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

SCHEDULE 14A
(RULE 14a-101)

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934

Check the appropriate box:

AXALTA COATING SYSTEMS LTD.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

Notice of 2019 Annual General Meeting
of Members and Proxy Statement

Axalta Coating Systems Ltd.

Wednesday, May 1, 2019 at 1:00 p.m., local time
Convene, 2001 Market Street, 2nd Floor, Philadelphia, PA 19103

Who Can Vote:

Only holders of our common shares at the close of business on March 8, 2019, the record date, will be entitled to receive notice of, and to vote at, the Annual General Meeting.

Annual Report:

Our 2018 Annual Report to Members accompanies but is not part of this Proxy Statement.

Proxy Voting:

Your Vote is Important. Please vote your shares at your earliest convenience. This will ensure the presence of a quorum at the meeting. Promptly voting your shares via the Internet, by telephone, or by signing, dating and returning the enclosed proxy card or voting instruction form will save the Company the expenses and extra work of additional solicitation. If you wish to vote by mail, for those receiving printed copies of the proxy materials we have enclosed an envelope, postage prepaid if mailed in the United States. Submitting your proxy now will not prevent you from voting your shares at the meeting, as your proxy is revocable at your option. You may revoke your proxy at any time before it is voted by delivering to the Company a subsequently executed proxy or a written notice of revocation or by voting in person at the Annual General Meeting.

Items of Business:

Date of Mailing:

A Notice of Internet Availability of Proxy Materials or this Proxy Statement is first being mailed to shareholders on or about March 21, 2019.

BY ORDER OF THE BOARD OF DIRECTORS,

Sincerely,
Tabitha R. Oman	Jared T. Zane
Vice President, Interim General Counsel & Chief Compliance Officer	Deputy General Counsel & Interim Corporate Secretary
March 21, 2019

TABLE OF CONTENTS
   

PROXY SUMMARY
   

This proxy statement (this “Proxy Statement”) and accompanying proxy materials are being furnished to the shareholders (referred to herein as “shareholders” or “members”) of Axalta Coating Systems Ltd., a Bermuda exempted company (the “Company” or “Axalta”), in connection with the solicitation of proxies by the board of directors of the Company (the “Board” or the “Board of Directors”) for use at the 2019 Annual General Meeting of Members, and at any adjournment or postponement thereof (the “Annual Meeting”), for the purposes set forth in the accompanying Notice of 2019 Annual General Meeting. This summary highlights information contained elsewhere in this Proxy Statement and in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018. For more complete information about these topics, please review the Company’s complete Proxy Statement and Annual Report on Form 10-K. Please also see the Questions and Answers section beginning on page 66 for important information about proxy materials, voting, the Annual Meeting, Company documents and communications.

Our Board of Directors

2018 Financial and Operating Highlights

Axalta accomplished a great deal in 2018 in the face of several headwinds. Notably:

business was driven by strong price and product mix improvement. Our Industrial business experienced solid organic growth, benefiting from significant investment in innovation and marketing support in recent years. Also, our Transportation Coatings segment responded well to challenging market conditions.

Corporate Governance Highlights

The Company is committed to meeting the highest standards of ethical behavior, corporate governance and business conduct. This commitment has led the Company to implement the following practices:

Executive Compensation Highlights

We maintain several guiding principles with respect to our executive compensation, and review our compensation programs on an ongoing basis to ensure that market and regulatory best practices are considered and addressed, including:

Compensation Committee may require reimbursement of incentive compensation awarded to an executive officer if the Company is required to restate its financial results as a result of the executive officer’s misconduct.

Our Board of Directors currently consists of nine directors divided into three classes with staggered three-year terms, so that the term of one class expires at each Annual General Meeting of Members. At our Annual General Meeting of Members in 2018 (the “2018 Annual Meeting”), our shareholders approved our Second Amended and Restated Bye-laws (“Bye-laws”) which eliminate our classified board structure over a three-year transition period. In accordance with this transition plan, the two nominees listed below will be proposed for election as Class II directors at the Annual Meeting to serve until the Annual General Meeting of Members in 2021, or until their successors are duly elected or until the earliest of their death, resignation or removal. Information regarding our directors’ professional experience, education, skills, ages and other relevant information (as of March 8, 2019) is set forth below.

There are three Class II directors presently serving as directors of the Company and two of the Class II directors, Ms. Kissire and Ms. Lempres, have been nominated and have agreed to stand for reelection. Mr. Kramvis, the third Class II director, informed the Company in January 2019 that he did not intend to stand for reelection due to his other commitments and his term will end at the Annual Meeting, which will result in one vacancy in Class II. The Board has not nominated any individual to fill this vacancy at this time.

In addition, if for any reason any nominee shall not be a candidate for election as a director at the Annual Meeting, it is intended that shares represented by the accompanying proxy will be voted for the election of a substitute nominee designated by our Board of Directors, or, alternatively, the Board may determine to leave the vacancy temporarily unfilled.

Nominees for Election as Class II Directors with Terms Expiring at the 2021 Annual General Meeting of Members

	Deborah J. Kissire
	Age: 61
	Axalta Board Service
	• Tenure: 2 years (December 2016) • Nominating & Corporate Governance Committee (Chair) • Compensation Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

	Elizabeth C. Lempres
	Age: 58
	Axalta Board Service
	• Tenure: 1 year (April 2017) • Compensation Committee (Chair) • Nominating & Corporate Governance Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

The Board of Directors recommends a vote “FOR” the election of both of the Class II directors to serve until the 2021 Annual General Meeting. Election of the nominees to our Board of Directors requires the affirmative vote of a plurality of votes cast at the Annual Meeting.

Class II Directors with Terms Expiring at the 2019 Annual General Meeting of Members

	Andreas C. Kramvis
	Age: 66
	Axalta Board Service
	• Tenure: 4 years (July 2014) • Audit Committee • Environment, Health, Safety & Sustainability Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

Continuing Class I Directors with Terms Expiring at the 2021 Annual General Meeting of Members

	Robert W. Bryant
	Age: 50
	Axalta Board Service
	• Tenure: <1 year (December 2018)

Professional Experience

Education

Relevant Skills

Other

	Robert M. McLaughlin
	Age: 61
	Axalta Board Service
	• Tenure: 4 years (April 2014) • Audit Committee (Chair) • Compensation Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

	Samuel L. Smolik
	Age: 65
	Axalta Board Service
	• Tenure: 2 years (September 2016) • Environment, Health, Safety & Sustainability Committee (Chair) • Nominating & Corporate Governance Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

Continuing Class III Directors with Terms Expiring at the 2020 Annual General Meeting of Members

	Charles W. Shaver
	Age: 60
	Axalta Board Service
	• Tenure: 6 years (February 2013) • Chairman of the Board

Professional Experience

Education

Relevant Skills

Other

	Mark Garrett
	Age: 56
	Axalta Board Service
	• Tenure: 2 years (June 2016) • Presiding Director • Audit Committee • Compensation Committee • Environment, Health, Safety & Sustainability Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

	Lori J. Ryerkerk
	Age: 56
	Axalta Board Service
	• Tenure: 3 years (October 2015) • Audit Committee • Nominating & Corporate Governance Committee
	Independent

Professional Experience

Education

Relevant Skills

Other

CORPORATE GOVERNANCE MATTERS AND COMMITTEES OF THE BOARD OF DIRECTORS
   

Policies on Corporate Governance

Our Board believes that strong corporate governance is important to ensure that our business is managed for the long-term benefit of our shareholders. We have adopted a Code of Business Conduct and Ethics that applies to all of our employees and directors, including our executive officers and senior financial and accounting officers. We have also adopted Corporate Governance Guidelines. Copies of the current versions of the Code of Business

Conduct and Ethics and the Corporate Governance Guidelines are available on our website and will also be provided upon request to any person without charge. Requests should be made in writing to our Corporate Secretary at Axalta Coating Systems Ltd., Two Commerce Square, 2001 Market Street, Suite 3600, Philadelphia, PA 19103, or by telephone at (855) 547-1461.

