DEF 14A of Knight-Swift Transportation Holdings Inc.
Filed Apr 4, 2024 · FY20230001492691-24-000047
Nominees for Director
Nominees for Director If elected at the Annual Meeting, the term of each director expires at the 2025 Annual Meeting of Stockholders.
Nominees for Director
| AMY BOERGER | Ms. Boerger served as Vice President and General Manager at Cummins Inc. until her retirement in March 2023. Ms. Boerger worked for Cummins for 39 years. During this time, much of her work was focused on the North American highway market, pioneering advancements of the trucking industry through building relationships with stakeholders and contributing to Cummins’ Emissions Solutions business. Ms. Boerger currently serves on the board of directors of Rush Enterprises, Inc., a premier solution to the commercial vehicle industry. Prior to serving as Cummins’ Vice President and General Manager, Ms. Boerger worked as a product engineer and account executive. Ms. Boerger holds a Bachelor of Science in Mechanical Engineering from Valparaiso University. The Board believes Ms. Boerger’s extensive and broad experience in the transportation industry will provide insight with the industry and continuing challenging regulatory environment. | | Age: 61 | Director Since 2023 | Independent: Yes Committees: Audit, Nominating and Governance Other Current Company Boards: Rush Enterprises, Inc. | |
Nominees for Director
| REID DOVE | Mr. Dove was appointed to the board of directors of Knight-Swift in connection with our acquisition of AAA Cooper Transportation, a leading LTL carrier, and has served as a member of the board of directors of Knight-Swift since 2021. Mr. Dove joined AAA Cooper Transportation (our subsidiary since July 2021) in 1994 and served multiple roles within the company, including currently serving as Chief Executive Officer of AAA Cooper Transportation. He is involved in many civic, educational and charitable boards both nationally and in his home state of Alabama. Mr. Dove earned his Bachelor’s degree in Supply Chain from Auburn University. The Board believes Mr. Dove provides valuable industry insight and perspective by virtue of his many years of executive-level leadership experience in the industry. | | Age: 52 | Director Since 2021 | Independent: No Committee: None Other Current Company Boards: Blue Cross Blue Shield – Alabama | |
Nominees for Director
| MICHAEL GARNREITER | Mr. Garnreiter has served as a member of the board of directors of Knight since 2003. Mr. Garnreiter currently provides financial consulting services to certain business of various sizes and during 2021 through 2023 Mr. Garnreiter served as Interim Chief Financial Officer for LeVecke Corporation, a privately held distilled spirits bottling company. Mr. Garnreiter served as treasurer of Shamrock Foods Company, a privately held manufacturer and distributor of foods and food-related products, from 2012 until his retirement in December 2015. From 2010 until 2012, Mr. Garnreiter was a managing director of Fenix Financial Forensics LLC, which provides financial analysis, forensic accounting, litigation support, and other dispute resolution services. Mr. Garnreiter is also the Chairman of the board of directors and chair of the audit committee of Axon Enterprise, Inc. (formerly, Taser International, Inc.), a manufacturer of less-lethal protection devices; chair of the audit and executive committees for Amtech Systems, Inc., a supplier of horizontal diffusion furnace systems; and is the former Chairman and current member of the board of directors of Banner Health Systems, a nonprofit multistate hospital system based in Phoenix, Arizona. Mr. Garnreiter began his career with Arthur Andersen LLP in 1974 after graduating with a Bachelor of Science degree in accounting from California State University at Long Beach, ultimately serving as a senior audit partner. Mr. Garnreiter is a Certified Public Accountant and is a Certified Fraud Examiner. As a member of our Board, Mr. Garnreiter offers financial, accounting, and managerial expertise gained from the various executive and supervisory roles he has held throughout his career. The experience acquired through Mr. Garnreiter’s positions as a director of several publicly traded and privately held companies benefit the Company, the Board, and our stockholders. | | Age: 72 | Director Since 2003 | Independent: Yes Committees: Audit (Chair), Finance Other Current Company Boards: Axon Enterprise, Inc., Amtech Systems, Inc., Banner Health Systems | |
Nominees for Director
| LOUIS HOBSON | Mr. Hobson has served as a member of the board of directors of Knight-Swift since 2021. Since 2019, Mr. Hobson has served as the Senior Vice President of North America Flood Insurance for Chubb Insurance, LTD, a publicly traded property and casualty insurance company. From 2017 through 2018, Mr. Hobson served as the President and Chief Executive Officer of National Flood Services, a provider of business process services in flood insurance. From 2015 through 2017, Mr. Hobson served as Executive Vice President of Aon National Flood Services, a financial service and insurance company. From 2004 to 2013, Mr. Hobson held many roles, including Principal, with the Boston Consulting Group, a management consulting firm, where he served as an advisor to C-suite executives of Fortune 500 companies, providing counsel on a wide range of topics, including competition, growth, turnaround, and talent. From 2017 through 2018, Mr. Hobson was a member of the board of the American Red Cross of Chicago and Northern Illinois. In 2022, Mr. Hobson rejoined the board of the American Red Cross of Illinois and currently is a member of the Board Development and Bio Medical Services Committees. Mr. Hobson holds a Bachelor of Science degree in Electrical Engineering and a Master’s degree in Business Administration, both from Stanford University. The Board believes Mr. Hobson’s extensive executive-level leadership and business experience through a variety of economic environments makes him a valuable asset for the Board and the Company. | | Age: 43 | Director Since 2021 | Independent: Yes Committees: Audit, Nominating and Corporate Governance, Finance Other Current Company Boards: American Red Cross of Illinois | |
Nominees for Director
| GARY KNIGHT | Mr. Knight has served as a Vice Chairman of the board of directors of Knight since 2004, and currently serves as the Vice Chairman of the Company. Mr. Knight served as Knight’s President from 1993 to 2004, and has been one of Knight’s officers and a member of Knight’s Board since 1990. From 1975 until 1990, Mr. Knight was employed by Swift, where he was an Executive Vice President. Mr. Knight is the first cousin of Kevin Knight. The selection of Mr. Knight as a director was based upon, among other things, his significant leadership experience and knowledge of the Company. Mr. Knight’s qualifications to serve on our Board also include his extensive knowledge of the transportation industry. | | Age 72 | Director Since 2004 | Independent: No Committee: Executive Other Current Company Boards: None | |
Nominees for Director
| KEVIN KNIGHT | Mr. Knight has served as the Chairman of the board of directors of Knight since 1999 (including as the Executive Chairman since January 2015) and served as the CEO of Knight from 1993 through December 2014, and currently serves as a full-time executive officer of the Company in his role as Executive Chairman. He has been one of our officers and directors since 1990. From 1975 to 1984 and again from 1986 to 1990, Mr. Knight was employed by Swift, where he served as Executive Vice President and President of Cooper Motor Lines, Inc., a former Swift subsidiary. Mr. Knight is the first cousin of Gary Knight. The selection of Mr. Knight as a director was based, among other things, upon his extensive experience in business operations, knowledge of the transportation industry, and exemplary executive leadership and mentorship since Knight’s founding. Mr. Knight also has exhibited commendable dedication to our financial and operating performance. | | Age 67 | Director Since 1999 | Independent: No Committees: Executive (Chair) Other Current Company Boards: None | |
Nominees for Director
| ADAM MILLER | Mr. Miller joined Knight in 2002. In February 2024, Mr. Miller was appointed Chief Executive Officer of Knight-Swift Transportation Holdings Inc., prior to which he served as President of Swift (since November 2020) and CFO of Knight-Swift Transportation Holdings Inc. (since the merger with Swift in September 2017). Before the merger, Mr. Miller served as CFO for Knight since 2012, and also served as the Secretary and Treasurer since 2011. Prior to becoming CFO of Knight, Mr. Miller served as the Senior Vice President of Accounting and Finance from 2011 to 2012 and as Controller of Knight Refrigerated, LLC, a subsidiary of Knight, from 2006 to 2011. Prior to his appointment as Controller of Knight Refrigerated, LLC, Mr. Miller served in several other accounting and finance positions at Knight since 2002. Mr. Miller earned his Bachelor of Science degree in Accounting from Arizona State University and is a Certified Public Accountant in the state of Arizona. The selection of Mr. Miller as a director was based, among other things, upon his extensive transportation, leadership, and finance experience and his deep understanding of Company culture and commitment to maintaining our financial and operating performance. | | Age 43 | Director Since 2024 | Independent: No Committee: None Other Current Company Boards: None | |
Nominees for Director
