​

​

April 21, 2023

Dear Fellow Stockholder:

Thank you for your continued investment in and support of KAR Auction Services, Inc. d/b/a KAR Global (“KAR Global” or the “Company”). You are cordially invited to attend KAR Global’s 2023 annual meeting of stockholders, which will be hosted virtually. You will be able to attend the 2023 annual meeting online, vote your shares electronically and submit your questions during the meeting by visiting www.virtualshareholdermeeting.com/​KAR2023.

As a KAR Global stockholder, your vote is important. The matters to be acted upon are described in the notice of annual meeting of stockholders and the proxy statement. Even if you are planning to attend the virtual meeting, you are strongly encouraged to vote your shares in advance through one of the methods described in the proxy statement.

Despite continuing supply pressures tied to the prolonged recovery of our industry, we made significant progress accelerating our vision to build the world’s greatest digital marketplaces for used vehicles. Notably, we sold the ADESA U.S. physical auction business, enabling us to pay down corporate debt, and we further simplified our business through strategic brand and platform consolidation in the U.S. and Europe. We are proud to have sold approximately 1.3 million vehicles and increased our total revenue from continuing operations 5% to $1.5 billion while making meaningful progress reducing our cost structure and annual cost run rate.

Thank you again for your continued support of KAR Global, our Board of Directors, our employees and our future.

Sincerely,

This proxy statement is dated April 21, 2023 and is first being distributed to stockholders on or about April 21, 2023.

11299 North Illinois Street
Carmel, Indiana 46032

Notice of Internet Availability of Proxy Materials for the Annual Meeting

The proxy statement for the 2023 annual meeting and the annual report to stockholders for the fiscal year ended December 31, 2022, each of which is being provided to stockholders prior to or concurrently with this notice, are also available to you electronically via the Internet. We encourage you to review all of the important information contained in the proxy materials before voting. To view the proxy statement and annual report to stockholders on the Internet, visit our website, www.karglobal.com, and click on “Investors” and then the “Financials” tab. The information on our website is not part of this proxy statement and is not deemed incorporated by reference into this proxy statement or any other public filing made with the SEC.

​	PROXY STATEMENT SUMMARY	​	​	​	​	1	​	​
​	Annual Meeting of Stockholders	​	​	​	​	1	​	​
​	Items to be Voted on at Annual Meeting of Stockholders	​	​	​	​	1	​	​
​	Board Nominees	​	​	​	​	2	​	​
​	2022 Business Highlights	​	​	​	​	3	​	​
​	Corporate Governance Highlights	​	​	​	​	4	​	​
​	Executive Compensation	​	​	​	​	5	​	​
​	PROPOSALS NO. 1 & 2: ELECTION OF DIRECTORS	​	​	​	​	6	​	​
​	Directors Elected Annually	​	​	​	​	6	​	​
​	Director Independence	​	​	​	​	6	​	​
​	Board Nominations and Director Nomination Process	​	​	​	​	6	​	​
​	Board Qualifications and Diversity	​	​	​	​	7	​	​
​	Information Regarding the Nominees for Election to the Board	​	​	​	​	7	​	​
​	BOARD STRUCTURE AND CORPORATE GOVERNANCE	​	​	​	​	14	​	​
​	Role of the Board	​	​	​	​	14	​	​
​	Board Leadership	​	​	​	​	14	​	​
​	Executive Sessions	​	​	​	​	15	​	​
​	Board Meetings and Attendance	​	​	​	​	15	​	​
​	Board Committees	​	​	​	​	15	​	​
​	Board and Committee Evaluation Process	​	​	​	​	17	​	​
​	Board’s Risk Oversight	​	​	​	​	17	​	​
​	Corporate Governance Documents	​	​	​	​	18	​	​
​	Compensation Committee Interlocks and Insider Participation	​	​	​	​	19	​	​
​	Stockholder Communications with the Board	​	​	​	​	19	​	​
​	DIRECTOR COMPENSATION	​	​	​	​	20	​	​
​	Cash and Stock Retainers	​	​	​	​	20	​	​
​	Director Deferred Compensation Plan	​	​	​	​	21	​	​
​	Director Stock Ownership and Holding Guidelines	​	​	​	​	21	​	​
​	Director Compensation Paid in 2022	​	​	​	​	21	​	​
​	Outstanding Director Restricted Stock Awards	​	​	​	​	22	​	​
​	BENEFICIAL OWNERSHIP OF COMPANY STOCK	​	​	​	​	23	​	​
​	PROPOSAL NO. 3: ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION	​	​	​	​	26	​	​
​	Proposal	​	​	​	​	26	​	​
​	COMPENSATION DISCUSSION AND ANALYSIS	​	​	​	​	27	​	​
​	Overview	​	​	​	​	27	​	​
​	Executive Summary	​	​	​	​	29	​	​
​	Compensation Philosophy and Objectives	​	​	​	​	31	​	​
​	The Role of the Compensation Committee and the Executive Officers in Determining Executive Compensation	​	​	​	​	31	​	​

​	Elements Used to Achieve Compensation Philosophy and Objectives	​	​	​	​	33	​	​
​	Compensation Policies and Other Information	​	​	​	​	43	​	​
​	Results of Say On Pay Vote at 2022 Annual Meeting	​	​	​	​	44	​	​
​	COMPENSATION COMMITTEE REPORT	​	​	​	​	45	​	​
​	ANALYSIS OF RISK IN THE COMPANY’S COMPENSATION STRUCTURE	​	​	​	​	46	​	​
​	SUMMARY COMPENSATION TABLE FOR 2022	​	​	​	​	47	​	​
​	GRANTS OF PLAN-BASED AWARDS FOR 2022	​	​	​	​	49	​	​
​	OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END 2022	​	​	​	​	50	​	​
​	OPTION EXERCISES AND STOCK VESTED DURING FISCAL YEAR 2022	​	​	​	​	53	​	​
​	POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL	​	​	​	​	54	​	​
​	Equity-Based Awards — Omnibus Plan	​	​	​	​	54	​	​
​	Annual Cash Incentive Awards — Omnibus Plan	​	​	​	​	55	​	​
​	POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE	​	​	​	​	56	​	​
​	Employment Agreements with Named Executive Officers	​	​	​	​	59	​	​
​	CEO PAY RATIO	​	​	​	​	62	​	​
​	PAY VERSUS PERFORMANCE	​	​	​	​	63	​	​
​	PROPOSAL NO. 4: ADVISORY VOTE TO APPROVE FREQUENCY OF FUTURE ADVISORY VOTES TO APPROVE EXECUTIVE COMPENSATION	​	​	​	​	66	​	​
​	PROPOSAL NO. 5: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	​	​	​	​	67	​	​
​	Proposal	​	​	​	​	67	​	​
​	Report of the Audit Committee	​	​	​	​	68	​	​
​	Fees Paid to KPMG LLP	​	​	​	​	69	​	​
​	Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Registered Public Accounting Firm	​	​	​	​	69	​	​
​	RELATED PERSON TRANSACTIONS	​	​	​	​	70	​	​
​	Review and Approval of Transactions with Related Persons	​	​	​	​	70	​	​
​	REQUIREMENTS, INCLUDING DEADLINES, FOR SUBMISSION OF PROXY PROPOSALS	​	​	​	​	72	​	​
​	Nomination of Directors and Other Business of Stockholders	​	​	​	​	72	​	​
​	QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS AND THE ANNUAL MEETING	​	​	​	​	73	​	​

