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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No.          )

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13085 Hamilton Crossing Boulevard
Carmel, Indiana 46032

April 30, 201329, 2014

Dear Stockholder:

        We cordially invite you to attend KAR Auction Services' annual meeting of stockholders. The meeting will be held on Wednesday, June 12, 2013,10, 2014, at 9:00 a.m., Eastern Daylight Time, at the Renaissance Indianapolis North Hotel, 11925 North Meridian Street, in Carmel, Indiana 46032.

        As a KAR Auction Services stockholder, your vote is important. At the meeting, stockholders will vote on a number of important matters. Even if you are planning to attend the annual meeting in person, you are strongly encouraged to vote your shares through one of the methods described in the enclosed proxy statement. Please take the time to carefully read each of the proposals described in the attached proxy statement. The Board of Directors would appreciate your support on our recommendations for the following proposals:

•

Election of the ten nominated directors;



•

Advisory vote approving the compensation of our named executive officers;



•

Approval of the amendment and restatement of the KAR Auction Services, Inc. 2009 Omnibus Stock and Incentive Plan; and



•

Ratification of the appointment of KPMG LLP as our independent registered public accounting firm for 2014.

        This year we are pleased to take advantage of the Securities and Exchange Commission rules that allow issuers to furnish proxy materials to their stockholders on the Internet. We believe these rules allow us to provide you with the information you need while lowering the costs of delivery and reducing the environmental impact of our annual meeting. The proxy statement contains instructions on how you can request a paper copy of the proxy statement and annual report.

        Thank you for your continued support of KAR Auction Services.

		Sincerely,
		James P. Hallett Chief Executive Officer

Important Notice Regarding the Availability of Proxy Materials
for our Stockholder Meeting to be Held on June 12, 2013

Our 2012 Annual Report and this proxy statement, each of which are being provided concurrently with this notice, are available electronically via the Internet at www.karauctionservices.com. We encourage you to review all of the important information contained in these proxy materials before voting.

        This proxy statement is dated April 30, 2013.
This proxy statement29, 2014 and the accompanying proxy card areis first being maileddistributed to
KAR Auction Services' stockholders beginning on or about April 30, 2013.29, 2014.

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13085 Hamilton Crossing Boulevard
Carmel, Indiana 46032

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

		On Behalf of the Board of Directors,
April 30, 201329, 2014 Carmel, Indiana		Rebecca C. Polak Executive Vice President, General Counsel and Secretary

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Notice of Internet Availability of Proxy Materials for the Annual Meeting

        The proxy statement for the Annual Meeting and the Annual Report to Stockholders for the fiscal year ended December 31, 2013, 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 the "Investor Relations" section of our website, under the "Proxy Statement" link at www.karauctionservices.com.

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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 Company's 2013 performance, please review the Company's Annual Report on Form 10-K for the year ended December 31, 2013.

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Business Highlights

        Despite the impact of Superstorm Sandy on our salvage auction business, KAR delivered solid growth in volume of total vehicles sold, revenues and Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure and is defined and reconciled to the GAAP measure, net income (loss), in our Annual Report on Form 10-K for the year ended December 31, 2013 in Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations—EBITDA and Adjusted EBITDA."

        Specific highlights for fiscal 2013 included:

•

Total vehicles sold for our ADESA, Inc. ("ADESA") and Insurance Auto Auctions, Inc. ("IAA") business segments rose approximately 12% to 3.7 million units.



•

Net revenue was up 11% to more than $2.1 billion.



•

Adjusted EBITDA rose 8% to $538.2 million.



•

We reduced our leverage, as measured by Net Debt / Adjusted EBITDA, to 3.07X.



•

We increased our annual dividend from $0.76 to $1.00 per share.



•

Shares of KAR stock rose 46% to $29.55.

Corporate Governance

        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 at www.karauctionservices.com on the "Investor Relations" page under the link "Corporate Governance":

•

Annual Elections:    Our directors are elected annually for one year terms.



•

Director Independence:    Eight of our ten director nominees are independent, and our Board of Directors' committees are comprised entirely of independent directors.



•

Board Leadership:    We separate the roles of Chairman of the Board and Chief Executive Officer. Our Chairman of the Board is a non-executive chairman.



•

Executive Sessions:    Our independent directors meet in executive session at regularly scheduled Board of Directors' meetings.



•

Board of Directors Risk Oversight:    Our Board of Directors provides oversight with respect to risk practices implemented by management, except for the oversight of risks that have been specifically delegated to a committee of the Board of Directors (in which case the Board of Directors may maintain oversight over such risks through the receipt of reports from the committees). The Audit Committee maintains initial oversight over risks related to the integrity of our financial statements; internal controls over financial reporting and disclosure controls and procedures (including the performance of our internal audit function); the performance of the independent auditor; and oversees our responses to ethics issues arising from our whistleblower hotline. The Compensation Committee maintains oversight over risks related to our compensation practices. The Nominating and Corporate Governance Committee monitors potential risks relating to the effectiveness of the Board of Directors, notably director succession, composition of the Board of Directors and the principal policies that guide our governance.



•

Cessation of Controlled Company Status:    At the time of our initial public offering, we qualified as a "controlled company" within the meaning of the NYSE corporate governance standards, as KAR Holdings II, LLC ("KAR LLC") controlled a majority of the voting power of our

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outstanding common stock. As of June 6, 2013, KAR LLC ceased to hold a majority of our outstanding common stock and, as of the date of this proxy statement, does not hold any shares of our common stock. Accordingly, we are no longer a controlled company, and we continue to evaluate our corporate governance structure in light of such transition. We currently have a majority of independent directors under the NYSE standards and each of our committees is comprised entirely of independent directors. See "Board of Directors Structure and Corporate Governance."

Executive Compensation

        During the past five years, including following the sale by our former equity sponsors of all of their holdings of our common stock in 2013, we have maintained a compensation program structured to achieve close connection between executive pay and company performance.

•

Pay for Performance Alignment:    During the past 5 fiscal years, including 2013, we have demonstrated close alignment between our total stockholder return (TSR) performance and the compensation of our Chief Executive Officer, as shown in the chart below.

5-Year Pay Alignment Chart

•

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



•

Independent Compensation Consultant:    In 2013, our compensation committee engaged ClearBridge Compensation Group as its independent compensation consultant.



