• | our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (filed on February 13, 2024); |
• | our Quarterly Reports on Form 10-Q for the fiscal quarter ended March 31, 2024 (filed on May 7, 2024) and the fiscal quarter ended June 30, 2024 (filed on August 7, 2024); |
• | our Current Reports on Form 8-K filed on April 2, 2024, April 11, 2024, May 20, 2024, June 14, 2024 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto), June 24, 2024 (excluding the information disclosed pursuant to Items 2.02 and 7.01 and Exhibits 99.1 and 99.2 thereto), August 2, 2024, August 9, 2024, August 12, 2024 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto), September 9, 2024 (Film No. 241285779), September 11, 2024, September 16, 2024 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto) and September 25, 2024; and |
• | the description of the Company’s common stock contained in the Company’s Amended and Restated Certificate of Incorporation filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on November 1, 2022, including any amendment or report filed with the SEC for the purpose of updating such description. |
• | the effect of the completion of the transaction to acquire Coyote Logistics on the parties’ business relationships and business generally; |
• | competition and pricing pressures; |
• | economic conditions generally; |
• | fluctuations in fuel prices; |
• | increased carrier prices; |
• | severe weather, natural disasters, terrorist attacks or similar incidents that cause material disruptions to our operations or the operations of the third-party carriers and independent contractors with which we contract; |
• | our dependence on third-party carriers and independent contractors; |
• | labor disputes or organizing efforts affecting our workforce and those of our third-party carriers; |
• | legal and regulatory challenges to the status of the third-party carriers with which we contract, and their delivery workers, as independent contractors, rather than employees; |
• | our ability to develop and implement suitable information technology systems and prevent failures in or breaches of such systems; |
• | the impact of potential cyber-attacks and information technology or data security breaches; |
• | issues related to our intellectual property rights; |
• | our ability to access the capital markets and generate sufficient cash flow to satisfy our debt obligations; |
• | litigation that may adversely affect our business or reputation; |
• | increasingly stringent laws protecting the environment, including transitional risks relating to climate change, that impact our third-party carriers; |
• | governmental regulation and political conditions; |
• | our ability to attract and retain qualified personnel; |
• | our ability to successfully implement our cost and revenue initiatives and other strategies; |
• | our ability to successfully manage our growth; |
• | our reliance on certain large customers for a significant portion of our revenue; |
• | damage to our reputation through unfavorable publicity; |
• | our failure to meet performance levels required by our contracts with our customers; |
• | the inability to achieve the level of revenue growth, cash generation, cost savings, improvement in profitability and margins, fiscal discipline, or strengthening of competitiveness and operations anticipated or targeted; |
• | a determination by the IRS that the distribution or certain related separation transactions should be treated as taxable transactions; and |
• | the impact of the separation on our businesses, operations and results. |
• | Truck Brokerage ($2.4 billion of our revenues for fiscal year 2023): We provide our customers highly efficient access to capacity through our digital brokerage technology. This proprietary platform, combined with excellent customer service and some of the best operators in the industry, is a major differentiator for our truck brokerage business. Truck brokerage is an asset-light business that facilitates the movement of over the road freight, typically from a single shipper. Together with our pricing technology, we believe we can unlock incremental growth well beyond our current levels. Our truck brokerage business operates in a growing, $88 billion brokered truckload industry in the United States, within a total addressable for-hire trucking opportunity of approximately $400 billion in 2021. |
• | Managed Transportation ($0.7 billion of our revenues for fiscal year 2023): Our managed transportation service provides asset-light solutions for shippers who outsource their freight transportation to gain reliability, visibility, and cost savings. The service uses proprietary technology to optimize freight networks while providing cross-selling opportunities to our truck brokerage and last mile businesses. Our managed transportation offering includes bespoke load planning and procurement, complex solutions tailored to specific challenges, performance monitoring, engineering and data analytics, among other services. Our control tower solution leverages the expertise of a dedicated team focused on continuous improvement, and digital, door-to-door visibility into order status and freight in transit. In addition, we offer technology-enabled managed expedite services that automate transportation procurement for time-critical freight moved by road and air charter carriers. We also offer freight forwarding services, including facilitation of ocean and air transportation, customs brokerage and additional domestic services. We estimate that the total addressable market for the managed transportation services we offer was $23 billion, as measured in revenue, in 2021. Over the last twelve months ending June 30, 2024, our freight under management was approximately $3.0 billion. |
• | Last Mile ($1.0 billion of our revenues for fiscal year 2023): Our last mile offering is an asset-light service that facilitates consumer deliveries of heavy goods performed by highly qualified third-party contractors. We are the largest provider of outsourced last mile transportation for heavy goods in the United States, offering superior service and national scale. We are positioned within 125 miles of the vast majority of the United States population and serve a customer base of omnichannel and e-commerce retailers and direct-to-consumer manufacturers. In the twelve months ended June 30, 2024, Last Mile completed approximately 9.5 million deliveries. We estimate that the total addressable market for the Last Mile services we offer was $16 billion in 2021. |
(1) | Fiscal year 2023. Excludes impact of eliminations. Numbers may not add up to 100% due to rounding. |
(2) | Reflects combined revenue of Managed Transportation and Freight Forwarding, which was combined with Managed Transportation in the second quarter 2024. |
(1) | Fiscal year 2023. |
(2) | Includes temporary workers. |
(1) | Fiscal year 2023. |
• | Market Leadership: RXO will become the third largest provider of brokered transportation in North America by revenue and a leading provider of full truckload services. |