Forward-Looking Statements:   This proxy statement contains information that may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, and which are subject to certain risks, trends and uncertainties. In particular, statements made that are not historical facts may be forward-looking statements. Words such as “should,” “may,” “will,” “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” and similar expressions identify forward-looking statements. Such statements are based on management’s current expectations, assumptions and/​or beliefs, are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from the results projected, expressed or implied by these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the section entitled “Risk Factors” in our annual and quarterly periodic reports filed with the Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statements.

PROXY STATEMENT SUMMARY

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement before voting. For more complete information regarding the 2022 performance of KAR Auction Services, Inc. (the “Company,” “KAR,” “KAR Auction Services” or “KAR Global”), please review the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

​

*

AC=Audit Committee
CC=Compensation Committee
NCGC=Nominating and Corporate Governance Committee
RC=Risk Committee

​

**

Chairman of the Board

​

For the year ended December 31, 2022, the Company continued to advance its digital transformation. Specific highlights for fiscal 2022 included:

We are committed to high standards of ethical and business conduct and strong corporate governance practices. This commitment is highlighted by the practices described below as well as the information contained on our website, www.karglobal.com, which can be accessed by clicking on “Investors” and then the “Governance” tab.

We maintain a compensation program structured to achieve a close connection between executive pay and Company performance. For more information regarding our named executive officer compensation, see “Compensation Discussion and Analysis” and the compensation tables that follow such section.

Executive Compensation Best Practices

The Apax Investor has designated, and our Board has nominated, Roy Mackenzie, to stand for election to the Board at the 2023 annual meeting. In addition, our Board has nominated the nine individuals named below to stand for election to the Board at the 2023 annual meeting. The Company’s directors are elected each year by our stockholders at the annual meeting (with one member of the Board being elected solely by the holders of Series A Preferred Stock). We do not have a staggered or classified board. Each director’s term will last until the 2024 annual meeting of stockholders and until such director’s successor is duly elected and qualified, or such director’s earlier death, resignation or removal. The director nominee designated by the Apax Investor must receive the affirmative vote of a majority of the votes cast by the holders of Series A Preferred Stock (voting as a separate class), and the nine other director nominees must receive the affirmative vote of a majority of the votes cast by the holders of common stock and Series A Preferred Stock, voting together as a single class, in the election of directors at the 2023 annual meeting to be elected (i.e., the number of shares voted “FOR” a director nominee must exceed the number of votes cast “AGAINST” such nominee).

The Board is responsible for determining the independence of our directors. Under the NYSE listing standards, a director qualifies as independent if the Board affirmatively determines that the director has no material relationship with the Company. While the focus of the inquiry is independence from management, the Board is required to broadly consider all relevant facts and circumstances in making an independence determination. In making independence determinations, the Board complies with NYSE listing standards and considers all relevant facts and circumstances. Based upon its evaluation, our Board has affirmatively determined that the following directors meet the standards of “independence” established by the NYSE: Carmel Galvin, Mark E. Hill, J. Mark Howell, Stefan Jacoby, Michael T. Kestner, Roy Mackenzie, Sanjeev Mehra and Mary Ellen Smith. James P. Hallett, our former Executive Chairman, and Peter J. Kelly, our Chief Executive Officer, are not independent directors.

The Board is responsible for nominating members for election to the Board and for filling vacancies on the Board that may occur between the annual meetings of stockholders. The Nominating and Corporate Governance Committee is responsible for identifying, screening and recommending candidates to the Board for Board membership. When formulating its Board membership recommendations, the Nominating and Corporate Governance Committee may also consider advice and recommendations from others, including third-party search firms, current Board members, management, stockholders and other persons, as it deems appropriate.

The Nominating and Corporate Governance Committee uses a variety of methods to identify and evaluate potential candidates. Consideration of candidates typically involves a series of internal discussions, review of candidate information, and interviews with selected candidates. The Nominating and Corporate Governance Committee will consider the candidate against the criteria it has adopted, as further discussed below, in the context of the Board’s then-current composition and the needs of the Board and its committees, and will ultimately recommend qualified candidates for election to the Board. Though the Nominating and Corporate Governance Committee does not have a formal policy regarding consideration of director candidates recommended by stockholders, the Nominating and Corporate Governance Committee generally evaluates such candidates in the same manner by which it evaluates director candidates recommended by other sources. With respect to the director to be elected by the holders of shares of Series A Preferred Stock, such nominee is required to have been designated by the Apax Investor pursuant to the Apax Investment Agreement.

As detailed in both the Nominating and Corporate Governance Committee Charter and the Corporate Governance Guidelines, director candidates are selected based upon various criteria, including experience, skills, expertise, diversity, personal and professional integrity, character, business judgment, time availability in light of other commitments, dedication, conflicts of interest and such other relevant factors that the Nominating and Corporate Governance Committee considers appropriate in the context of the needs of the Board. Director candidates are considered in light of the needs of the Board with due consideration given to the foregoing criteria. Board members are expected to prepare for, attend and participate in all Board and applicable committee meetings and the Company’s annual meetings of stockholders.

In addition, a stockholder may nominate candidates for election as a director, provided that the nominating stockholder follows the procedures set forth in Article II, Section 5 of the Company’s Second Amended and Restated By-Laws for nominations by stockholders of persons to serve as directors, including the requirements of timely notice and certain information to be included in such notice. Deadlines for stockholder nominations for next year’s annual meeting are included in the “Requirements, Including Deadlines, for Submission of Proxy Proposals” section on page 72.

Pursuant to our employment agreement with Peter J. Kelly, our Chief Executive Officer, the Company will nominate Mr. Kelly to serve as a member of the Board during his period of employment under such agreement.

The Nominating and Corporate Governance Committee and the Board believe that diversity along multiple dimensions, including opinions, skills, perspectives, personal and professional experiences, and other differentiating characteristics, is an important element of its nomination recommendations. The Nominating and Corporate Governance Committee has not identified any specific minimum qualifications which must be met for a person to be considered as a candidate for director. However, Board candidates are selected based upon various criteria including experience, skills, expertise, diversity, personal and professional integrity, character, business judgment, time availability in light of other commitments, dedication, conflicts of interest and such other relevant factors that the Nominating and Corporate Governance Committee considers appropriate in the context of the needs of the Board. Although the Board does not have a formal diversity policy, the Nominating and Corporate Governance Committee and Board review these factors, including diversity of gender, race, ethnicity, age, cultural background and professional experience, in considering candidates for Board membership.