•

Performance-Based Compensation Awards:    The equity awards granted to our named executive officers in late 2013 and in 2014 are heavily performance-based, consisting of restricted stock units that vest based on achievement of relative TSR and adjusted earnings per share goals and stock options.



•

Incentive Compensation Recoupment Policy:    In 2014, we adopted a policy providing for the recovery of incentive compensation in the event we are required to prepare an accounting restatement due to any executive officer's intentional misconduct.



•

Anti-Hedging and Pledging of Company Stock Policy:    In addition to our existing anti-pledging of Company stock policy, we adopted a formal anti-hedging of Company stock policy in 2014, which is applicable to our officers and directors.

        For more information regarding our named executive officer compensation, see "Compensation Discussion and Analysis" and the tables that follow.

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KAR AUCTION SERVICES, INC.
13085 Hamilton Crossing Boulevard
Carmel, Indiana 46032

PROXY STATEMENT

QUESTIONS AND ANSWERS ABOUT THE PROXY MATERIALS
AND THE ANNUAL MEETING

Q:

Why am I receiving these materials?

A:

We are providing these proxy materials to you in connection with the solicitation, by the Board of Directors of KAR Auction Services, Inc. (the "Company" or "KAR Auction Services"), of proxies to be voted at the Company's 20132014 annual meeting of stockholders and at any adjournments or postponements thereof. Stockholders are invited to attend the annual meeting to be held on June 12, 201310, 2014 beginning at 9:00 a.m., Eastern Daylight Time, at the Renaissance Indianapolis North Hotel, 11925 North Meridian Street, Carmel, Indiana 46032. Our proxy materials are first being maileddistributed to stockholders on or about April 30, 2013.29, 2014.

Q:

What proposals will be voted on at the annual meeting?

A:

There are threefour proposals scheduled to be voted on at the annual meeting:

•

To elect thirteenten directors to the Board of Directors;



•

To provide an advisory vote to approve the material termscompensation of our named executive officers;



•

To approve the performance goals underamendment and restatement of the KAR Auction Services, Inc. 2009 Omnibus Stock and Incentive Plan (the "Omnibus Plan") in accordance with Section 162(m) of the Internal Revenue Code;; and



•

To ratify the appointment of KPMG LLP ("KPMG") as our independent registered public accounting firm for 2013.2014.

Q:

What is the Board of Directors' voting recommendation?

A:

The Company's Board of Directors recommends that you vote your shares:

•

"FOR" each of the nominees to the Board of Directors;



•

"FOR" the approval, on an advisory basis, of the compensation of our named executive officers;



•

"FOR" the approval of the material termsamendment and restatement of the performance goals under the Omnibus Plan in accordance with Section 162(m) of the Internal Revenue Code;Plan; and



•

"FOR" the ratification of the appointment of KPMG as our independent registered public accounting firm for 2013.2014.

Q:

Who is entitled to vote?

A:

All shares owned by you as of the record date, which is the close of business on April 17, 2013,16, 2014, may be voted by you. You may cast one vote per share of common stock that you held on the record date.

These shares include shares that are:

•

held directly in your name as the stockholder of record; and

other nominee may generally vote on routine matters, and therefore no broker non-votes are expected to exist in connection with Proposal No. 3.

4.

The election of directors (Proposal No. 1), the advisory vote on the compensation of our named executive officers (Proposal No. 2) and the approval of the material termsamendment and restatement of the performance goals under the Omnibus Plan in accordance with Section 162(m) of the Internal Revenue Code (Proposal No. 2)3) are considered non-routine matters under applicable rules. A broker or other nominee cannot vote without instructions on non-routine matters, and therefore there may be broker non-votes on Proposal Nos. 1, 2 and 2.3.




Q:

What is the voting requirement to approve each of the proposals?



A:

ThirteenTen director nominees have been nominated for election at the annual meeting. Directors will be elected by a plurality of the votes cast in the election of directors at the annual meeting, either in person or represented by a properly authorized proxy. This means that the thirteenten nominees who receive the largest number of "FOR" votes cast will be elected as directors. Stockholders cannot cumulate votes in the election of directors. "Withhold""WITHHOLD" votes and broker non-votes will not have any effect on the election of directors, except in the case of "withhold""WITHHOLD" votes to the extent they revoke earlier dated proxies.

The advisory approval of the material termscompensation of our named executive officers, the approval of the performance goals underamendment and restatement of the Omnibus Plan in accordance with Section 162(m) of the Internal Revenue Code and the ratification of the appointment of our independent registered public accounting firm require the affirmative vote of a majority of the votes represented at the meeting and entitled to vote on the proposals. In accordance with Delaware law, only votes cast "FOR" a matter constitute affirmative votes. A properly executed proxy marked "abstain" with respect to the advisory approval of our executive compensation, the approval of the material termsamendment and restatement of the performance goals under the Omnibus Plan in accordance with Section 162(m) of the Internal Revenue Code and/or the ratification of the appointment of our independent registered public accounting firm will not be voted, although it will be counted for purposes of determining whether there is a quorum. Accordingly, with respect to Proposals Nos. 2, 3 and 3,4, abstentions will have the same effect as negative votes or votes "AGAINST" that matter. Broker non-votes will have no effect on these items.Proposals Nos. 2 and 3.

Q:

What does it mean if I receive more than one proxy or voting instruction card?



A:

It means your shares are registered differently or are in more than one account. Please provide voting instructions for all proxy and voting instruction cards you receive.



Q:

Who will count the vote?



A:

A representative of American Stock Transfer & Trust Company, LLCThe votes will tabulate the votes and act asbe counted by the inspector of election.election appointed for the annual meeting.



Q:

Can I revoke my proxy or change my vote?



A:

Yes. You may revoke your proxy or change your voting instructions at any time prior to the vote at the annual meeting by:



•

providing written notice of revocation to the Secretary of the Company at 13085 Hamilton Crossing Boulevard, Carmel, Indiana 46032;



•

delivering a valid, later-dated proxy or a later-dated vote on the Internet or by telephone; or



•

attending the annual meeting and voting in person.

Please note that your attendance at the annual meeting in person will not cause your previously granted proxy to be revoked unless you vote in person at the annual meeting to revoke your proxy. If you wish to revoke your proxy, you must do so in sufficient time to permit the necessary




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examination and tabulation of the subsequent proxy or revocation before the vote is taken. Shares held in street name may be voted in person by you at the annual meeting only if you obtain a signed proxy from the record holder giving you the right to vote the shares.