Board Leadership Structure

The Board of Directors does not have a set policy with respect to the separation of the offices of Chairman of the Board and Chief Executive Officer (“CEO”), as the Board believes it is in the best interests of the Company and our shareholders to make that determination based on the position and direction of the Company and the membership of the Board. The Board regularly evaluates whether the roles of Chairman of the Board and Chief Executive Officer should be separate and, if they are to be separate, whether the Chairman of the Board should be selected from the non-employee directors or be an employee of the Company. The Board believes these issues should be considered as part of the Board’s broader oversight and succession planning process.

In 2018, in connection with Mr. Shaver’s stepping down as our Chief Executive Officer, the Board separated the position of Chairman from the position of Chief Executive Officer, with Mr. Shaver continuing as non-executive Chairman and Mr. Bryant now serving as our Chief Executive Officer. The Board believes that the separation of the Chairman and CEO positions is in the best interests of our Company and shareholders at this time because it allows Mr. Bryant to devote his time and attention to the day-to-day operations of the Company, while Mr. Shaver provides leadership of our Board as well as executive guidance and support through his experience as our former CEO.

In addition, our Corporate Governance Guidelines require that when the Chairman of the Board is also the Chief Executive Officer or otherwise employed by the Company, or at any other time the Board deems it advisable, the Board, upon the recommendation of the Nominating & Corporate Governance Committee, shall appoint a Presiding Director from the independent directors. The Corporate Governance Guidelines provide that the Presiding Director will:

Mark Garrett has served as our Presiding Director since February 2018. As our former CEO, Mr. Shaver is not yet independent under NYSE listing standards and therefore the Board has determined that Mr. Garrett should continue to serve as Presiding Director to provide independent guidance and supplement Mr. Shaver’s leadership as Chairman.

Board Role in Risk Oversight

While risk management is primarily the responsibility of our executive team, the Board provides overall risk oversight focusing on the most significant risks facing our Company. The Board annually reviews the Company’s overall risk profile and assesses specific key business or functional risk areas during Board meetings throughout the year. The Board also oversees the risk management processes that are implemented by our executives to determine whether these processes are functioning as intended and are consistent with our business and strategy as well as best practices. The Board executes its oversight responsibility for risk management directly and through its committees. The Board’s role in risk oversight has not had a significant effect on its leadership structure, although we believe our current leadership structure, with Mr. Shaver serving as Chairman, Mr. Bryant serving as Chief Executive Officer, and Mr. Garrett serving as the independent Presiding Director, enhances the Board’s effectiveness in risk oversight.

The Audit Committee is specifically tasked with reviewing our compliance with legal and regulatory requirements and any related compliance policies and programs with management, our independent auditors and our legal counsel, as appropriate. The Audit Committee is also tasked with reviewing our financial risks and risk management policies. Members of our management who have

responsibility for designing and implementing our risk management processes regularly meet with the Audit Committee, and the Audit Committee is updated on a regular basis on relevant and significant risk areas. In addition, the Audit Committee oversees cybersecurity risks facing the Company, which are also regularly reviewed by the full Board. The EHS&S Committee is tasked with overseeing management’s monitoring and enforcement of the Company’s policies to protect the health and safety of employees, contractors, customers, the public and the environment. The Compensation Committee and the Nominating & Corporate Governance Committee oversee risks associated with executive and employee compensation and corporate governance matters, respectively.

The full Board considers specific risk topics, including risks involved with CEO and management succession planning, risk-related issues pertaining to laws and regulations enforced by the United States and foreign government regulators, and risks associated with our business plan, strategies and capital structure. In addition, the Board receives reports from members of our management that include discussions of the risks and exposures involved with their respective areas of responsibility, and the Board is routinely informed of developments that could affect our risk profile or other aspects of our business.

Director Independence

Our Corporate Governance Guidelines require that the Board be comprised of a majority of directors who are “independent” under applicable NYSE rules, and state the Board’s belief that a substantial majority of directors should be independent. Our Board has determined that all of our directors other than Messrs. Shaver and Bryant are independent under the NYSE listing standards.

In reaching such determination, the Board considered the fact that Ms. Lempres currently serves on the Board of Directors of MIO Partners, a privately-held asset manager serving McKinsey & Company partners and the McKinsey retirement fund which is operated separately from McKinsey’s consulting business, and that the Company has and may continue to engage McKinsey for strategic

consulting services on an arms-length basis, and did so prior to Ms. Lempres joining the Board. In addition, the Board considered the fact that Mr. Smolik serves on the Ducks Unlimited Conservation Programs Committee and the Boards of Directors of Ducks Unlimited, Inc. and Ducks Unlimited de Mexico on a volunteer basis, and that the Company provides annual corporate support to Ducks Unlimited and Ducks Unlimited de Mexico at a level well below 2% of the organization’s gross revenues, and did so prior to Mr. Smolik joining the Board. In each case, the Board considered the magnitude and nature of these relationships and determined that they did not impair the independence of Ms. Lempres or Mr. Smolik.

Director Recruitment and Nominations

The Nominating & Corporate Governance Committee will consider director nominees recommended by our shareholders. A shareholder who wishes to recommend a director candidate for consideration by the Nominating & Corporate Governance Committee should send the recommendation to our Corporate Secretary at Axalta Coating Systems Ltd., Two Commerce Square, 2001 Market Street, Suite 3600, Philadelphia, PA 19103, who will then forward it to the Nominating & Corporate Governance Committee. The recommendation must include a description of the candidate’s qualifications for board service, including all of the information that would be required to be disclosed pursuant to Item 404 of Regulation S-K (as amended from time to time) promulgated by the Securities and Exchange Commission (“SEC”), the candidate’s written consent to be considered for nomination and to serve if nominated and elected, and addresses and telephone numbers for contacting the shareholder and the candidate for more information. A shareholder who wishes to nominate an individual as a candidate for election, rather than recommend the individual to the Nominating & Corporate Governance Committee as a nominee, must comply with the notice procedures set forth in our Bye-laws. See “Shareholder Proposals for the Company’s 2020 Annual General Meeting of Members” for more information on these procedures.

The Nominating & Corporate Governance Committee will consider and evaluate persons recommended by the shareholders in the same manner as it considers and evaluates other potential directors.

Director Qualifications

The Nominating & Corporate Governance Committee is responsible for reviewing the qualifications of potential director candidates and recommending to the Board candidates to be nominated for election to the Board of Directors. Our Corporate Governance Guidelines, which are available on our website as described above, set forth criteria that the Nominating & Corporate Governance Committee will consider when evaluating a director candidate for membership on the Board of Directors. These criteria are as follows: professional experience; education; skill; diversity; differences of viewpoint; and other

individual qualities and attributes that will positively contribute to the Board, including integrity and high ethical standards; experience with business administration processes and principles; ability to express opinions, ask difficult questions and make informed, independent judgments; significant experience in at least one specialty area; ability to devote sufficient time to prepare for and attend Board meetings; and diversity with respect to other characteristics. The committee does not assign specific weights to particular criteria and no particular criterion is a prerequisite for any prospective nominee.

Our Nominating & Corporate Governance Committee also considers the mix of backgrounds and qualifications, and the challenges and needs, of the directors to ensure that the Board of Directors has the necessary experience, knowledge and abilities to perform its responsibilities effectively. While diversity and variety of experiences and viewpoints represented on the Board are always considered, the Board believes that a director nominee should not be chosen nor excluded solely or largely because of race, religion, national origin, sex, sexual orientation or disability.