| KATHRYN MUNRO | Ms. Munro has served as a member of the board of directors of Knight since 2005. She is a principal of BridgeWest, LLC, a private equity investment company specializing in wireless technology companies, a position she has held since 2003. Prior to BridgeWest, Ms. Munro spent 20 years at Bank of America Corporation where she held a variety of senior executive positions. Ms. Munro has served on the board of directors of Pinnacle West Capital Corporation, an investor-owned electric utility holding company, since 2002. Ms. Munro also served on the board of Premera Blue Cross, a privately held health insurance company, from 2007 to 2019 and on the board of Flow International Corp from 1996 to 2011. The Board, upon the recommendation of the Nominating and Corporate Governance Committee (without Ms. Munro present), has, in accordance with its Corporate Governance Guidelines, approved a waiver to the retirement age for directors for Ms. Munro to stand for reelection at the 2024 Annual Meeting, and determined that such waiver was in the best interests of the Company because of her continued valuable contributions to the Board, promotion of gender and tenure diversity on the Board, and her extensive knowledge and familiarity with the Company. From her distinguished career in commercial banking, Ms. Munro brings business acumen and financial knowledge to our Board and provides insightful guidance and independent leadership. | | Age 75 | Director Since 2005 | Independent: Yes Committees: Compensation, Nominating and Corporate Governance, Executive Other Current Company Boards: Pinnacle West Capital Corporation | |
Nominees for Director
| JESSICA POWELL | Ms. Powell currently serves as Associate General Counsel for California Closet Company, Inc., a large manufacturer, designer, and installer of custom storage solutions throughout North America. Prior to her work for California Closets, Ms. Powell was a partner at a law firm, Ryley Carlock & Applewhite (“RCA”) from 2014 to 2021. Ms. Powell was a leader of the Corporate, Banking and Real Estate practice group at RCA and represented transportation, banking and technology companies as an attorney for over 15 years. During her legal career, Ms. Powell gained extensive experience in legal, regulatory, compliance and governance matters, and has frequently advised clients on securities and finance matters, mergers and acquisitions and intellectual property strategy, amongst numerous other issues. Ms. Powell holds a Bachelor of Arts degree in International Relations from Stanford University and a Juris Doctor from the University of Chicago. The Board believes Ms. Powell’s wide-ranging legal, corporate, regulatory, and governance experience makes her a valuable asset for the Board and the Company. | | Age 43 | Director Since 2023 | Independent: Yes Committees: Audit, Nominating and Corporate Governance Other Current Company Boards: None | |
Nominees for Director
| ROBERTA ROBERTS SHANK | Ms. Roberts Shank was appointed to the board of directors of Knight in February 2016. Ms. Roberts Shank currently serves as the Chief Executive Officer, President, and director of Chas Roberts A/C and Plumbing, Arizona's largest residential air conditioning installer, a position she has held since 2000. For her role at Chas Roberts, Ms. Roberts Shank was named the 2014 CEO of the Year by the ACE Awards, in addition to previously being named one of Arizona's most dynamic women in business, winning the Greater Phoenix Chamber of Commerce Impact Award. Ms. Roberts Shank also serves on the Board of U-Haul, North America's largest "do-it-yourself' moving and storage operator, since December 2019, previously serving on their Advisory Board. In addition, Ms. Roberts Shank has served in multiple civic and community roles, including the Boys and Girls Club of Metro Phoenix and the City of Phoenix planning commission and Greater Phoenix Leadership. The Board believes Ms. Roberts Shank’s extensive executive-level leadership and business experience through a variety of economic environments makes her a valuable asset for the Board and the Company. | | Age 57 | Director Since 2016 | Independent: Yes Committees: Audit, Compensation (Chair) Other Current Company Boards: U-Haul, Chas Roberts A/C and Plumbing Inc., Greater Phoenix Leadership | |
Nominees for Director
| ROBERT SYNOWICKI | Mr. Synowicki has served on the board of directors of Knight since February 2016. Mr. Synowicki served in multiple roles with Werner Enterprises, Inc., a publicly traded national trucking company, for over 25 years, most recently serving as Executive Vice President of Driver Resources from 2010 until December 2015, where he oversaw recruitment and other critical professional driver initiatives. In addition, Mr. Synowicki served as Chief Financial Officer, Chief Operating Officer, and Chief Information Officer at various times during his career with Werner. Mr. Synowicki has also served as a member of the Board of the American Trucking Associations and the Truckload Carriers Association. Mr. Synowicki is a Certified Public Accountant (inactive) and currently serves on the board of directors of Blue Cross Blue Shield - Nebraska, as Finance Committee Vice Chairman and a member of the Audit Committee. He earned a Bachelor of Science degree in Biology and a Bachelor of Science in Business Administration, Accounting from the University of Nebraska. The Board believes Mr. Synowicki provides financial and accounting expertise, past public company experience, and valuable industry insight and perspective by virtue of his many years of leadership experience in the industry. | | Age 65 | Director Since 2016 | Independent: Yes Committees: Compensation, Finance (Chair), Nominating and Corporate Governance Other Current Company Boards: Blue Cross Blue Shield - Nebraska | |
Nominees for Director
| DAVID VANDER PLOEG | Mr. Vander Ploeg has served on the board of directors of Knight-Swift since 2017 and currently serves as our lead independent director. He currently serves as Founder and President of Dutchman Advisors, LLC, a management consulting, and private investment company. Mr. Vander Ploeg previously served on the board of directors of Swift from 2009 to 2017. Mr. Vander Ploeg is the retired Executive Vice President and CFO of School Specialty, Inc., a distributor of products and curriculum solutions in the education marketplace, where he served from 2008 until December 2013. Prior to that role, Mr. Vander Ploeg spent 24 years at Schneider National, Inc., a provider of transportation and logistics services and was Executive Vice President and CFO from 2004 until his departure in 2007. Prior to joining Schneider, Mr. Vander Ploeg was a senior auditor for Arthur Andersen. Mr. Vander Ploeg currently serves on the board of directors of The Clearwing Group, a multidisciplined suite of companies specializing in live event support and permanent systems integration. He is a past board member at Energy Bank, Inc., Bellin Psychiatric Hospital, Dutchland Plastics Corp., and Carson Dellosa. Mr. Vander Ploeg holds a Bachelor’s degree in accounting and a Master’s degree in business administration from the University of Wisconsin-Oshkosh. Mr. Vander Ploeg’s qualifications to serve on our Board include his extensive experience in the transportation and logistics services industry and his past public company and finance and audit experience provide us with valuable insight on public company governance practices. | | Age 65 | Director Since 2009 | Independent: Yes Committee: Finance, Audit, Nominating and Corporate Governance (Chair), Executive Other Current Company Boards: The Clearwing Group | |
Director Compensation
Director Compensation We pay only non-employee directors for their services as directors. Directors who are also officers or employees of the Company are not eligible to receive any of the compensation described below. For 2023, non-employee directors were eligible for the following compensation:
Director Compensation
| | Member | Cash Retainer for Lead Independent Director/Committee Chair Cash Retainer | | Compensation Element | | | | Board Service Cash Retainer1 | $90,000 | $25,000 | | Equity Award Annual Equity Grant1 | $130,000 | — | | Committee Service Cash Retainer | | | | Audit | $10,000 | $15,000 | | Compensation | $7,500 | $12,500 | | Nominating and Corporate Governance | $6,000 | $10,000 | | Finance | $5,000 | $6,000 | | Executive | — | — | | Meeting Fees | None | |
Director Compensation
1 Effective January 1, 2023 through June 30, 2023, the annual retainer to each non-employee director was $185,000, with a minimum of $115,000 in the form of an annual equity grant. Effective July 1, 2023 through December 31, 2023, the annual cash retainer to each non-employee director was $90,000, prorated for the balance of 2023, and the annual equity grant was $130,000 prorated for the balance of 2023. Non-employee directors may elect to receive up to the entire $220,000 retainer in the form of equity. No additional retainers are paid to the members or the Chairperson of the Executive Committee. No other fees are paid for attendance at Board or committee meetings, except for reimbursement of expenses to attend Board and committee meetings. The following table provides information for the fiscal year ended December 31, 2023, regarding all plan and non-plan compensation awarded to, earned by, or paid to, each non-employee who served as a director during 2023.
Director Compensation
| Director | Fees Earned or Paid in Cash | Stock Awards Cash Value 1 | All Other Compensation | Total | | Amy Boerger | $98,334 | $— | — | $98,334 | | Michael Garnreiter | 90,000 | 132,453 | — | 222,453 | | Louis Hobson | 98,500 | 122,477 | — | 220,977 | | Kathryn Munro | 78,000 | 152,462 | — | 230,462 | | Jessica Powell | 96,000 | 122,477 | — | 218,477 | | Roberta Roberts Shank | 32,500 | 192,479 | — | 224,979 | | Robert Synowicki, Jr. | 99,000 | 122,477 | — | 221,477 | | David Vander Ploeg | 103,500 | 132,453 | — | 235,953 |
Director Compensation
1The amounts shown reflect the aggregate grant date fair value of stock awards granted to non-employee directors during 2023, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”). The grant date fair value for common stock was measured based on the closing price of our common stock on the date of grant (the date of our 2023 Annual Meeting).