Q:

Who will bear the cost of soliciting votes for the annual meeting?



A:

The Board of Directors of the Company is soliciting your proxy to vote your shares of common stock at the annual meeting. We have engaged MacKenzie Partners, Inc., to assist in the solicitation of proxies for the annual meeting for a fee of approximately $15,000 plus reimbursement of reasonable out-of-pocket expenses. KAR Auction Services will pay the entire cost of preparing, assembling, printing, mailing and distributing these proxy materials. In addition to the mailingdistribution of




these proxy materials, the solicitation of proxies or votes may be made in person, by telephone or by electronic and facsimile transmission by our directors, officers and employees, who will not receive any additional compensation for such solicitation activities. The Company also may reimburse brokerage firms and other persons representing beneficial owners of shares of KAR Auction Services' common stock for their expenses in forwarding solicitation material to such beneficial owners.





Q:

I share an address with another stockholder, and we received only one paper copy of the proxy materials. How may I obtain an additional copy of the proxy materials?



A:

The Company has adopted a procedure called "householding" which the Securities and Exchange Commission (the "SEC") has approved. Under this procedure, the Company is delivering a single copy of this proxy statement and the Company's Annual Report to multiple stockholders who share the same address unless the Company has received contrary instructions from one or more of the stockholders. This procedure reduces the Company's printing costs, mailing costs and fees.costs. Stockholders who participate in householding will continue to be able to access and receive separate proxy cards. Upon written or oral request, a separate copy of this proxy statement and the Company's Annual Report will be promptly delivered to any stockholder at a shared address to which the Company delivered a single copy of any of these documents. ToIf you prefer to receive a separate copycopies of thisthe proxy statement or the Company's Annual Report,annual report, contact Broadridge Financial Solutions, Inc. by calling 1-800-542-1061 or in writing at 51 Mercedes Way, Edgewood, New York 11717, Attention: Householding Department.

In addition, if you currently are a stockholder who shares an address with another stockholder and would like to receive only one copy of future notices and proxy materials for your household, you may notify your broker if your shares are held in a brokerage account or you may notify us if you hold registered shares. Registered stockholders may write or call the Company's transfer agentnotify us by contacting Broadridge Financial Solutions, Inc. at the following address andabove telephone number: American Stock Transfer & Trust Company, LLC, 6201 15^th Avenue, Brooklyn, NY 11219number or 1-800-937-5449. Stockholders who hold shares in street name may contact their brokerage firm, bank, broker-dealer or other similar organization to request information about householding.

address.

Q:

Can IWhat is notice and access the Company's proxy materials and Annual Report electronically?why did KAR Auction Services elect to use it?



A:

This year, for the first time, we are making the proxy statement and the Company's Annual Report arematerials available on our website at www.karauctionservices.com. Mostto stockholders can elect to view future proxy statements and annual reports overelectronically via the Internet insteadunder the Notice and Access regulations of the SEC. Most of our stockholders will receive a Notice of Electronic Availability ("Notice") in lieu of receiving paper copiesa full set proxy materials in the mail. IfThe Notice includes information on how to access and review the proxy materials, and how to vote, via the Internet. We believe this method of delivery will decrease costs, expedite distribution of proxy materials to you, are a stockholder of record, you can choose this option and savereduce our impact on the Company the cost of production and mailing these documents by registering for electronic access of future proxy statements at www.amstock.com. If you hold your KAR Auction Services stock through a bank, broker or other holder of record, you can choose this option and save the Company the cost of production and mailing these documents by registering for electronic access of future proxy statements at www.proxyvote.com.

If you choose to view future proxy statements and annual reports over the Internet, you willenvironment. Stockholders who receive a notice next year containingNotice but would like to receive a printed copy of the Internet address to access our proxy statement and Annual Report. The notice also will include instructions for voting overmaterials in the Internet. You will have the opportunity to opt out at any time by followingmail should follow the instructions atin the website addresses set forth above. Unless you subsequently elect to opt out, future notices will be available through Internet access. You do not have to re-elect Internet access each year.

Notice for requesting such materials.



Q:

How can I obtain a copy of KAR Auction Services' Annual Report on Form 10-K?



A:

Copies of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2012,2013, as filed with the SEC, are available to stockholders free of charge on KAR Auction Services' website at www.karauctionservices.com or by writing to KAR Auction Services, Inc., Investor Relations, 13085 Hamilton Crossing Boulevard, Carmel, Indiana 46032.



Q:

Where can I find the voting results of the annual meeting?



A:

KAR Auction Services will announce preliminary voting results at the annual meeting and publish preliminary, or final results if available, in a Current Report on Form 8-K within four business days of the annual meeting.




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PROPOSALS TO BE VOTED ON BY KAR AUCTION SERVICES' STOCKHOLDERSELECTION OF DIRECTORS


PROPOSAL NO. 1
ELECTION OF DIRECTORS


Directors Elected Annually


        Our Board of Directors and KAR LLC havehas nominated the thirteenten individuals named below to stand for election to the Board of Directors at the annual meeting. Messrs. Ament, Finlayson, Goldberg, Moore, O'Brien and Ward, who currently serve on our Board of Directors, are not standing for re-election at the annual meeting. KAR Auction Services' directors are elected each year by the stockholders at the annual meeting. We do not have a staggered or classified board. Each director's term will last until the 20142015 annual meeting of stockholders and until such director's successor is duly elected and qualified, or such director's earlier death, resignation or removal. Directors are elected by a plurality of the votes cast at the annual meeting.


Director Independence


        The Board of Directors is responsible for determining the independence of our directors. Under the NYSE listing standards, a director qualifies as independent if the Board of Directors affirmatively determines that the director has no material relationship with us. 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. Based upon its evaluation, our Board has affirmatively determined that the following directors and director nominees meet the standards of "independence" established by the NYSE: David J. Ament, Kelly J. Barlow, Thomas J. Carella,Ryan M. Birtwell, Donna R. Ecton, Robert M. Finlayson, Peter R. Formanek, Michael B. Goldberg, Sanjeev Mehra,Mark E. Hill, Lynn Jolliffe, Michael T. Kestner, John P. Larson, Church M. Moore, Gregory P. SpivyStephen E. Smith and Jonathan P. Ward. Brian T. Clingen, our Chairman of the Board, James P. Hallett, our CEO, and Thomas C. O'Brien, CEO of Insurance Auto Auctions, Inc. ("IAA"),IAA, are not independent directors.