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 2023 for a term expiring at the 2024 annual meeting. Consistent with the Apax Investment Agreement, our Board now nominates, and recommends, Mr. Mackenzie for election in 2023 for a term expiring at the 2024 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 2023 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 nine 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 2023 annual meeting. The ages of the nominees are as of the date of the 2023 annual meeting, June 2, 2023.

​	Roy Mackenzie							​
​					​	​	Independent Director since June 2020 Age: 51 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 2023 annual meeting.							​

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.

​	Carmel Galvin							​
​					​	​	Independent Director since February 2020 Age: 54 Current Board Committees: Compensation Committee (Chair) and Nominating and Corporate Governance Committee	​
​	Career Highlights							​
​	• Chief People Officer at Stripe, Inc., a payment software services and solutions company, since January 2021. ​ • 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.				​

​	James P. Hallett							​
​					​	​	Director since April 2007 Age: 70	​
​	Career Highlights							​
​	• Executive Chairman of the Company from April 2021 to March 2023 and Chairman of the Board of the Company from December 2014 to March 2023. Chief Executive Officer of the Company from September 2009 to March 2021. ​ • Chief Executive Officer and President of ADESA from April 2007 to September 2009, a wholly owned subsidiary of the Company. ​ • President of Columbus Fair Auto Auction, a large independent automobile auction located in Columbus, Ohio, from May 2005 to April 2007. ​ • After selling his auctions to ADESA in 1996, Mr. Hallett held various senior executive leadership positions with ADESA between 1996 and 2005, including President and Chief Executive Officer of ADESA. ​ • Founded and owned two automobile auctions in Canada from 1990 to 1996. ​ • Managed and then owned a number of new car franchise dealerships for 15 years. ​ • Winner of multiple industry awards, including NAAA Pioneer of the Year in 2008 and the Ed Bobit Industry Icon award in 2018. ​ • Recognized as the EY Entrepreneur of the Year 2014 National Services Award Winner and one of Northwood University’s 2015 Outstanding Business Leaders. ​ • Graduate of Algonquin College. ​							​
​	Skills and Qualifications							​
​		​	​	Committed and deeply engaged leader with over 25 years of experience in key leadership roles throughout the Company and over 45 years of experience in the industry.				​
​		​	​	As the former Chief Executive Officer and Executive Chairman, Mr. Hallett has a thorough and in-depth understanding of the Company’s business and industry, including its employees, business units, customers and investors, which provides an additional perspective to our Board.				​
​		​	​	Strong leadership skills and entrepreneurial mindset.				​

​	Mark E. Hill				​	​	​	​
​					​	​	Independent Director since June 2014 Age: 67 Current Board Committees: Nominating and Corporate Governance Committee (Chair) and Risk Committee	​
​	Career Highlights							​
​	• Managing Partner of Collina Ventures, LLC, a private investment company that invests in software and technology companies, since 2006. ​ • Chairman and Chief Executive Officer of Lumavate LLC, a company that provides a platform for building cloud-based mobile applications, from November 2017 to April 2021 and Executive Chairman from May 2021 to December 2021. ​ • Co-founder and Chairman of Bluelock, LLC, a privately held infrastructure-as-a-service company, from 2006 to March 2018. ​ • Co-Founder, President and Chief Executive Officer of Baker Hill Corporation, a banking industry software and services business, from 1985 to 2006. Baker Hill Corporation was acquired by Experian PLC, a global information solutions company, in 2005. ​ • Graduate of the University of Notre Dame (BBA) and Indiana University (MBA). ​							​
​	Skills and Qualifications							​
​		​	​	Significant executive leadership and management experience leading and owning a software and technology-based business provides our Board with expertise in technology, innovation, and strategic investments.				​
​		​	​	Extensive experience as an investor and mentor to numerous early stage software and technology companies provides entrepreneurial perspective to the Board.				​
​		​	​	Key leadership experience in numerous central Indiana business and community service organizations, including Central Indiana Corporate Partnership, Ascend Indiana, the Orr Fellowship and the local Teach For America board.				​
​		​	​	Public company board experience, including serving as a lead independent director.				​

​	J. Mark Howell				​	​	​	​
​					​	​	Independent Director since December 2014 Age: 58 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 has earned a CERT Certificate in Cybersecurity Oversight from the National Association of Corporate Directors and the Software Engineering Institute of Carnegie Mellon University.				​

​	Stefan Jacoby				​	​	​	​
​					​	​	Independent Director Since June 2019 Age: 65 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.				​

​	Peter Kelly				​	​	​	​
​					​	​	Director since April 2021 Age: 54 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, a subsidiary of the Company, from February 2011 to June 2013. ​ • President and Chief Financial Officer of OPENLANE from February 2010 to February 2011. ​ • Co-founded OPENLANE in 1999, and served in a number of executive roles at OPENLANE from 1999 to 2010. ​ • Prior to his work with OPENLANE, 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.				​

​	Michael T. Kestner				​	​	​	​
​					​	​	Independent Director since December 2013 Chairman of the Board since April 2023 Age: 69 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.				​

​	Sanjeev Mehra				​	​	​	​
​					​	​	Independent Director since October 2021 Age: 64 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.				​

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

BOARD STRUCTURE AND CORPORATE GOVERNANCE

The Board oversees the Company’s CEO and other members of senior management in the competent and ethical operation of the Company and assures that the long-term interests of the stockholders are being served. The Board serves as the ultimate decision-making body of the Company, except for those matters reserved to or shared with the stockholders. The Company’s Corporate Governance Guidelines are available on our website, www.karglobal.com, by clicking on “Investors” and then the “Governance” tab. The information on our website is not part of this proxy statement and is not deemed incorporated by reference into this proxy statement or any other public filing made with the Securities and Exchange Commission (the “SEC”).

The Company’s Corporate Governance Guidelines provide that the Board shall be free to choose its Chairman in any way it deems best for the Company at any given point in time. If the Chairman is not an independent director, the independent directors are to annually appoint a Lead Independent Director. The Board believes that it should have the flexibility to make these determinations from time to time in the way that it believes best to provide appropriate leadership for the Company under then-existing circumstances.

From December 2014 to March 31, 2023, James P. Hallett served as Chairman of the Board. During such period, the Board elected a Lead Independent Director each year. Michael T. Kestner most recently served as the Lead Independent Director from July 2019 to March 31, 2023.

