Document

DEF 14A 1 wern-2022xproxy.htm DEF 14A Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

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WERNER ENTERPRISES, INC.

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Post Office Box 45308

Omaha, Nebraska 68145-0308

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

TO BE HELD MAY 10, 2022

Dear Stockholders:

Notice is hereby given that the 2022 Annual Meeting of Stockholders of Werner Enterprises, Inc., a Nebraska corporation (the “Company”), will be held at the Embassy Suites Omaha-La Vista Hotel & Conference Center, 12520 Westport Parkway, La Vista, Nebraska, on Tuesday, May 10, 2022, at 10:00 a.m. Central Time for the following purposes:

1.To elect three Class I directors to each serve for a three-year term expiring at the 2025 Annual Meeting of Stockholders.

2.To approve an advisory resolution on executive compensation.

3.To ratify the appointment of KPMG LLP as the Company’s independent registered public accounting firm for the year ending December 31, 2022.

4.To transact such other business as may properly come before the meeting or any adjournment thereof.

Only stockholders of record at the close of business on March 21, 2022, will be entitled to receive notice of and to vote at the 2022 Annual Meeting or any adjournment thereof.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 10, 2022: This Notice of Annual Meeting of Stockholders presents only an overview of the more complete enclosed proxy materials comprised of the Company’s (i) 2022 Proxy Statement and (ii) 2021 Annual Report to Stockholders (containing our Annual Report on Form 10-K for 2021). Copies of the proxy materials are available, without charge, on the Company’s website (http://www.werner.com under the “Investors” link). The enclosed proxy materials contain important information about the Company and 2022 Annual Meeting, and you are encouraged to review these documents before voting.

Your vote is important. Whether or not you attend the meeting, please vote and submit your proxy as promptly as possible using one of the voting methods described in the Proxy Statement. If you hold your shares through a brokerage firm, bank or other nominee, follow the instructions you receive from them to vote your shares.


						By Order of the Board of Directors,
						James L. Johnson
Omaha, Nebraska						Executive Vice President, Chief Accounting Officer
April 1, 2022						& Corporate Secretary


TABLE OF CONTENTS
PROXY STATEMENT SUMMARY AND BUSINESS OVERVIEW		1
PROPOSAL 1–ELECTION OF DIRECTORS		3
	DIRECTOR NOMINEES	3
	DIRECTOR INFORMATION	4
	RECOMMENDATION OF THE BOARD OF DIRECTORS–PROPOSAL 1	7
CORPORATE GOVERNANCE		7
	DIRECTOR INDEPENDENCE DETERMINATIONS	7
	ROLE AND LEADERSHIP OF THE BOARD OF DIRECTORS	7
	BOARD OVERSIGHT OF RISK MANAGEMENT	8
	CORPORATE GOVERNANCE POLICIES AND MATERIALS	8
	HEDGING AND PLEDGING POLICY	8
	COMMITTEES OF THE BOARD OF DIRECTORS	9
	ATTENDANCE AT BOARD AND BOARD COMMITTEE MEETINGS AND ANNUAL MEETING	9
	AUDIT COMMITTEE	9
	COMPENSATION COMMITTEE	10
	NOMINATING AND CORPORATE GOVERNANCE COMMITTEE	11
	ENVIRONMENTAL SOCIAL AND GOVERNANCE COMMITTEE	11
	STOCKHOLDER COMMUNICATIONS WITH THE BOARD OF DIRECTORS	11
	DIRECTOR NOMINATION PROCESS	11
	DIRECTOR COMPENSATION AND BENEFITS	13
EXECUTIVE OFFICERS		15
	EXECUTIVE OFFICER INFORMATION	15
BENEFICIAL OWNERSHIP OF COMMON STOCK		17
	STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN BENEFICIAL OWNERS	17
	DELINQUENT SECTION 16(a) REPORTS	18
EXECUTIVE COMPENSATION		19
	COMPENSATION DISCUSSION AND ANALYSIS	19
	REPORT OF THE COMPENSATION COMMITTEE	28
	EMPLOYMENT ARRANGEMENTS	28
	ARRANGEMENTS AND POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL	28
	SUMMARY COMPENSATION TABLE	30
	ALL OTHER COMPENSATION FOR 2021	31
	GRANTS OF PLAN-BASED AWARDS FOR 2021	32
	OUTSTANDING EQUITY AWARDS AT 2021 YEAR-END	33
	STOCK VESTED FOR 2021	34
	NONQUALIFIED DEFERRED COMPENSATION FOR 2021	34
	CEO PAY RATIO	35
PROPOSAL 2–ADVISORY RESOLUTION ON EXECUTIVE COMPENSATION		36
	RECOMMENDATION OF THE BOARD OF DIRECTORS–PROPOSAL 2	36
PROPOSAL 3 –RATIFICATION OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		37
	FEES OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	37
	AUDIT COMMITTEE PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES PERFORMED BY THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	37
	REPORT OF THE AUDIT COMMITTEE	38
	RECOMMENDATION OF THE BOARD OF DIRECTORS–PROPOSAL 3	39
TRANSACTIONS WITH RELATED PERSONS		39
	REVIEW AND APPROVAL OF RELATED PERSON TRANSACTIONS	39
	RELATED PERSON TRANSACTIONS	40
STOCKHOLDER PROPOSALS		41
ANNUAL MEETING AND VOTING INFORMATION		41
STOCKHOLDERS SHARING THE SAME ADDRESS		44
CONTACTING THE CORPORATE SECRETARY AND EXECUTIVE OFFICES		45
INTERNET WEBSITE AND AVAILABILITY OF MATERIALS		45