CAPITAL DEPLOYMENT
Our 2023 compensation plan was based on a conservative pay policy with executive officer pay targeted to the market median and was designed to appropriately award our executive officers for these results and the stockholder value they created by directly linking pay and performance. The goals of our 2023 compensation program were to: •motivate pursuit of our business initiatives, emphasizing consolidated revenue growth to reward continued focus on growth of our diversified businesses with an emphasis on cost controls, with an ESG modifier to highlight the Company’s commitment to ESG initiatives; •incentivize executives to continue to operate with industry-leading efficiency, with a total stockholder return (“TSR”) modifier to provide incremental value creation relative to peers; •reinforce long-term value creation and encourage sustained earnings growth, which was accomplished through performance-based cash and equity awards, including the use of Adjusted EPS CAGR in our performance-based long-term incentives; and •retain an executive team that we were confident would continue to be the best team in the industry in maximizing stockholder value. Our 2024 compensation design has a similar structure because the Compensation Committee believes the plan design: •is competitive with our peer group and primary competitors for talent, as we target overall compensation at the market median for our executives as a group, while allowing for exceptions based on experience and individual responsibilities and performance; •incentivizes diversification of revenue streams and profitable growth of our business, while emphasizing stringent cost controls and operating efficiencies; •attracts and retains our talented executives that have produced industry-leading results, which encourages a smooth transition of leadership, such as the transition of leadership from Kevin Knight to Adam Miller at Swift during 2020, and from David Jackson to Adam Miller as CEO of the Company in 2024; •provides stability through conservative but competitive base salary, which ensures reasonable base pay if targets are not met, mitigating the need for excessive risk-taking; •aligns our executives’ interests with our corporate strategies, our business objectives, and the long-term interests of our stockholders, with 60% of our long-term incentives comprised of performance-based awards; •reinforces long-term value creation, our goal of out-performing our peers, and strong pay-for-performance alignment; and •enhances our executives’ focus on and incentive to take actions designed to increase our stock price and maximize stockholder value over time, without undue risk.
2024 Compensation Plan Highlights
| ✓ | Conservative pay policy with named executive officer and director pay targeted to the market median | | ✓ | Peer group designed to reflect companies we compete with for business and talent | | ✓ | Direct link between pay and performance that emphasizes our business objectives and drives stockholder value creation, including emphasis on our strategic goals of improving profitability of U.S. Xpress and expanding our LTL network, as well as an ESG modifier built into our 2024 Cash Bonus Plan design | | ✓ | Appropriate balance between short- and long-term compensation that appropriately focuses on both growth and return while discouraging short-term risk taking at the expense of long-term results | | ✓ | Cap on short-term cash incentive to curtail behavior focused on short-term gain | | ✓ | Independent compensation consultant retained by the Compensation Committee to advise on executive compensation matters | | ✓ | Independent Compensation Committee | | ✓ | Clawback policy | | ✓ | Anti-Pledging and Hedging Policy limiting the pledging and hedging of the Company’s securities by executives and Board members with no hardship exemption | | ✓ | Vesting periods of less than twelve months prohibited for most awards under our Omnibus Plan | | ✓ | No re-pricing or back-dating of stock options | | ✓ | No dividends paid on unvested stock awards | | ✓ | Robust key officer stock ownership and retention guidelines | | ✓ | Omnibus Plan requires double trigger vesting upon change of control | | ✓ | No tax gross-up payments |
2023 Compensation
2023 Compensation The following graphs illustrate the allocation of primary compensation elements for our CEO and our other named executive officers in 2023. The graphs reflect Messrs. David Jackson and Adam Miller’s voluntary temporary reduction in base salary of approximately 20% each effective September 3, 2023 through December 30, 2023, in support of our initiatives to reduce costs in the third and fourth quarters of 2023. The temporary reductions in base salary did not affect any other items of compensation or modify any rights under outstanding compensation arrangements. At-risk compensation represents (i) target cash bonuses under our 2023 annual cash bonus plan, plus (ii) the value of performance-based restricted stock units, calculated by multiplying the number of shares subject to such awards by the grant date fair value computed in accordance with FASB ASC Topic 718, plus (iii) the value of time-vested restricted stock units, calculated by multiplying the number of shares subject to such awards by the closing price of our common stock on the grant date. We consider time-vested restricted stock units to be at-risk, given changes in stock price over the three-year vesting period combined with the required employment provisions. See "Summary Compensation Table", "Grants of Plan-Based Awards Table", and the footnotes thereto for additional detail.
ELEMENTS OF 2023 EXECUTIVE COMPENSATION
| Element | Form | Time Horizon | Primary Objectives and Link to Value Creation | | Base Salary | Cash | Annual | Attract and retain our named executive officers with fixed cash compensation to provide stability that allows our named executive officers to focus their attention on business objectives and ensures reasonable base pay if targets are not met to discourage excessive risk-taking | | Annual Cash Bonus | Cash | Annual | Focus and motivate our named executive officers to achieve annual corporate financial and operating goals (including our ESG goals, with an ESG modifier built into our annual cash bonus plan) with opportunity for upside based on exceptional performance, but with payout capped to curtail behavior focused on short-term gain | | Performance-Based Long-Term Incentives | PRSUs | Three-year performance period | Focus and motivate our named executive officers to achieve long-term corporate financial and operating goals and superior stockholder returns relative to our peer group Total stockholder return modifier provides direct focus on incremental value creation and relative performance metrics reinforce our objective of out-performing our peers New awards are granted annually to mitigate the risk of focusing on one specific time period Three-year vesting and performance periods align with market best practice, encourage retention, and reinforce long-term value creation PRSUs comprise 60% of our long-term incentives | | Time-Based Long-Term Incentives | RSUs | Ratable three-year vesting | Encourage retention of our named executive officers and promote stability among senior management as we transition to the next generation of leadership Time-vested RSUs comprise 40% of our long-term incentives | | Other Compensation | Other Benefits | N/A | Limited personal benefits such as 401(k) and vehicle allowance |
ANNUAL CASH BONUS
ANNUAL CASH BONUS In February 2023, the Compensation Committee approved our cash bonus plan for 2023 (the “2023 Cash Bonus Plan”) pursuant to our Second Amended and Restated 2014 Omnibus Incentive Plan (the “Omnibus Plan”). Under the 2023 Cash Bonus Plan, certain of our employees, including our named executive officers, were eligible to earn incremental cash bonuses upon satisfaction of 2023 performance targets related to adjusted operating income growth and consolidated revenue growth excluding Trucking fuel surcharge. The Compensation Committee believes including consolidated revenue growth in both the short-term and long-term performance incentive metrics reinforces our continued emphasis on revenue growth and rewards continued focus on diversification of revenue streams. In addition, in light of our commitment to our ESG initiatives, payout under the 2023 Cash Bonus Plan could be adjusted between -10% and +10% based on the Company’s scores provided by several ESG rating indices, including but not limited to MSCI, Sustainalytics, CDP, EcoVadis, and S&P Global. The Compensation Committee established a target bonus potential, expressed as a percentage of year-end annualized base salary, for each of our named executive officers in 2023:
ANNUAL CASH BONUS
| Name | Target Bonus Potential | | David Jackson | 120% | | Adam Miller | 100% | | Kevin Knight | 100% | | Gary Knight | 75% | | Todd Carlson | 75% |
ANNUAL CASH BONUS
With input from Pearl Meyer, the 2023 performance targets were reviewed and approved by the Compensation Committee.
2023 CASH BONUS PAYOUT AND PERFORMANCE TARGET RANGE
2023 CASH BONUS PAYOUT AND PERFORMANCE TARGET RANGE The payout ranges and related 2023 performance targets under the 2023 Cash Bonus Program are summarized below:
2023 CASH BONUS PAYOUT AND PERFORMANCE TARGET RANGE
| | Consolidated Revenue Growth (excluding Trucking Fuel Surcharge) 2 3 | | | | | | | | Adjusted Operating Income Growth 1 2 | | <-7.0% | >-7.0% - -4.5% | >-4.5% - -2.0% | >-2.0% - 0.5% | >0.5% - 3.0% | >3.0% | | | <-25.0% | 0% | 0% | 0% | 0% | 0% | 0% | | | >-25.0% - -23.0% | 0% | 20% | 40% | 60% | 80% | 100% | | | >-23.0% - -21.0% | 0% | 40% | 60% | 80% | 100% | 120% | | | >-21.0% - -19.0% | 0% | 60% | 80% | 100% | 120% | 140% | | | >-19.0% - -17.0% | 0% | 80% | 100% | 120% | 140% | 160% | | | >-17.0% - -15.0% | 0% | 100% | 120% | 140% | 160% | 180% | | | >-15.0% | 0% | 120% | 140% | 160% | 180% | 200% |
2023 CASH BONUS PAYOUT AND PERFORMANCE TARGET RANGE
1 Adjusted operating income is defined as consolidated total revenue, net of truckload and LTL fuel surcharge, less consolidated total adjusted operating expenses, net of truckload and LTL fuel surcharge. Adjusted operating income growth is calculated by taking 2023 adjusted operating income less 2022 adjusted operating income, divided by 2022 adjusted operating income. 2 Both the adjusted operating income growth and consolidated revenue growth targets could be adjusted by the Compensation Committee to omit the effects of extraordinary items, acquisitions or dispositions, unusual, one-time or non-recurring items, amortization of intangibles, cumulative effects of changes in accounting principles, and similar items or transactions. 3 Consolidated revenue growth is calculated by taking the total of 2023 consolidated revenue less 2023 trucking fuel surcharge, less 2022 consolidated revenue less 2022 trucking fuel surcharge, divided by 2022 consolidated revenue less 2022 trucking fuel surcharge. Trucking fuel surcharge is calculated as the sum of the applicable amount across each of the following of our operating segments: Knight Trucking, Swift Truckload, Swift Dedicated, Swift Refrigerated, AAA Cooper, MME (or, if the segments are reorganized, increased or decreased, any segment that provides truckload or LTL services). The Compensation Committee viewed the 2023 performance targets as reflecting a range of performance that was challenging yet reasonable, with the upper end of the range reflecting a significant accomplishment. Each year, the Compensation Committee reviews and adjusts one or more of the performance targets to set goals that are achievable yet uncertain, and that the Compensation Committee believes will motivate our senior management team to continue to improve operating performance and create value for our stockholders. In January 2024, the Compensation Committee assessed performance under the 2023 Cash Bonus Program and determined that the adjusted operating income growth and consolidated revenue growth targets were not met, and accordingly, no payouts were made to our named executive officers under our 2023 Cash Bonus Program.