• | Scale: The acquisition will add to RXO’s already substantial capacity and will provide us with access to new power lanes, the highest density lanes in the network. It will also increase our market share for cross-border and LTL freight. Our larger scale will provide us an opportunity to increase our purchasing power with transportation carriers. |
• | Growth: Coyote brings new customers to RXO. Upon closing, we will increase the number of customers that do more than $1 million in revenue with us by about 80%. We will also diversify our book of business. Coyote’s top two verticals are food and beverage and transportation, while ours are retail/e-commerce and industrial and manufacturing. There is minimal overlap across our largest customers. |
• | Operations: Technology will remain a core focus. Supported by people that provide exceptional customer service, we believe our continuous improvement mindset will deliver exceptional results for our customers, carriers, employees and shareholders. |
• | Synergies: We see significant opportunities to achieve operational synergies, including at least $25 million of annualized cost savings in the first year of ownership. |
• | Critical Scale in an Expanding Industry with Low Penetration: We are one of the largest brokers of full truckload freight transportation in the United States, with a carrier pool that gives us access to vast truck capacity to serve high shipper demand for transportation. We are also well established as a freight broker of choice across diversified industry sectors, with a notable presence in the e-commerce and retail sectors and believe that shippers look to do business with brokers of greater scale. We expect to benefit from both overall industry growth in demand for truckload transportation, and a long runway for increased broker penetration of for-hire trucking. |
• | Proprietary Technology: We believe our technology strongly differentiates us as a leading innovator of complex brokerage solutions that enhance visibility, reliability, speed, accuracy and cost effectiveness, and by the fully automated transactional capabilities of our digital platform. We have continued to invest in our cutting-edge technology, including artificial intelligence and machine learning, based on decades of high-quality internal data sets that include attributes that we believe are not available elsewhere. As more and more shippers outsource their shipping needs to brokers, we believe they increasingly prefer brokers that have a combination of excellent customer service, people and digital capabilities that we offer. |
• | Long-Tenured, Blue-Chip Customer Relationships in Attractive Verticals: Our customer base includes numerous long-term relationships with market leaders and other world-class companies across a diverse array of customer verticals. Our tiered sales organization tailors its approach to each prospective customer based on size and profitability potential. |
• | Asset-Light Model Generates High Returns and Substantial Free Cash Flow: Our asset-light model generates high returns with strong free cash flow characteristics. Because we’ve invested significantly in our proprietary platform for more than a decade, we believe that we can leverage our historical invested capital to generate strong returns. |
• | Experienced and Cohesive Leadership and Strong Company Values: Our business operations are led by highly experienced executives who are recognized as leading truck brokerage experts and technologists. These executives have worked together for many years, creating value through operational excellence, data science and a people-centric culture. |
• | Market our brokerage capabilities and value-added services to new and existing customers of all sizes, using a partnership approach that creates enduring relationships; |
• | Leverage our positioning to increasingly capitalize on secular trends in demand, such as the increasing broker penetration of the for-hire truckload industry and the growing shipper preference for digital brokerage services; |
• | Continue to recruit and retain talented customer and carrier sales representatives, and continuously improve their productivity with our state-of-the-art technology; |
• | Continue to attract and retain high-caliber independent carriers to provide third-party transportation services for our customers; and |
• | Capitalize on our first-mover technology advantage to continue to gain share of the truck brokerage industry by optimizing brokerage processes and pricing for customers and carriers, and by enhancing the productivity of our operations. |
• | Increases market share and revenue generation by providing real-time visibility into available supply and demand for current and future time periods, leading to optimal transportation management; |
• | Ensures competitive rates by engaging customers and carriers through user-friendly interfaces underpinned by cutting-edge pricing technology; |
• | Optimizes for value and margin with dynamic pricing algorithms that use machine learning, and generates superior, real-time market intelligence harvested from load-matching data; and |
• | Improves productivity by facilitating transactions through cost-efficient automated processes and messaging, increasing the productivity of RXO’s customer and carrier representatives, and enabling our business to manage more volume without a commensurate increase in expense. |
(1) | Fiscal year 2023. |
(1) | Fiscal year 2023. Excludes impact of eliminations. |
(1) | See below for a reconciliation of these measures to the most directly comparable measures used in accordance with U.S. GAAP. |
Three months ended June 30, | ||||||
(dollars in millions) | 2024 | 2023 | ||||
Net income (loss) | $(7) | $3 | ||||
Interest expense, net | 8 | 8 | ||||
Income tax provision (benefit) | (1) | 3 | ||||
Depreciation and amortization expense | 17 | 18 | ||||
Transaction and integration costs | 7 | 4 | ||||
Restructuring and other costs | 4 | 2 | ||||
Adjusted EBITDA | $28 | $38 | ||||
Revenue | $930 | $963 | ||||
Adjusted EBITDA margin | 3.0% | 3.9% | ||||
Three months ended June 30, | ||||||
(dollars in millions) | 2024 | 2023 | ||||
Revenue | $930 | $963 | ||||
Cost of transportation and services (exclusive of depreciation and amortization) | 700 | 723 | ||||
Direct operating expense (exclusive of depreciation and amortization) | 50 | 59 | ||||
Direct depreciation and amortization | 3 | 2 | ||||
Gross margin | $177 | $179 | ||||
Gross margin as a percentage of revenue | 19.0% | 18.6% | ||||
Pro Forma Condensed Combined | Historical RXO, Inc. | ||||||||||||||||||||
(dollars in millions, shares in thousands, except per share amounts) | As of and for the six months ended June 30, 2024 | For the year ended December 31, 2023 | As of and for the six months ended June 30, | As of and for the year ended December 31, | |||||||||||||||||
2024 | 2023 | 2023 | 2022 | 2021 | |||||||||||||||||
Statement of Operations Data: | |||||||||||||||||||||
Revenue | $3,149 | $7,079 | $1,843 | $1,973 | $3,927 | $4,796 | $4,689 | ||||||||||||||