Mr. Kestner began serving as the independent Chairman of the Board on April 1, 2023 (following Mr. Hallett’s retirement). Our Board believes that having an independent Chairman provides the most appropriate leadership structure for the Company at this time. Mr. Kestner has a wealth of leadership experience and deep understanding of the Company and the Board from serving as Lead Independent Director from July 2019 to March 2023 and serving as a member of the Board since December 2013.

Given the Chairman is now an independent director, the Board no longer has a Lead Independent Director. The duties of the Chairman are substantially similar to those of the Lead Independent Director. The Board has adopted a Lead Independent Director Charter, which sets forth a clear mandate with significant authority and responsibilities for the Lead Independent Director or independent Chairman, as applicable, including:

The independent directors of the Company meet in executive session at every regularly scheduled Board meeting. The Company’s Corporate Governance Guidelines state that the Chairman of the Board (if an independent director) or the Lead Independent Director (if the Chairman of the Board is not an independent director) shall preside at such executive sessions, or in such director’s absence, another independent director designated by the Chairman of the Board or the Lead Independent Director, as applicable. Currently, Mr. Kestner, our independent Chairman of the Board, presides at the executive sessions of our independent directors.

The Board held seven meetings during 2022. All of the incumbent directors attended at least 75% of the meetings of the Board and Board committees on which they served during 2022. As stated in our Corporate Governance Guidelines, each director is expected to attend all annual meetings of stockholders. All of our directors attended last year’s annual meeting of stockholders.

In 2022, the Board maintained four standing committees: the Audit Committee, the Compensation Committee, the Nominating and Corporate Governance Committee and the Risk Committee. Each of our committees operates pursuant to a written charter. Copies of the committee charters are available on our website, www.karglobal.com, by clicking on “Investors” and then the “Governance” tab. The information on our website is not part of this proxy statement and is not deemed incorporated by reference into this proxy statement or any other public filing made with the SEC. The following table sets forth the current membership of each committee:

​

(1)

Mr. Hallett is our former Executive Chairman and Chairman of the Board, and Mr. Kelly is our current CEO.

​

(2)

Mr. Kestner serves as Chairman of the Board.

​

A description of each Board committee is set forth below.

Audit Committee

Meetings Held in 2022: 6

Primary Responsibilities: Our Audit Committee assists the Board in its oversight of the integrity of our financial statements, our independent registered public accounting firm’s qualifications and independence and the performance of our independent registered public accounting firm. The Audit Committee (i) reviews the audit plans and findings of our independent registered public accounting firm and our internal audit team and tracks management’s corrective action plans where necessary; (ii) reviews our financial statements, including any significant financial items and changes in accounting policies or practices, with our senior management and independent registered public accounting firm; (iii) reviews our financial risk and control procedures, compliance programs (including our Code of Business Conduct and Ethics) and significant tax, legal and regulatory matters; (iv) reviews and approves related person transactions; and (v) has the sole discretion to appoint annually our independent registered public accounting firm, evaluate its independence and performance and set clear hiring policies for employees or former employees of the independent registered public accounting firm.

Independence: Each member of the Audit Committee is “financially literate” under the rules of the NYSE, and each of Messrs. Howell and Kestner has been designated as an “audit committee financial expert” as that term is defined by the SEC. In addition, the Board has determined that each member of the Audit Committee meets the standards of “independence” established by the NYSE and is “independent” under the independence standards for audit committee members adopted by the SEC.

Compensation Committee

Meetings Held in 2022: 9

Primary Responsibilities: The Compensation Committee reviews and recommends policies relating to the compensation and benefits of our executive officers and employees. The Compensation Committee reviews and approves corporate goals and objectives relevant to the compensation of our CEO and other executive officers, evaluates the performance of these officers in light of those goals and objectives, and approves the compensation of these officers based on such evaluations. The Compensation Committee also administers the issuance of equity and other awards under our equity plans.

Independence: All of the members of the Compensation Committee are independent under the NYSE rules (including the enhanced independence requirements for compensation committee members).

Nominating and Corporate Governance Committee

Meetings Held in 2022: 4

Primary Responsibilities: The Nominating and Corporate Governance Committee is responsible for making recommendations to the Board regarding candidates for directorships and the size and composition of the Board. The Nominating and Corporate Governance Committee also reviews non-employee director compensation on an annual basis and makes recommendations to the Board. In addition, the Nominating and Corporate Governance Committee is responsible for overseeing our Corporate Governance Guidelines and reporting and making recommendations to the Board concerning governance matters. The Nominating and Corporate Governance Committee also assists the Board in the general oversight of the Company’s environmental, social and governance (ESG) strategy, including diversity and inclusion matters. As required by the Company’s Corporate Governance Guidelines, the Nominating and Corporate Governance Committee oversees an annual evaluation process of the Board and each committee of the Board, as discussed in more detail under “Board and Committee Evaluation Process” below.

Independence: All of the members of the Nominating and Corporate Governance Committee are independent under the NYSE rules.

Risk Committee

Meetings Held in 2022: 4

Primary Responsibilities: The Risk Committee assists the Board in its oversight of (i) the principal business, financial, technology, operational and regulatory risks, and other material risks and exposures of the Company and (ii) the actions, activities and initiatives of the Company to mitigate such risks and exposures. The Risk Committee also provides oversight for matters specifically relating to cybersecurity and other risks related to information technology systems and procedures, including but not limited to data security and privacy. The Risk Committee receives quarterly reports from the Company’s Chief Information Security Officer on information security matters, including, among other things, the Company’s cyber risks and threats, the status of projects to strengthen the Company’s information security systems, assessments of the Company’s security program and the emerging threat landscape. The Risk Committee also oversees the Company’s enterprise risk management (“ERM”) program and has direct oversight over certain risks within the ERM framework.

Independence: All of the members of the Risk Committee are independent under the NYSE rules.

The Nominating and Corporate Governance Committee oversees the annual evaluation process of the Board and each of its committees. The evaluation process includes a self evaluation by the Board, a self evaluation by each committee of the Board, and a peer evaluation by each director of each other Board member. The Lead Independent Director or independent Chairman of the Board, as applicable, also conducts a personal interview with each Board member to gather in depth perspectives and candid insight about Board, committee and individual director effectiveness and suggestions for improvement. Once the evaluation process is complete, the Nominating and Corporate Governance Committee reports to the full Board the results, including any recommendations, which are discussed by the full Board and each committee, as applicable, and changes in practices or procedures are considered and implemented as appropriate.

The Nominating and Corporate Governance Committee periodically reviews the format of the evaluation process to ensure that actionable feedback is solicited on the operation and effectiveness of the Board, the Board committees and each Board member. The Nominating and Corporate Governance Committee also utilizes the results of this self evaluation process in assessing and determining the characteristics and critical skills required of prospective candidates for election to the Board and making recommendations to the Board with respect to assignments of Board members to various committees.