        Mr. Barlow is not standing for re-election as a director at the annual meeting. As a result, there will be a vacancy on the Board unless another person is elected to fill the vacancy. Pursuant to the director designation agreement described under "Board Nominations and Director Nomination Process" below, KAR Holdings II, LLC ("KAR LLC") has nominated Ryan M. Birtwell to fill that vacancy. Our Board of Directors has evaluated Mr. Birtwell's independence and has affirmatively determined that, if elected, Mr. Birtwell would meet the standards of "independence" established by the NYSE.


Board Nominations and Director Nomination Process


        The Board of Directors is responsible for nominating members for election to the Board of Directors and for filling vacancies on the Board of Directors 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 of Directors for board membership. When formulating its Board of Directors membership recommendations, the Nominating and Corporate Governance Committee may also consider advice and recommendations from others, including stockholders, as it deems appropriate.

        Board candidates also 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 of Directors. Board members are expected to prepare for, attend and participate in all Board of Directors and applicable committee meetings and the Company's annual meetings of stockholders.

        In accordance with its charter, the Board of Directors also considers candidates for election as a director of the Company recommended by any stockholder, provided that the recommending




stockholder follows the procedures set forth in Section 5 of the Company's 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. The Board of Directors generally evaluates such candidates in the same manner by which it evaluates other director candidates considered by the Board of Directors.




        In connection with the Company's initial public offering, the Company entered into a director designation agreement that provides for the rightTable of KAR LLC to directly nominate individuals to our Board of Directors. The director designation agreement provides that, for so long as KAR LLC owns more than 50% of our outstanding common stock, KAR LLC will have the right to nominate seven individuals to the Company's Board of Directors at each meeting of stockholders where directors are to be elected. KAR LLC's designees are as follows: David J. Ament, Ryan M. Birtwell, Thomas J. Carella, Michael B. Goldberg, Sanjeev Mehra, Church M. Moore and Gregory P. Spivy.Contents

        An employment agreement entered into on February 27, 2012, between the Company and James P. Hallett, the Company's CEO, provides that Mr. Hallett shall be entitled to serve as a member of the Board of Directors for so long as the employment agreement is in effect.

        Previously, KAR LLC had the right to directly nominate individuals to our Board of Directors for so long as KAR LLC owned at least 5% of our outstanding common stock pursuant to a director designation agreement entered into in connection with the Company's initial public offering. See "Certain Related Party Relationships—Historical Transactions with Former Equity Sponsors—Director Designation Agreement." During 2013, KAR LLC sold all if its shares of Company common stock in a series of transactions, and accordingly, KAR LLC's director nomination rights have terminated and are of no further effect.


Diversity


        The Nominating and Corporate Governance Committee and the Board of Directors 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 of Directors. Although the Board of Directors does not have a formal diversity policy, the Nominating and Corporate Governance Committee and Board of Directors review these factors, including diversity, in considering candidates for board membership.





Information Regarding the Nominees for Election to the Board of Directors


        The following information is furnished with respect to each nominee for election as a director. AllSeven of the nominees other than Mr. Birtwell,are currently are directors. Each of the nominees has consented to being named in this proxy statement and to serve as a director if elected. If a nominee is unavailable to serve as a director, your proxies will have the authority and discretion to vote for another nominee proposed by the Board of Directors, or the Board of Directors may reduce the number of directors to be elected at the annual meeting. The ages of the nominees are as of the date of the annual meeting, June 12, 2013.10, 2014.




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David J. AmentRyan M. Birtwell		Mr. Ament, 38,Birtwell, 31, has been a member of the Board of Directors since April 2007.
		Mr. Ament joined Parthenon Capital, a private equity firm, in 2003 and is a Managing Partner in its Boston office. Prior to joining Parthenon, he was a principal at Audax Group, a private equity firm, from 2001 to 2003. Prior to that, Mr. Ament was an investment professional at Apollo Advisors from 1997 to 2001. Mr. Ament serves on the Board of Directors of the following companies: Altegra Health, Inc., Abeo, Inc., ASG Security, Bryant and Stratton College, Eliza Corporation, IWP, Inc. and Triad Isotopes, Inc.
		Mr. Ament is qualified to serve on the Board of Directors because he is a sophisticated investor with significant experience in the private equity industry.
Ryan M. Birtwell		June 2013. Mr. Birtwell 30, is a nominee for electionserves as a director.the Chairman of our Nominating and Corporate Governance Committee.
		Mr. Birtwell joined ValueAct Capital in 2004 and has been a Partner since 2013. Mr. Birtwell is a holder of the right to use the Chartered Financial Analyst® designation. Mr. Birtwell serves on the Board of Directors of Seitel, Inc.
		Mr. Birtwell is qualified to serve on the Board of Directors because he has significant experience in investment management, capital markets, treasury and financial analysis.
Thomas J. Carella		Mr. Carella, 38, has been a member of the Board of Directors since April 2007.
		Mr. Carella is a Managing Director of Goldman, Sachs & Co. Mr. Carella joined Goldman Sachs in 1997 and rejoined in 2004 following his graduation from Harvard Business School. Mr. Carella serves on the Board of Directors of Drayer Physical Therapy and HGI Global Holdings, Inc. Mr. Carella previously served as a director of Cequel Communications, LLC from May 2006 to November 2012.
		Mr. Carella is qualified to serve on the Board of Directors because he is a sophisticated investor with significant experience in the private equity industry.