As Axalta has only been a stand-alone company since February 2013, none of our directors has a tenure longer than approximately six years. However, the Nominating & Corporate Governance Committee considers Board tenure

and refreshment as additional relevant criteria in its identification, consideration and recommendation of director candidates.

When considering whether our directors and nominees have the experience, qualifications, attributes and skills, taken as a whole, to enable the Board of Directors to satisfy its oversight responsibilities effectively in light of our business and structure, the Board focused primarily on each person’s background and experience as reflected in the information discussed in each of the directors’ individual biographies set forth in “Proposal No. 1: Election of Two Class II Directors.” We believe that our directors provide an appropriate diversity of experience and skills for the size and nature of our business.

Limitations on Board Service

Our Corporate Governance Guidelines provide for certain limitations on the service of our directors:

Board Composition

Our Board currently consists of nine directors, with Mr. Shaver serving as Chairman of the Board.

The number of directors on our Board may be modified from time to time by our Board of Directors in accordance with our Bye-laws.

Under our current Bye-laws, until our Annual General Meeting of Members in 2021, our Board is divided into three classes whose directors serve three-year terms expiring in successive years. Directors hold office until their successors have been duly elected and qualified or until the earliest of their respective death, resignation or removal. Any additional directorships resulting from an increase in the number of directors will be distributed among the three classes so that, as nearly as possible, each class will consist of one-third of the directors.

Under the transition plan to eliminate our classified board structure, as approved by shareholders at the 2018 Annual Meeting, Class I directors elected at the 2018 Annual Meeting, the nominees for election as Class II directors at this year’s Annual Meeting and the nominees for election as Class III directors at the Annual General Meeting of Members in 2020 will each serve terms expiring at the Annual General Meeting of Members in 2021. At that time, our classified board structure will expire and the entire Board will be elected annually. Any directors appointed by the Board to fill vacancies after such time would serve only until the next election of directors by the shareholders or until a director’s earlier death, resignation or removal.

Director Orientation and Continuing Education

We have a process for onboarding and orienting new directors and for providing continuing education to our Board members. As part of our director orientation program, new directors participate in one-on-one introductory meetings with Axalta’s business and functional leaders and are briefed on the Company’s

strategic plans, financial statements and key issues, as well as the Company’s governance and compliance policies and procedures. We provide our directors quarterly corporate governance updates via our legal department. In addition, we identify and pay for our directors to attend continuing education programs on corporate governance,

compliance and other critical issues associated with a director’s service on a public company board, as well as site visits to our facilities around the world. Our Board also

receives training through guest speakers and substantive issue presentations during Board and committee meetings and other Board events.

Board Meetings, Attendance and Executive Sessions

Directors are expected to spend the time needed and to meet as frequently as necessary to properly fulfill their responsibilities. The Board meets on a regularly scheduled basis during the year to review significant developments affecting us and to act on matters requiring Board approval. It also holds special meetings when an important matter requires Board action between scheduled meetings. Members of senior management regularly attend meetings of the Board and its committees to report on and discuss their areas of responsibility. Directors are expected to attend Board meetings and meetings of committees on which they serve. In addition, all directors are invited, but not required, to attend our

Annual General Meeting of Members. All of our current directors attended the 2018 Annual Meeting.

In general, the Board reserves time during each regularly scheduled meeting to allow the non-employee directors to meet without management and also to allow the independent directors to meet alone in executive session. During these executive sessions without the Chairman, the Presiding Director presides over the discussion.

During 2018, the Board met eight times. All directors attended 75% or more of the meetings of the Board and committees on which they served.

Board and Director Evaluation Process

Our Board believes that a comprehensive evaluation process enhances the effectiveness of our Board and committees. Therefore, our Board and each of our standing committees conducts an annual evaluation to determine whether it has complied with its responsibilities under our Bye-laws, the committee charter and applicable laws and regulations and whether it is functioning effectively. The evaluations are overseen by the Nominating & Corporate Governance Committee and consider, among other things, the following topics:

Board Committees

Our Board of Directors directs the management of our business and affairs as provided by Bermuda law and conducts its business through its meetings and its four standing committees: Audit Committee, Compensation Committee, Nominating & Corporate Governance Committee, and Environment, Health, Safety & Sustainability Committee. In addition, from time to time, other committees may be established under the Board’s direction when necessary or advisable to address specific issues. In August 2018, the Board of Directors eliminated its Executive Committee, which had authority to exercise the powers of the Board between regularly scheduled Board

meetings but had met infrequently over the past two years, so that all relevant matters would be brought before the full Board.

Each of the standing committees operates under a charter that was approved by our Board of Directors, copies of which are available on our website at www.axalta.com.

Set forth below is the current membership and descriptions of each of the standing committees, with the number of meetings held during the year ended December 31, 2018 in parentheses:

Our Board’s Commitment to Shareholder Engagement

Why We Engage

Our Board and management team understand the benefits of regular engagement with our shareholders in order to maintain awareness of their perspectives on Axalta and matters affecting the Company.

Our shareholder engagement efforts allow the Board to:

How We Engage

Outcomes from Shareholder Feedback

Some tangible examples of the results of our shareholder outreach efforts over the past several years include:

Our Board’s Commitment to Improving our Corporate Governance and Compensation Standards

Our Board is committed to meeting the highest standards of ethical behavior, corporate governance and business conduct. The following summary highlights the

governance and compensation developments overseen by the Board since our November 2014 initial public offering (“IPO”).

Succession Planning and Increasing Diversity

The Company actively engages in succession planning in order to ensure that it has a strong pipeline of internal executive talent. The Board of Directors and its committees regularly review succession plans for the Chief Executive Officer and other members of senior management, including plans for emergency scenarios. The Board and its committees also regularly assess the staffing of the Company’s key leadership positions to identify and develop employees for such positions.

In addition, the Company holds an annual senior leadership development program to recognize the Company’s emerging leaders from around the globe and to connect them with peers and senior executives of the Company. The Company seeks the best person for every open role and strives to identify candidates from differing backgrounds and with experience and perspectives to continue to enhance the diversity of our management team.

The Board oversaw multiple changes in our leadership during 2018. Following Mr. Shaver’s decision to step down as Chief Executive Officer, the Board conducted a robust search process for a successor; this process included consideration of both external candidates and internal

candidates on the Company’s succession plan. With the assistance of national search firms, the Board evaluated a slate of qualified candidates and ultimately named Terrence S. Hahn as CEO, effective September 4, 2018. In October, Mr. Hahn resigned by mutual agreement with the Board following an investigation by outside counsel into conduct by Mr. Hahn unrelated to financial matters that Axalta believes was inconsistent with Company policies. Following this subsequent and unexpected change in CEO, the Board consulted the Company’s succession plans (including emergency scenario contingency planning) and appointed Mr. Bryant, who was then serving as our Executive Vice President and Chief Financial Officer, as interim CEO. During the following interim period, the Board conducted a thorough evaluation of the needs of the Company and received feedback from investors, employees and other stakeholders. After reviewing multiple options and carefully considering Mr. Bryant’s qualifications, the Board named him as our CEO on a permanent basis in December 2018. Additional details including related compensation actions are described below under “2018 CEO Transitions” in the Compensation Discussion and Analysis section of this Proxy Statement.

Spotlight on Women in STEM (Science, Technology, Engineering and Math)

In 2018, Axalta continued to engage and develop our female workforce. Throughout the world, women hold positions such as technical directors, plant managers, site supervisors, scientists and technicians. Through the Axalta Women’s Network, the Company hosted multiple events aimed at supporting and engaging women at every juncture of their career, including a panel discussion and networking event with Axalta business partner The Philadelphia Eagles. Women account for nearly 30% of our global Technology organization, and many are engaged in professional associations such as the Society for Women Engineers, as well as community activities to support science, technology, engineering and math (STEM) education.