LONG-TERM INCENTIVES
LONG-TERM INCENTIVES In December 2023, the Compensation Committee approved the following grants of PRSUs and RSUs to the named executive officers under the Omnibus Plan:
LONG-TERM INCENTIVES
| | Target Performance-Based Long-Term Incentives (60% of Grant) | | Target Time-Based Long-Term Incentives (40% of Grant) | | Total Target Long-Term Incentives (in Dollars) 1 | | Name | No. of PRSUs | Target (in Dollars) 1 | No. of RSUs | Target (in Dollars) 1 | | | David Jackson | 36,331 | $2,100,000 | 24,221 | $1,400,000 | $3,500,000 | | Adam Miller | 25,951 | $1,500,000 | 17,301 | $1,000,000 | $2,500,000 | | Kevin Knight | 28,027 | $1,620,000 | 18,685 | $1,080,000 | $2,700,000 | | Gary Knight | 8,304 | $480,000 | 5,536 | $320,000 | $800,000 | | Todd Carlson | 8,304 | $480,000 | 5,536 | $320,000 | $800,000 |
LONG-TERM INCENTIVES
1The number of PRSUs and RSUs granted was determined by taking the applicable target (in dollars) divided by the closing price of our common stock on the grant date ($57.80). Please refer to the Summary Compensation Table and the Grants of Plan Based Awards table below for details regarding the fair value of these awards calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC Topic 718”). The PRSUs have a three-year performance period commencing January 1, 2024, and ending December 31, 2026. The performance targets for one-third of the PRSUs relate to attaining defined targets, where one-half relate to the compound annual growth rate in adjusted earnings per share (“Adjusted EPS CAGR”) and the other one-half relate to compound annual growth rate in consolidated revenue (excluding truckload and LTL fuel surcharge) CAGR (the “Company Performance PRSUs”). The Compensation Committee believes that the Adjusted EPS CAGR goal creates a focus on sustained growth, and that the use of consolidated revenue CAGR emphasizes our continued focus on diversification of revenue streams, particularly with the Company’s entry into the LTL market in 2021 and subsequent focus on expansion of our LTL network. The performance targets for the other two-thirds of the PRSUs relate to relative performance targets, where one-half relate to the ranking of the Company’s total revenue growth and the other one-half relate to the Company’s return on net tangible assets compared to a relative peer group of public truckload carriers selected by the Compensation Committee (the “Relative Performance PRSUs”). The peer group for the Relative Performance PRSUs consists of the following public truckload carriers (collectively, the “Performance Peer Group”):
LONG-TERM INCENTIVES
| Covenant Logistics Group, Inc. | Heartland Express, Inc. | | Marten Transport, Ltd. | Schneider National, Inc. | | Werner Enterprises, Inc. | |
LONG-TERM INCENTIVES
The Compensation Committee views the Performance Peer Group of truckload carriers as an appropriate peer group for the Relative Performance PRSUs given the more asset-intensive nature of the Performance Peer Group’s businesses. The Compensation Committee believes the Relative Performance PRSUs reinforce the Company’s objective of out-performing its peers. With input from Pearl Meyer, the PRSU performance targets were reviewed and approved by the Compensation Committee. The PRSU performance targets do not reflect any opinion or projection of management concerning Adjusted EPS CAGR, revenue, return on net tangible assets, or other performance expectations for the performance period.
2023 PRSU PAYOUT AND PERFORMANCE RANGE
2023 PRSU PAYOUT AND PERFORMANCE RANGE The payout range and related performance goals for the Company Performance PRSUs are summarized below:
2023 PRSU PAYOUT AND PERFORMANCE RANGE
| Adjusted EPS CAGR | | | Growth Percentage | Payout % of Target | | <10.0% | 0% | | >10.0% - 15.0% | 33% | | >15.0% - 20.0% | 67% | | >20.0% - 25.0% | 100% | | >25.0% - 30.0% | 133% | | >30.0% - 35.0% | 167% | | >35.0% | 200% |
2023 PRSU PAYOUT AND PERFORMANCE RANGE
| Consolidated Revenue Growth (excluding Truckload and LTL Fuel Surcharge) CAGR | | | Growth Percentage | Payout % of Target | | < 5.0% | 0% | | >5.0% - 6.5% | 33% | | >6.5% - 8.0% | 67% | | >8.0% - 9.5% | 100% | | >9.5% - 11.0% | 133% | | >11.0% - 12.5% | 167% | | >12.5% | 200% |
2023 PRSU PAYOUT AND PERFORMANCE RANGE
The payout range and related performance goals for the Relative Performance PRSUs are summarized below.
2023 PRSU PAYOUT AND PERFORMANCE RANGE
| Return on Net Tangible Assets | | | Rank Verus Peers | Payout % of Target | | 6 | 0% | | 5 | 40% | | 4 | 80% | | 3 | 120% | | 2 | 160% | | 1 | 200% |
2023 PRSU PAYOUT AND PERFORMANCE RANGE
| Total Revenue Growth | | | Rank Verus Peers | Payout % of Target | | 6 | 0% | | 5 | 40% | | 4 | 80% | | 3 | 120% | | 2 | 160% | | 1 | 200% |
2023 PRSU PAYOUT AND PERFORMANCE RANGE
The number of PRSUs earned will be increased or decreased based on our compound annual total stockholder return (“TSR”) relative to the Benchmarking Peer Group (as defined below) over the performance period, as set forth below:
2023 PRSU PAYOUT AND PERFORMANCE RANGE
| | Relative TSR Percentile Rank | | | | | | | | | | | <35th | >35th to 40th | >40th to 45th | >45th to 50th | >50th to 55th | >60th to 65th | >65th | | Award Leverage | | -25% | -15% | -10% | 0% | 10% | 15% | 25% |
2023 PRSU PAYOUT AND PERFORMANCE RANGE
The TSR for the Company and for any peer will be determined by the annual compound growth rate between the average stock price of each company in the Benchmarking Peer Group for the 60 trading days on and following the grant date, and the average stock price of each company in the Benchmarking Peer Group for the final 60 trading days of the performance period, with dividends reinvested at the closing stock price of the applicable stock on the date the dividend is declared. The Compensation Committee believes the TSR modifier provides direct focus on incremental value creation. An independent third party verifies the TSR at the end of the performance period. The actual number of restricted shares earned pursuant to this grant of PRSUs will be determined following the conclusion of the performance period based upon actual performance relative to the performance targets, and any earned restricted shares will vest on January 31, 2027. The time-based RSUs vest in three installments as follows: 33% on January 31, 2025, 33% on January 31, 2026, and 34% on January 31, 2027. In determining to grant time-based equity awards, the Compensation Committee considered, among other things, the important role of RSUs in encouraging long-term retention of an executive team that is managing one of North America’s largest and most diversified transportation companies and overseeing the diversification of our service offerings to include LTL and the buildout of our LTL network, reducing our seasonality and cyclicality, densifying our truckload network, and decreasing our asset intensity.
2020 PRSU VESTING
2020 PRSU VESTING In November 2020, Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson were granted 23,613, 13,078, 21,797, 5,812, and 4,359 PRSUs, respectively (the “2020 Target Performance PRSUs”). The 2020 Target Performance PRSUs were subject to vesting upon achievement of certain levels of Adjusted EPS CAGR and Adjusted Trucking Operating Ratio during a performance period starting on January 1, 2021 and ending on December 31, 2023, as follows:
2020 PRSU VESTING
The number of 2020 Target Performance PRSUs and 2020 Relative Performance PRSUs earned would be increased or decreased based on our compound annual TSR relative to the Benchmarking Peer Group (as defined below) over the performance period, as set forth below:
2020 PRSU VESTING
| | Relative TSR Percentile Rank | | | | | | | | | | | <40th | 40th to 45th | >40th to 50th | >50th to 60th | >60th to 65th | >65th to 75th | >75th | | Award Leverage | | -25% | -15% | -10% | 0% | 10% | 15% | 25% |
2020 PRSU VESTING
With respect to the 2020 Target Performance PRSUs, the Compensation Committee determined that (i) the Adjusted EPS CAGR was (14.3)%, (ii) the Adjusted Trucking Operating Ratio was 83.7%, and (iii) the Company’s TSR was 27.3%, positioning the Company between the 40th and 45th percentile of the peer group, as verified by an independent third party. Accordingly, none of the 2020 Target Performance PRSUs vested. With respect to the 2020 Relative Performance PRSUs, on January 31, 2024, the 2020 Relative Performance PRSUs vested, giving Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson the right to receive shares of our common stock at the performance level determined by the Compensation Committee. In March 2024, the Compensation Committee determined that (i) the Company’s Return on Net Tangible Assets ranking was second, (ii) the Company’s CAGR Total Revenue Growth ranking was second, and (iii) the Company’s TSR was 27.3%, positioning the Company between the 40th and 45th percentile of the peer group, as verified by an independent third party. Accordingly, in March 2024, 127.5% of the 2020 Relative Performance PRSUs were issued, resulting in Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson receiving 30,107, 16,674, 27,791, 7,410, and 5,558 shares, respectively.
