Limited Liability Company Agreement of KAR Holdings II, LLC



 Exhibit 10.23 
 LIMITED LIABILITY COMPANY AGREEMENT 
 OF 
 KAR HOLDINGS II, LLC 
 THIS LIMITED LIABILITY COMPANY AGREEMENT (the “Agreement”) of KAR Holdings II, LLC (the
“Company”) dated as of this 15th day of December, 2006, by Kelso Investment Associates VII, L.P., as the sole member of the Company (the
“Member”). 
 RECITAL 
 The Member has formed the Company as a limited liability company under the laws of the State of Delaware and desires to enter into a written agreement, in accordance with the provisions of the Delaware Limited
Liability Company Act and any successor statute, as amended from time to time (the “Act”), governing the affairs of the Company and the conduct of its business. 
 ARTICLE 1 
 THE LIMITED LIABILITY COMPANY 
 1.1 Formation. The Member has previously formed the Company as a limited liability company pursuant to the provisions of the Act. A
certificate of formation for the Company as described in Section 18-201 of the Act (the “Certificate of Formation”) has been filed in the Office of the Secretary of State of the State of Delaware in conformity with the Act.

 1.2 Authorized Person. The designation of Lynn Buckley as an authorized person within the meaning of the Act and the actions
taken by Lynn Buckley in causing the Certificate of Formation to be executed, delivered and filed with the Secretary of State of Delaware on December 15, 2006, are hereby ratified, adopted and appointed. 
 1.3 Name. The name of the Company shall be “KAR Holdings II, LLC” and its business shall be carried on in such name with such
variations and changes as the Member shall determine or deem necessary to comply with requirements of the jurisdictions in which the Company’s operations are conducted. 
 1.4 Business Purpose; Powers. The Company is formed for the purpose of engaging in any lawful business, purpose or activity for which
limited liability companies may be formed under the Act. The Company shall possess and may exercise all the powers and privileges granted by the Act or by any other law or by this Agreement, together with any powers incidental thereto, so far as
such powers and privileges are necessary or convenient to the conduct, promotion or attainment of the business purposes or activities of the Company. 







 1.5 Registered Office and Agent. The location of the registered office of the Company shall
be 160 Greentree Drive, Suite 101, Dover, Delaware. The Company’s Registered Agent at such address shall be The National Registered Agents, Inc. 
 1.6 Term. Subject to the provisions of Article 6 below, the Company shall have perpetual existence. 
 ARTICLE 2 
 THE MEMBER 
 2.1 The Member. The name and address of the Member is as follows: 
  

			
	 Name
	 	 Address

	 Kelso Investment Associates VII, L.P.
	 	c/o Kelso & Company
		 	320 Park Avenue, 24th Floor
		 	New York, NY 10022

 2.2 Actions by the Member; Meetings. The Member may approve a matter or take any
action at a meeting or without a meeting by the written consent of the Member. Meetings of the Member may be called at any time by the Member. 
 2.3 Liability of the Member. All debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and the Member shall
not be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a member. 
 2.4 Power
to Bind the Company. The Member (acting in its capacity as such) shall have the authority to bind the Company to any third party with respect to any matter. 
 2.5 Admission of Members. New members shall be admitted only upon the approval of the Member. 
 ARTICLE 3 
 MANAGEMENT BY THE MEMBER 
 The management of the Company is fully reserved to the Member, and the Company shall not have “managers,” as that term is used in the Act. The powers of the Company shall be exercised by or under the authority of, and the business
and affairs of the Company shall be managed under the direction of, the Member, who shall make all decisions and take all actions for the Company. In managing the business and affairs of the Company and exercising its powers, the Member shall act
through resolutions adopted in written consents. Decisions or actions taken by the Member in accordance with this Agreement shall constitute decisions or action by the Company and shall be binding on the Company. 
 3.2 Officers and Related Persons. The Member shall have the authority to appoint and terminate officers of the Company and retain and
terminate employees, agents and 

  

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consultants of the Company and to delegate such duties to any such officers, employees, agents and consultants as the Member deems appropriate, including the
power, acting individually or jointly, to represent and bind the Company in all matters, in accordance with the scope of their respective duties. The following persons are hereby appointed officers of the Company: 
  

	
	Michael B. Goldberg – President
	
	David I. Wahrhaftig - Vice President
	
	Frank J. Loverro – Vice President and Treasurer
	
	James J. Connors, II – Vice President and Secretary

 ARTICLE 4 
 CAPITAL STRUCTURE AND CONTRIBUTIONS 
 4.1 Capital Structure. The capital structure of
the Company shall consist of one class of common interests (the “Common Interests”). All Common Interests shall be identical with each other in every respect. The Member shall own all of the Common Interests issued and outstanding.

 4.2 Capital Contributions. From time to time, the Member may determine that the Company requires capital and may make
capital contribution(s) in an amount determined by the Member. A capital account shall be maintained for the Member, to which contributions and profits shall be credited and against which distributions and losses shall be charged. 
 ARTICLE 5 
 PROFITS, LOSSES AND
DISTRIBUTIONS 
 5.1 Profits and Losses. For financial accounting and tax purposes, the Company’s net profits or net
losses shall be determined on an annual basis in accordance with the manner determined by the Member. In each year, profits and losses shall be allocated entirely to the Member. 
 5.2 Distributions. The Member shall determine profits available for distribution and the amount, if any, to be distributed to the Member,
and shall authorize and distribute on the Common Interests, the determined amount when, as and if declared by the Member. The distributions of the Company shall be allocated entirely to the Member. 
 ARTICLE 6 
 EVENTS OF DISSOLUTION

 The Company shall be dissolved and its affairs wound up upon the occurrence of any of the following events (each, an “Event of
Dissolution”): 
 (a) The Member votes for dissolution; or 
  


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 (b) A judicial dissolution of the Company under Section 18-802 of the Act. 
 ARTICLE 7 
 TRANSFER OF INTERESTS IN THE
COMPANY 
 The Member may sell, assign, transfer, convey, gift, exchange or otherwise dispose of any or all of its Common Interests and,
upon receipt by the Company of a written agreement executed by the person or entity to whom such Common Interests are to be transferred agreeing to be bound by the terms of this Agreement, such person shall be admitted as a member. 
 ARTICLE 8 
 EXCULPATION AND INDEMNIFICATION

 8.1 Exculpation. Notwithstanding any other provisions of this Agreement, whether express or implied, or any obligation
or duty at law or in equity, none of the Member, or any officers, directors, stockholders, partners, employees, affiliates, representatives or agents of any of the Member, nor any officer, employee, representative or agent of the Company
(individually, a “Covered Person” and, collectively, the “Covered Persons”) shall be liable to the Company or any other person for any act or omission (in relation to the Company, its property or the conduct of its business or
affairs, this Agreement, any related document or any transaction or investment contemplated hereby or thereby) taken or omitted by a Covered Person in the reasonable belief that such act or omission is in or is not contrary to the best interests of
the Company and is within the scope of authority granted to such Covered Person by the Agreement, provided such act or omission does not constitute fraud, willful misconduct, bad faith, or gross negligence. 
 8.2 Indemnification. To the fullest extent permitted by law, the Company shall indemnify and hold harmless each Covered Person from and
against any and all losses, claims, demands, liabilities, expenses, judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative
(“Claims”), in which the Covered Person may be involved, or threatened to be involved, as a party or otherwise, by reason of its management of the affairs of the Company or which relates to or arises out of the Company or its property,
business or affairs. A Covered Person shall not be entitled to indemnification under this Section 8.2 with respect to (i) any Claim with respect to which such Covered Person has engaged in fraud, willful misconduct, bad faith or gross
negligence or (ii) any Claim initiated by such Covered Person unless such Claim (or part thereof) (A) was brought to enforce such Covered Person’s rights to indemnification hereunder or (B) was authorized or consented to by the
Member. Expenses incurred by a Covered Person in defending any Claim shall be paid by the Company in advance of the final disposition of such Claim upon receipt by the Company of an undertaking by or on behalf of such Covered Person to repay such
amount if it shall be ultimately determined that such Covered Person is not entitled to be indemnified by the Company as authorized by this Section 8.2. 
  

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 8.3 Amendments. Any repeal or modification of this Article VIII by the Member shall not
adversely affect any rights of such Covered Person pursuant to this Article VIII, including the right to indemnification and to the advancement of expenses of a Covered Person existing at the time of such repeal or modification with respect to any
acts or omissions occurring prior to such repeal or modification. 
 ARTICLE 9 
 MISCELLANEOUS 
 9.1 Tax Treatment. Unless otherwise determined by
the Member, the Company shall be a disregarded entity for U.S. federal income tax purposes (as well as for any analogous state or local tax purposes), and the Member and the Company shall timely make any and all necessary elections and filings for
the Company treated as a disregarded entity for U.S. federal income tax purposes (as well as for any analogous state or local tax purposes). 
 9.2 Amendments. Amendments to this Agreement and to the Certificate of Formation shall be approved in writing by the Member. An amendment shall become effective as of the date specified in the approval of the Member or if none
is specified as of the date of such approval or as otherwise provided in the Act. 
 9.3 Severability. If any provision of this
Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being
impaired or invalidated in any way unless such invalid or unenforceable provision or clause shall be so significant as to materially affect the expectations of the Member regarding this Agreement. Otherwise, any invalid or unenforceable provision
shall be replaced by the Member with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision. 
 9.4 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to the principles of conflicts of laws thereof. 
 9.5 Limited Liability Company. The Member intends to form a limited liability company and does not intend to form a partnership under the
laws of the State of Delaware or any other laws. 
  

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 IN WITNESS WHEREOF, the undersigned has duly executed this Agreement as of the day first above written.

  

			
	KELSO INVESTMENT ASSOCIATES VII, L.P.
		
	By:	 	Kelso GP VII, L.P., the general partner
		
	By:	 	Kelso GP VII, LLC, its general partner
		
	By:	 	 /s/ James J. Connors, II

	Name:	 	James J. Connors, II
	Title:	 	Managing Member