The Technology organization, in conjunction with the opening of the Axalta Global Innovation Center at the Philadelphia Navy Yard, continues to recruit with a focus on hiring the best talent, and we encourage women scientists and engineers to consider Axalta as they look to expand their careers. Axalta supports organizations promoting involvement in STEM fields. In 2018, we supported DRIVE One, an automotive industry training center in Detroit, by installing an Axalta-branded paint booth where students receive hands-on training on automotive coatings. We also

continued our Axalta All-Pro Teachers program and partnered with organizations such as The Franklin Institute and the Science Leadership Academy to support STEM education in Philadelphia, with a focus on the inclusion of female students, who are traditionally underrepresented in these fields. STEM education plays a critical role in inspiring young students to embrace technology and to ultimately pursue careers in STEM fields. Encouraging young women to pursue STEM education supports a diversified workforce, a vital component of a competitive organization.

Communications with the Board

The Board of Directors provides a process for shareholders and other interested parties to send communications to the Board. Shareholders and other interested parties may send written communications to the Board, c/o the Corporate Secretary of the Company at Axalta Coating Systems Ltd., Two Commerce Square, 2001 Market Street,

Suite 3600, Philadelphia, PA 19103. Communications concerning substantive Board or Company matters shall promptly be forwarded by the Corporate Secretary to the Chairman of the Board, and the Corporate Secretary shall keep and regularly provide to the Chairman of the Board a summary of any communications received.

Stock Ownership Guidelines

In order to ensure meaningful share ownership in Axalta by the Company’s directors and officers, the Company has adopted minimum share ownership requirements. More information is set forth under the heading “Stock

Ownership Guidelines” in the Director Compensation and Compensation Discussion and Analysis sections of this Proxy Statement.

Clawback Policy

The Board of Directors has adopted a policy regarding the recapture of compensation paid to executive officers in the event of a restatement of the Company’s financial results.

More information is set forth under the heading “Incentive Compensation Recoupment Policy” in the Compensation Discussion and Analysis section of this Proxy Statement.

Certain Relationships and Related Person Transactions

Our Board has adopted a written policy for the review and approval of transactions involving us and “related persons,” which include our executive officers, directors, director nominees, shareholders owning 5% or more of our outstanding common shares, and the immediate family members of any of the foregoing persons. The policy covers any transaction, arrangement or relationship, or any series of similar transactions, arrangements or relationships, in which we were or are to be a participant, where the amount involved exceeds $100,000 and a related person had or will have a direct or indirect material interest. Pursuant to this policy, our management will present to our Audit Committee each proposed related person transaction, including all relevant facts and circumstances relating thereto. Our Audit Committee will then:

All related person transactions may only be consummated if our Audit Committee has approved or ratified each such transaction in accordance with the guidelines set forth in the policy. Certain types of transactions have been pre-approved by our Audit Committee under the policy, including ordinary course purchases of Company products, resolution of warranty claims, receipt of compensation and benefits, reimbursement of expenses, and transactions where the related person’s interest arises only from certain roles with the other party. No director may participate in the approval of a related person transaction of which he or she, or his or her immediate family member, is a party.

From time to time the Company may engage in ordinary course transactions with other parties affiliated with our directors; however, to the Company’s knowledge, since the beginning of fiscal year 2018, no related person has had a material interest in any of the Company’s business transactions or relationships.

Indemnification Agreements

We have entered into indemnification agreements with each of our directors and certain of our executive officers. These indemnification agreements provide the directors and executive officers with contractual rights to

indemnification and expense advancement that are, in some cases, broader than the specific indemnification rights granted to directors and officers under Bermuda law.

Executive Restrictive Covenant and Severance Agreements

See “Compensation Discussion and Analysis – Severance Arrangements” for information regarding the Executive

Restrictive Covenant and Severance Agreements that we have entered into with our executive officers.

Sustainability Matters

Our sustainability strategy is to develop, manufacture and sell high performance coatings in a responsible manner. Axalta has taken a deliberate approach to sustaining our business and addressing the sustainability goals of our stakeholders through the lens of our impact on the environment, social performance and governance. The EHS&S Committee was established to oversee these matters. We established four overarching goals, endorsed by the committee, to guide our Company’s approach to sustainability:

We focus our efforts on four key areas: technology, operations, our people and corporate social responsibility.

Our Approach to Technology: Technology at Axalta builds on more than 150 years of developing innovative coatings. We create durable products that protect, increase productivity and offer beautiful color across the wide range of products and services we provide to our customers. Those benefits also translate into improvement in our customers’ performance and productivity, both when applying our coatings and by extending the life of the materials protected by our coatings. When our customers’ products last longer, the demand on natural resources to produce replacements is reduced.

Our Approach to Operations: Axalta’s sustainable manufacturing practices provide our customers with superior products using carefully selected materials that are processed to optimize productivity while minimizing our impact on the environment and protecting the health and safety of our employees and surrounding communities. We also work with our suppliers and logistics partners to ensure our supply chain maintains a focus on quality, sustainability and ethical business practices.

Our Approach to People: At Axalta, we aim to recruit, develop and retain the most talented people: those that are passionate about our Company, skilled in their area of expertise, committed to doing their best and eager to work as part of a united global team. Simply stated, Axalta wants to be the employer of choice for the world’s best talent who will enable us to innovate and grow our business. Our commitment to growth begins by providing unique and challenging experiences for our people every day, creating a platform for individual and professional growth building on our company values.

Our Approach to Corporate Social Responsibility: Axalta has a strong commitment to improving the world we live in by using focused giving to create, support and nurture STEM education and environmental stewardship programs. These corporate social responsibility initiatives serve a global community, the hometowns where our employees and customers live and work, and tie back to our business. Many of our STEM programs encourage youth to consider careers in related fields and provide them with practical opportunities to expand their exposure to the ways in which STEM disciplines touch their lives daily. Our environmental stewardship projects address the need for clean water and habitat.

For additional information, please read our latest Sustainability Report available at www.axalta.com/sustainability.

DIRECTOR COMPENSATION
   

Overview

Our non-employee director compensation program is designed to fairly compensate directors for the work required at a company of our size and scope as well as to align directors’ interests with the long-term interests of our shareholders. The annual compensation under our

program is detailed below. We pay additional annual compensation to the non-executive Chairman, Presiding Director and chairs of each committee in recognition of the workload and responsibilities required of such positions. No additional meeting fees are paid.

Our employee directors receive no compensation for serving on our Board of Directors or its committees.

Following Mr. Shaver’s stepping down as Chief Executive Officer on September 3, 2018, Mr. Shaver’s compensation as CEO was discontinued and he began to participate in our non-employee director compensation program, including the annual cash retainer and annual equity award, each of which were prorated to cover only the portion of 2018 that Mr. Shaver served as a non-employee director.

In addition, as compensation for his service as Chairman of the Board, Mr. Shaver received an additional annual cash fee of $125,000, payable quarterly in arrears and prorated for 2018. In 2019, he also received an additional award of restricted stock units with a grant date fair value of $125,000, at the same time and on the same terms as the 2019 annual equity awards provided to all non-employee directors. In approving Mr. Shaver’s additional compensation for serving as Chairman of the Board, and in particular the additional restricted stock units, the Compensation Committee and the Board considered the additional time, workload and responsibility expected of him during the transition of leadership, the ongoing

executive support he is providing to the Company’s new Chief Executive Officer, including regular strategy and operations review sessions, as well as his regular duties as Chairman, which include regular attendance at the meetings of the Board’s committees. The Compensation Committee also considered relevant benchmarking data of chairman compensation compiled by its compensation consultant. The Compensation Committee intends to regularly review the non-executive Chairman compensation amounts to ensure they are commensurate with the role of the Chairman and market practices at such time.

The Compensation Committee reviews all director compensation annually, assisted by a third-party compensation consultant. The Compensation Committee in December 2018 reviewed a peer comparison of director compensation conducted by Deloitte Consulting LLP. Following such review, the Compensation Committee recommended no changes to the components and amounts of non-employee director compensation for 2019.

Director Compensation Table 2018

For the year ended December 31, 2018, we provided the compensation set out in the table below to our directors.

Non-Employee Director Stock Ownership Guidelines

Our Compensation Committee adopted stock ownership guidelines for all non-employee directors, which require that, within five years after first appointment to the Board, each of our non-employee directors must directly or indirectly own an amount of our common shares equal to

five times the director’s annual cash retainer for Board service, or $375,000 based on the amount of the retainer at this time. All directors are in compliance with this requirement or within the grace period of the guidelines.

The Audit Committee has appointed PricewaterhouseCoopers LLP (“PwC”) as the Company’s independent registered public accounting firm and auditor to examine the books of account and other records of the Company and its consolidated subsidiaries for the 2019 fiscal year. The Board of Directors is asking shareholders to approve this action and to delegate authority to the Board, acting through the Audit Committee, to set the terms and remuneration thereof.

Representatives of PwC are expected to be present at the Annual Meeting and will be afforded the opportunity to

make a statement and will be available to respond to appropriate questions that may come before the Annual Meeting.

In the event that shareholders fail to approve the appointment of PwC as the Company’s independent registered public accounting firm and auditor, the Audit Committee will consider the shareholder vote in determining whether to retain the services of PwC in connection with the 2019 audit.

Independent Registered Public Accounting Firm

The following table shows the aggregate fees for professional services provided by PwC and its affiliates for the audits of the Company’s consolidated financial

statements for the years ended December 31, 2018 and 2017, and other services rendered during such years:

Audit Fees

Audit Fees were for professional services rendered for the audit of the U.S. GAAP consolidated financial statements and the effectiveness of internal controls over financial

reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, statutory audits and quarterly reviews.

Audit-Related Fees

Audit-Related Fees consist of the fees and expenses for audits and related services that are not required under

securities laws, reviews of financial statements and due diligence associated with acquisitions.

Tax Fees

Tax Fees consist of the fees and expenses for tax planning, advisory and compliance services. Compliance fees consist of the aggregate fees billed for professional services rendered

for tax return preparation and related compliance documentation. The following table details the associated tax fees for 2018 and 2017.

When engaging PwC on these matters, management and the Audit Committee considered PwC’s expertise in domestic and international corporate taxation as well as its institutional knowledge of our operations. As such, management and the Audit Committee determined that the engagement of PwC would ensure efficient and quality advice that is pertinent to our business and consistent with our overall business strategy.

The Audit Committee discussed and determined that PwC’s performance of the tax services would not impair its independence. Nonetheless, our Audit Committee has instructed PwC and management that, absent extenuating circumstances, PwC’s audit, audit-related and compliance fees should comprise a majority of its overall fees.

All Other Fees

Fees for all other services and related expenses not included in other fee categories, principally for accounting research software.

Audit Committee Pre-Approval Policies and Procedures

The Audit Committee is responsible for selecting the independent registered public accounting firm retained by us to audit our financial statements, subject to approval by our shareholders of such appointment. The Audit Committee also has responsibility for the retention, compensation, oversight and termination of any independent auditor employed by us.

The Audit Committee has adopted policies and procedures for pre-approving all audit and non-audit services provided by the Company’s independent registered public accounting firm prior to the engagement of such firm with respect to such services. Under these policies and procedures, proposed services may be pre-approved on a periodic basis or

individual engagements may be separately approved by the Audit Committee prior to the services being performed. However, the authority to pre-approve up to $500,000 per engagement has been delegated to the Audit Committee Chair to accommodate time-sensitive service proposals and the Audit Committee Chair reports any such pre-approvals to the full committee at the next meeting. In each case, the Audit Committee considers whether the provision of such services would impair the independent registered public accounting firm’s independence. All audit services, audit-related services, tax services and other services provided by PwC for 2018 and 2017 were pre-approved by the Audit Committee.

The Board of Directors recommends a vote “FOR” Proposal No. 2, to approve the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm and auditor until the conclusion of the 2020 Annual General Meeting of Members and the delegation of authority to the Board, acting through the Audit Committee, to set the terms and remuneration thereof. Proxies will be voted “FOR” such appointment, unless otherwise specified in the proxy.

AUDIT COMMITTEE REPORT
   

Notwithstanding anything to the contrary set forth in any of the previous or future filings under the Securities Act of 1933 or the Securities Exchange Act of 1934 that might incorporate this Proxy Statement or future filings with the Securities and Exchange Commission, in whole or part, the following report shall not be deemed to be incorporated by reference into any such filing.

The Audit Committee of the Board of Directors is providing this report to enable shareholders to understand how the Audit Committee monitors and oversees the Company’s financial reporting process. The Audit Committee serves an independent oversight role by consulting with and providing guidance to management and the Company’s independent registered public accounting firm on matters such as accounting, audits, compliance, controls, disclosure, finance and risk management. The Audit Committee members do not act as accountants or auditors for the Company. Management is responsible for the preparation of the Company’s financial statements and the financial reporting process, including the implementation and maintenance of effective internal control over financial reporting. The Company’s independent registered public accounting firm is responsible for expressing an opinion on the conformity of those audited financial statements with U.S. generally accepted accounting principles. The Company’s independent registered public accounting firm has free access to the Audit Committee to discuss any matters it deems appropriate. The Audit Committee operates pursuant to an Audit Committee Charter that is reviewed annually by the Audit Committee and updated as appropriate. A copy of the charter can be found on the Company’s website at www.axalta.com.

The Audit Committee consists of four directors, Messrs. McLaughlin, Garrett and Kramvis and Ms. Ryerkerk, each of whom satisfies the independence requirements promulgated by the SEC and applicable NYSE rules.

This report confirms that the Audit Committee has: (i) reviewed and discussed the audited financial statements for the year ended December 31, 2018 with management and the Company’s independent registered public accounting firm, PwC; (ii) discussed with PwC the matters required to be discussed under standards of the Public Company Accounting Oversight Board, or the “PCAOB”; (iii) reviewed the written disclosures and letters from PwC as required by the rules of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence; and (iv) discussed with PwC its independence from the Company.

The Audit Committee has considered whether the provision of non-audit professional services rendered by PwC, and disclosed elsewhere in this Proxy Statement, is compatible with maintaining its independence.

Based upon the above review and discussions, the Audit Committee recommended to the Board of Directors that the audited financial statements for the year ended December 31, 2018 be included in the Company’s Annual Report on Form 10-K for filing with the SEC.

Respectfully submitted,

AUDIT COMMITTEE

Robert M. McLaughlin (Chairman)
Mark Garrett
Andreas C. Kramvis
Lori J. Ryerkerk

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, or the “Dodd-Frank Act,” the SEC enacted requirements for the Company to present to its shareholders a separate resolution, subject to an advisory (non-binding) vote, to approve the compensation of its named executive officers. This proposal is commonly referred to as a “Say on Pay” proposal. This proposal is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies and practices described in this Proxy Statement. As required by these rules, the Board of Directors invites you to review carefully the Compensation Discussion and Analysis beginning on page 34 and the tabular and other disclosures on compensation under Executive Compensation beginning on page 54, and to cast an advisory vote on the Company’s executive compensation programs through the following resolution:

“Resolved, that the members approve, on an advisory basis, the compensation of the Company’s named executive officers, including the Company’s compensation practices and principles and their implementation, as discussed and disclosed in the Compensation Discussion and Analysis, the compensation tables, and any narrative executive compensation disclosure contained in the

Company’s Proxy Statement for the 2019 Annual General Meeting of Members.”

As discussed in the Compensation Discussion and Analysis, the Board of Directors believes that the Company’s long-term success depends in large measure on the talents of our employees. The Company’s compensation system plays a significant role in our ability to attract, retain and motivate the highest quality workforce. The Board of Directors believes that our current compensation program directly links executive compensation to Company performance, aligning the interests of the Company’s executive officers with those of its shareholders.

Pursuant to the Dodd-Frank Act, this vote is advisory and will not be binding on the Company. While the vote does not bind the Board of Directors or the Compensation Committee to any particular action, the Board of Directors and the Compensation Committee value the input of the shareholders, and will take into account the outcome of this vote in considering future compensation arrangements.

Although this vote is advisory in nature and does not impose any action or requirement on the Company or the Compensation Committee of the Board of Directors, the Company strongly encourages all shareholders to vote on this matter.

The Board of Directors recommends a vote “FOR” Proposal No. 3, to approve an advisory (non-binding) resolution regarding the compensation of the Company’s named executive officers.

COMPENSATION DISCUSSION AND ANALYSIS
   

CD&A Table of Contents

Introduction

This Compensation Discussion and Analysis provides an overview and analysis of our executive compensation program, including: (i) the elements of our compensation program for our named executive officers (“NEOs”); (ii) the material compensation decisions made under that program and reflected in the executive compensation tables that follow this Compensation Discussion and Analysis; and (iii) the material factors considered in making those decisions.

* For the year ended December 31, 2018, our NEOs listed below include three former executive officers who were not employed by Axalta at the end of fiscal year 2018.

Robert W. Bryant

Chief Executive Officer and President

Sean M. Lannon

Senior Vice President and Chief Financial Officer

Charles W. Shaver

Chairman and former Chief Executive Officer and President*

Terrence S. Hahn

Former Chief Executive Officer and President*

Steven R. Markevich

Executive Vice President and President, Transportation Coatings and Greater China

Joseph F. McDougall

Executive Vice President and President, Global Refinish and EMEA

Michael A. Cash

Senior Vice President and President, Industrial Coatings

Michael F. Finn

Former Senior Vice President, General Counsel, and Corporate/Government Affairs and Corporate Secretary*

Executive Summary

2018 Highlights

Axalta performed very well in 2018 even in the face of headwinds, including substantially higher raw material costs, a slowdown in certain coatings markets – most notably in China – and overall increased competition globally. Net sales for the year increased more than 7 percent, Adjusted EBITDA increased roughly 6 percent, and

we delivered cash from operations of $496 million. However, these accomplishments fell short of certain targets for the year and this Company performance, along with the individual performance and key achievements of each NEO, was reflected in the compensation paid to our NEOs in 2018, as described below.

We also experienced a transition in leadership during 2018 as Mr. Shaver, our long-time Chairman and Chief Executive Officer, stepped down as CEO while continuing to serve as non-executive Chairman of the Board. Our Compensation Committee and our Board made numerous compensation determinations in connection with Mr. Shaver’s resignation, a subsequent CEO appointment and resignation and the appointments of Robert Bryant and Sean Lannon as our new Chief Executive Officer and Chief Financial Officer, respectively, as described in more detail below under “2018 CEO Transitions.” These compensation decisions, which include the approvals of compensation

packages for the new CEOs and new CFO and retention stock awards for senior management, were intended to attract and retain new leadership while also ensuring stability and continuity among the senior management team through the transitions, in a manner consistent with our compensation philosophy. The Compensation Committee believes these decisions, which resulted from a unique set of circumstances that we do not expect to reoccur, were critical to successfully navigating through the transitions and challenging market conditions in 2018 and positioning Axalta for continued success in 2019 and future years.

In addition, our Compensation Committee made several modifications to our executive compensation program in 2018 to better align with our compensation philosophy,

business strategy and shareholder interests, detailed below:

Objectives, Philosophy and Practices

Our overall compensation program is structured to attract, motivate and retain highly qualified executives by paying them competitively, consistent with our success and their contribution to that success. We believe compensation

should be structured to ensure that a portion of an executive’s compensation opportunity will be related to factors that directly and indirectly influence shareholder value, without motivating improper risk taking.

We maintain several guiding practices and review our compensation programs on an ongoing basis to ensure

that market and regulatory best practices are considered and addressed.

Pay for Performance

Total compensation for our NEOs has been allocated between cash and equity compensation, taking into consideration the balance between providing short-term incentives and long-term investment in our financial performance, to align the interests of management with the interests of our shareholders. The variable annual

performance-based awards and the long-term equity awards, including the performance stock awards, are designed to ensure that total compensation reflects our overall level of success and to motivate the NEOs to meet appropriate performance measures tied to maximizing total shareholder returns.

Elements of Compensation Program

Compensation for our NEOs consists primarily of the elements, and their corresponding objectives, identified in the following table.

To serve the foregoing objectives, our overall compensation program is generally designed to be adaptive rather than purely formulaic. Our Compensation Committee has primary authority to determine and approve compensation decisions with respect to our NEOs. For 2018, compensation for our NEOs reflected the overall performance of the Company, each individual’s area of responsibility, their specific contributions to Axalta’s

performance and the need to ensure management stability during a period of significant transition. Our compensation decisions for the NEOs in 2018 are discussed below in relation to each of the above-described elements of our compensation program. The below discussion is intended to be read in conjunction with the executive compensation tables and related disclosures that follow this Compensation Discussion and Analysis.

2018 CEO Transitions

On July 25, 2018, Axalta announced that Mr. Shaver was stepping down as Chief Executive Officer and President, effective September 3, 2018. Mr. Shaver continues to serve as the non-executive Chairman of the Board and participates in Axalta’s non-employee director compensation program, which includes compensation for serving in the role of Chairman that is in addition to the compensation for serving as a director, as described above under “Director Compensation.” In addition, the Board approved certain other benefits for Mr. Shaver under his amended Executive Severance and Restrictive Covenant Agreement, as described in more detail below under “Severance Arrangements”, including a prorated annual bonus award for 2018 and an extension of the exercise period for vested stock options. These additional benefits were provided to ensure Mr. Shaver’s interests continued to be aligned with shareholders and the overall

performance of the Company. In particular, the extended option exercise period was provided to allow for a more orderly disposition of Mr. Shaver’s options granted prior to our IPO than might otherwise be necessitated by the standard option exercise period of six months following termination of service to the Company.

Following Mr. Shaver’s resignation, the Board appointed Mr. Hahn as Chief Executive Officer and President, effective September 4, 2018. In connection with his appointment, Mr. Hahn received: (1) a $500,000 cash sign-on bonus, (2) sign-on equity awards with an aggregate grant date fair value of $2,500,000, (3) a prorated annual long-term incentive award for 2018 with an aggregate grant date fair value of approximately $1,385,616, (4) an annual base salary of $950,000, (5) an incentive target of 110% of his base salary under Axalta’s annual incentive program, and (6) reimbursement for certain other expenses incurred in

connection with his appointment. Mr. Hahn’s compensation package as described was intended to attract, motivate and retain Mr. Hahn in line with market competitive compensation for a CEO considering Mr. Hahn’s experience and anticipated time with the Company during 2018.