Brian T. Clingen		Mr. Clingen, 53,54, has been the Chairman of the Board of Directors since April 2007. Mr. Clingen serves on our Compensation Committee.
		Mr. Clingen served as our Chief Executive Officer from April 2007 to September 2009. Mr. Clingen has served as a Managing Partner of BP Capital Management since 1998. Established in 1998, BP Capital Management manages private equity investments principally in the service and finance sectors. Prior to founding BP Capital Management, Mr. Clingen was the Chief Financial Officer of Universal Outdoor between 1988 and 1996. Kelso & Company invested in Universal Outdoor in 1993.
		Mr. Clingen is qualified to serve on the Board of Directors because he has significantof his executive management and leadership experience with the Company, as well as his operational and investment experience, including in the automotive services industry.
Robert M. FinlaysonDonna R. Ecton		Mr. Finlayson, 63,Ms. Ecton, 67, has been a member of the Board of Directors since December 2009. Mr. Finlayson2013. Ms. Ecton serves as the Chairman ofon our AuditCompensation Committee.
		Mr. Finlayson was employed byMs. Ecton is the accountingChairman and Chief Executive Officer of EEI, Inc., a management consulting firm of Ernst & Young LLP from 1975 through September 2008, when he retired as a partner. During that time, Mr. Finlaysonshe founded in July 1998. Prior to this, Ms. Ecton served as the lead partner onChief Operating Officer and a numberdirector of Fortune 500 company accountsPETsMART, Inc. Ms. Ecton has also served as well as the accountsChief Executive Officer of several private equity firms. Mr. Finlayson alsocompanies, including Business Mail Express, Inc., Van Houten North America Inc. and Andes Candies Inc., prior to which she held severalvarious senior management positions at Ernst & Young, including leading the firm's private equity practice groupNutri/System, Inc., Campbell Soup Company and servingNordemann Grimm, Inc. Ms. Ecton currently serves as a member of the firm's U.S. Executive Boardboard of Directors, which was responsible for all partner-related matters indirectors of CVR GP, LLC, the United States.general partner of CVR Partners, LP, and Body Central Corp.
		Mr. FinlaysonMs. Ecton is qualified to serve on the Board of Directors because of her executive management and leadership skills, as the Chairman of the Audit Committeewell as a result of his accounting expertise and business leadershipher public company board experience.




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Peter R. Formanek		Mr. Formanek, 69,70, has been a member of the Board of Directors since December 2009. Mr. Formanek serves on our Audit Committee and our Compensation Committee.
		Mr. Formanek has been a private investor since 1994 and has served on several public company boards. Prior to 1994, Mr. Formanek served as the President, Chief Operating Officer andwas a directorco-founder of AutoZone, Inc., a retailer of auto parts, and served as its President and Chief Operating Officer and a director from 1987 to 1994. From 1969 to 1987, Mr. Formanek served in various roles for Malone & Hyde, a food wholesaler and specialty retailer. Mr. Formanek previously served as a director of Burger King Holdings, Inc. from September 2003 to October 2010.
		Mr. Formanek is qualified to serve on the Board of Directors because he is a sophisticated investor with significant business leadership experience, including in the automotive industry.




Michael B. Goldberg		Mr. Goldberg, 66, has been a member ofbrings an entrepreneurial and operational perspective to the Board of Directors, since October 2009.
		Mr. Goldberg joined Kelso & Company in 1991having co-founded one of North America's largest retailers and has been Managing Director since 1991. He spent the preceding two years as a Managing Directordistributors of automotive replacement part and co-head of the mergers and acquisitions department at The First Boston Corporation. Mr. Goldberg spent the previous eleven years practicing corporate law in the mergers and acquisitions group of Skadden, Arps, Meagher & Flom, becoming a partner in 1980. He spent the previous five years as an associate at Cravath, Swaine & Moore. Mr. Goldberg servesaccessories. AutoZone, Inc. grew on the Boardbasis of Directors of Cronos Holding Company Ltd., Delphin Shipping LLCexcellent customer service, which is also fundamental to the Company's brand and Poseidon Containers Holdings LLC.strategy. In addition, Mr. Goldberg previously served as a director of RHI Entertainment, Inc. from August 2007 to March 2011, Buckeye GP Holdings L.P. from June 2007 to November 2010.
		Mr. Goldberg is qualified to serveFormanek's service on the Board of Directors because he is a sophisticated investor whose legal background brings valuable board governance experienceother public company boards provides great value to our Board of Directors.
James P. Hallett		Mr. Hallett, 60,61, has been a member of the Board of Directors since April 2007 and has been our Chief Executive Officer since September 2009.
		Mr. Hallett served as President and Chief Executive Officer of ADESA Inc. ("ADESA") from April 2007 to September 2009. Mr. Hallett served as: Executive Vice President of ADESA, Inc. from May 2004 to May 2005; President of ADESA Corporation, LLC from March 2004 to May 2005; President of ADESA Corporation between August 1996 and October 2001 and again between January 2003 and March 2004; Chief Executive Officer of ADESA Corporation from August 1996 to July 2003; ADESA Corporation's Chairman from October 2001 to July 2003; Chairman, President and Chief Executive Officer of ALLETE Automotive Services, Inc. from January 2001 to January 2003 and Executive Vice President from August 1996 to May 2004. Mr. Hallett left ADESA in May 2005 and thereafter served as President of the Columbus Fair Auto Auction until April 2007.
		Mr. Hallett is qualified to serve on the Board of Directors due to his significant business leadership experience and extensive knowledge of the automotive auction industry.




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Sanjeev MehraMark E. Hill		Mr. Mehra, 54, has beenHill, 58, is a member of the Board of Directors since April 2007. Mr. Mehra serves on our Compensation Committee and as the Chairman of our Nominating and Corporate Governance Committee.nominee for director.
		Mr. MehraHill is the Managing Partner of Collina Ventures, LLC, a private investment company that invests in software and technology companies. From 1985 to 2006, Mr. Hill served as Co-Founder, President and Chief Executive Officer of Baker Hill Corporation which served the banking industry with software and services that delivered business process needs. In 2005, Baker Hill was acquired by Experian, a global information solutions company. Mr. Hill has served as a Managing Director of Goldman, Sachs & Co. in its Principal Investment Area since 1990. Mr. Mehra joined Goldman Sachs in 1986. Mr. Mehra serves on the Boardboard of Directorsdirectors of ARAMARK Corporation, Interline Brands, Inc., Max India Ltd., Sigma Electric, SunGard Data Systems, Inc.Interactive Intelligence since 2005 and TVS Logistics. Mr. Mehra previously served as a director and Chairman ofis currently the Board of Hawker Beechcraft,  Inc. from March 2007 to February 2013. In addition, Mr. Mehra previously served as a director of First Aviation Services, Inc. from May 2008 to December 2012, Adam Aircraft Industries, Inc. from April 2003 to February 2008, Burger King Holdings, Inc. from December 2002 to October 2010, Madison River Telephone Company from October 1996 to April 2007 and Nalco Holding Company from November 2003 to May 2007.board's lead independent director.
		Mr. Mehra is qualified to serve on the Board of Directors because he is a sophisticated investor with significant experience in the financial sector and has public company board experience.
Church M. Moore		Mr. Moore, 40, has been a member of the Board of Directors since April 2007. Mr. Moore serves on our Nominating and Corporate Governance Committee and as the Chairman of our Compensation Committee.
		Mr. Moore joined Kelso & Company in 1998 and has been a Managing Director since 2007. For the preceding year, Mr. Moore was an associate at Investcorp International, Inc. For the previous three years, he was an analyst in the corporate finance group at BT Securities Corporation. Mr. Moore serves on the Board of Directors of Ellis Communications Group, LLC and Truck-Lite Co., LLC.
		Mr. Moore is qualified to serve on the Board of Directors because he is a sophisticated investor with significant experience in the private equity industry.
Thomas C. O'Brien		Mr. O'Brien, 59, has been a member of the Board of Directors since April 2007 and has been the Chief Executive Officer of IAA since November 2000.
		Prior to joining IAA, Mr. O'Brien served as President of Thomas O'Brien & Associates from 1999 to 2000, Executive Vice President of Safelite Glass Corporation from 1998 to 1999, Executive Vice President of Vistar, Inc. from 1996 to 1997 and President of U.S.A. Glass, Inc. from 1992 to 1996. Mr. O'Brien serves on the Board of Directors of CoreLogic, Inc.
		Mr. O'BrienHill is qualified to serve on the Board of Directors due to his significant businessexperience in the technology industry and leadership skills as a former CEO.
Lynn Jolliffe		Ms. Jolliffe, 62, is a nominee for director.
		Ms. Jolliffe is the Executive Vice President, Global Human Resources of Ingram Micro Inc., a technology distribution company, a position she has held since June 2007. Prior to that, Ms. Jolliffe served as Ingram Micro's Vice President, Human Resources for the North America region from October 2006 to May 2007 and as Regional Vice President, Human Resources and Services for Ingram Micro European Coordination Center from August 1999 to October 2006. Prior to joining Ingram Micro, Ms. Jolliffe served as Vice President and Chief Financial Officer with responsibility for human resources at two Canadian retailers, including Holt Renfrew.
		Ms. Jolliffe is qualified to serve on the Board of Directors due to her executive management and leadership experience includingand particular expertise in executive compensation issues.
Michael T. Kestner		Mr. Kestner, 59, has been a member of our Board of Directors since December 2013. Mr. Kestner serves on our Audit Committee.
		Mr. Kestner has served as the Chief Financial Officer of Building Materials Holding Corporation, a building products company, since August 2013. He previously was a partner in FocusCFO, a consulting firm providing part-time CFO services, from April 2012 to August 2013 and served as the 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, and Chief Financial Officer of Sinter Metals, Inc., a supplier of metal power precision components, from 1995 to 1998. Prior to that, he served in various capacities at Banc One Capital Partners and Wolfensohn Ventures LP and as a senior audit manager at KPMG LLP.
		Mr. Kestner is qualified to serve on the Board of Directors and the Audit Committee as a result of his extensive experience in businesses that provide services tofinancial analysis and financial statement preparation, as well has his management experience in the automotive industry.




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GregoryJohn P. SpivyLarson		Mr. Spivy, 44,has beenLarson, 51, is a member of the Board of Directors since April 2007. Mr. Spivy serves on our Compensation Committee.nominee for director.
		Mr. Spivy joined ValueAct Capital in 2004Larson served as the Chief Executive Officer of Escort Inc., an automotive electronics manufacturer, from January 2008 to January 2014, and has been a Partner since 2004.prior to that as President and Chief Operating Officer from June 2007 to January 2008. Prior to joining ValueAct Capital,Escort Inc., Mr. Spivy worked with Gryphon Investors,Larson served in a private equity fund,number of capacities at General Motors Company from 20021986 to 2004. Previously, Mr. Spivy was a Managing Director at Fremont Partners2007, most recently serving as General Manager overseeing operations for the Buick, Pontiac and GMC Divisions from 1995 to 2000. Prior to joining Fremont Partners, Mr. Spivy was a director with The Bridgeford Group, and began his career in the mergers and acquisitions department of Lehman Brothers. Mr. Spivy serves as Chairman of the Board of Directors of Seitel, Inc. Mr. Spivy previously served as a director of MDS, Inc. from April 2008January 2005 to May 2010.2007 and as Chief Financial Officer for U.S. Sales, Service and Marketing Operations from 2001 to 2004.
		Mr. Spivy is qualified to serve on the Board of Directors because he is a sophisticated investor with significant experience in the financial sector.
Jonathan P. Ward		Mr. Ward, 59,has been a member of the Board of Directors since December 2009. Mr. Ward serves on our Audit Committee and our Nominating and Corporate Governance Committee.
		Mr. Ward has served as an Operating Partner of Kohlberg & Co., an investment firm, since July 2009. Mr. Ward served as the former Chairman of the Chicago office of Lazard Ltd., an investment banking firm, and Managing Director of Lazard Freres & Co., LLC from November 2006 to June 2009. Mr. Ward served as Chairman and Chief Executive Officer of The ServiceMaster Company, a national service company, from 2002 to 2006, and President and Chief Executive Officer of ServiceMaster from 2001 to 2002. Mr. Ward was President and Chief Operating Officer of RR Donnelley & Sons Company, a commercial printing company, from 1997 to 2001. Mr. Ward serves on the Board of Directors of Hub Group, Inc., Standard Parking Corporation and The Hillshire Brands Company. Mr. Ward previously served as a director of United Stationers, Inc. from July 2011 to June 2012.
		Mr. WardLarson is qualified to serve on the Board of Directors as a result of his financial expertise and businessextensive experience serving in executive leadership experience and has public company board experience.roles in the automotive industry.
Stephen E. Smith		Mr. Smith, 65, has been a member of the Board of Directors since December 2013.
		Mr. Smith has been a consultant in the automotive industry since October 2012. Mr. Smith also served as the interim President of the California Council on Economic Education, a not-for-profit organization that provides training and educational materials to California teachers relating to economics and personal finance, from July 2013 to February 2014. From 1985 to October 2012, Mr. Smith served in various capacities at American Honda Finance Corporation, a provider of automobile financing to purchasers, lessees and dealers, and most recently served as the Senior Vice President—Financial Services and as a director, from June 2004 to June 2012.
		Mr. Smith is qualified to serve on the Board of Directors due to his extensive operational and management experience in the automotive industry.