Cost of transportation and services (exclusive of depreciation and amortization) | 2,532 | 5,657 | 1,399 | 1,482 | 2,967 | 3,624 | 3,681 | ||||||||||||||
Direct operating expense (exclusive of depreciation and amortization) | 106 | 241 | 103 | 120 | 235 | 226 | 192 | ||||||||||||||
Sales, general and administrative expense | 442 | 949 | 299 | 297 | 591 | 640 | 539 | ||||||||||||||
Depreciation and amortization expense | 60 | 131 | 33 | 36 | 67 | 86 | 81 | ||||||||||||||
Intangible asset impairment charge | — | 111 | — | — | — | — | — | ||||||||||||||
Transaction and integration costs | 11 | 31 | 8 | 10 | 12 | 84 | 2 | ||||||||||||||
Restructuring | |||||||||||||||||||||
costs | 17 | 31 | 13 | 9 | 16 | 13 | 2 | ||||||||||||||
Operating income (loss) | (19) | (72) | (12) | 19 | 39 | 123 | 192 | ||||||||||||||
Other expense | 1 | 219 | 1 | — | 3 | — | 1 | ||||||||||||||
Interest expense, net | 23 | 46 | 16 | 16 | 32 | 4 | — | ||||||||||||||
Income (loss) before income taxes | (43) | (337) | (29) | 3 | 4 | 119 | 191 | ||||||||||||||
Income tax expense (benefit) | (10) | (29) | (7) | — | — | 27 | 41 | ||||||||||||||
Net income (loss) | $(33) | $(308) | $(22) | $3 | $4 | $92 | $150 | ||||||||||||||
Pro Forma Condensed Combined | Historical RXO, Inc. | ||||||||||||||||||||
(dollars in millions, shares in thousands, except per share amounts) | As of and for the six months ended June 30, 2024 | For the year ended December 31, 2023 | As of and for the six months ended June 30, | As of and for the year ended December 31, | |||||||||||||||||
2024 | 2023 | 2023 | 2022 | 2021 | |||||||||||||||||
Earnings (loss) per share: | |||||||||||||||||||||
Basic | $(0.21) | $(2.01) | $(0.19) | $0.03 | $0.03 | $0.80 | $1.30 | ||||||||||||||
Diluted | (0.21) | (2.01) | (0.19) | 0.03 | 0.03 | 0.79 | 1.30 | ||||||||||||||
Weighted-average shares outstanding: | |||||||||||||||||||||
Basic | 153,751 | 153,224 | 117,398 | 116,748 | 116,871 | 115,335 | 115,163 | ||||||||||||||
Diluted | 153,751 | 153,224 | 117,398 | 119,414 | 119,456 | 115,791 | 115,163 | ||||||||||||||
Balance Sheet Data: | |||||||||||||||||||||
Total assets | $3,387 | $1,813 | $1,912 | $1,825 | $2,031 | ||||||||||||||||
Total liabilities | 1,947 | 1,234 | 1,323 | 1,231 | 1,444 | ||||||||||||||||
Long-term debt and obligations under finance leases | 569 | 370 | 451 | 356 | 451 | ||||||||||||||||
Total equity | 1,440 | 579 | 589 | 594 | 587 | ||||||||||||||||
Other Data: | |||||||||||||||||||||
Adjusted EBITDA(1) | $70 | $238 | $43 | $75 | $132 | $306 | $277 | ||||||||||||||
Adjusted EBITDA margin(1) | 2.2% | 3.4% | 2.3% | 3.8% | 3.4% | 6.4% | 5.9% | ||||||||||||||
Bank adjusted EBITDA(1) | 59 | 82 | 146 | ||||||||||||||||||
Gross margin(2) | 506 | 1,173 | 336 | 368 | 717 | ||||||||||||||||
Brokerage gross margin(2) | 330 | 819 | 160 | 184 | 363 | ||||||||||||||||
(1) | Our non-GAAP financial measures for the periods presented in the table above include adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”), adjusted EBITDA margin and bank adjusted EBITDA. |
Pro Forma Condensed Combined | Historical RXO, Inc. | ||||||||||||||||||||
(dollars in millions) | Six months ended June 30, 2024 | Year ended December 31, 2023 | Six months ended June 30, | Year ended December 31, | |||||||||||||||||
2024 | 2023 | 2023 | 2022 | 2021 | |||||||||||||||||
Net income (loss) | $(33) | $(308) | $(22) | $3 | $4 | $92 | $150 | ||||||||||||||
Interest expense, net | 23 | 46 | 16 | 16 | 32 | 4 | — | ||||||||||||||
Income tax provision (benefit) | (10) | (29) | (7) | — | — | 27 | 41 | ||||||||||||||
Depreciation and amortization expense | 60 | 131 | 33 | 36 | 67 | 86 | 81 | ||||||||||||||
Intangible asset impairment charge | — | 111 | — | — | — | — | — | ||||||||||||||
Transaction, integration and other costs(a) | 11 | 247 | 8 | 10 | 12 | 84 | 2 | ||||||||||||||
Restructuring and other costs | 19 | 40 | 15 | 10 | 17 | 13 | 3 | ||||||||||||||
Adjusted EBITDA | $70 | $238 | $43 | $75 | $132 | $306 | $277 | ||||||||||||||
Pro Forma Condensed Combined | Historical RXO, Inc. | ||||||||||||||||||||
(dollars in millions) | Six months ended June 30, 2024 | Year ended December 31, 2023 | Six months ended June 30, | Year ended December 31, | |||||||||||||||||
2024 | 2023 | 2023 | 2022 | 2021 | |||||||||||||||||
Credit agreement adjustments(b) | 16 | 7 | 14 | ||||||||||||||||||
Bank adjusted EBITDA | $59 | $82 | $146 | ||||||||||||||||||
Revenue | $3,149 | $7,079 | $1,843 | $1,973 | $3,927 | $4,796 | $4,689 | ||||||||||||||
Adjusted EBITDA margin | 2.2% | 3.4% | 2.3% | 3.8% | 3.4% | 6.4% | 5.9% | ||||||||||||||
(a) | Other for the pro forma period reflects a one-time cost of $216 million representing the difference between the issuance price and the closing market price of common stock issued in connection with the Private Placement. |
(b) | Represents stock compensation expense and other non-recurring items included in sales, general and administrative expense. |
(2) | The following is the calculation of gross margin, brokerage gross margin and, in each case, as a percentage of revenue: |
Pro Forma Condensed Combined | Historical RXO, Inc. | ||||||||||||||
(dollars in millions) | Six months ended June 30, 2024 | Year ended December 31, 2023 | Six months ended June 30, | Year ended December 31, 2023 | |||||||||||
2024 | 2023 | ||||||||||||||
Revenue | $3,149 | $7,079 | $1,843 | $1,973 | $3,927 | ||||||||||
Cost of transportation and services (exclusive of depreciation and amortization) | 2,532 | 5,657 | 1,399 | 1,482 | 2,967 | ||||||||||
Direct operating expense (exclusive of depreciation and amortization) | 106 | 241 | 103 | 120 | 235 | ||||||||||
Direct depreciation and amortization | 5 | 8 | 5 | 3 | 8 | ||||||||||
Gross margin | $506 | $1,173 | $336 | $368 | $717 | ||||||||||
Gross margin as a percentage of revenue | 16.1% | 16.6% | 18.2% | 18.7% | 18.3% | ||||||||||
Pro Forma Condensed Combined | Historical RXO, Inc. | ||||||||||||||
(dollars in millions) | Six months ended June 30, 2024 | Year ended December 31, 2023 | Six months ended June 30, | Year ended December 31, 2023 | |||||||||||
2024 | 2023 | ||||||||||||||
Revenue | $2,413 | $5,510 | $1,107 | $1,157 | $2,358 | ||||||||||
Cost of transportation and services (exclusive of depreciation and amortization) | 2,079 | 4,683 | 946 | 973 | 1,993 | ||||||||||
Direct operating expense (exclusive of depreciation and amortization) | 3 | 7 | — | — | 1 | ||||||||||
Direct depreciation and amortization | 1 | 1 | 1 | — | 1 | ||||||||||
Brokerage gross margin | $330 | $819 | $160 | $184 | $363 | ||||||||||
Brokerage gross margin as a percentage of revenue | 13.7% | 14.9% | 14.5% | 15.9% | 15.4% | ||||||||||
For the six months ended June 30, | For the year ended December 31, | |||||||||||
(dollars in millions) | 2024 | 2023 | 2023 | 2022 | ||||||||
Statement of Income Data: | ||||||||||||
Revenue | $1,307 | $1,625 | $3,154 | $4,774 | ||||||||
Operating Expenses | ||||||||||||
Purchased transportation | 1,124 | 1,365 | 2,674 | 4,052 | ||||||||
Compensation and benefits | 122 | 163 | 298 | 368 | ||||||||
Depreciation and amortization | 31 | 31 | 62 | 61 | ||||||||
Intangible asset impairment charge | — | — | 111 | — | ||||||||
Other expenses | 41 | 54 | 99 | 96 | ||||||||
Total Operating Expenses | 1,318 | 1,613 | 3,244 | 4,577 | ||||||||
Operating Profit (Loss) | (11) | 12 | (90) | 197 | ||||||||
Other Income and (Expense) | ||||||||||||
Investment (expense) and other | (1) | — | (3) | (3) | ||||||||
Income (Loss) Before Income Taxes | (12) | 12 | (93) | 194 | ||||||||
Income Tax Expense (Benefit) | (2) | 3 | (23) | 51 | ||||||||
Net Income (Loss) | $(10) | $9 | $(70) | $143 | ||||||||
As of and for the six months ended June 30, | As of and for the year ended December 31, | |||||||||||
(dollars in millions) | 2024 | 2023 | 2023 | 2022 | ||||||||
Balance Sheet Data: | ||||||||||||
Total Assets | $1,155 | $1,215 | $1,549 | |||||||||
Total Liabilities | 402 | 511 | 722 | |||||||||
Total Equity | 753 | 704 | 827 | |||||||||
As of and for the six months ended June 30, | As of and for the year ended December 31, | |||||||||||
(dollars in millions) | 2024 | 2023 | 2023 | 2022 | ||||||||
Other Data: | ||||||||||||
Adjusted EBITDA(1) | $27 | $58 | $106 | |||||||||
Gross margin(2) | 170 | 247 | 456 | |||||||||
(1) | See “— Summary Historical and Unaudited Pro Forma Financial and Other Information of RXO” for a discussion of adjusted EBITDA. |
Six months ended June 30, | Year ended December 31, 2023 | |||||||||
(dollars in millions) | 2024 | 2023 | ||||||||
Net income (loss) | $(10) | $9 | $(70) | |||||||
Interest expense, net | 1 | 1 | 3 | |||||||
Income tax provision (benefit) | (2) | 3 | (23) | |||||||
Depreciation and amortization expense | 31 | 31 | 62 | |||||||
Intangible asset impairment charge | — | — | 111 | |||||||
Transaction and integration costs | 3 | — | — | |||||||
Restructuring and other costs | 4 | 14 | 23 | |||||||
Adjusted EBITDA | $27 | $58 | $106 | |||||||
(2) | The following is the calculation of gross margin: |
Six months ended June 30, | Year ended December 31, 2023 | |||||||||
(dollars in millions) | 2024 | 2023 | ||||||||
Revenue | $1,307 | $1,625 | $3,154 | |||||||
Cost of transportation and services (exclusive of depreciation and amortization) | 1,134 | 1,375 | 2,692 | |||||||
Direct operating expense (exclusive of depreciation and amortization) | 3 | 3 | 6 | |||||||
Direct depreciation and amortization | — | — | — | |||||||
Gross margin | $170 | $247 | $456 | |||||||
Gross margin as a percentage of revenue | 13.0% | 15.2% | 14.5% | |||||||
• | our announcements or our competitors’ announcements regarding new products, enhancements, significant contracts, acquisitions or strategic investments; |
• | changes in earnings estimates or recommendations by securities analysts, if any, who cover our common stock; |
• | failures to meet external expectations or management guidance; |
• | fluctuations in our quarterly financial results or the quarterly financial results of companies perceived to be similar to us; |
• | changes in our capital structure or dividend policy, future issuances of securities, sales of large blocks of common stock by our shareholders or our incurrence of additional debt; |
• | reputational issues; |
• | changes in general economic and market conditions in or any of the regions in which we conduct our business; |
• | changes in industry conditions or perceptions; and |
• | changes in applicable laws, rules or regulations and other dynamics. |
• | the ability of our remaining directors to fill vacancies on our board of directors; |
• | limitations on stockholders’ ability to call a special stockholder meeting or act by written consent; |
• | rules regarding how stockholders may present proposals or nominate directors for election at stockholder meetings; |
• | the right of our board of directors to issue preferred stock without stockholder approval; and |
• | a classified board of directors, with each class serving a staggered three-year term, which could have the effect of making the replacement of incumbent directors more time consuming and difficult. |
Common Stock Owned Prior to the Offering | Number of Shares Offered | Common Stock Owned After the Offering(1) | |||||||||||||
Name of Selling Stockholder | Shares | % | Shares | % | |||||||||||
MFN Partners, LP(2) | 30,136,419(3) | 18.74% | 14,844,137(4) | 17,310,856 | 10.77% | ||||||||||
Entities affiliated with Orbis Investment Management Limited, Orbis Investment Management (U.S.), L.P. or Allan Gray Australia Pty Limited | 28,561,230(5) | 17.76% | 12,370,114(6) | 17,873,260 | 11.12% | ||||||||||
Jacobs Private Equity, LLC(7) | 1,300,701 | * | 1,300,701 | — | — | ||||||||||
* | Less than 1%. |
(1) | Assumes the sale of all of the shares offered by the selling stockholders pursuant to this prospectus supplement and that the selling stockholders buy or sell no additional shares of common stock prior to the completion of the offering. |
(2) | The general partner of MFN Partners, LP (“MFN Partnership”) is MFN Partners GP, LLC (“MFN GP”). MFN Partners Management, LP (“MFN Management”) acts as investment adviser to the MFN Partnership. The general partner of MFN Management is MFN Partners Management, LLC (“MFN LLC”). Farhad Nanji and Michael F. DeMichele are the managing members of MFN GP and MFN LLC. Each of MFN Partnership, MFN GP, MFN Management, MFN LLC, Farhad Nanji and Michael F. DeMichele disclaims beneficial ownership of the shares reported herein except to the extent of its or his pecuniary interest therein. The address of each of MFN Partnership, MFN GP, MFN Management, MFN LLC, Farhad Nanji and Michael F. DeMichele is 222 Berkeley Street, 13th Floor, Boston, MA 02116. |
(3) | Consists of (i) 27,577,666 shares of common stock, and (ii) 2,558,753 shares of common stock issuable upon exercise of Warrants subject to the Beneficial Ownership Limitation held by the MFN Partnership. Excludes 2,018,574 shares of common stock issuable upon exercise of the Warrants subject to the Beneficial Ownership Limitation and the Stockholder Approval Condition. |
(4) | Consists of (i) 10,266,810 shares of common stock, (ii) 2,558,753 shares of common stock issuable upon exercise of the Warrants subject to the Beneficial Ownership Limitation and (iii) 2,018,574 shares of common stock issuable upon exercise of the Warrants subject to the Beneficial Ownership Limitation and the Stockholder Approval Condition. The shares being offered are subject to the Lock-Ups. See “Summary—Recent Developments—Private Placement” and “—Public Offering.” |
(5) | Consists of 28,561,230 shares of common stock held by entities managed, directly or indirectly, by Orbis Investment Management Limited (“OIML”), Orbis Investment Management (U.S.), L.P. (“OIMUS”) or Allan Gray Australia Pty Limited (“AGAPL”). Excludes 1,682,144 shares of common stock issuable upon exercise of the Warrants subject to the Stockholder Approval Condition. The address of OIML is Orbis House, 25 Front Street, Hamilton HM11 Bermuda, the address of OIMUS is One Letterman Drive, Building C, Suite CM-100, The Presidio of San Francisco, San Francisco, CA 94129 and the address of AGAPL is Level 2, Challis House, 4-10 Martin Place, Sydney NSW2000, Australia. |
(6) | Consists of (i) 10,687,970 shares of common stock and (ii) 1,682,144 shares of common stock issuable upon exercise of the Warrants subject to the Stockholder Approval Condition. The shares being offered are subject to the Lock-Ups. See “Summary—Recent Developments—Private Placement” and “—Public Offering.” |
(7) | Brad Jacobs, the non-executive chairman and director of the Company, is the managing member of Jacobs Private Equity, LLC (“JPE”). The address of each of JPE and Mr. Jacobs is Five American Lane, Greenwich, CT 06831. The shares being offered are subject to the Public Offering Lock-Up. See “Summary—Recent Developments—Public Offering.” |
• | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
• | block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
• | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
• | an exchange distribution in accordance with the rules of the applicable exchange; |
• | privately negotiated transactions; |
• | settlement of short sales made after the date of this prospectus supplement; |
• | in transactions through broker-dealers that agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share; |
• | through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
• | a combination of any such methods of sale; or |
• | any other method permitted pursuant to applicable law. |
• | our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (filed on February 13, 2024); |
• | our Quarterly Reports on Form 10-Q for the fiscal quarter ended March 31, 2024 (filed on May 7, 2024) and June 30, 2024 (filed on August 7, 2024); |
• | our Current Reports on Form 8-K filed on April 2, 2024, April 11, 2024, May 20, 2024, June 14, 2024 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto), June 24, 2024 (excluding the information disclosed pursuant to Items 2.02 and 7.01 and Exhibits 99.1 and 99.2 thereto), August 2, 2024, August 9, 2024, August 12, 2024 (excluding the information disclosed pursuant to Item 7.01 and Exhibit 99.1 thereto) and September 9, 2024. |
• | the description of the Company’s Common Stock contained in the Company’s Amended and Restated Certificate of Incorporation filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on November 1, 2022, including any amendment or report filed with the SEC for the purpose of updating such description. |
• | potential delays in consummating the potential transaction to acquire Coyote Logistics; |
• | the occurrence of any event, change or other circumstance that could give rise to the termination of the purchase agreement for the potential transaction; |
• | the effect of the pendency or completion of the potential transaction on the parties’ business relationships and business generally; |
• | competition and pricing pressures; |
• | economic conditions generally; |
• | fluctuations in fuel prices; |
• | increased carrier prices; |
• | severe weather, natural disasters, terrorist attacks or similar incidents that cause material disruptions to our operations or the operations of the third-party carriers and independent contractors with which we contract; |
• | our dependence on third-party carriers and independent contractors; |
• | labor disputes or organizing efforts affecting our workforce and those of our third-party carriers; |
• | legal and regulatory challenges to the status of the third-party carriers with which we contract, and their delivery workers, as independent contractors, rather than employees; |
• | our ability to develop and implement suitable information technology systems and prevent failures in or breaches of such systems; |
• | the impact of potential cyber-attacks and information technology or data security breaches; |
• | issues related to our intellectual property rights; |
• | our ability to access the capital markets and generate sufficient cash flow to satisfy our debt obligations; |
• | litigation that may adversely affect our business or reputation; |
• | increasingly stringent laws protecting the environment, including transitional risks relating to climate change, that impact our third-party carriers; |
• | governmental regulation and political conditions; |
• | our ability to attract and retain qualified personnel; |
• | our ability to successfully implement our cost and revenue initiatives and other strategies; |
• | our ability to successfully manage our growth; |
• | our reliance on certain large customers for a significant portion of our revenue; |
• | damage to our reputation through unfavorable publicity; |
• | our failure to meet performance levels required by our contracts with our customers; |
• | the inability to achieve the level of revenue growth, cash generation, cost savings, improvement in profitability and margins, fiscal discipline, or strengthening of competitiveness and operations anticipated or targeted; and |
• | a determination by the IRS that the distribution or certain related separation transactions should be treated as taxable transactions, and the impact of the separation on our businesses, operations and results. |
• | may rank equally with other unsubordinated debt or may be subordinated to other debt we have or may incur; |
• | may be issued in one or more series with the same or various maturities; |
• | may be issued at a price of 100% of their principal amount or at a premium or discount; |
• | may be issued in registered form and certificated or uncertificated form; and |
• | may be represented by one or more global debt securities registered in the name of a designated depositary’s nominee, and if so, beneficial interests in the global debt securities will be shown on and transfers will be made only through records maintained by the designated depositary and its participants. |
• | the title of the debt securities of the series (which will distinguish the debt securities of that particular series from the debt securities of any other series) and ranking (including the terms of any subordination provisions); |
• | the price or prices of the debt securities of the series at which such debt securities will be issued; |
• | whether the debt securities are entitled to the benefit of any guarantee by any guarantor; |
• | any limit on the aggregate principal amount of the debt securities of the series that may be authenticated and delivered under the indenture (except for debt securities authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other debt securities of the series); |
• | the date or dates on which the principal and premium with respect to the debt securities of the series are payable; |
• | the person to whom any interest on a security of the series shall be payable if other than the person in whose name that security is registered at the close of business on the record date; |
• | the rate or rates (which may be fixed or variable) at which the debt securities of the series will bear interest (if any) or the method of determining such rate or rates (including, but not limited to, any commodity, commodity index, stock exchange index or financial index), the date or dates from which such interest, if any, will accrue, the interest payment dates on which such interest, if any, will be payable or the method by which such dates will be determined, the record dates for the determination of holders thereof to whom such interest is payable (in the case of securities in registered form), and the basis upon which interest will be calculated if other than that of a 360-day year of twelve 30-day months; |
• | the currency or currencies in which debt securities of the series will be denominated and/or in which payment of the principal, premium, if any, and interest of any of the securities shall be payable, if other than U.S. dollars, the place or places, if any, in addition to or instead of the corporate trust office of the trustee (in the case of securities in registered form) where the principal, premium and interest, if any, with respect to debt securities of the series will be payable, where notices and demands to or upon us in respect of the debt securities and the indenture may be delivered, and the method of such payment, if by wire transfer, mail or other means; |
• | the price or prices at which, the period or periods within which, and the terms and conditions upon which debt securities of the series may be redeemed, in whole or in part, at our option or otherwise; |
• | the obligation or right, if any, to redeem, purchase or repay debt securities of the series pursuant to any sinking fund or analogous provisions or at the option of a holder of such debt securities and the price or prices at which, the period or periods within which, and the terms and conditions upon which, debt securities of the series will be redeemed, purchased or repaid, in whole or in part, pursuant to such obligations; |
• | the terms, if any, upon which the debt securities of the series may be convertible into or exchanged for any issuer’s common stock, preferred stock, depositary shares, other debt securities or warrants for common stock, preferred stock, depositary shares, indebtedness or other securities of any kind and the terms and conditions upon which such conversion or exchange will be effected, including the initial conversion or exchange price or rate, the conversion or exchange period and any other additional provisions; |
• | if other than minimum denominations of $2,000 or any integral multiple of $1,000 in excess thereof, the denominations in which debt securities of the series will be issuable; |
• | if the amount of principal, premium or interest with respect to the debt securities of the series may be determined with reference to an index or pursuant to a formula, the manner in which such amounts will be determined; |
• | if the principal amount payable at the stated maturity of debt securities of the series will not be determinable as of any one or more dates prior to such stated maturity, the amount that will be deemed to be such principal amount as of any such date for any purpose, including the principal amount thereof which will be due and payable upon any maturity other than the stated maturity or which will be deemed to be outstanding as of any such date (or, in any such case, the manner in which such deemed principal amount is to be determined), and if necessary, the manner of determining the equivalent thereof in U.S. dollars; |
• | any changes or additions to the provisions of the indenture dealing with defeasance; |
• | if other than the principal amount thereof, the portion of the principal amount of debt securities of the series that will be payable upon declaration of acceleration of the maturity thereof or provable in bankruptcy; |
• | the terms, if any, of the transfer, mortgage, pledge or assignment as security for the debt securities of the series of any properties, assets, moneys, proceeds, securities or other collateral and any corresponding changes to provisions of the indenture as then in effect; |
• | any addition to or change in the events of default with respect to the debt securities of the series and any change in the right of the trustee or the holders to declare the principal, premium and interest, if any, with respect to such debt securities due and payable; |
• | if the debt securities of the series will be issued in whole or in part in the form of a global security, the terms and conditions, if any, upon which such global security may be exchanged in whole or in part for other individual debt securities in definitive registered form, the depositary (as defined in the applicable prospectus supplement) for such global security and the form of any legend or legends to be borne by any such global security in addition to or in lieu of the legend referred to in the indenture; |
• | any trustee, authenticating or paying agent, transfer agent or registrar or any other agent with respect to the debt securities; |
• | the applicability of, and any addition to, deletion of or change in, the covenants and definitions then set forth in the indenture or in the terms then set forth in the indenture relating to permitted consolidations, mergers or sales of assets; |
• | the terms, if any, of any guarantee of the payment of principal, premium and interest with respect to debt securities of the series and any corresponding changes to the provisions of the indenture as then in effect; |
• | the subordination, if any, of the debt securities of the series pursuant to the indenture and any changes or additions to the provisions of the indenture relating to subordination; |
• | with regard to debt securities of the series that do not bear interest, the dates for certain required reports to the trustee; |
• | any provisions granting special rights to holders when a specified event occurs; |
• | any co-issuer; |
• | the place or places where the principal of and interest, if any, on the debt securities will be payable, where the debt securities may be surrendered for registration of transfer or exchange and where notices and demands to or upon us in respect of the debt securities and the indenture may be served, and the method of such payment, if by wire transfer, mail or other means; and |
• | any other terms of the debt securities of the series (which terms will not be prohibited by the provisions of the indenture). |
• | debt securities with respect to which payments of principal, premium or interest are determined with reference to an index or formula (including changes in prices of particular securities, currencies or commodities); |
• | debt securities with respect to which principal or interest is payable in a foreign or composite currency; |
• | debt securities that are issued at a discount below their stated principal amount, bearing no interest or interest at a rate that at the time of issuance is below market rates or original issue discount debt securities; and |
• | variable rate debt securities that are exchangeable for fixed rate debt securities. |
• | any aspect of the records relating to or payments made by the depositary, its nominee or any participants on account of beneficial interests in the global security or for maintaining, supervising or reviewing any records relating to such beneficial interests; |
• | the payment to the owners of beneficial interests in the global security of amounts paid to the depositary or its nominee; or |
• | any other matter relating to the actions and practices of the depositary, its nominee or its participants. |
• | default in payment of the principal amount of the debt securities of that series, when such amount becomes due and payable at maturity, upon acceleration, required redemption or otherwise; |
• | failure to pay interest on the debt securities of that series within 30 days of the due date; |
• | failure to comply with the obligations described under “— Mergers and Sales of Assets” below; |
• | failure to comply for 90 days after notice with any of our other agreements in the debt securities of that series or the indenture or supplemental indenture related to that series of debt securities; or |
• | certain events of bankruptcy, insolvency or reorganization affecting us. |
• | such holder has previously given to the trustee written notice of a continuing event of default with respect to such series of debt securities; |
• | the holder or holders of at least 30% in aggregate principal amount of the outstanding debt securities of that series have made written request, and such holder or holders have offered security or indemnity satisfactory to the trustee against any loss, liability or expense, to the trustee to institute such proceeding as trustee; and |
• | the trustee has failed to institute such proceeding, and has not received from the holders of a majority in aggregate principal amount of the outstanding debt securities of that series a direction inconsistent with such request, within 60 days after such notice, request and offer. |
• | reduce the percentage of principal amount of the outstanding debt securities, the consent of whose holders is required for any amendment; |
• | reduce the principal amount of, or interest on, or extend the Stated Maturity or interest payment periods of, any debt securities; |
• | change the provisions applicable to the redemption of any debt securities; |
• | make any debt securities payable in money or securities other than those stated in the debt securities; |
• | impair the contractual right of any holder of the debt securities to receive payment of principal of and interest on such holder’s debt securities on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such holder’s debt securities; |
• | except as otherwise provided as described under “— Satisfaction and Discharge” and “— Defeasance” herein, release any security or guarantee that may have been granted with respect to any debt securities; |
• | in the case of any subordinated securities, or coupons appertaining thereto, make any change in the provisions of the indenture relating to subordination that adversely affects the rights of any holder under such provisions (including any contractual subordination of senior unsubordinated debt securities); or |
• | make any change in the amendment provisions which require each holder’s consent or in the waiver provisions. |
• | to cure any ambiguity, omission, defect or inconsistency; |
• | to surrender any right or power conferred upon the Company by the indenture, to add to the covenants of the Company such further covenants, restrictions, conditions or provisions for the protection of the holders of all or any series of debt securities as the board of directors of the Company will consider to be for the protection of the holders of such debt securities, and to make the occurrence, or the occurrence and continuance, of a default in respect of any such additional covenants, restrictions, conditions or provisions a default or an event of default under the indenture; provided, however that with respect to any such additional covenant, restriction, condition or provision, such amendment may provide for a period of grace after default, which may be shorter or longer than that allowed in the case of other defaults, may provide for an immediate enforcement upon such default, may limit the remedies available to the trustee upon such default or may limit the right of holders of a majority in aggregate principal amount of the debt securities of any series to waive such default; |
• | to provide for the assumption by a successor company of the obligations of the Company under the indenture; |
• | to add guarantees with respect to the debt securities or to secure the debt securities; |
• | to make any change that does not adversely affect in any material respect the rights of any holder of the debt securities; |
• | to add to, change, or eliminate any of the provisions of the indenture with respect to one or more series of debt securities, so long as any such addition, change or elimination not otherwise permitted under the indenture will (a) neither apply to any debt securities of any series created prior to the execution of such supplemental indenture and entitled to the benefit of such provision nor modify the rights of the holders of any such debt securities with respect to the benefit of such provision or (b) become effective only when there is no such debt securities outstanding; |
• | to evidence and provide for the acceptance of appointment by a successor or separate trustee with respect to the debt securities of one or more series and to add to or change any of the provisions of the indenture as shall be necessary to provide for or facilitate the administration of the indenture by more than one trustee; |
• | in the case of subordinated debt securities, to make any change in the provisions of the indenture or any supplemental indenture relating to subordination that would limit or terminate the benefits available to any holder of senior Indebtedness under such provisions (but only if each such holder of senior Indebtedness consents to such change); |
• | to comply with any requirement of the SEC in connection with the qualification of the indenture or any supplemental indenture under the Trust Indenture Act; |
• | to conform any provision in the indenture or the debt securities to the description of any debt securities in an offering document; |
• | to approve a particular form of any proposed amendment; |
• | to provide for the issuance of additional debt securities of any series; |
• | to establish the form or terms of debt securities and coupons of any series pursuant to the indenture; |
• | to comply with the rules of any applicable depositary; |
• | to make any amendment to the provisions of the indenture relating to the transfer and legending of debt securities; provided, however, that (a) compliance with the indenture as so amended would not result in debt securities being transferred in violation of the Securities Act or any other applicable securities law and (b) such amendment does not materially and adversely affect the rights of holders of debt securities to transfer debt securities; or |
• | to convey, transfer, assign, mortgage or pledge any property to or with the trustee, or to make such other provisions in regard to matters or questions arising under the indenture as shall not adversely affect, in any material respect, the interests of any holders of debt securities of any series. |
• | the title of such debt warrants; |
• | the offering price for such debt warrants, if any; |
• | the aggregate number of such debt warrants; |
• | the designation and terms of the debt securities purchasable upon exercise of such debt warrants; |
• | if applicable, the designation and terms of the debt securities with which such debt warrants are issued and the number of such debt warrants issued with each such debt security; |
• | if applicable, the date from and after which such debt warrants and any debt securities issued therewith will be separately transferable; |
• | the principal amount of debt securities purchasable upon exercise of a debt warrant and the price at which such principal amount of debt securities may be purchased upon exercise (which price may be payable in cash, securities or other property); |
• | the date on which the right to exercise such debt warrants shall commence and the date on which such right shall expire; |
• | if applicable, the minimum or maximum amount of such debt warrants that may be exercised at any one time; |
• | information with respect to book-entry procedures, if any; |
• | the currency or currency units in which the offering price, if any, and the exercise price are payable; |
• | if applicable, a discussion of material United States federal income tax considerations; |
• | the antidilution or adjustment provisions of such debt warrants, if any; |
• | the redemption or call provisions, if any, applicable to such debt warrants; and |
• | any additional terms of such debt warrants, including terms, procedures, and limitations relating to the exchange and exercise of such debt warrants. |
• | the title of such warrants; |
• | the offering price for such warrants, if any; |
• | the aggregate number of such warrants; |
• | the designation and terms of the offered securities purchasable upon exercise of such warrants; |
• | if applicable, the designation and terms of the offered securities with which such warrants are issued and the number of such warrants issued with each such offered security; |
• | if applicable, the date from and after which such warrants and any offered securities issued therewith will be separately transferable; |
• | the number of shares of common stock, preferred stock or depositary shares purchasable upon exercise of a warrant and the price at which such shares may be purchased upon exercise; |
• | the date on which the right to exercise such warrants shall commence and the date on which such right shall expire; |
• | if applicable, the minimum or maximum amount of such warrants that may be exercised at any one time; |
• | the currency or currency units in which the offering price, if any, and the exercise price are payable; |
• | if applicable, a discussion of material United States federal income tax considerations; |
• | the antidilution provisions of such warrants, if any; |
• | the redemption or call provisions, if any, applicable to such warrants; and |
• | any additional terms of such warrants, including terms, procedures and limitations relating to the exchange and exercise of such warrants. |
• | the date of determining the security holders entitled to the rights distribution; |
• | the aggregate number of rights issued and the aggregate number of shares of common stock purchasable upon exercise of the rights; |
• | the exercise price; |
• | the conditions to completion of the rights offering; |
• | the date on which the right to exercise the rights will commence and the date on which the rights will expire; and |
• | any applicable federal income tax considerations. |
• | the material terms of the units and of the securities comprising the units, including whether and under what circumstances those securities may be held or transferred separately; |
• | if applicable, the prepaid securities and the documents pursuant to which such prepaid securities will be issued; |
• | any material provisions relating to the issuance, payment, settlement, transfer or exchange of the units or of the securities comprising the units; |
• | if appropriate, any special United States federal income tax considerations applicable to the units; and |
• | any material provisions of the governing unit agreement that differ from those described above. |
• | to or through underwriters, brokers or dealers; |
• | directly to one or more other purchasers; |
• | through a block trade in which the broker or dealer engaged to handle the block trade will attempt to sell the securities as agent, but may position and resell a portion of the block as principal to facilitate the transaction; |
• | through agents on a best-efforts basis; or |
• | otherwise through a combination of any of the above methods of sale. |
• | enter into transactions involving short sales of the securities by underwriters, brokers or dealers; |
• | sell securities short and deliver the securities to close out short positions; |
• | enter into option or other types of transactions that require us to deliver securities to an underwriter, broker or dealer, who will then resell or transfer the securities under this prospectus; or |
• | loan or pledge the securities to an underwriter, broker or dealer, who may sell the loaned securities or, in the event of default, sell the pledged securities. |
• | the purchase price of the securities and the proceeds we and/or such selling stockholders will receive from the sale of the securities; |
• | any underwriting discounts and other items constituting underwriters’ compensation; |
• | any public offering or purchase price and any discounts or commissions allowed or re-allowed or paid to dealers; |
• | any commissions allowed or paid to agents; |
• | any other offering expenses; |
• | any securities exchanges on which the securities may be listed; |
• | the method of distribution of the securities; |
• | the terms of any agreement, arrangement or understanding entered into with the underwriters, brokers or dealers; and |
• | any other information we think is important. |
• | at a fixed price or prices that may be changed; |
• | at market prices prevailing at the time of sale; |
• | at prices related to such prevailing market prices; |
• | at varying prices determined at the time of sale; or |
• | at negotiated prices. |
• | in transactions on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale; |
• | in transactions in the over-the-counter market; |
• | in block transactions in which the broker or dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction, or in crosses, in which the same broker acts as an agent on both sides of the trade; |
• | through the writing of options; or |
• | through other types of transactions. |
• | commercial and savings banks; |
• | insurance companies; |
• | pension funds; |
• | investment companies; and |
• | educational and charitable institutions. |