Management is responsible for assessing and managing risk at the Company, including communicating the most material risks to the Board and its committees. The Board has primary responsibility for risk oversight, with a focus on the most significant risks facing the Company. Oversight of the Company’s risks is carried out by the Board as a whole and by each of its committees.

The Board’s leadership structure, through its committees, supports its role in risk oversight. In general, the committees oversee the following risks:

•

Audit Committee: The Audit Committee maintains initial oversight over risks related to (i) the integrity of the Company’s financial statements; (ii) internal control over financial reporting and disclosure controls and procedures (including the performance of the Company’s internal audit function); (iii) the performance of the independent registered public accounting firm; and (iv) ethics and related issues arising from the Company’s whistleblower hotline. The Audit Committee meets with the Company’s Chief Financial Officer, the Company’s head of Internal Audit and representatives of KPMG in separate executive sessions on a quarterly basis.

​

•

Compensation Committee: The Compensation Committee maintains oversight over risks related to the Company’s compensation programs and practices.

​

•

Nominating and Corporate Governance Committee: The Nominating and Corporate Governance Committee monitors potential risks relating to the effectiveness of the Board, notably director succession, composition of the Board and the principal policies that guide the Company’s governance.

​

•

Risk Committee: The Risk Committee maintains oversight over the Company’s enterprise-level risks, including with respect to cybersecurity and information technology systems and procedures as noted above. The Risk Committee provides oversight with respect to risk practices implemented by management, except for the oversight of risks that have been specifically delegated to another committee of the Board. Even when the oversight of a specific area of risk has been delegated to another committee, the Risk Committee may maintain oversight over such risks through the receipt of reports from the committee chairs.

​

The Board maintains oversight over such risks through the receipt of reports from the committee chairs at each regularly scheduled Board meeting.

As part of the risk management process, an annual risk assessment is conducted by management to identify and prioritize the most significant enterprise risks to the Company. This risk assessment is reviewed with the Risk Committee and helps guide the focus and selection of risks that are brought to the Risk Committee for review or covered by the full Board or its other committees. The reviews by the Risk Committee and other committees occur principally through the receipt of reports from management and third parties on applicable areas of risk, and discussions with management and third parties regarding risk assessment and risk management.

At its regularly scheduled meetings, the Board generally receives a number of reports which include information relating to risks faced by the Company. The Company’s Chief Financial Officer provides a report on the Company’s results of operations, its liquidity position, including an analysis of prospective sources and uses of funds, and the implications to the Company’s debt covenants and credit rating, if any. The Company’s Chief Legal Officer provides a privileged report which provides information regarding the status of the Company’s material litigation and other legal matters, if any, including the Company’s continuing compliance with applicable laws and regulations. Further, the Company’s business leaders provide information relating to certain strategic, operational and competitive risks. At each regularly scheduled Board meeting, the Board also receives reports from the Chair of the Risk Committee as well as other committee chairs, which may include a discussion of risks initially overseen by the committees for discussion and input from the Board. As noted above, in addition to these regular reports, the Risk Committee receives reports on specific areas of risk, such as regulatory, cyclical or other risks, and reports to the Board on these matters.

The Board has adopted the following corporate governance documents:

We expect that any amendment to or waiver of the codes of ethics that apply to executive officers or directors will be disclosed on the Company’s website. The foregoing documents are available on our website, www.karglobal.com, by clicking on “Investors” and then the “Governance” tab and in print to any stockholder who requests them. Requests should be made to KAR Auction Services, Inc., Investor Relations, 11299 North Illinois Street, Carmel, Indiana 46032.

During fiscal year 2022, each of Messrs. Jacoby, Mackenzie and Mehra and Ms. Galvin served as members of the Compensation Committee. None of our executive officers serve, or in fiscal year 2022 served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board or our Compensation Committee. None of the individuals serving as members of the Compensation Committee during fiscal year 2022 are now or were previously an officer or employee of the Company or its subsidiaries.

Any stockholder or other interested parties desiring to communicate with the Board, the Chairman of the Board, a committee of the Board or any of the independent directors individually or as a group regarding the Company may directly contact such directors by delivering such correspondence to the Company’s Chief Legal Officer at KAR Auction Services, Inc., 11299 North Illinois Street, Carmel, Indiana 46032. Our Chief Legal Officer reviews all such correspondence and forwards to the applicable director(s) copies of all such applicable correspondence.

The Audit Committee has established procedures for employees, stockholders and others to submit confidential and anonymous reports regarding accounting, internal accounting controls, auditing or any other relevant matters.

DIRECTOR COMPENSATION

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 (including ClearBridge Compensation Group LLC (“ClearBridge”) in October 2018 and 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 ClearBridge’s October 2018 review 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 Chairman of the Board cash retainer of $100,000 be implemented, effective April 2023 (upon the Company appointing an independent Chairman of the Board). 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.

Non-employee directors who served for the entirety of 2022 were entitled to receive:

(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

do not receive fees for attending Board or committee meetings. All of our directors are reimbursed for reasonable expenses incurred in connection with attending Board meetings, committee meetings and director education events.

Our Board adopted the KAR Auction Services, Inc. Directors Deferred Compensation Plan (the “Director Deferred Compensation Plan”) in December 2009. Pursuant to the terms of the Director Deferred Compensation Plan, each non-employee director may elect to defer the receipt of his or her cash director fees into a pre-tax interest-bearing deferred compensation account, which account accrues interest as described in the Director Deferred Compensation Plan. Amounts under the Director Deferred Compensation Plan may also be invested in the same investment choices as are available under our 401(k) plan. Non-employee directors also may choose to receive all or a portion of their annual stock retainer in the form of a deferred share account that tracks shares of our common stock. The Director Deferred Compensation Plan provides that the amount of cash in a director’s deferred cash account, plus the number of shares of our common stock equal to the number of shares in the director’s deferred share account, will be delivered to a director in installments over a specified period or within 60 days following the date of the director’s departure from the Board, with cash being paid in lieu of any fractional shares.

The Company’s non-employee directors are subject to the Company’s director stock ownership and holding guidelines. The stock holding guideline requires each non-employee director to hold any shares of the Company’s common stock granted by the Company for at least three years post-vesting while serving as a director, subject to certain exceptions approved by the Nominating and Corporate Governance Committee.

The Company’s stock ownership guideline requires each non-employee director to own a minimum of five times his or her annual cash retainer amount in shares of Company stock. All non-employee directors are in compliance with this stock ownership guideline, except for Ms. Galvin who joined the Board in 2020. These guidelines did not apply to Messrs. Mackenzie and Mehra, who each agreed to waive all non-employee director compensation in 2022.

The following table provides information regarding the fiscal 2022 compensation paid to our non-employee directors:

(1)

The amounts represent the $85,000 annual cash retainer paid to each non-employee director, plus an additional $37,500 paid to the Lead Independent Director, an additional $25,000 paid to the Chair of the Audit Committee, 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). Mr. Jacoby and Ms. Smith each elected to receive his or her annual cash retainer (and for Ms. Smith, her Audit Committee membership fee) in shares of the Company’s common stock.