On October 7, 2018, Mr. Hahn resigned by mutual agreement with the Board from the positions of Chief Executive Officer and President, effective immediately, following an investigation by outside counsel into conduct by Mr. Hahn unrelated to financial matters that Axalta believes was inconsistent with Company policies. In connection with his resignation, Mr. Hahn also vacated his position on the Board. Mr. Hahn subsequently entered an Employment Separation Agreement and Mutual Release (the “Separation Agreement”) with the Company on November 20, 2018, as described in more detail below under “Potential Payments upon Termination or Change-in-Control,” for the purpose of resolving all disputes between Axalta and Mr. Hahn. The Separation Agreement provided that Mr. Hahn could retain his sign-on cash and equity awards, and provided for 24 months of health insurance premiums. The Separation Agreement did not provide for any additional severance or other payments of any kind. In approving Mr. Hahn’s resignation terms and separation benefits, the Board considered several factors. The Board considered the benefits to the Company of obtaining a complete release and avoiding the risk, expense and distraction involved with any potential dispute or litigation with Mr. Hahn, including the significant legal fees and other costs that the Company could incur in the event of any dispute or litigation, as well as the payment of remedies or damages if the Company had not prevailed in any such dispute or litigation. Such remedies or damages could have included, for example, additional severance payments of approximately

$4 million and the payment of Mr. Hahn’s legal fees, in the event of a finding that Mr. Hahn was terminated without “cause” under the terms of the Executive Restrictive Covenant and Severance Agreement that Mr. Hahn entered into when he joined Axalta, as well as any other damages that Mr. Hahn may have claimed in connection with his resignation. The Board also considered the ability of the Company to provide timely public disclosure regarding the circumstances of the separation without risk of litigation, as well as the fact that the stock options Mr. Hahn retained under the Separation Agreement (comprising 50% of Mr. Hahn’s sign-on equity award) had relatively little value at the time of entering into the Separation Agreement (given that such options had an exercise price of $29.40 and that such options would expire six months after Mr. Hahn’s resignation in accordance with the standard terms of the Company’s equity award agreements).

Immediately following Mr. Hahn’s resignation, the Board appointed Mr. Bryant, Axalta’s then-Executive Vice President and Chief Financial Officer, to serve in the additional role of interim Chief Executive Officer, and on October 12, 2018, the Board appointed Mr. Lannon, Axalta’s then-Vice President, Corporate Finance and Global Controller, to serve as interim Chief Financial Officer. Following these appointments, the Board adjusted the base salaries and annual incentive targets for Messrs. Bryant and Lannon to levels commensurate with their interim positions, as described in more detail below under “Elements of 2018 Compensation Program.” On December 10, 2018, the Board appointed Mr. Bryant to serve in the role of Chief Executive Officer and President and appointed Mr. Lannon to serve in the role of Senior Vice President and Chief Financial Officer, each on a permanent basis. In addition, the Board appointed Mr. Bryant as a Class I director.

Compensation Governance: Oversight and Administration of the Executive Compensation Program

Role of the Compensation Committee

The Compensation Committee has oversight of the Company’s executive compensation program and is provided with the primary authority to establish the general compensation polices of the Company and determine and approve the compensation paid to our NEOs. The Compensation Committee is charged with, among other things, reviewing compensation policies and practices to ensure: (1) adherence to our compensation philosophies; and (2) that the total compensation paid to our NEOs is fair, reasonable and competitive, taking into account our position within our industry, including our comparative performance, and our NEOs’ level of expertise and experience in their respective positions. In furtherance of the considerations described above, the Compensation

Committee is primarily responsible for: (i) determining any future adjustments to base salary and target annual performance-based award levels (representing the non-equity incentive compensation that may be awarded expressed as a percentage of base salary or as a dollar amount for the year); (ii) assessing the performance of the Chief Executive Officer and other NEOs for each applicable performance period; and (iii) determining the awards to be paid to our Chief Executive Officer and other NEOs under the long-term equity incentive program for each year. The Compensation Committee is also delegated authority to administer our Amended and Restated 2014 Incentive Award Plan and approve equity grants under the plan.

To aid the Compensation Committee in making its determinations, the Chief Executive Officer provides recommendations to the Compensation Committee regarding the compensation of all NEOs, excluding himself. The Chief Executive Officer does not participate in discussions about his own compensation, which is handled by the Compensation Committee. The Compensation Committee annually reviews the performance and compensation of our senior executives

(including the NEOs). In determining compensation levels for our NEOs, the Compensation Committee considers each NEO’s particular position and responsibility and relies upon the judgment and industry experience of the members of the Compensation Committee, including their knowledge of competitive compensation levels in our industry, as well as advice from the independent compensation consultant as discussed below.

Role of the Independent Compensation Consultant

The Compensation Committee engages an independent compensation consultant on executive compensation matters, including compiling and presenting comparative data and recommending compensation structures and levels. For that purpose, the Compensation Committee engaged Willis Towers Watson for assistance in the determination of 2018 compensation.

The Compensation Committee determined that Willis Towers Watson does not have a relationship with the Company that would present a conflict of interest with serving as the committee’s advisor or would impair its independence. In making this determination, the Compensation Committee considered, among other

things, the following factors: (1) the other services provided to the Company by Willis Towers Watson (primarily related to pension actuarial support and compensation surveys); (2) the amount of fees paid by the Company to Willis Towers Watson as a percentage of its total revenue; (3) Willis Towers Watson’s policies and procedures to prevent or mitigate conflicts of interest; (4) that there are no other business or personal relationships between Willis Towers Watson and members of the Compensation Committee or Axalta executive officers; and (5) none of the Willis Towers Watson representatives who provide compensation services to the Company own any Axalta common shares.

Compensation Peer Group and Survey Data

We believe that total compensation opportunities for our senior management (including the NEOs) should be competitive with comparable opportunities for individuals with similar positions, experience and responsibilities in our marketplace. We generally seek to align base pay with peer median benchmarks and calibrate variable compensation opportunities to provide actual compensation opportunities above peer benchmarks when Company and individual performance were strong, while providing for consequences when performance targets were not met.

Willis Towers Watson provided the Compensation Committee with a comprehensive report that included

publicly available compensation data relating to our Chemical Industry Peer Group as well as compensation data from Willis Towers Watson’s general industry survey.

The Compensation Committee utilized the Chemical Industry Peer Group set forth below for benchmarking 2018 compensation for our Chief Executive Officer, Chief Financial Officer and General Counsel. The Chemical Industry Peer Group broadly reflects the companies with which we compete for talent, business and investment capital based on the scope of our operations, as measured by revenue and market capitalization.

The Compensation Committee also utilized Willis Towers Watson’s survey data for benchmarking 2018 compensation for our business leader NEOs as well as other executives. The

survey data focuses on general industry companies and matches each discrete executive role.

Role of “Say on Pay” Votes

We provide our shareholders with the opportunity to cast an annual advisory vote on our executive compensation program for our NEOs (referred to as a “Say on Pay” proposal) and consider this vote in future compensation determinations for our NEOs. At our 2018 Annual Meeting, 96% of the votes cast on the “Say on Pay” proposal were

voted in favor of the compensation paid to our NEOs, which we consider strong support for our executive compensation program, practices and policies. Accordingly, no significant changes were made to our compensation program for our NEOs as a result of the 2018 Say on Pay proposal.

Shareholder and Proxy Advisory Firm Feedback

To ensure that our Board and Compensation Committee are apprised of the views of our shareholders and the proxy advisory firms as well as evolving best practices, senior management regularly meets with these parties regarding our executive compensation program and follows developments in their methodologies and analyses. As part of this process, we conduct regular outreach initiatives with our significant shareholders and representatives from Institutional Shareholder Services, Inc. (ISS) and Glass, Lewis & Co. Since our 2018 Annual Meeting, we met with the holders of an aggregate of approximately 75% of our outstanding common shares as

well as representatives from ISS and Glass Lewis to discuss our executive compensation program, and in particular the actions taken in 2018 to provide management stability and focus during the leadership transition. Our Compensation Committee will continue to consider the input from these parties along with the outcome of our shareholders’ votes on Say on Pay proposals when making future decisions on our compensation programs for NEOs. The committee also continually reassesses the competitiveness of our pay programs and their appropriateness in supporting our business strategy.