COMPENSATION DECISIONS FOR 2024
| Name | Target Bonus Potential | | Adam Miller | 110% | | Kevin Knight | 100% | | Gary Knight | 75% | | Todd Carlson | 75% |
BENCHMARKING COMPENSATION
BENCHMARKING COMPENSATION The Compensation Committee uses a peer group of companies (the "Benchmarking Peer Group") to assess whether our compensation programs are competitive in structure and amount. Our executive compensation is not determined by any formula or ranking within the Benchmarking Peer Group. However, as previously noted, our total stockholder return compared to the total stockholder return of a separate but similar Performance Peer Group does affect the payout percentage and vesting under our PRSUs. The Compensation Committee, with the advice of Pearl Meyer, considers several criteria to determine our Benchmarking Peer Group from time to time, such as whether companies (i) are in the same or similar lines of business, (ii) compete for the same customers with similar products and services, (iii) have comparable financial characteristics that investors view similarly, (iv) consider us a peer, (v) would be considered our peer by proxy advisory services, (vi) compete with us for talent, and (vii) are within a reasonable range in terms of percentile rank with the Company in key financial metrics, such as revenue, total assets, asset intensity, and market capitalization. Our Benchmarking Peer Group for 2023 was as follows:
BENCHMARKING COMPENSATION
| ArcBest Corp | Old Dominion Freight Line, Inc. | | C.H. Robinson Worldwide, Inc. | Ryder System, Inc. | | Forward Air Corporation | Saia, Inc. | | Heartland Express, Inc. | Schneider National, Inc. | | Hub Group, Inc. | Werner Enterprises, Inc. | | J.B. Hunt Transport Services, Inc. | XPO Logistics, Inc. | | Landstar System, Inc. | Expeditor's International of Washington Inc | | GXO Logistics, Inc. | |
BENCHMARKING COMPENSATION
Based on publicly available data for 2023, the Company is positioned relative to the Benchmarking Peer Group as follows: at approximately the 61st percentile in total revenue, the 54th percentile in total return on assets, and the 62nd percentile in market capitalization, and its total direct compensation for its executive officers as a group is at the competitive median. The Company’s larger size relative to the peer median results is due to the fact that finding companies of comparable size with a similar business is challenging given the Company’s position as one of the country’s largest and most diversified freight transportation companies. During 2024, the Compensation Committee, with the assistance of Pearl Meyer, will review the Benchmarking Peer Group again for continued relevancy.
RISK CONSIDERATIONS REGARDING COMPENSATION
RISK CONSIDERATIONS REGARDING COMPENSATION We believe that the structure of our executive compensation program provides an appropriate mix of cash, equity, and other compensation, with our program sufficiently weighted toward incentive compensation to appropriately link pay with performance. Each element of compensation has been designed and is administered in a manner intended to minimize potential risks to the Company: •base salary is targeted at the competitive median (taking into account experience and individual responsibilities and performance) and designed to ensure a reasonable base pay in the event incentive targets are not met to discourage excessive risk-taking; •our incentive compensation is comprised of 60% performance-based long-term incentives to align the interests of our executive officers and stockholders by focusing on long-term, sustained value creation, with three-year vesting consistent with market practice and supporting a long-term orientation, as well as a new long-term incentive cycle commencing annually to avoid focusing on one particular time period; and •our short-term incentive compensation program is designed with metrics that are aligned with our operating strategy, with payout capped to discourage behavior oriented toward short-term gain. We believe that our executive compensation program aligns the interests of named executive officers with those of the Company’s stockholders. Moreover, we have determined that any risks arising from the Company’s compensation policies and practices for all of its employees are not reasonably likely to have a material adverse effect on the Company.
Summary Compensation Table
Summary Compensation Table The following table summarizes the compensation earned by our named executive officers in the fiscal years noted.
Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($) | Non-Equity Incentive Plan Compensation ($)1 | All Other Compensation ($)2 | Total ($) | | David Jackson Former President and CEO5 | 2023 | 868,077 | — | 3,570,3883 | — | 18,985 | 4,457,450 | | | 2022 | 925,000 | — | 3,588,933 | 1,831,500 | 19,769 | 6,365,202 | | | 2021 | 883,665 | — | 3,532,322 | 1,850,000 | 15,285 | 6,281,262 | | Adam Miller CEO (Former CFO of Knight-Swift, President of Swift)5 | 2023 | 774,231 | — | 2,550,3113 | — | 18,432 | 3,342,974 | | | 2022 | 803,365 | — | 2,563,484 | 1,388,475 | 20,182 | 4,775,506 | | | 2021 | 758,654 | — | 2,523,070 | 1,360,000 | 18,677 | 4,660,401 | | Kevin Knight Executive Chairman | 2023 | 850,000 | — | 2,754,3263 | — | 25,860 | 3,630,186 | | | 2022 | 936,538 | — | 2,768,676 | 1,881,000 | 237,398 | 5,823,612 | | | 2021 | 950,000 | — | 3,027,756 | 1,900,000 | 276,192 | 6,153,948 | | Gary Knight Vice Chairman | 2023 | 450,000 | — | 816,0623 | — | 21,684 | 1,287,746 | | | 2022 | 450,000 | — | 820,256 | 668,250 | 20,934 | 1,959,440 | | | 2021 | 450,000 | — | 807,281 | 675,000 | 20,484 | 1,952,765 | | Todd Carlson General Counsel and Secretary | 2023 | 525,000 | 100,0004 | 816,0623 | — | 19,773 | 1,460,835 | | | 2022 | 503,365 | — | 820,256 | 675,675 | 17,510 | 2,016,806 | | | 2021 | 458,654 | 70,000 | 756,909 | 650,000 | 16,710 | 1,952,273 |
Summary Compensation Table
1The amounts represent the amount earned in such year under our short-term cash incentive plan, notwithstanding the year in which it was paid. See “Compensation Discussion and Analysis – Annual Cash Bonus” for further information. 2Refer to the All Other Compensation table for more detailed information about compensation reported in this column. 3These amounts represent the aggregate grant date fair value of time-vested RSUs and PRSUs granted on December 15, 2023. Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson received 24,221, 17,301, 18,685, 5,536, and 5,536 time-vested RSUs and 36,331, 25,951, 28,027, 8,304, and 8,304 PRSUs, respectively. The fair value of the RSUs was computed in accordance with FASB ASC Topic 718, which was $57.80 per share, the closing price of our common stock on the grant date. The fair value of the PRSUs was computed in accordance with FASB ASC Topic 718, which was $59.74 per share. The amounts for the PRSUs reflect our accounting expense to be recognized over the vesting period of the PRSUs awarded, and do not necessarily correspond to the actual value that will be recognized by the named executive officers. The number of shares ultimately issued pursuant to the PRSUs granted in 2023 varies depending upon the satisfaction of performance conditions and stockholder return conditions relative to our peer group identified in the grant. The $59.74 per share grant date fair value reflects the probable outcome of the stockholder return conditions pursuant to the Monte Carlo Simulation Valuation model. The stated grant date fair value for the PRSUs further assumes that the performance conditions will be achieved at the target level. Assuming both the performance conditions and stockholder return conditions are achieved at the highest level, and using a per share grant date fair value equal to the closing price of our common stock on the grant date $57.80, the grant date fair value of the PRSUs would be $5,249,830, $3,749,920, $4,049,902, $1,199,928, and $1,199,928 for Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson, respectively. It would not be appropriate to use the $59.74 per share grant date fair value for purposes of this assumed maximum achievement of the PRSUs granted in 2023 because the $59.74 per share grant date fair value already accounts for the probable outcome of the stockholder return conditions under the Monte Carlo Simulation Valuation model. For additional information on the valuation assumptions with respect to the grants, refer to Note 21, Stock-based Compensation, of our consolidated financial statements as provided in our Form 10-K for the year ended December 31, 2023, as filed with the SEC. 4Represents a one-time cash bonus in recognition of his work on closing our acquisition of U.S. Xpress during 2023. 5In February 2024, Mr. Miller was promoted to CEO, and Mr. Jackson stepped down as President and CEO. Mr. Miller served as CFO for all of 2023.
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table provides estimated information about non-equity and equity plan-based awards that were granted to the named executive officers in 2023.
Grants of Plan-Based Awards
| Name | Grant Date | Award Approval Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards 1 | | | Estimated Future Payouts Under Equity Incentive Plan Awards 2 | | | All Other Stock Awards: Number of Shares of Stock or Units (#) 3 | Grant Date Fair Value of Stock and Option Awards ($) | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | David Jackson | — | — | 199,8006 | 1,110,0006 | 2,442,0006 | — | — | — | — | — | | | 12/15/2023 | 12/12/2023 | — | — | — | 1,499 | 36,331 | 90,828 | — | 2,170,4144 | | | 12/15/2023 | 12/12/2023 | — | — | — | — | — | — | 24,221 | 1,399,9745 | | Adam Miller | — | — | 148,5006 | 825,0006 | 1,815,0006 | — | — | — | — | — | | | 12/15/2023 | 12/12/2023 | — | — | — | 1,070 | 25,951 | 64,878 | — | 1,550,3134 | | | 12/15/2023 | 12/12/2023 | — | — | — | — | — | — | 17,301 | 999,9985 | | Kevin Knight | — | — | 171,0006 | 950,0006 | 2,090,0006 | — | — | — | — | — | | | 12/15/2023 | 12/12/2023 | — | — | — | 1,156 | 28,027 | 70,068 | — | 1,674,3334 | | | 12/15/2023 | 12/12/2023 | — | — | — | — | — | — | 18,685 | 1,079,9935 | | Gary Knight | — | — | 60,750 | 337,500 | 742,500 | — | — | — | — | — | | | 12/15/2023 | 12/12/2023 | — | — | — | 343 | 8,304 | 20,760 | — | 496,0814 | | | 12/15/2023 | 12/12/2023 | — | — | — | — | — | — | 5,536 | 319,9815 | | Todd Carlson | — | — | 70,875 | 393,750 | 866,250 | — | — | — | — | — | | | 12/15/2023 | 12/12/2023 | — | — | — | 343 | 8,304 | 20,760 | — | 496,0814 | | | 12/15/2023 | 12/12/2023 | — | — | — | — | — | — | 5,536 | 319,9815 |
Grants of Plan-Based Awards
1Represents the range of potential cash payments under the annual performance bonuses that Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson could have earned under the 2023 Cash Bonus Plan, as described under the heading “Compensation Discussion and Analysis – Annual Cash Bonus.” For awards under the 2023 Cash Bonus Plan, (i) Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson had bonus potentials of 120%, 100%, 100%, 75%, and 75% of year-end annualized base salary, respectively, (ii) threshold was set at 18% of the bonus potential, (iii) target was set at 100% of the bonus potential, and (iv) maximum was set at 220% of the bonus potential. Based on 2023 performance, Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson did not earn a cash bonus under the 2023 Cash Bonus Plan. 2These columns represent the potential shares issuable in connection with 2023 PRSUs for each of Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson under the Omnibus Plan, for which target awards were approved by the Compensation Committee on December 12, 2023, as described under the heading “Compensation Discussion and Analysis – Long-Term Incentives.” The threshold was set at approximately 4.13% of target and maximum was set at 250% of target. The PRSUs were granted at target and will not be earned, and the actual number of PRSUs finally earned will not be finally determined, until the expiration of the three-year performance period on December 31, 2026. The number of shares ultimately earned will vest on January 31, 2027, subject to certain conditions set forth in the grant agreement. 3Represents an award of RSUs under the Omnibus Plan. The RSUs vest in three installments as follows: 33% on January 31, 2025; 33% on January 31, 2026; and 34% on January 31, 2027. 4The amount disclosed represents the aggregate grant date fair value of the PRSUs granted in 2023 computed in accordance with FASB ASC Topic 718, which was $59.74 per share. These amounts reflect our accounting expense to be recognized over the vesting period of the PRSUs granted in 2023, and do not necessarily correspond to the actual value that will be recognized by the named executive officer. The number of shares ultimately issued pursuant to the PRSUs varies depending upon the satisfaction of performance conditions and stockholder return conditions relative to our peer group identified in the grant. The $59.74 per share grant date fair value reflects the probable outcome of the stockholder return conditions pursuant to the Monte Carlo Simulation Valuation model. The stated grant date fair value for the PRSUs further assumes that the performance conditions will be achieved at the target level. For additional information on the valuation assumptions with respect to the grants, refer to Note 21, Stock-based Compensation, of our consolidated financial statements as provided in our Form 10-K for the year ended December 31, 2023, as filed with the SEC. 5The grant date fair value of the RSUs was computed in accordance with FASB ASC Topic 718, which was $57.80 per share, the closing price of our common stock on the grant date. Dividends accrue on the unvested RSUs and are paid in cash when and if the underlying award vests. 6Potential cash payments under the 2023 Cash Bonus Plan for each of Messrs. Jackson and Miller are based on his respective salary prior to the voluntary reductions that took place in September 2023. The potential cash payment for Mr. Kevin Knight is based on his salary prior to the voluntary reduction from $950,000 to $850,000 that took place in November 2022.
Outstanding Equity Awards at Fiscal Year-End
Outstanding Equity Awards at Fiscal Year-End The following table provides information on the current equity holdings for each of the named executive officers. This table includes unvested RSUs and PRSUs as of December 31, 2023. Each equity grant is shown separately for each named executive officer.
Outstanding Equity Awards at Fiscal Year-End
| | Stock Awards | | | | | | Name | Stock Award Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) 1 | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) 1 | | David Jackson | 11/30/2020 | 10,7052 | 617,143 | — | — | | | 11/30/2020 | 30,1073 | 1,735,669 | — | — | | | 12/06/2021 | 15,7314 | 906,892 | — | — | | | 12/06/2021 | — | — | 35,2165 | 2,030,202 | | | 11/30/2022 | 25,2576 | 1,456,066 | — | — | | | 11/30/2022 | — | — | 37,8847 | 2,184,013 | | | 12/15/2023 | 24,2218 | 1,396,341 | — | — | | | 12/15/2023 | — | — | 1,4999 | 86,417 | | Adam Miller | 11/30/2020 | 5,9292 | 341,807 | — | — | | | 11/30/2020 | 16,6743 | 961,256 | — | — | | | 12/06/2021 | 11,2364 | 647,755 | — | — | | | 12/06/2021 | — | — | 25,1545 | 1,450,128 | | | 11/30/2022 | 18,0406 | 1,040,006 | — | — | | | 11/30/2022 | — | — | 27,0607 | 1,560,009 | | | 12/15/2023 | 17,3018 | 997,403 | — | — | | | 12/15/2023 | — | — | 1,0709 | 61,686 | | Kevin Knight | 11/30/2020 | 9,8822 | 569,697 | — | — | | | 11/30/2020 | 27,7913 | 1,602,151 | — | — | | | 12/06/2021 | 13,4844 | 777,353 | — | — | | | 12/06/2021 | — | — | 30,1865 | 1,740,223 | | | 11/30/2022 | 19,4846 | 1,123,253 | — | — | | | 11/30/2022 | — | — | 29,2267 | 1,684,879 | | | 12/15/2023 | 18,6858 | 1,077,190 | — | — | | | 12/15/2023 | — | — | 1,1569 | 66,643 | | Gary Knight | 11/30/2020 | 2,6352 | 151,908 | — | — | | | 11/30/2020 | 7,4103 | 427,187 | — | — | | | 12/06/2021 | 3,5964 | 207,309 | — | — | | | 12/06/2021 | — | — | 8,0485 | 463,967 | | | 11/30/2022 | 5,7736 | 332,813 | — | — | | | 11/30/2022 | — | — | 8,6587 | 499,134 | | | 12/15/2023 | 5,5368 | 319,150 | — | — | | | 12/15/2023 | — | — | 3439 | 19,774 | | Todd Carlson | 11/30/2020 | 1,9772 | 113,974 | — | — | | | 11/30/2020 | 5,5583 | 320,419 | — | — | | | 12/06/2021 | 3,3714 | 194,338 | — | — | | | 12/06/2021 | — | — | 7,5465 | 435,027 | | | 11/30/2022 | 5,7736 | 332,813 | — | — | | | 11/30/2022 | — | — | 8,6587 | 499,134 | | | 12/15/2023 | 5,5368 | 319,150 | — | — | | | 12/15/2023 | — | — | 3439 | 19,774 |
Outstanding Equity Awards at Fiscal Year-End
1Market value of RSUs and PRSUs is calculated by multiplying the number of restricted shares that have not vested by the closing market price of our common stock on December 29, 2023 (the last trading day of the year), which was $57.65 per share. 2100% of the RSUs vested on January 31, 2024. 3Represents shares earned with respect to the 2020 PRSUs. The shares vested on January 31, 2024, with final payout percentage at 63.75% (zero for the target PRSU and 127.5% for the relative PRSU). See “Compensation Discussion and Analysis – 2020 PRSU Vesting” for further information. 4Of the unvested RSUs. 49.3% vested on January 31, 2024, and 50.7% will vest on January 31, 2025. 5Represents PRSUs granted in 2021 subject to vesting upon achievement of certain performance targets and stockholder return conditions over a three-year period starting January 1, 2022 and ending December 31, 2024. The actual number of PRSUs finally earned will not be determined until the expiration of the performance period. The shares ultimately earned will vest on January 31, 2025, subject to certain conditions set forth in the grant agreement. The table reflects the target shares payable with respect to the awards, as performance during 2023 exceeded the threshold. 6Of the unvested RSUs, 33% vested on January 31, 2024, 33% will vest on January 31, 2025, and 34% will vest on January 31, 2026. 7Represents PRSUs granted in 2022 subject to vesting upon achievement of certain performance targets and stockholder return conditions over a three-year period starting January 1, 2023 and ending December 31, 2025. The actual number of PRSUs finally earned will not be determined until the expiration of the performance period. The shares ultimately earned will vest on January 31, 2026, subject to certain conditions set forth in the grant agreement. The table reflects the target shares payable with respect to the awards, as the performance during 2023 exceeded the threshold. 8The RSUs vest in three installments as follows: 33% on January 31, 2025, 33% on January 31, 2026, and 34% on January 31, 2027. 9Represents PRSUs granted in 2023 subject to vesting upon achievement of certain performance targets and stockholder return conditions over a three-year period starting January 1, 2024 and ending December 31, 2026. The actual number of PRSUs finally earned will not be determined until the expiration of the performance period. The shares ultimately earned will vest on January 31, 2027, subject to certain conditions set forth in the grant agreement. The table reflects the threshold shares payable with respect to the awards, as the performance period did not begin until January 1, 2024. This does not reflect any opinion or projection of management concerning the ultimate level of satisfaction of such performance targets or stockholder return conditions for the performance period.
Stock Vested in 2023
Stock Vested in 2023 The following table sets forth information regarding the values realized by our named executive officers upon the vesting of RSUs and PRSUs during 2023, and such values reflect the total pre-tax value realized by each named executive officer.
Stock Vested in 2023
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#) | Value Acquired on Vesting ($) 1 | | David Jackson | 109,806 | 6,489,535 | | Adam Miller | 61,326 | 3,624,367 | | Kevin Knight | 108,299 | 6,400,471 | | Gary Knight | 30,212 | 1,785,529 | | Todd Carlson | 16,520 | 976,332 |
Stock Vested in 2023
1Calculated by multiplying the aggregate number of shares vested by the closing market price of our common stock on the dates the shares vested.
Nonqualified Deferred Compensation
Nonqualified Deferred Compensation
Nonqualified Deferred Compensation
| Name | Executive Contributions in Last FY ($) | Registrant Contributions in Last FY ($) | Aggregate Earnings in Last FY ($) 1 | Aggregate Withdrawals/ Distributions in Last FY ($)2 | Aggregate Balance at Last FYE ($)3 | | David Jackson | — | — | — | — | — | | Adam Miller | — | — | — | — | — | | Kevin Knight | — | — | 432,8831 | — | 4,472,8762 | | Gary Knight | — | — | — | — | — | | Todd Carlson | 103,3013 | — | 20,465 | — | 171,499 |
Nonqualified Deferred Compensation
1These amounts do not include any above-market or preferential earnings. Accordingly, these amounts are not reported in the Summary Compensation Table. Kevin Knight, who deferred the receipt of 74,635 PRSUs in our 2017 fiscal year, the earnings include (1) the change in the closing price per share of our common stock from December 30, 2022 (the last trading day of 2022) $52.41 and December 29, 2023 (the last trading day of 2023) $57.65, and (2) $0.56 of cash dividends per share declared for all four quarters of 2023 at $0.14 per share. 2For Mr. Kevin Knight, the amount deferred represents deferral of 74,635 PRSUs during our 2017 fiscal year that vested on the date of the 2017 merger of Knight and Swift, to be delivered within six months of the date his employment terminates. The Company accrues for cash dividends on the deferred PRSUs in an amount equal to the amount of cash dividend Mr. Knight would have received had the deferred PRSUs been actual shares of our common stock on the date of the cash dividend payment to stockholders. The accrued cash dividends will be paid to Mr. Knight when the underlying shares of our common stock are distributed to Mr. Knight. 3Todd Carlson contributed $103,301 of his salary into the Company’s Deferred Compensation Plan, as amended (the “Deferred Compensation Plan”) in 2023. The amount contributed are included in the Salary column of the Summary Compensation Table. Each participant in the Deferred Compensation Plan may elect to defer up to 75% of their base salary and bonuses for services performed during a calendar year. Each participant is fully vested in the deferred compensation which they contribute under the Deferred Compensation Plan, including any earnings thereon. Contributions by us, if any, including any earnings thereon, would be determined by the Company at the time of such contribution. We offer a number of investment options under the Deferred Compensation Plan. Participants are responsible for choosing the deemed investments for their deferred cash compensation and may change the deemed investment selections for their existing account balances at any time. The investment options offered currently include money market funds, bond funds, blended funds, and stock funds. All amounts are considered unfunded and are subject to general creditor claims until actually distributed to the employee. The participant may elect to receive a lump sum distribution or installments of up to 10 years upon the occurrence of separation from service, disability, or death, and with respect to compensation deferred prior to January 1, 2015, reaching a retirement age of 65. The participant may request a withdrawal of a stated amount to cover an eligible unforeseeable emergency. The participant may also make an in-service distribution election with specified distribution dates with respect to compensation deferred on or after January 1, 2015.
Potential Payments Upon Termination or Change of Control
Potential Payments Upon Termination or Change of Control Outstanding RSUs and PRSUs held by our named executive officers will vest upon their death or disability (in the case of PRSUs, at the level of performance through the end of the calendar year in which the death or disability occurred). Outstanding PRSUs will vest in the event of a “Change of Control” together with termination for convenience (as defined in the award agreement) or a termination for Good Reason (as defined in the award agreement), at the level of performance through the end of the calendar year in which the termination occurred. Notwithstanding the foregoing, no PRSUs will vest in the event the performance period for the applicable grant had not started prior to the triggering event. The estimated value of RSUs and PRSUs that would have vested for Messrs. Jackson, Miller, Kevin Knight, Gary Knight, and Carlson as of December 31, 2023, under the acceleration scenarios described above is set forth in the table below. The value was calculated by multiplying the closing market price of our common stock on December 29, 2023 (the last trading day of the year) ($57.65 per share), by the number of shares underlying accelerated awards. For additional information on the number of currently unvested RSUs and PRSUs, please refer to “Outstanding Equity Awards at Year-End.”
Potential Payments Upon Termination or Change of Control
| Name/Event | Value of Accelerated RSUs ($) | Value of Accelerated PRSUs ($) | Total ($) | | David Jackson | | | | | Change of Control without Qualifying Change of Control Termination | — | — | — | | Change of Control with Qualifying Change of Control Termination | — | 3,653,627 | 3,653,627 | | Death/Disability | 4,376,442 | 3,653,627 | 8,030,069 | | Eligible Retirement | — | — | — | | Adam Miller | | | | | Change of Control without Qualifying Change of Control Termination | — | — | — | | Change of Control with Qualifying Change of Control Termination | — | 2,331,251 | 2,331,251 | | Death/Disability | 3,026,971 | 2,331,251 | 5,358,222 | | Eligible Retirement | — | — | — | | Kevin Knight | | | | | Change of Control without Qualifying Change of Control Termination | — | — | — | | Change of Control with Qualifying Change of Control Termination | — | 3,166,599 | 3,166,599 | | Death/Disability | 3,547,493 | 3,166,599 | 6,714,092 | | Eligible Retirement | — | — | — | | Gary Knight | | | | | Change of Control without Qualifying Change of Control Termination | — | — | — | | Change of Control with Qualifying Change of Control Termination | — | 865,500 | 865,500 | | Death/Disability | 1,011,180 | 865,500 | 1,876,680 | | Eligible Retirement | — | — | — | | Todd Carlson | | | | | Change of Control without Qualifying Change of Control Termination | — | — | — | | Change of Control with Qualifying Change of Control Termination | — | 744,665 | 744,665 | | Death/Disability | 960,275 | 744,665 | 1,704,940 | | Eligible Retirement | — | — | — |
Potential Payments Upon Termination or Change of Control
Additionally, the award agreements include six month non-compete and non-solicitation provisions in the event of a named executive officer’s Separation from Service (as defined the award agreement). The Company may extend the non-compete period for up to an additional 12 months beyond the completion of the initial six months. If the Company elects to extend the non-compete period, the Company will pay the named executive officer his monthly base salary in effect at the time of the separation for the duration of the additional non-compete period, provided that the payments will be reduced for any other monies earned by the named executive officer from any other work during the period. If each named executive officer separated from service on December 31, 2023, the Company elected to extend the non-compete period for each named executive officer by 12 months, and there were no offsetting monies earned by the named executive officers during the extension period, the named executive officers would receive aggregate base salary payments as follows: $925,000 for Mr. Jackson, $825,000 for Mr. Miller, $850,000 for Mr. Kevin Knight, $450,000 for Mr. Gary Knight, and $525,000 for Mr. Carlson.
Pay Ratio Disclosure
Pay Ratio Disclosure We provide fair and equitable compensation to our employees through a combination of competitive base pay, incentives, retirement plans, and other benefits. We are disclosing the following pay ratio and supporting information, which compares the annual total compensation of our median employee and the annual total compensation of Mr. Jackson, our CEO, as required by Section 953(b) of the Dodd-Frank Act. The pay ratio is a reasonable estimate calculated in a manner consistent with Item 402(u) of SEC Regulation S-K. The SEC rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their compensation practices. As such, the pay ratio reported by other companies may not be comparable to the pay ratio reported below, as other companies may have different employment and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios. For 2023, our last completed fiscal year: •The annual total compensation of our median employee was $67,318; and •The annual total compensation of our CEO, as reported in the Summary Compensation Table included in this proxy statement, was $4,457,450. Based on this information, the ratio of the annualized annual total compensation of our CEO to the annual total compensation of our median employee was 66 to 1. As permitted under SEC rules, the median employee was originally determined as of December 31, 2022, and excludes the approximately 9,200 persons who became our employees as a result of our acquisition of U.S. Xpress on July 1, 2023. There has been no change in our employee population or employee compensation arrangements that we believe would significantly impact the pay ratio disclosure. However, the median employee identified at December 31, 2022 is no longer employed with us. For 2023, we identified another median employee whose compensation and duties are substantially similar to the prior year median employee. We calculated our median employee’s annual total compensation for 2023 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in that employee’s annual total compensation of $67,318. The median employee’s annual total compensation includes salary, as well as company matching contributions to our 401(k) plan, incentive payments, and equity awards. The median employee did not receive health or other fringe benefits. Median employee compensation reflects that, as of December 31, 2023, approximately 5% of our employees were student drivers, which had the effect of lowering our median employee compensation.
Pay Versus Performance
Pay Versus Performance In accordance with rules adopted by the Securities and Exchange Commission pursuant to the Dodd-Frank Act, we provide the following disclosure regarding executive compensation for our principal executive officer (“PEO”) and non-PEO named executive officers (“NEO”) and certain financial performance of the Company for the fiscal years listed below.
Pay Versus Performance
| Year | Summary Compensation Table Total for PEO¹ ($) | Compensation Actually Paid to PEO¹˒²˒³ ($) | Average Summary Compensation Table Total for Non-PEO NEOs¹ ($) | Average Compensation Actually Paid to Non-PEO NEOs¹˒²˒³ ($) | Value of Initial Fixed $100 Investment based on:4 | | Net Income ($ Millions) | Consolidated Revenue Growth5 | | | | | | | TSR ($) | Peer Group TSR ($) | | | | 2023 | 4,457,450 | 5,849,721 | 2,430,435 | 3,132,645 | 166.56 | 130.87 | 216 | (4)% | | 2022 | 6,365,202 | 4,772,193 | 3,643,842 | 2,798,975 | 149.92 | 97.55 | 771 | 17.6% | | 2021 | 6,281,262 | 20,558,596 | 3,679,847 | 10,836,812 | 172.72 | 120.41 | 743 | 27% | | 2020 | 5,834,698 | 12,915,345 | 3,321,116 | 6,981,316 | 117.63 | 106.29 | 410 | (0.6)% |
Pay Versus Performance
1David Jackson was our PEO for each year presented. The individuals comprising the Non-PEO NEOs for each year presented are listed below.
Pay Versus Performance
| 2020-2023 | | Adam Miller | | Kevin Knight | | Gary Knight | | Todd Carlson |
Pay Versus Performance
2The amounts shown for Compensation Actually Paid have been calculated in accordance with Item 402(v) of Regulation S-K and do not reflect compensation actually earned, realized, or received by the Company’s PEO or non-PEO NEOs. These amounts reflect the Summary Compensation Table Total with certain adjustments as described in footnote 3 below. 3Compensation Actually Paid reflects the exclusions and inclusions of certain amounts for the PEO and the Non-PEO NEOs as set forth below. Equity values are calculated in accordance with FASB ASC Topic 718. Amounts in the Exclusion of Stock Awards column are the totals from the Stock Awards column set forth in the Summary Compensation Table.
Pay Versus Performance
| Year | Summary Compensation Table Total for PEO ($) | Exclusion of Stock Awards for PEO ($) | Inclusion of Equity Values for PEO ($) | Compensation Actually Paid to PEO ($) | | 2023 | 4,457,450 | (3,570,388) | 4,962,660 | 5,849,721 |
Pay Versus Performance
| Year | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average Exclusion of Stock Awards for Non-PEO NEOs ($) | Average Inclusion of Equity Values for Non-PEO NEOs ($) | Average Compensation Actually Paid to Non-PEO NEOs ($) | | 2023 | 2,430,435 | (1,734,190) | 2,436,400 | 3,132,645 |
Pay Versus Performance
The amounts in the Inclusion of Equity Values in the tables above are derived from the amounts set forth in the following tables:
Pay Versus Performance
| Year | Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for PEO ($) | Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for PEO ($) | Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for PEO ($) | Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for PEO ($) | Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for PEO ($) | Value of Dividends or Other Earnings Paid on Stock or Option Awards Not Otherwise Included for PEO ($) | Total - Inclusion of Equity Values for PEO ($) | | 2023 | 5,675,523 | (1,183,290) | — | 470,427 | — | — | 4,962,660 |
Pay Versus Performance
| Year | Average Year-End Fair Value of Equity Awards Granted During Year That Remained Unvested as of Last Day of Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Last Day of Year of Unvested Equity Awards for Non-PEO NEOs ($) | Average Vesting-Date Fair Value of Equity Awards Granted During Year that Vested During Year for Non-PEO NEOs ($) | Average Change in Fair Value from Last Day of Prior Year to Vesting Date of Unvested Equity Awards that Vested During Year for Non-PEO NEOs ($) | Average Fair Value at Last Day of Prior Year of Equity Awards Forfeited During Year for Non-PEO NEOs ($) | Average Value of Dividends or Other Earnings Paid on Stock or Option Awards Not Otherwise Included for Non-PEO NEOs ($) | Total - Average Inclusion of Equity Values for Non-PEO NEOs ($) | | 2023 | 2,756,615 | (553,319) | — | 233,105 | — | — | 2,436,400 |
Pay Versus Performance
4The Peer Group TSR set forth in this table utilizes the Nasdaq Transportation index, which we also utilize in the stock performance graph required by Item 201(e) of Regulation S-K included in our Annual Report for the year ended December 31, 2023. The comparison assumes $100 was invested for the period starting December 31, 2019, through the end of the listed year in the Company and in the Nasdaq Transportation index, respectively. Historical stock performance is not necessarily indicative of future stock performance. 5We determined consolidated revenue growth to be the most important financial performance measure used to link Company performance to Compensation Actually Paid to our PEO and Non-PEO NEOs in 2023, as it served as a performance metric for both our 2023 Cash Bonus Plan and our Company Performance PRSUs, along with the additional measures that make up the components of our short-term and long-term incentive programs. This performance measure may not have been the most important financial performance measure for prior years and we may determine a different financial performance measure to be the most important financial performance measure in future years. Below are graphs showing the relationship of Compensation Actually Paid to our PEO and our Non-PEO NEOs in 2023, 2021, and 2020 to (i) the TSR of the Company and the Nasdaq Transportation index, (ii) the Company’s net income, and (iii) the Company’s consolidated revenue growth. Compensation Actually Paid, as required by SEC rules, reflects adjusted values to unvested and vested equity awards during the years shown in the table based on year-end stock prices and various accounting valuation assumptions but does not reflect actual amounts paid out for those awards. Compensation Actually Paid generally fluctuates due to stock price and varying levels of projected and actual achievement of performance goals. Listed below are the performance measures that in our assessment represent the most important performance measures we use to link Compensation Actually Paid to our PEO and Non-PEO NEOs, for 2023, to Company performance.
Pay Versus Performance
| Measure | Description | | Consolidated Revenue Growth | Consolidated revenue growth is calculated by taking the total of current year consolidated revenue less current year trucking fuel surcharge, minus prior year consolidated revenue less prior year trucking fuel surcharge, divided by prior year consolidated revenue less prior year trucking fuel surcharge. Trucking fuel surcharge is calculated as the sum of the applicable amount across each of the following of our operating segments: Knight Trucking, Swift Truckload, Swift Dedicated, Swift Refrigerated, AAA Cooper, MME, and U.S. Xpress (or, if the segments are reorganized, increased or decreased, any segment that provides truckload or LTL services). Consolidated revenue growth targets could be adjusted by the Compensation Committee to omit the effects of extraordinary items, acquisitions or dispositions, unusual, one-time or non-recurring items, amortization of intangibles, cumulative effects of changes in accounting principles, and similar items or transactions. | | Adjusted EPS CAGR | Adjusted EPS CAGR is a non-GAAP measure calculated as the compound annual growth rate in earnings per diluted share, adjusted to eliminate the effect of certain items or events, over the applicable period. | | Adjusted Operating Income Growth | Adjusted operating income is a non-GAAP measure calculated as consolidated total revenue, net of trucking fuel surcharge, less consolidated total adjusted operating expenses, net of trucking fuel surcharge. Adjusted operating income growth is calculated by taking current year adjusted operating income less prior year adjusted operating income, divided by prior year adjusted operating income. Adjusted operating income growth targets could be adjusted by the Compensation Committee to omit the effects of extraordinary items, acquisitions or dispositions, unusual, one-time or non-recurring items, amortization of intangibles, cumulative effects of changes in accounting principles, and similar items or transactions. | | Return on Net Tangible Assets | Return on net tangible assets is a non-GAAP measure calculated as net income, adjusted to eliminate the effects of certain items or events, divided by average net tangible assets, and compared to a relative peer group of public truckload carriers selected by the Compensation Committee. |
Election of Directors (Proposal 1)
Election of Directors (Proposal 1) Directors are elected by a majority of votes cast with respect to each director, provided that the number of nominees does not exceed the number of directors to be elected, in which case the directors will be elected by the vote of a plurality of the shares represented in person or by proxy at any stockholder meeting. Broker non-votes and abstentions will have no effect on the outcome of this proposal.