KAR AUCTION SERVICES' BOARD OF DIRECTORS RECOMMENDS A VOTE
"FOR" THE ELECTION OF THE FOREGOING THIRTEENTEN NOMINEES
TO THE BOARD OF DIRECTORS.

PROXIES SOLICITED BY THE BOARD OF DIRECTORS WILL BE VOTED "FOR" THE
ELECTION OF EACH OF THE DIRECTOR NOMINEES NAMED IN THIS
PROXY STATEMENT AND THE PROXY CARD UNLESS STOCKHOLDERS SPECIFY A
CONTRARY VOTE.




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BOARD OF DIRECTORS STRUCTURE AND CORPORATE GOVERNANCE


Role of the Board of Directors


        The Company's business and affairs are managed under the direction of the Board of Directors, which is the Company's ultimate decision-making body, except with respect to those matters reserved to the Company's stockholders. The Board of Directors, among other things, establishes the Company's overall corporate policies, evaluates the Company's Chief Executive Officer and the senior leadership team and oversees senior management. The Board of Directors also oversees the Company's business strategy and planning, as well as the performance of management in executing the Company's business strategy, assessing and managing risks and managing the Company's day-to-day operations.


Board Leadership


        Currently, KAR Auction Services separates the roles of Chairman of the Board of Directors and Chief Executive Officer. Separating these roles allows our Chief Executive Officer to focus on the day-to-day management of our business and our Chairman of the Board of Directors to lead the Board of Directors and focus on providing advice and general oversight of management. Given the time and effort that is required of each of these positions, the Company currently believes it is best to separate these roles. However, neither the Company's Amended and Restated By-Laws nor the Company's Corporate Governance Guidelines requires that the Company separate these roles and the Board of Directors does not have a policy on whether the same person should serve as both the Chief Executive Officer and Chairman of the Board of Directors, or if the roles must remain separate. The Board of Directors 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.


Board of Directors Meetings and Attendance


        The Board of Directors held 13 meetings during 2012.2013. All of the incumbent directors attended at least 75% of the meetings of the Board of Directors and Board committees on which they served during 2012.2013. As stated in our Corporate Governance Guidelines, each director is expected to attend all annual meetings of stockholders. Last year's annual meeting of stockholders was attended, either in person or by telephone, by substantially all of the directors.


Committees of the Board of Directors


        In 2012,2013, the Board of Directors maintained three standing committees: the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee. A description of each Board committee is set forth below.

        Audit Committee.    Our Audit Committee assists the Board of Directors 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 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; 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; reviews our financial risk and control procedures, compliance programs and significant tax, legal and regulatory matters; and 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. The Audit Committee held fivesix meetings during 2012.2013. Messrs. Finlayson, Formanek, Kestner and Ward, who comprise the Audit Committee, are "financially literate" under the rules of the New York Stock Exchange (the "NYSE").




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Mr. Finlayson serves as Chairman of the Audit Committee and haseach of Messrs. Finlayson, Formanek and Kestner have been designated as ouran "audit committee financial expert" as that term is defined by the SEC. In addition, the Board of Directors has determined that each of the members 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. If all of our director nominees are elected at the annual meeting, we expect to appoint Messrs. Kestner, Larson and Smith and Ms. Jolliffe as members of the Audit Committee following the annual meeting.

        Compensation Committee.    The Compensation Committee reviews and recommends policies relating to compensation and benefits of our officers and employees. The Compensation Committee establishes, reviews and approves corporate goals and objectives relevant to the compensation of our Chief Executive Officer 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 stock options and other awards under our equity plans. The Compensation Committee held four11 meetings during 2012.2013. The Compensation Committee is currently comprised of Messrs. Clingen, Formanek Mehra,and Moore and Spivy.Ms. Ecton. Mr. Moore serves as Chairman of the Compensation Committee. Mr. Clingen, Sanjeev Mehra and Gregory P. Spivy served on the Compensation Committee during a portion of 2013. All of the current and former members of the Compensation Committee are, or were during their tenure on the committee, independent under the NYSE rules (including the new enhanced independence requirements for Compensation Committee members), except for Mr. Clingen. If all of our director nominees are elected at the annual meeting, we expect to appoint Messrs. Formanek and Larson, Ms. Ecton and Ms. Jolliffe as members of the Compensation Committee following the annual meeting.

The Compensation Committee did not retain aretained ClearBridge Compensation Group ("ClearBridge") as its independent compensation consultant in 2012.2013. During 2013, ClearBridge provided advice to the Compensation Committee with respect to the assessment of the Company's executive compensation practices, evaluation of long-term incentive compensation practices, designing new long-term equity awards, and related compensation matters. 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 ClearBridge's work for the Compensation Committee does not raise any conflict of interest.

        Nominating and Corporate Governance Committee.    The Nominating and Corporate Governance Committee is responsible for making recommendations to the Board of Directors regarding candidates for directorships and the size and composition of the Board of Directors. In addition, the Nominating and Corporate Governance Committee is responsible for overseeing our Corporate Governance Guidelines and reporting and making recommendations to the Board of Directors concerning governance matters. The Nominating and Corporate Governance Committee held one meetingfour meetings during 2012.2013. The Nominating and Corporate Governance Committee is comprised of Messrs. Barlow, Mehra,Birtwell, Goldberg, Moore and Ward. Mr. MehraBirtwell serves as Chairman of the Nominating and Corporate Governance Committee. Kelly J. Barlow and Mr. Mehra served on the Nominating and Corporate Governance Committee during 2013. All of the current and former members of the Nominating and Corporate Governance Committee are, or were during their tenure on the committee, independent under the NYSE rules. If all of our director nominees are elected at the annual meeting, we expect to appoint Messrs. Birtwell, Hill and Smith as members of the Nominating and Corporate Governance Committee following the annual meeting.

        Each of our committees operates pursuant to a written charter. Copies of the committee charters are available on KAR Auction Services' website at www.karauctionservices.com on the "Investor Relations" page under the link "Corporate Governance." 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.




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Board of Directors' Oversight of Risk


        Our management is responsible for the management and assessment of risk at the Company, including communication of the most material risks to the Board of Directors and its committees. The Board of Directors provides oversight with respect to risk practices implemented by management, except for the oversight of risks that have been specifically delegated to a committee of the Board of Directors. Even when the oversight of a specific area of risk has been delegated to a committee, the Board of Directors may maintain oversight over such risks through the receipt of reports from the committee chairpersons to the Board of Directors at each regularly scheduled Board of Directors meeting. The Board of Directors and committee reviews occur principally through the receipt of regular reports from management to the Board of Directors on these areas of risk, and discussions with management regarding risk assessment and risk management.