Executive Officer Stock Ownership Guidelines

To directly align the interests of our NEOs with our shareholders, our Compensation Committee has adopted stock ownership and holding guidelines. The guidelines require that, within five years of becoming subject to the guidelines, our NEOs and other officers listed below must directly or indirectly own an amount of our common shares at least equal to the multiple of their respective base salaries set forth below.

If an executive is out of compliance with the ownership requirement, he or she must retain 50% of our common shares acquired upon stock option exercises and 75% of our common shares issued upon the vesting of restricted stock, restricted stock unit and performance stock grants, in each case net of applicable taxes, until the executive satisfies the ownership requirement. The Compensation

Committee annually reviews each NEO’s compliance with the stock ownership and holding guidelines based on the NEO’s current base salary and the price of our common shares as of the end of the prior year. All of our NEOs were in compliance with the guidelines or within the grace period as of December 31, 2018.

Prohibition on Pledging, Hedging and Other Transactions

Our insider trading policy prohibits our officers, directors and employees from pledging their Axalta common shares as collateral to secure loans, utilizing their common shares

as collateral for margin loans, engaging in hedging transactions and otherwise speculating on short-term movements in the price of our common shares.

Incentive Compensation Recoupment Policy

The Board of Directors has adopted an Incentive Compensation Recoupment Policy which provides, among other things, that, in the event the Company must restate its financial results to correct an accounting error due to material noncompliance with any financial reporting requirement under applicable securities laws within three years after the first issuance of such results, the Company, at the direction of the Compensation

Committee, will seek to recover any incentive compensation (cash or equity-based) from any executive officer whose intentional misconduct caused or contributed to the need for the restatement if a lower award would have been made based upon such restated results. The Compensation Committee will determine in its discretion the amount it will seek to recover.

Elements of 2018 Compensation Program

Base Compensation

We set base salaries for our NEOs generally at a level we deem necessary to attract and retain individuals with superior talent. Each year, the Compensation Committee will determine base salary adjustments, if any, after evaluating the job responsibilities and demonstrated proficiency of the NEOs as assessed by the Compensation Committee and, for NEOs other than the Chief Executive Officer, in conjunction with recommendations to be made by the Chief Executive Officer.

Based on the Compensation Committee’s review of the job responsibilities, market data, proficiency and individual performance of each NEO as discussed above under “Compensation Governance: Oversight and Administration of the Executive Compensation Program,” in February 2018, the Compensation Committee set base salaries effective April 2, 2018 for all executive officers. Each NEO’s respective base salary increase at that time is set forth in the table below.

Subsequently, in connection with our Chief Executive Officer transitions in 2018, (1) Mr. Hahn’s base salary was set at $950,000 effective September 4, 2018 upon his hire as Chief Executive Officer and President; (2) Mr. Bryant’s base salary was increased to $950,000 effective October 8, 2018 following his appointment as interim Chief Executive

Officer; and (3) Mr. Lannon’s base salary was increased to $500,000 effective October 15, 2018 following his appointment as interim Chief Financial Officer. No further changes to the base salaries of Mr. Bryant or Mr. Lannon were made upon their appointment to their roles on a permanent basis in December 2018.

Annual Performance-Based Compensation

We structure our compensation programs to reward NEOs based on our performance and the individual executive’s relative contribution to that performance. This allows NEOs to receive annual performance-based awards under the Annual Bonus Plan (“ABP”) in the event certain specified performance measures are achieved. The ABP pool is determined by the Compensation Committee based upon a pre-established formula with reference to the achievement of corporate-level, business-level and individual performance goals established annually by the Compensation Committee.

The ABP is designed to reward NEOs for contributions made to help us meet our annual performance goals. The amount actually received by the NEOs will depend on our performance and the NEOs’ individual performance during the year. The Compensation Committee may make discretionary adjustments to the formulaic awards to reflect its subjective determination of an individual’s impact and contribution to overall corporate or business performance, as discussed below.

2018 Annual Bonus Plan Formula

Under the terms of the ABP, the NEOs’ annual incentive awards are based on a percentage of their base salaries. Once the extent of achievement of corporate and business performance against targets have been determined, the Compensation Committee also assesses each NEO’s business impact, leadership and attainment of individual objectives, as well as other related factors, which determine the individual performance component of the

ABP award. In addition, funding amounts may be adjusted by the Compensation Committee to account for unusual events such as significant foreign currency exchange rate fluctuations, extraordinary transactions, asset dispositions and purchases, and mergers and acquisitions if, and to the extent, the Compensation Committee does not consider the effect of such events indicative of our performance.

2018 Annual Bonus Plan Targets

The 2018 target percentage under the ABP approved by the Compensation Committee for each of our NEOs is set forth in the table below. Target-level percentages for each NEO remained the same as for 2017 other than for Messrs.

Bryant and Lannon, whose targets were increased in October 2018 in connection with their appointments as Chief Executive Officer and Chief Financial Officer, respectively.

For the year ended December 31, 2018, financial performance metrics were based upon Adjusted EBITDA (as defined below) and Adjusted Free Cash Flow (as defined below) on a Corporate level and, for Messrs. Markevich, McDougall and Cash, with respect to the business unit and/or region they oversee. For this purpose, “Adjusted EBITDA” was defined as our consolidated earnings before interest expense or income, income tax expense or income, depreciation, amortization and other adjustments as defined in the credit agreement governing our senior secured credit facilities. “Adjusted Free Cash Flow” was defined as cash flows from operations plus interest proceeds from net investment hedges less capital expenditures adjusted for certain items which the Company believed due to discrete events should not be included in our incentive compensation targets.

For each performance year, the Compensation Committee assigns a target, threshold and maximum value to each financial performance metric. The financial performance payouts can range from 0 to 200% of the assigned target. Award amounts for performance between the threshold and maximum levels are determined at the beginning of the applicable performance period and depend on the level of achievement for each metric relative to its assigned performance target, in accordance with a

predetermined payout matrix. The minimum award under the payout matrix (i.e., 50% of the target award) is payable only upon achievement of the threshold performance goals for each financial performance metric. For the year ended December 31, 2018, the minimum achievement threshold for each financial performance metric was 85% (i.e., >85% of Adjusted EBITDA, and >85% of Adjusted Free Cash Flow). If the threshold performance goal for a financial performance metric is not achieved, the award for that metric is zero. The maximum award under the payout matrix (i.e., 200% of the target award) is payable only upon achievement of maximum-level performance goals for each financial performance metric (i.e., 117% of Adjusted EBITDA and 117% of Adjusted Free Cash Flow). Award amounts increase linearly with a 3.3:1 slope between threshold and target-level financial performance and linearly with a 6:1 slope between target and maximum-level financial performance.

For the individual performance component, the Compensation Committee provides each NEO with an individual performance factor reflecting the Compensation Committee’s assessment of each NEO’s performance, business impact, contributions and leadership, among other factors. The individual performance factor can range from 0 to 200%.

2018 Annual Bonus Plan Results

For 2018, the Compensation Committee considered the following key achievements in determining the individual performance component for each of our NEOs:

The following chart sets forth for each NEO the weighting of each performance metric, the threshold, target and maximum performance goals, the actual performance

achieved for the year ended December 31, 2018, and resulting weighted bonus payout percentage: