COPART INC (CPRT): CEO A. Jayson Adair compensation terms

Events in this filing

Item 5.02 as filed

Item 5.02.
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On October 14, 2026 (the “Grant Date”), the board of directors (the “Board”) of Copart, Inc. (the “Company”), upon recommendation by its Compensation Committee, approved the grant to A. Jayson Adair, the Company’s Chief Executive Officer (“CEO”), of a nonstatutory stock option to purchase 20,000,000 shares of the Company’s common stock (the “Option”) pursuant to a stand-alone stock option award agreement (the “Option Agreement”). The Option was granted outside of the Company’s 2007 Equity Incentive Plan, as amended and restated, and is subject to approval by the Company’s stockholders at the Company’s 2026 Annual Meeting of Stockholders (the “2026 Annual Meeting”) or a special meeting of the stockholders following the 2026 Annual Meeting. No portion of the Option may be exercised before stockholder approval is obtained, and if stockholder approval is not obtained at the 2026 Annual Meeting or such special meeting, the Option will be forfeited in its entirety.
The shares subject to the Option are divided into 4 tranches with different exercise prices, as follows: (i) 5,000,000 shares at $26.27 per share, (ii) 5,000,000 shares at $35.03 per share, (iii) 5,000,000 shares at $43.78 per share, and (iv) 5,000,000 shares at $52.54 per share. The Option has a term of 10 years and, other than certain perquisite programs approved by the Compensation Committee, is intended to serve as Mr. Adair’s only substantive cash or equity compensation for the 10-year period following the Grant Date, as Mr. Adair is expected to receive a salary of $1 each year and is not expected to receive a bonus or additional equity awards during that period.
The Option will vest become exercisable on the 5th anniversary of the Grant Date, subject to Mr. Adair’s continued service as CEO through such date except as noted below.
Vested shares are subject to a service-based Company clawback, pursuant to which 10% of the shares are subject to clawback for each whole or partial year of the 10-year term following Mr. Adair’s termination of service as CEO (including both exercised and unexercised shares). Additionally, the shares received upon exercise of the Option with a value equal to the gain recognized upon exercise, net of taxes, are subject to a holding period through the 10-year term of the award.
If Mr. Adair’s service as CEO terminates due to death or disability, the portion of the Option for which the average closing sales price of a share over the 30 trading days preceding the date of termination exceeds the applicable exercise price will vest, and the Company clawback and the holding period will be waived as to such vested shares and any shares that previously vested. Any portion of the Option that does not vest in accordance with the foregoing will be forfeited.
Upon a change in control of the Company, and subject to Mr. Adair’s continued service as CEO through such change in control, to the extent then unvested, the portion of the Option for which the price per share paid to holders of the Company’s common stock in the change in control exceeds the applicable exercise price will vest as of immediately prior to the change in control. Shares that vest in this manner will remain subject to the Company clawback and the holding period described above.
If, following the change in control, Mr. Adair’s service as CEO is terminated by the Company without cause or Mr. Adair resigns for good reason, or in the event of his death or disability, the Company clawback and the holding period will be waived, subject to execution of a release of claims in favor of the Company.
The Option is subject to the Company’s Compensation Recovery Policy, the current version of which was filed by the Company as an exhibit to its Annual Report on Form 10-K for the year ended July 31, 2026 (such Annual Report, the “Annual Report”), as may be amended from time to time.
This summary of the Option is qualified in its entirety by reference to the full text of the Option Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference.
Section 9 - Financial Statements and Exhibits