        At its regularly scheduled meetings, the Board of Directors 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 Chief Executive Officer of each primary business unit provides an




operational report, which includes information relating to strategic, operational and competitive risks. Finally, the Company's General Counsel provides a privileged report which provides information regarding the status of the Company's material litigation and related matters, including environmental updates and the Company's continuing compliance with applicable laws and regulations. At each regularly scheduled Board of Directors meeting, the Board of Directors also receives reports from committee chairpersons, which may include a discussion of risks initially overseen by the committees for discussion and input from the Board of Directors. As noted above, in addition to these regular reports, the Board of Directors receives reports on specific areas of risk from time to time, such as regulatory, cyclical or other risks that are not covered in the regular reports given to the Board of Directors and described above.

        The Board of Directors' leadership structure, through its committees, also supports its role in risk oversight. The Audit Committee maintains initial oversight over risks related to the integrity of the Company's financial statements; internal controls over financial reporting and disclosure controls and procedures (including the performance of the Company's internal audit function); the performance of the independent auditor; and oversees the Company's responses to ethics issues arising from the Company's whistleblower hotline. The Company's Compensation Committee maintains oversight over risks related to the Company's compensation practices. The Nominating and Corporate Governance Committee monitors potential risks relating to the effectiveness of the Board of Directors, notably director succession, composition of the Board of Directors and the principal policies that guide the Company's governance.




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Corporate Governance Documents


        The Board of Directors has adopted the following corporate governance documents:

Document		Purpose/Application
Code of Business Conduct and Ethics		Applies to all of the Company's employees, officers and directors, including those officers responsible for financial reporting.
Code of Ethics for Principal Executive and Senior Financial Officers		Applies to the Company's principal executive officer, principal financial and accounting officer and such other persons who are designated by the Board of Directors.
Corporate Governance Guidelines		Contains general principles regarding the functions of the Board of Directors and its committees.
Committee Charters		Applies to the following Board committees, as applicable: Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee.

        We expect that any amendments to the codes of ethics, or any waivers of their requirements for executive officers and directors, will be disclosed on the Company's website. The foregoing documents are available at www.karauctionservices.com under the "Investor Relations" link on the "Corporate Governance" page and in print to any stockholder who requests them. Requests should be made to KAR Auction Services, Inc., Investor Relations, 13085 Hamilton Crossing Boulevard, Carmel, Indiana 46032. 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.





"ControlledCessation of "Controlled Company" ExemptionStatus


        At the time of our initial public offering, we qualified as a "controlled company" within the meaning of the NYSE corporate governance standards, as KAR LLC controlscontrolled a majority of the voting power of our outstanding common stock. The Equity Sponsors and management indirectly own through their investment inAs of June 6, 2013, KAR LLC approximately 56%ceased to hold a majority of our outstanding common stock and, as of the date of this proxy statement, does not hold any shares of our common stock. As a result,controlled company, we are a "controlled company" within the meaning of the NYSE corporate governance standards. Under the NYSE rules, a company of which more than 50% of the voting power is held by an individual, group or another company is a "controlled company" and may elect not to complywere exempt from compliance with certain NYSE corporate governance standards, including:

•

including (i) the requirement that a majority of the Board of Directors consist of independent directors;



•

(ii) the requirement that we have a nominating/corporate governance committee that is composed entirely of independent directors with a written charter addressing the committee's purposedirectors; and responsibilities;



•

(iii) the requirement that we have a compensation committee that is composed entirely of independent directorsdirectors.

        The NYSE listing rules provide that, to the extent a controlled company ceases to qualify as such, it is required to comply with a written charter addressing the committee's purpose and responsibilities;corporate governance requirements from which it was previously exempt as follows:

•

The company must satisfy the majority independent board requirement within one year of the date its status changed; and



•

The company must have at least one independent member on its nominating committee and at least one independent member on its compensation committee by the requirement for an annual performance evaluationdate its status changed, at




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least a majority of independent members on each committee within 90 days of the nominating/corporate governancedate its status changed and compensation committees.

        We utilize certain of these exemptions. Accordingly, you may not have the same protections afforded to stockholders of companies that are subject to allfully independent committees within one year of the date its status changed.

        As of the date of this proxy statement, ten of our 13 directors are independent under NYSE corporate governance requirements.standards, and each of our committees is comprised entirely of independent directors. In addition, eight of our ten nominees are independent.

Compensation Committee Interlocks and Insider Participation

        ForDuring the fiscal year ended December 31, 2012,2013, Messrs. Clingen, Formanek, Mehra, Moore and Spivy and Ms. Ecton served as members of the Compensation Committee was comprised of Church M. Moore (Chairman), Brian T. Clingen, Peter R. Formanek, Sanjeev Mehra and Gregory P. Spivy.Committee. None of our executive officers serve 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 of Directors or our Compensation Committee. None of the individuals serving as members of the Compensation Committee during 2013 is now or was previously an officer or employee of the Company, other than Mr. Clingen who is the Chairman of the Board of Directors and served as the Company's Chief Executive Officer from April 2007 to September 2009. See "Certain Related Party Relationships" for a description of certain relationships between the Company and members of the Compensation Committee or their affiliated companies.

Section 16(a) Beneficial Ownership Reporting Compliance

        Section 16(a) of the Securities Exchange Act of 1934, as amended, requires KAR Auction Services' directors and executive officers and persons who own more than 10% of the issued and outstanding shares of the Company's common stock to file reports of initial ownership of common stock and other equity securities and subsequent changes in that ownership with the SEC and the NYSE. Based solely on a review of such reports and written representations from the directors and executive officers, the Company believes that all such filing requirements were met during 2012, other than one late Form 4 filed on April 5, 2013 by Jonathan P. Ward reporting phantom shares received in connection the reinvestment of dividend equivalents pursuant to the terms of the KAR Auction Services, Inc. Directors Deferred Compensation Plan.2013.

Director CompensationDIRECTOR COMPENSATION

        We use a combination of cash and stock-based incentive compensation to attract and retain independent, qualified candidates to serve on the Board of Directors. In setting director compensation,