​

(2)

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, 2022, the date of our 2022 annual meeting, received 7,832 shares of restricted stock as an annual stock retainer in June 2022. Pursuant to the Director Deferred Compensation Plan, Messrs. Hill, 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 Restricted Stock Awards” below for the aggregate number of stock awards outstanding at fiscal year-end for each non-employee director.

​

(3)

Messrs. Mackenzie and Mehra each agreed to waive all non-employee director compensation in 2022.

​

Each of Messrs. Hallett and Kelly were not entitled to receive any fees or other compensation for serving as a member of our Board in 2022 because each was employed by the Company.

The following table sets forth information regarding the number of unvested or deferred shares of our common stock held by each non-employee director as of December 31, 2022:

(1)

This number represents unvested shares of restricted stock and, for those directors who deferred, unvested phantom stock.

​

(2)

This number represents vested phantom stock and dividend equivalents which are deferred in each director’s account pursuant to the Director Deferred Compensation Plan. These shares will be settled for shares of our common stock on a one-for-one basis.

​

BENEFICIAL OWNERSHIP OF COMPANY STOCK

The following table sets forth certain information with respect to the beneficial ownership of our common stock and Series A Preferred Stock as of April 6, 2023 of: (1) each person or entity who beneficially owns more than 5% of any class of the Company’s voting securities; (2) each of our directors, director nominees and named executive officers; and (3) all of our directors, director nominees and executive officers as a group. Beneficial ownership is determined in accordance with the rules of the SEC. To our knowledge, each stockholder will have sole voting and investment power with respect to the shares indicated as beneficially owned, unless otherwise indicated in a footnote to the following table. The percentage calculations below are based on 109,185,902 shares of our common stock and 634,305 shares of Series A Preferred Stock outstanding as of April 6, 2023, rather than the percentages set forth in any stockholder’s Schedule 13D or Schedule 13G filing. Unless otherwise indicated in a footnote, the business address of each person is our corporate address, c/o KAR Auction Services, Inc., 11299 North Illinois Street, Carmel, Indiana 46032.

* Less than one percent

(1)

The number of shares includes shares of our common stock subject to vesting requirements and options exercisable within 60 days of April 6, 2023.

​

(2)

Shares subject to options exercisable within 60 days of April 6, 2023 are considered outstanding for the purpose of determining the percent of the class held by the holder of such option, but not for the purpose of computing the percentage held by others.

​

(3)

Based solely on information disclosed in a Schedule 13D filed with the SEC on July 2, 2020, as amended on September 14, 2020, reflects securities beneficially owned by Ignition Acquisition Holdings LP. In this filing, it was disclosed that Ignition Acquisition Holdings GP, LLC, as the general partner of Ignition Acquisition Holdings LP, Ignition Parent LP, as the sole member of Ignition Acquisition Holdings GP, LLC, Ignition GP LLC, as the general partner of Ignition Parent LP, Ignition Topco Ltd, as the sole member of Ignition GP LLC, Apax X GP Co. Limited, as investment manager of the relevant investment vehicles in the fund known as Apax X which is the sole shareholder of Ignition Topco Ltd, and Apax Guernsey (Holdco) PCC Limited Apax X Cell, as the sole parent of Apax X GP Co. Limited, may be deemed to be the beneficial owners having shared voting and investment power with respect to the securities. Based on information provided by the security holder and information disclosed in a Registration Statement on Form S 3 filed with the SEC on February 18, 2021, Apax X GP Co. Limited is controlled by its board of directors that is comprised of the following persons: Simon Cresswell, Andrew Guille, Martin Halusa, Jeremy Latham, Paul Meader and David Staples. The address of Ignition Acquisition Holdings LP, Ignition Acquisition Holdings GP, LLC, Ignition Parent LP and Ignition GP LLC is c/o Apax Partners US, LLC, 601 Lexington Avenue, New York, NY 10022. The address of Ignition Topco Ltd is P.O. Box 656, East Wing, Trafalgar Court, Les Banques, St. Peter Port, Guernsey GY1 3PP, Place of Organization: Guernsey. The address of Apax X GP Co. Limited is Third Floor, Royal Bank Place, 1 Glategny Esplanade, St. Peter Port, Guernsey, GY1 2HJ. Mr. Mackenzie is a partner at Apax and is also our director. Mr. Mackenzie disclaims beneficial ownership of the shares of common stock beneficially owned by Ignition Acquisition Holdings LP.

​

(4)

At the close of business on April 6, 2023, the record date, (i) Ignition Acquisition Holdings LP held in the aggregate voting power equivalent to 32,524,507 shares of our common stock, approximately 22.9% of our common stock on an as converted basis, and (ii) Periphas held in the aggregate voting power equivalent to 3,252,169 shares of our common stock, approximately 2.9% of our common stock on an as converted basis.

​

(5)

Periphas Kanga Holdings GP, LLC as the general partner of Periphas Kanga Holdings, LP, SKM Periphas GP LLC, as the Managing Member of Periphas Kanga Holdings, GP, LLC and Mr. Mehra, as the Manager of SKM Periphas GP LLC, may be deemed to be the beneficial owners having shared voting and investment power with respect to the securities. The principal business address of each of the individuals and entities identified in this paragraph is 667 Madison Avenue, 15th Floor, New York, NY 10065.

​

(6)

Based solely on information disclosed in a Schedule 13G/A filed by BlackRock, Inc. on January 26, 2023. According to this Schedule 13G/A, BlackRock, Inc. has sole voting power with respect to 17,706,989 shares, sole dispositive power with respect to 17,939,836 shares, and no shared voting or dispositive power. The address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055.

​

(7)

Based solely on information disclosed in a Schedule 13G/A filed by The Vanguard Group on February 9, 2023. According to this Schedule 13G/A, The Vanguard Group has sole voting power with respect to zero shares, sole dispositive power with respect to 11,992,982 shares, shared voting power with respect to 106,113 shares and shared dispositive power with respect to 216,248 shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.

​

(8)

Based solely on information disclosed in a Schedule 13G/A filed by Burgundy Asset Management Ltd. on February 10, 2023. According to this Schedule 13G/A, Burgundy Asset Management Ltd. has sole voting power with respect to 5,246,376 shares, sole dispositive power with respect to 8,021,848 shares, and no shared voting or dispositive power. The address of Burgundy Asset Management Ltd. is 181 Bay Street, Suite 4510, Toronto, Ontario M5J 2T3.

​

(9)

Based solely on information disclosed in a Schedule 13G filed by Snyder Capital Management, L.P. on February 14, 2023. According to this Schedule 13G, Snyder Capital Management, L.P. has shared voting and dispositive power with respect to 5,747,890 shares, and no sole voting or dispositive power. The address of Snyder Capital Management, L.P. is 101 Mission Street, Suite 1400, San Francisco, California 94105.

​

(10)

Based solely on information disclosed in a Schedule 13G filed by Dimensional Fund Advisors LP on February 10, 2023. According to this Schedule 13G, Dimensional Fund Advisors LP has sole voting power with respect to 5,397,769 shares, sole dispositive power with respect to 5,508,286 shares, and no shared voting or dispositive power. The address of Dimensional Fund Advisors LP is 6300 Bee Cave Road, Building One, Austin, Texas 78746.

​

(11)

Includes the following shares of our common stock issuable pursuant to options that are exercisable within 60 days of April 6, 2023: Mr. Coyle, 17,688; Mr. Hallett, 268,273; Mr. Kelly, 147,351; and Mr. Subrahmanyam, 44,206.

​

(12)

Includes 800 shares held in a family member’s brokerage account, over which Mr. Hill holds a power of attorney. Mr. Hill disclaims beneficial ownership of these shares.

​

(13)

Includes an aggregate of 611,389 shares of our common stock issuable pursuant to options that are exercisable within 60 days of April 6, 2023. This group includes Brad S. Lakhia, age 50, who has served as the Company’s Executive Vice President and Chief Financial Officer since April 17, 2023. Mr. Lakhia was Vice President Finance, Americas of The Goodyear Tire & Rubber Company (“Goodyear”) from November 2019 to April 2023. Mr. Lakhia was Vice President, Business Planning & Analysis of Andeavor (formerly Tesoro Corp.) from September 2016 to October 2018 and Vice President, Treasurer and Credit of Andeavor from February 2014 to September 2016. Prior to joining Andeavor, Mr. Lakhia served in accounting, treasury and divisional finance roles with increasing responsibility at Goodyear from October 1996 to February 2014.

​

In accordance with Section 14A of the Exchange Act and related SEC rules, the Company seeks a non-binding advisory vote from its stockholders to approve the compensation of its named executive officers as described in the “Compensation Discussion and Analysis” section beginning on page 27 and the compensation tables that follow such section. The Company currently seeks this non-binding advisory vote from its stockholders annually, pursuant to the results of the stockholders’ vote at the Company’s 2017 annual meeting of stockholders selecting such frequency. The next “Say on Pay” vote will occur at the Company’s 2024 annual meeting of stockholders, subject to the outcome of the advisory vote on the frequency of future “Say on Pay” votes (Proposal No. 4).

At the 2022 annual meeting, approximately 98% of the votes cast were in favor of the advisory vote to approve executive compensation.

Our executive compensation program includes certain “best practices” in governance and executive compensation, including the following:

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Pay for performance: Our 2022 annual incentive program is 100% performance-based and our 2022 annual long-term incentive program is 90% performance-based.

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Independent Compensation Committee: All of the members of our Compensation Committee are independent under NYSE rules.

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Independent compensation consultant: The Compensation Committee retains its own independent compensation consultant to review our executive compensation program and practices.

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Maximum payout caps: The Compensation Committee sets maximum amounts that may be payable for annual cash incentive compensation and PRSUs.

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Clawback policy for financial misconduct: Our clawback policy provides for the recovery and cancellation of an executive officer’s incentive compensation in the event we are required to prepare an accounting restatement due to such executive officer’s intentional misconduct.

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No excise tax gross-ups: The Company does not provide tax gross-ups with respect to severance or change in control arrangements.

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Double-trigger vesting provisions in equity award agreements: Our equity awards permit accelerated vesting of assumed or replaced equity awards upon a change in control only if an executive experiences a qualifying termination of employment in connection with or following such change in control.

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Robust equity ownership requirements: We have stock ownership guidelines that are applicable to our executive officers. The stock ownership guideline for our CEO is five times his annual base salary.

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Stockholder alignment: We reward performance that meets or exceeds the performance goals that the Compensation Committee establishes with the objective of increasing stockholder value.

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In deciding how to vote on this proposal, the Board encourages you to read the “Compensation Discussion and Analysis” section and the compensation tables that follow. Because this vote is advisory, it will not be binding upon the Board; however, the Board and the Compensation Committee value our stockholders’ opinions, and the Compensation Committee will take into account the outcome of the advisory vote when considering future executive compensation decisions.

The affirmative vote of the holders of a majority of the shares present and entitled to vote at the 2023 annual meeting is required to approve this proposal.

Proxies solicited by the Board of Directors will be voted “FOR” the advisory vote to approve executive compensation unless stockholders specify a contrary vote.

COMPENSATION DISCUSSION AND ANALYSIS

The following discussion and analysis of our compensation program for named executive officers should be read in conjunction with the tables and text elsewhere in this proxy statement that describe the compensation awarded and paid to the named executive officers.

Named Executive Officers

Our named executive officers for the last completed fiscal year were (i) the chief executive officer; (ii) the chief financial officer; (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) two additional individuals who served as executive officers during a portion of the last completed fiscal year but who were not serving as an executive officer at the end of the last completed fiscal year. Our named executive officers are:

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The titles shown for our named executive officers reflect their position on December 31, 2022. Mr. Loughmiller retired from the Company on December 31, 2022; Mr. Hallett retired from the Company on March 31, 2023; Mr. Hammer separated from the Company on May 9, 2022 in connection with the Company’s sale of the ADESA U.S. physical auction business to Carvana; Mr. Fisher separated from the Company on April 7, 2022.

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This Compensation Discussion and Analysis is organized into six sections:

2022 Pay For Performance Highlights

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A combination of the Company’s Adjusted EBITDA performance (85%) and cost reduction goals (15%) were utilized as performance objectives under our 2022 annual incentive program. In furtherance of our pay-for-performance philosophy, despite unanticipated industry headwinds, the Compensation Committee did not apply any discretion in determining achievement, resulting in payouts at 22.5% of the target award amount.

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Despite the 2020 PRSUs’ three-year performance goals being established prior to the onset of the pandemic and related industry headwinds, the Compensation Committee did not adjust the performance goals in commitment to our pay-for-performance philosophy, resulting in the 2020 PRSUs paying out at 0%.

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We continued our heavy focus on performance-based equity awards, with 90% of the target annual long-term incentive awards under the 2022 annual long-term incentive program tied to pre-established financial and stock price performance goals.

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These highlights are discussed in more detail below.

IAA Spin-Off

In 2019, we completed the spin-off of our former salvage auction business, IAA, Inc. (“IAA”), to our stockholders, resulting in KAR and IAA being two independent, publicly-traded companies (the “IAA Spin-Off”). In connection with the IAA Spin-Off, KAR stockholders received one share of IAA stock for every one share of KAR stock held as of June 18, 2019. All equity awards outstanding as of the IAA Spin-Off were adjusted to preserve the economic value of the awards in accordance with the Employee Matters Agreement, dated June 27, 2019, between KAR and IAA. Certain adjusted KAR and IAA awards remained outstanding in 2022. The adjusted KAR awards and adjusted IAA awards were generally subject to the same terms and conditions, and continued to vest on the same schedule, except as noted below. For purposes of award vesting, continued employment with KAR is treated as continued employment for both KAR and IAA awards. The following summarizes the applicable adjustments:

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RSUs: Holders of outstanding KAR RSUs retained such KAR RSUs and also received an RSU relating to IAA common stock in respect of each KAR RSU held.

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PRSUs Granted in 2019: Holders of KAR 2019 PRSUs retained such PRSUs and received a PRSU relating to IAA common stock in respect of each KAR PRSU held. The PRSUs were subject to adjusted performance criteria for the period from January 1, 2019, through December 31, 2019, with time-based vesting being applicable through the third anniversary of the applicable grant date for KAR PRSUs (the IAA PRSUs previously vested on December 31, 2021).

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Stock Options: Each KAR stock option was converted into two separate options, an adjusted option to purchase KAR common stock and an option to purchase IAA common stock, with the number and exercise prices of both options adjusted to maintain economic value. A conversion formula based on the pre-spin closing price of KAR and IAA was used to determine the exercise prices of the adjusted options.

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ADESA Sale

In May 2022, we completed the sale of the ADESA U.S. physical auction business to Carvana for approximately $2.2 billion in cash (the “ADESA Sale”). The ADESA Sale was a significant and historic milestone in the Company’s history, and a transformative transaction for the Company, our employees and our stockholders. As described in more detail below, in connection with the ADESA Sale, the goals for the 2022 annual incentive program and 2022 performance-based restricted stock units, as well as our go-forward proxy comparator group, reflect the exclusion of the operating results of the ADESA U.S. physical auction business.

In addition, in connection with the ADESA Sale, we also granted a one-time Strategic Transformation Award to certain of our named executive officers. This award is separate and apart from the 2022 annual executive compensation program, and is intended to further incentivize our executive team to continue to execute upon the Company’s digital transformation and strategy, through enhanced long-term stock price alignment. See page 40 for further information.

For the year ended December 31, 2022, the Company continued to advance its digital transformation. Specific highlights for fiscal 2022 included:

Our Executive Compensation Practices are Aligned with Stockholders’ Interests

We maintain a compensation program structured to achieve a close connection between executive pay and Company performance.

We design and administer our executive pay programs to help ensure the compensation of our named executive officers is (i) closely aligned with our performance on both a short-term and long-term basis; (ii) linked to specific, measurable results intended to create value for stockholders; and (iii) competitive in attracting and retaining key executive talent. Each of the compensation programs that we have developed and implemented is intended to satisfy one or more of the following specific objectives:

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align the interests of our executive officers with the interests of our stockholders so that our executive officers manage from the perspective of owners with an equity stake in the Company;

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motivate and focus our executive officers through incentive compensation programs directly tied to our business objectives and financial results;

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support a one-company culture and encourage synergies among business units by aligning rewards with long-term, overall Company performance and stockholder value;

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provide a significant percentage of total compensation through variable pay based on pre-established, measurable goals and objectives;

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provide competitive upside opportunity without encouraging excessive risk-taking;

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enhance our ability to attract and retain skilled and experienced executive officers; and

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provide rewards commensurate with performance and with competitive market practices.

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While the Company does not target any specific percentile positioning versus the market, the market median is used as a reference point but is not the sole determinant when making compensation decisions. Compensation decisions are made considering a number of factors including experience, retention, sustained performance, specific requirements of roles relative to the market and individual and Company performance.

Role of the Compensation Committee. The Compensation Committee has primary responsibility for all compensation decisions relating to our named executive officers. The Compensation Committee reviews the aggregate level of our executive compensation, as well as the mix of elements used to compensate our named executive officers on an annual basis.

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 Willis Tower Watson and 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 2022 were selected based on (i) a focus on service-oriented companies in related industries and business areas as the Company, considering the Company’s digital transformation and go-forward strategy; (ii) similarly-sized revenue and market capitalization levels; (iii) comparable profitability and/or market valuation profiles; and (iv) companies with which the Company competes for executive talent. Where possible, the Compensation Committee included companies that are in related or similar industries to the Company, with an additional focus on technology companies that offer online marketplaces and digital intermediary services in light of the Company’s digital transformation and go-forward strategy.

The proxy comparator group used from June 2021 to June 2022 (i.e., the group of peer companies used to provide comparable market data for 2022 compensation decisions) consisted of the following 17 companies:

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 2022 compensation levels (as discussed below).

In June 2022, the Compensation Committee reviewed the proxy comparator group in light of the ADESA Sale and, based on the recommendation of ClearBridge, approved a revised proxy comparator group consisting of the following 16 companies:

Companies in the revised proxy comparator group were generally selected based on the same criteria as the prior proxy comparator group, but with an additional focus on the Company’s revenue and market capitalization levels following the ADESA Sale to ensure the comparator group used for 2023 compensation decisions is aligned with the Company’s go-forward posture.

Role of the Independent Compensation Consultant. The Compensation Committee continued to use ClearBridge as its independent compensation consultant in 2022. 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.

Role of Executive Officers. Our Chief Executive Officer regularly participates in meetings of the Compensation Committee at which compensation actions involving our named executive officers are discussed (recusing himself and not participating in portions of meetings where his compensation is discussed). Our Chief Executive Officer assists the Compensation Committee by making recommendations regarding compensation actions for the executive officers other than himself.

Elements of 2022 Executive Compensation Program Design

The following table lists the elements of compensation for our 2022 annual executive compensation program. The program uses a mix of fixed and variable compensation elements and provides alignment with both short- and long-term business goals through annual and long-term incentives. Our incentives are designed to drive overall corporate performance and business strategies that correlate to stockholder value and align with our strategic vision. In order to confirm competitiveness of compensation, the Compensation Committee reviews survey data and proxy compensation data of our proxy comparator group.

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 2022 executive compensation program for our CEO and the average of our other named executive officers is shown in the charts below. Approximately 89% 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.

Base Salary

General. Annual salary levels for our named executive officers are based upon various factors, including the amount and relative percentage of total compensation that is derived from base salary, individual performance, current roles and responsibilities, skills, experience and job scope. In view of the wide variety of factors considered by the Compensation Committee in connection with determining the base salary of each of our named executive officers, the Compensation Committee has not attempted to rank or otherwise assign relative weights to the factors that it considers. A description of how these factors were applied in 2022 is described below.

Base Salaries for 2022. In late 2021 and the first quarter of 2022, the Compensation Committee reviewed the base salaries of each of our named executive officers for 2022. After considering multiple factors as noted above, the following base salaries were approved for 2022: