Highlights

    2023 Pay For Performance Highlights • A combination of Adjusted EBITDA performance and cost reduction goals were utilized as performance objectives under our 2023 annual incentive program. Payouts were 117.1% of the target award amount for the named executive officers whose payout is solely based on the performance of OPENLANE. • Consistent with our pay-for-performance philosophy, the 2021 PRSUs paid out at 0% due to the three-year performance goals not being achieved. • We continued our heavy focus on performance-based equity awards, with 90% of the target annual long-term incentive awards under the 2023 annual long-term incentive program tied to pre-established financial and stock price performance goals. • We incorporated relative TSR as a performance metric under our long-term incentive program. These highlights are discussed in more detail below.

  45. WHAT WE DO

    | | 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. |

  46. WHAT WE DON’T DO

    | | 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. |

  47. Compensation Committee’s Use of Market and Survey Data

    Compensation Committee’s Use of Market and Survey Data Although the Company is comprised of a unique mix of businesses and lacks directly comparable public companies, the Compensation Committee understands that most companies consider pay levels at comparably-sized, peer companies when setting named executive officer compensation levels. With assistance from its independent compensation consultant, ClearBridge, the Compensation Committee has developed a meaningful comparator group for the Company. In order to confirm competitiveness of compensation, the Compensation Committee uses a combination of proxy compensation data of a “proxy comparator group” and survey data (including surveys published by Radford) in setting and adjusting compensation levels. The Compensation Committee, with assistance from ClearBridge, annually reviews the composition of our proxy comparator group. As part of such reviews, the Compensation Committee considers specific criteria and recommendations regarding companies to add or remove from the group. In light of the lack of directly comparable companies for the Company’s business, as noted above, companies in the proxy comparator group utilized in 2023 were selected based on (i) a focus on North American-based companies that trade on a U.S. exchange in related industries, taking into account the Company’s digital strategy; (ii) similarly-sized revenue and market valuation levels; and (iii) companies with which the Company competes for executive talent. Where possible, the Compensation Committee included companies that are in related or similar industries

  48. Compensation Committee’s Use of Market and Survey Data

    | 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. |

  49. Compensation Committee’s Use of Market and Survey Data

    * IAA, Inc. was acquired by Ritchie Bros. Auctioneers Incorporated on March 20, 2023. In April 2023, the Compensation Committee reviewed the proxy comparator group in light of the Company’s digital transformation and, based on the recommendation of ClearBridge, approved removing Rush Enterprises, Inc. and adding Yelp, Inc. Consistent with the Company’s compensation philosophy, the Compensation Committee viewed the proxy comparator group and market data as an important guide, but not as the sole determinant in making its decisions regarding 2023 compensation levels (as discussed below).

  50. Role of the Independent Compensation Consultant

    Role of the Independent Compensation Consultant The Compensation Committee continued to use ClearBridge as its independent compensation consultant in 2023. ClearBridge provided the Compensation Committee advice and guidance with respect to (i) the assessment of the Company’s executive compensation programs and practices; (ii) the evaluation of annual and long-term incentive compensation plan design and practices; (iii) the selection of a proxy comparator group; and (iv) the competitiveness of the executive officers’ elements of compensation. ClearBridge regularly attends Compensation Committee meetings and attends executive sessions as requested by the Chair of the Compensation Committee. The Compensation Committee has reviewed the independence of ClearBridge in light of SEC rules and NYSE listing standards regarding compensation consultants and has concluded that the work of ClearBridge for the Compensation Committee does not raise any conflict of interest. All work performed by ClearBridge is and was subject to review and approval of the Compensation Committee.

  51. Elements of 2023 Executive Compensation Program Design

    | | 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. |

  52. Compensation Structure and Goal Setting

    Compensation Structure and Goal Setting Our executive compensation program is designed to deliver compensation in accordance with our performance, with a large percentage of the compensation at risk through long-term equity awards and annual cash incentive awards. These awards are linked to actual performance, consistent with our belief that a significant amount of executive compensation should be in the form of equity and that a greater percentage of compensation should be tied to performance for executives who bear higher levels of responsibility for our performance. The mix of target direct compensation under our 2023 executive compensation program for our CEO and the average of our other named executive officers is shown in the charts below. Approximately 90% of our CEO’s total target compensation, and approximately 76% of the average total target compensation of our other named executive officers, is at-risk. * To better represent target annual compensation under our 2023 executive compensation program, these charts (i) include the performance- and time-based stock options granted to the named executive officers in 2021 intended to cover stock option grants that would otherwise be made in 2023, and (ii) exclude Mr. Anderson’s compensation (who did not participate in our 2023 executive compensation program given his interim role) and Mr. Lakhia’s one-time sign-on awards.

  53. Annual Cash Incentive Program

    Annual Cash Incentive Program Under the Company’s Annual Incentive Program (the “Annual Incentive Program”), which is part of the KAR Auction Services, Inc. Amended and Restated 2009 Omnibus Stock and Incentive Plan (the “Omnibus Plan”), the grant of cash-based awards to eligible participants is contingent upon the achievement of certain pre-established performance goals as determined by the Compensation Committee. The Annual Incentive Program is designed so that a significant proportion of our named executive officers’ annual cash compensation is variable and directly tied to key performance goals.

  54. Annual Cash Incentive Program

    | | 32 |

  55. 2023 ANNUAL INCENTIVE PROGRAM

    2023 ANNUAL INCENTIVE PROGRAM As described below, the 2023 Annual Incentive Program was tied 100% to pre-established, objective performance metrics, utilizing a combination of Adjusted EBITDA performance (80%) and cost reduction goals (20%).

  56. Use of 2023 Adjusted EBITDA

    Use of 2023 Adjusted EBITDA In 2023, the Compensation Committee used “2023 Adjusted EBITDA” of the Company (and, for Mr. Money, of AFC)* as the relevant financial performance metric for determining awards under the Annual Incentive Program. For the named executive officers, 80% of the award’s total payout was weighted on achievement of 2023 Adjusted EBITDA. “Adjusted EBITDA” is equal to EBITDA (earnings before interest expense, income taxes, depreciation and amortization) adjusted to exclude, among other things: gains and losses from asset sales; unrealized foreign currency translation gains and losses in respect of indebtedness; certain non-recurring gains and losses; stock based compensation expense; certain other non-cash amounts included in the determination of net income; charges and revenue reductions resulting from purchase accounting; minority interest; consulting expenses incurred for cost reduction, operating restructuring and business improvement efforts; expenses realized upon the termination of employees and the termination or cancellation of leases, software licenses or other contracts in connection with the operational restructuring and business improvement efforts; expenses incurred in connection with permitted acquisitions; any impairment charges or write-offs of intangibles; and any extraordinary, unusual or non-recurring charges, expenses or losses. * AFC’s 2023 Adjusted EBITDA performance targets and achieved results are used for Annual Incentive Program purposes only and exclude certain corporate expenses otherwise included in our Finance segment’s reported Adjusted EBITDA for the year ended December 31, 2023.

  57. Annual Incentive Opportunity

    Annual Incentive Opportunity In 2023, each of our named executive officers was eligible to earn a cash-based incentive award under the Annual Incentive Program. The Compensation Committee establishes, on an annual basis, specific targets that determine the size of payouts under the Annual Incentive Program. In 2023, the annual incentive opportunity based on achievement of 2023 Adjusted EBITDA and 2023 Cost Reduction for each named executive officer was as follows:

  58. Annual Incentive Opportunity

    | | | 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 |

  59. Annual Incentive Opportunity

    (1) Mr. Lakhia’s 2023 annual incentive award payout was prorated based on his April 17, 2023 hire date, as described below. The base salaries of Messrs. Anderson, Coyle, Money and Davis were increased from $344,500 to $358,280, $500,000 to $520,000, $425,000 to $442,000 and $312,000 to $450,000, respectively, as of March 19, 2023 (and, for Mr. Coyle, $520,000 to $600,000 on July 25, 2023), and the base salaries shown in the table reflect the prorated, blended base salaries applied to the respective awards. Mr. Coyle was also provided a $150,000 One Marketplace target opportunity under the Annual Incentive Program, as described below.

  60. Annual Incentive Opportunity

    | | 33 |

  61. Performance Targets

    Performance Targets The Compensation Committee reviews the Company’s business plan approved by the Board and determines the level of performance required to receive threshold, target and superior annual incentive payouts. The Compensation Committee established the performance objectives in amounts which it believed would increase stockholder value and be achievable given sustained performance on the part of the named executive officers and which would require increasingly greater results to achieve the target and superior objectives. Consistent with the terms of the Omnibus Plan, the Compensation Committee may adjust performance goals to reflect unforeseen, unusual or extraordinary events or circumstances. The Compensation Committee did not increase or decrease the targets or potential payouts of the 2023 annual incentive program awards. The Compensation Committee established the following 2023 annual incentive program targets for OPENLANE:

  62. Performance Targets

    | | | 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% |

  63. Performance Targets

    ($ in millions) For AFC, the Compensation Committee utilized the OPENLANE targets described above for Mr. Money’s 2023 annual incentive opportunity, in addition to the AFC Adjusted EBITDA target of $202.7 million (with threshold and maximum targets of $172.3 million and $233.1 million, respectively).

  64. 2023 Annual Incentive Program Payouts

    2023 Annual Incentive Program Payouts For OPENLANE, the actual annual incentive award earned by named executive officers for 2023 was determined by the Company’s achievement of the Adjusted EBITDA and Cost Reduction performance goals, as determined by the Compensation Committee. For AFC, the actual annual incentive award earned by Mr. Money for 2023 was determined 40% by OPENLANE Adjusted EBITDA, 40% by AFC Adjusted EBITDA, and 20% by Cost Reduction, as determined by the Compensation Committee. Under the Annual Incentive Program, threshold performance objectives must be met in order for a payout to occur. Payouts can range from 50% of target awards for performance at threshold, up to a maximum of 200% of target awards for superior performance, or no payout if performance is below threshold. Our 2023 performance resulted in our named executive officers being eligible to receive an award under the Annual Incentive Program. The actual amounts received are set forth in the “Summary Compensation Table for 2023” on page 45. The following chart provides the actual level of OPENLANE Adjusted EBITDA and Cost Reduction performance achieved in 2023.

  65. 2023 Annual Incentive Program Payouts

    | | 34 |

  66. 2023 Annual Incentive Program Payouts

    AFC achieved Adjusted EBITDA performance of $177.5 million (above threshold performance but below target). Based on 2023 performance and the accompanying payout percentages for the different performance goals, our named executive officers earned the percentages and corresponding payout amounts of their target annual incentive awards as set forth below:

  67. 2023 Annual Incentive Program Payouts

    | | 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 |

  68. 2023 Annual Incentive Program Payouts

    (1) The target annual incentive award for Messrs. Coyle, Money and Davis reflect the mid-year base salary adjustments described on pages 31-32. Mr. Lakhia’s annual incentive award was prorated based on his April 17, 2023 hire date. The target incentive award for Mr. Coyle also includes the One Marketplace opportunity (described below). (2) In connection with the rebrand to OPENLANE and the consolidation of our marketplaces in the United States and Canada during 2023, the Compensation Committee provided Mr. Coyle an additional one-time $150,000 annual incentive opportunity under the Annual Incentive Program tied to achievement of 2023 technology transformation objectives, including cloud migration and one-marketplace consolidation initiatives (“One Marketplace”). In determining achievement, the Compensation Committee determined that Mr. Coyle accomplished each of the pre-defined objectives, notably timely and successful (i) platform combination of the Canadian marketplaces into one Canadian marketplace, (ii) platform combination of the U.S. marketplaces into one U.S. marketplace, and (iii) technology migration from on-premises to the cloud. Such performance resulted in Mr. Coyle earning the full $150,000 target opportunity.

  69. 2024 ANNUAL INCENTIVE PROGRAM

    2024 ANNUAL INCENTIVE PROGRAM In the first quarter of 2024, the Compensation Committee approved the performance objectives for our 2024 Annual Incentive Program. For 2024, the annual incentive opportunity for each named executive officer will be weighted on a combination of the Company’s Adjusted EBITDA performance (80%) and strategic volume objectives (20%), with a performance modifier tied to pre-defined quantitative and qualitative strategic objectives (that can modify the final award by +/- up to 15%).

  70. Long-Term Incentive Opportunities

    Long-Term Incentive Opportunities To further align our named executive officers’ interests with those of our stockholders, the Company provides long-term incentive compensation opportunities under the Omnibus Plan, as described below. Omnibus Plan. The Company currently grants long-term incentive awards under the Omnibus Plan. Our Board adopted the Omnibus Plan on December 10, 2009, and it has since been amended and restated, as approved by our stockholders. Under the Omnibus Plan, participants are eligible to receive stock options, restricted stock, RSUs (with or without performance conditions), stock appreciation rights, other stock-based awards and/or cash-based awards, each as determined by the Compensation Committee. 2021−2024 Long-Term Incentive Program Framework In February 2021, the Compensation Committee approved changes to the components of our long-term incentive program, which is intended to apply for the 2021-2024 compensation periods. In prior years (2015−2020), named executive officers had been granted long-term incentive awards on an annual basis in the form of PRSUs and RSUs, allocated such that 75% of the value was in the form of PRSUs and 25% of the value was in the form of RSUs. In connection with the Company’s digital transformation and go-forward strategy, in 2021 the Compensation

  71. Long-Term Incentive Opportunities

    | | 35 |

  72. Long-Term Incentive Opportunities

    Committee approved changes to the structure of our long-term incentive program, including the elimination of RSUs and the introduction of performance- and time-based stock options, as described below. In 2021, the Compensation Committee granted named executive officers who were not retirement-eligible additional performance-based stock options and time-based stock options, intended to cover stock option grants that would otherwise be made in 2022, 2023 and 2024 (i.e., 50% of the grant value attributed to those years), and, for retirement-eligible named executive officers, additional performance-based stock options and time-based stock options intended to cover grants that would otherwise be made in 2022. As a result of the 2021 grants, in 2022, 2023 and 2024 the Compensation Committee only granted PRSUs to our named executive officers as part of the annual executive compensation program, with a target value equal to 50% of the long-term incentive grant value that our named executive officers would otherwise receive (with any increases in target long-term incentive opportunities being provided in the form of PRSUs). The Compensation Committee approved these stock option grants attributable to future years (i.e., 2022, 2023 and 2024), of which 80% are tied to stock price vesting hurdles, to motivate executives to achieve the Company’s go-forward business strategy, including our digital transformation; further align the executives’ interests with stockholders; reward the executive management team for meaningful stock price growth above the grant date stock price; and enhance the retentiveness of the compensation program in a highly competitive market environment for talent. The stock price vesting hurdles for the performance-based stock options were set at levels that require significant growth, and, as of the date hereof, no performance-based hurdles have been achieved and all performance-based stock options remain unvested and unexercisable, which ensures our executives continue to remain highly incentivized to achieve the performance goals. The outstanding performance-based stock options, as well as the outstanding 2022, 2023 and 2024 PRSU awards, continue to align executives’ interests with those of our stockholders. Executives remain highly motivated to achieve the performance goals under the 2021-2024 long-term incentive program framework, which will drive long-term stockholder value creation.

  73. 2023 LONG-TERM INCENTIVE AWARDS

    2023 LONG-TERM INCENTIVE AWARDS On February 24, 2023 (but on May 5, 2023 for Mr. Lakhia and again on August 4, 2023 for Mr. Coyle), the Compensation Committee granted PRSUs to the Company’s named executive officers, as described in the table below. Awards were based on the individual’s ability to impact future results, job scope, individual performance, and a review of competitive pay practices. The target award value took into account that the stock options attributable to the 2023 program were granted in 2021.

  74. 2023 LONG-TERM INCENTIVE AWARDS

    | 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 |

  75. 2023 LONG-TERM INCENTIVE AWARDS

    (1) To reflect Mr. Coyle’s increased target long-term incentive opportunity to align with market competitive practice for his expanded role and responsibilities as the Company’s Executive Vice President and President, North American Marketplaces, Mr. Coyle received a one-time make-whole grant of 11,342 PRSUs on August 4, 2023, which are included in this table. (2) These amounts represent the grant date fair value as calculated based on the stock price at the date of grant. For the aggregate grant date fair value of these awards as computed in accordance with ASC 718 see “Summary Compensation Table for 2023” and “Grants of Plan-Based Awards for 2023” below. Mr. Anderson participates in the long-term incentive program applicable for non-executive participants, and therefore Mr. Anderson was not eligible to receive PRSUs (but instead received RSUs, as described below). As described below, Mr. Lakhia, who joined the Company on April 17, 2023, was granted performance- and time-based stock options on May 5, 2023 under the Company’s 2021-2024 long-term incentive program framework.

  76. 2023 LONG-TERM INCENTIVE AWARDS

    | | 36 |

  77. 2023 Performance-Based RSU Awards

    2023 Performance-Based RSU Awards Seventy-five percent (75%) of the PRSUs will vest if and to the extent that the sum of the Company’s “Cumulative Adjusted EBITDA” exceeds certain levels over the three-year measurement period beginning on January 1, 2023 and ending on December 31, 2025 (‘Measurement Period”). The remaining twenty-five percent (25%) of the PRSUs will vest if and to the extent that the Company’s total shareholder return (“TSR”) relative to that of companies within the S&P SmallCap 600 Index exceeds the levels described below over the Measurement Period. “Cumulative Adjusted EBITDA” is defined as the sum of the Company’s Adjusted EBITDA for the three fiscal years in the Measurement Period. “Adjusted EBITDA” for a fiscal year is equal to the Company’s consolidated earnings before interest expense, income taxes, depreciation and amortization, as adjusted, calculated and reported in the Company’s annual earnings release and Form 10-K. Adjusted EBITDA may be further adjusted at the Compensation Committee’s discretion to exclude the impact of unplanned transactions or events, including but not limited to excluding the impact of acquisitions in the year of acquisition. “Relative TSR” is defined as the Company’s relative total shareholder return percentile ranking as compared to the S&P SmallCap 600 index. Calculation of Relative TSR will be based on a beginning price measured over the 20 trading days prior to the start of the Measurement Period and an ending price measured over the 20 trading days prior to the end of the Measurement Period.*

  78. 2023 Performance-Based RSU Awards

    | 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 |

  79. 2023 Performance-Based RSU Awards

    * Companies that were part of the S&P SmallCap 600 index as of the beginning of the Measurement Period but are no longer publicly traded as of the Measurement Date will be excluded except those no longer publicly traded due to filing for bankruptcy during the Measurement Period will be assigned a total shareholder return of -100% for the Measurement Period. The total shareholder return for the common stock of the Company and an S&P SmallCap 600 component company will be adjusted to reflect changes in capitalization affecting the value of a share of common stock and assumes that all cash dividends are immediately reinvested in common stock of the entity using the closing market price on the dividend payment date. The amount of the target PRSUs actually earned and paid in shares of common stock in a lump sum following the performance period will be: 0% for below threshold performance, 50% for threshold performance, 100% for target performance and up to 200% for achieving the maximum performance level or higher. Linear interpolation will be used to calculate the percentage of PRSUs earned and paid if performance falls between the levels described above (and no PRSUs will be earned for performance below threshold performance).

  80. Other 2023 Long-Term Incentive Awards

    Other 2023 Long-Term Incentive Awards Mr. Lakhia On May 5, 2023, Mr. Lakhia, who joined the Company on April 17, 2023, was granted performance-based stock options and time-based stock options under the Company’s 2021-2024 long-term incentive program framework. The aggregate grant value is intended to cover stock option grants for 2023 and 2024 (i.e., 50% of the grant value below is attributable to 2024, the final year of the program).

  81. Other 2023 Long-Term Incentive Awards

    | 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 |

  82. Other 2023 Long-Term Incentive Awards

    | | 37 |

  83. Other 2023 Long-Term Incentive Awards

    This amount represents the grant date fair value as calculated based on the Black-Scholes fair value at the date of grant. For the grant date fair value of this award as computed in accordance with ASC 718 see “Summary Compensation Table for 2023” and “Grants of Plan-Based Awards for 2023” below. The performance-based stock options will 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. The performance-based hurdles are designed to require a minimum stock price appreciation threshold as a vesting condition separate and apart from the stock option’s time-based vesting component. The time-based stock options will vest and become exercisable in equal installments on each of the first four anniversaries of the grant date, subject to Mr. Lakhia’s continued employment with the Company through each such anniversary. In connection with Mr. Lakhia’s offer of employment, on May 5, 2023, Mr. Lakhia also received a one-time sign-on grant of 26,973 RSUs with a grant date value of $400,010, which was intended to partially address forfeited compensation from his previous employer. One half of the RSUs will vest and convert into shares of common stock of the Company in equal installments on each of the first two anniversaries of the grant date, subject to Mr. Lakhia’s continued employment through each such anniversary. Mr. Anderson Mr. Anderson, who served as our Interim Chief Financial Officer from January 1, 2023 to April 16, 2023, did not participate in the 2023 executive compensation program. On February 24, 2023, the Compensation Committee granted RSUs to Mr. Anderson under the long-term incentive program applicable for non-executive participants.

  84. Other 2023 Long-Term Incentive Awards

    | Name | Number of RSUs | Value of RSUs at Grant | | Scott Anderson | 8,487 | $120,006 |

  85. Other 2023 Long-Term Incentive Awards

    One-third of the RSUs will vest and convert into shares of common stock of the Company on each of the first three anniversaries of the grant date, subject to Mr. Anderson’s continued employment with the Company through each such anniversary.

  86. PRIOR YEARS’ LONG-TERM INCENTIVE AWARDS

    PRIOR YEARS’ LONG-TERM INCENTIVE AWARDS

  87. 2022 Long-Term Incentive Awards

    2022 Long-Term Incentive Awards As previously disclosed, on February 28, 2022, the Compensation Committee granted PRSUs to certain of the Company’s named executive officers, which remained outstanding at fiscal year-end 2023. The PRSU awards have terms substantially similar to those granted in 2023, except that one hundred percent (100%) of the PRSUs were tied to the Company’s Cumulative Adjusted EBITDA performance. The amount of PRSUs that remain outstanding are disclosed in the “Outstanding Equity Awards” table below. Mr. Anderson did not participate in our 2022 executive compensation program but instead received RSUs under our long-term incentive program applicable for non-executive participants. One-third of the RSUs will vest and convert into shares of common stock of the Company on each of the first three anniversaries of the grant date, subject to Mr. Anderson’s continued employment with the Company through each such anniversary. The amounts of RSUs that remain outstanding are disclosed in the “Outstanding Equity Awards” table below. As previously disclosed, on December 9, 2022, a one-time RSU grant was made to certain key leaders following the sale of the ADESA U.S. physical auction business to Carvana for approximately $2.2 billion in cash (the “ADESA Sale”). One-third of the RSUs will vest and convert into shares of common stock of the Company on each of the first three anniversaries of the ADESA Sale (i.e., May 9, 2023, May 9, 2024, and May 9, 2025), subject to continued employment with the Company through each such vesting date. For the fiscal year ended December 31, 2023, one-third of the RSUs vested. The amounts of RSUs that remain outstanding are disclosed in the “Outstanding Equity Awards” table below.

  88. 2022 Long-Term Incentive Awards

    | | 38 |

  89. 2022 Long-Term Incentive Awards

    As previously disclosed, on March 4, 2021 (but on November 5, 2021 for Mr. Coyle), the Compensation Committee granted PRSUs and performance- and time-based stock options to certain of the Company’s named executive officers, some of which remained outstanding at fiscal year-end 2023. The amounts of PRSUs and performance- and time-based stock options that remain outstanding are disclosed in the “Outstanding Equity Awards” table below. The PRSU awards had terms substantially similar to those granted in 2022, except the Company’s “Cumulative Operating Adjusted Net Income Per Share” was utilized as the performance measure. The performance-based stock options will 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. The time-based stock options will vest and become exercisable in equal installments on each of the first four anniversaries of the grant date, subject to the named executive officer’s continued employment with the Company through each such anniversary. For the year ended December 31, 2023, a portion of the time-based stock options had vested, as reflected in the “Outstanding Equity Awards” table below. The number of PRSUs that were eligible to vest based on Cumulative Operating Adjusted Net Income Per Share achieved was determined in accordance with the chart below:

  90. 2022 Long-Term Incentive Awards

    | 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 |

  91. 2022 Long-Term Incentive Awards

    The Company achieved Cumulative Operating Adjusted Net Income Per Share of $2.97 over the three-year performance period ended December 31, 2023, which was below the threshold level of performance necessary for any payout. As such, on February 6, 2024, based on the Cumulative Operating Adjusted Net Income Per Share achieved, 0% of the PRSUs vested.

  92. Other 2021 Long-Term Incentive Awards

    Other 2021 Long-Term Incentive Awards As previously disclosed, on March 4, 2021, the Compensation Committee granted RSUs to Mr. Anderson and Mr. Davis under the long-term incentive program applicable for non-executive participants. For the year-ended December 31, 2023, two-thirds of the RSUs granted in 2021 had vested, as disclosed in the “Option Exercises and Stock Vested” table below. Further, as previously disclosed, on June 4, 2021, the Compensation Committee granted a one-time PRSU award to Mr. Davis to incentivize the achievement of certain volume-based milestones on the BacklotCars platform. The PRSUs were tied to achieving volume-based goals on the BacklotCars platform, with 30% of the PRSUs vesting and converting into shares of common stock of the Company if and to the extent that a specified number of vehicles are sold on the BacklotCars platform during a one-month period between the grant date and December 31, 2024, and the remaining 70% vesting and converting into shares of common stock of the Company if and to the extent that a specified number of vehicles are sold on the BacklotCars platform during a 12-month period between the grant date and December 31, 2023. To the extent the 12-month volume objective is not met by December 31, 2023, 35% of the PRSUs (i.e., 50% of the PRSUs tied to the 12-month volume objective) would be forfeited and the other 35% of the PRSUs would remain eligible to vest if and to the extent that a specified number of vehicles are sold on the BacklotCars platform by December 31, 2024. On February 6, 2024, the Compensation Committee determined that the 12-month volume objective was not met by December 31, 2023, resulting in 35% of the PRSUs being forfeited. A portion of the PRSUs remained eligible to vest as of December 31, 2023, as disclosed in the “Outstanding Equity Awards” table below, but were subsequently forfeited upon Mr. Davis’s departure from the Company on March 5, 2024.

  93. Other 2021 Long-Term Incentive Awards

    | | 39 |

  94. Other 2021 Long-Term Incentive Awards

    As previously disclosed, on February 21, 2020, the Compensation Committee granted PRSUs and RSUs to certain of the Company’s named executive officers, with 0% of the PRSUs granted in 2020 vesting in 2023 based on the Cumulative Operating Adjusted Net Income Per Share achieved, and the final one-third of the RSUs granted in 2020 vesting in 2023, as disclosed in the “Option Exercises and Stock Vested” table below.

  95. Retirement, Health and Welfare Benefits

    Retirement, Health and Welfare Benefits We offer a variety of health and welfare and retirement programs to all eligible employees, including our named executive officers. As with all Company employees, our named executive officers are eligible to receive 401(k) employer matching contributions equal to 100% of the first 4% of compensation contributed by the named executive officer (subject to limits set by the Internal Revenue Service). The health and welfare programs are intended to protect employees against catastrophic loss and encourage a healthy lifestyle. Our health and welfare programs include medical, dental, vision, pharmacy, life, disability and accidental death and disability insurance. We also provide travel insurance to all employees who travel for business purposes. We provide certain enhanced retirement vesting of equity-incentive awards as described in “Potential Payments Upon Termination or Change in Control—Potential Payments Upon Termination or Change in Control Table.”

  96. Employment and Severance Agreements

    Employment and Severance Agreements The Compensation Committee recognizes that, from time to time, it is appropriate to enter into agreements with our executive officers to ensure that we continue to retain their services and to promote stability and continuity within the Company. All of our named executive officers have an employment agreement with the Company. A description of these agreements can be found in the section titled “Potential Payments Upon Termination or Change in Control—Employment Agreements with Named Executive Officers.”

  97. Tax and Accounting Considerations

    Tax and Accounting Considerations Employment Agreements. Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) and related provisions impose substantial excise taxes under Section 4999 of the Code on so-called “excess parachute payments” payable to certain named executive officers upon a change in control and results in the loss of the compensation deduction for such payments by the Company. None of the employment agreements entered into with named executive officers contain excise tax gross-up provisions. Tax Deductibility of Awards Under the Omnibus Plan. Section 162(m) of the Code (“Section 162(m)”) generally disallows a federal tax deduction by the Company for compensation paid to Covered Employees (as defined in Section 162(m)) in excess of $1,000,000. Though tax deductibility is one of many factors considered by the Compensation Committee when determining executive compensation, the Compensation Committee may make decisions in designing and approving pay programs that are not driven by tax consequences to the Company. Accounting for Stock-Based Compensation. We account for stock-based compensation in accordance with the requirements of ASC 718. Clawback Policy for Financial Restatements. In 2023 we adopted a new clawback policy to comply with the SEC rules promulgated under the Dodd-Frank Act and NYSE listing standards regarding the recovery from executive officers of erroneously awarded incentive-based compensation (including cash and equity) received by our current and former executive officers on or after October 2, 2023, the effective date specified in the NYSE listing standards, if we are required to restate our financial results due to material noncompliance with financial reporting requirements under the federal securities laws, including the corrections of errors. The policy covers both current and former executive officers, even if not directly involved in activity that caused or contributed to the misstatement, and includes a three-year lookback requirement.

  98. COMPENSATION COMMITTEE

    | SUMMARY COMPENSATION TABLE FOR 2023 |

  99. COMPENSATION COMMITTEE

    | 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 |

  100. COMPENSATION COMMITTEE

    | GRANTS OF PLAN-BASED AWARDS FOR 2023 |

  101. COMPENSATION COMMITTEE

    | OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2023 |

  102. COMPENSATION COMMITTEE

    | OPTION EXERCISES AND STOCK VESTED DURING FISCAL YEAR 2023 |

  103. COMPENSATION COMMITTEE

    | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL |

  104. Equity-Based Awards—Omnibus Plan

    | 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. |

  105. Annual Cash Incentive Awards—Omnibus Plan

    | 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. |

  106. Annual Cash Incentive Awards—Omnibus Plan

    | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE |

  107. Transition Arrangements

    | CEO PAY RATIO |

  108. Methodology

    | PAY VERSUS PERFORMANCE |

  109. Pay Versus Performance Table

    Pay Versus Performance Table

  110. Pay Versus Performance Table

    | 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) | Adjusted EBITDA ($ Millions)(8) | | | | | | | | | Total Shareholder Return ($)(5) | Peer Group Total Shareholder Return ($)(6) | | | | 2023 | — | 6,721,355 | — | 7,642,078 | 1,954,108 | 2,094,025 | 69 | 137 | (154.1) | 272.0 | | 2022 | — | 7,028,222 | — | 3,969,021 | 2,658,920 | 678,130 | 61 | 118 | 241.2 | 231.2 | | 2021 | 4,736,187 | 8,420,877 | 3,227,659 | 10,028,492 | 2,615,880 | 2,711,700 | 73 | 141 | 66.5 | 434.2 | | 2020 | 5,847,463 | — | 7,717,959 | — | 1,963,108 | 2,365,166 | 87 | 111 | 0.5 | 375.3 |

  111. Pay Versus Performance Table

    (1) James P. Hallett was our PEO in 2020 (First PEO). In 2021, Peter J. Kelly became our PEO effective April 1, 2021 (Second PEO), and Mr. Hallett stepped down from the PEO role on March 31, 2021. Mr. Kelly was our PEO in 2022 and 2023. The Non-PEO NEOs included in these columns reflect the following: • 2023: Brad S. Lakhia; Scott A. Anderson; James P. Coyle; Sriram Subrahmanyam; James E. Money; and Justin T. Davis. • 2022: Eric M. Loughmiller; James P. Hallett; James P. Coyle; Sriram Subrahmanyam; John C. Hammer; and Thomas J. Fisher. • 2021: Eric M. Loughmiller; John C. Hammer; Justin T. Davis; and James P. Coyle. • 2020: Eric M. Loughmiller; Peter J. Kelly; John C. Hammer; and Thomas J. Fisher. (2) Amounts reflect the total compensation for our PEOs, as reported in the Summary Compensation Table for the applicable fiscal year. (3) Amounts reflect the CAP to our PEOs and the average CAP to our Non-PEO NEOs, as computed in accordance with Item 402(v). Equity values are calculated in accordance with FASB ASC Topic 718, and the valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. As provided in Item 402(v), the adjustments in the table below were made to our PEO’s and to the average Non-PEO NEO’s total compensation reported in the Summary Compensation Table for 2023 to determine the compensation actually paid to our PEO and the average compensation actually paid to Non-PEO NEOs for 2023 for purposes of this disclosure.

  112. Pay Versus Performance Table

    | Summary Compensation Table (“SCT”) Total for PEO and Non-PEO NEOs | 2023 PEO | 2023 Non-PEO NEOs | | SCT Total | $6,721,355 | $1,954,108 | | 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 | $(4,783,508) | $(897,285) | | 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 | $4,966,098 | $898,217 | | 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 | $2,061,529 | $297,793 | | Add: Vesting date fair value of awards granted and vested during the covered fiscal year | — | $368 | | 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 | $94,056 | $14,165 | | (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 | $(1,417,452) | $(173,341) | | 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) | $7,642,078 | $2,094,025 |

  113. Pay Versus Performance Table

    | | 62 |

  114. Pay Versus Performance Table

    Amounts reflect the average compensation for our non-PEO NEOs, as reported in the Summary Compensation Table for the applicable fiscal year. (5) The amounts in this column assume the investment of $100 on December 31, 2019 in the Company’s common stock and reinvestment of all dividends since that date. (6) The amounts in this column assume the investment of $100 on December 31, 2019 in the S&P SmallCap 600 Index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report on Form 10-K for the year ended December 31, 2023. (7) Amounts reflect the Company’s net income as reported in the Company’s audited financial statements for the applicable year. (8) Adjusted EBITDA (a non-GAAP measure), as defined on page 33, was selected as the 2023 “Company-Selected Measure” as defined in Item 402(v).