WERNER ENTERPRISES, INC.

Post Office Box 45308

Omaha, Nebraska 68145-0308

________________

PROXY STATEMENT FOR

ANNUAL MEETING OF STOCKHOLDERS

MAY 10, 2022

________________________

PROXY STATEMENT SUMMARY AND BUSINESS OVERVIEW

We are sending you this Proxy Statement in connection with the solicitation of proxies by our Board of Directors (the “Board”) for the 2022 Annual Meeting of Stockholders of Werner Enterprises, Inc. The 2022 Annual Meeting will be held for the purposes set forth in the Notice of Annual Meeting of Stockholders on the cover page of this Proxy Statement. We are mailing the Proxy Statement, proxy and our Annual Report to Stockholders for the year ended December 31, 2021 (the “2021 Annual Report”) on or about April 1, 2022.

In this Proxy Statement, we also use the following terms and abbreviations:

•We refer to Werner Enterprises, Inc. as the “Company,” “we,” “our” or “us.”

•The 2022 Annual Meeting of Stockholders is referred to as the “Annual Meeting” or “2022 Annual Meeting.”

•References to “2021” and “for the year ended December 31, 2021” mean the Company’s fiscal year for the period beginning January 1, 2021 and ending December 31, 2021.

•The term “executive officers” means those executives listed in the Executive Officer Information section of this Proxy Statement.

•The term “Proxy Materials” means and consists of this Proxy Statement, the proxy relating to the 2022 Annual Meeting and the 2021 Annual Report.

•We also refer to our “website,” which means the Internet website available at http://www.werner.com under the “Investors” link, as provided in the Internet Website and Availability of Materials section of this Proxy Statement.

This Proxy Statement and our 2021 Annual Report are available on our website. In these Proxy Materials, we refer to certain reports and forms that we have filed with the U.S. Securities and Exchange Commission (the “SEC”). All of our SEC filings are available on our website, as well as the SEC website at www.sec.gov. You may also request copies of our SEC filings and Proxy Materials from our Corporate Secretary at the contact information provided in the Contacting the Corporate Secretary and Executive Offices section of this Proxy Statement.

2021 Financial Highlights. We achieved another record year of financial results in 2021, despite the many disruptions and challenges faced by our company and our industry. As the economy rebounded from shocks formed by the pandemic, truckload and logistics freight demand outpaced industry capacity. Increased consumer spending and supply chain bottlenecks led to inventory shortages. COVID-19 issues persisted, and labor challenges escalated.


•Total revenues $2.7 billion			•Cash flow from operations $332.8 million
•Operating income $309.1 million			•Capital expenditures, net $193.0 million
•Net income attributable to Werner $259.1 million			•Dividends paid $29.1 million
•Earnings per diluted share $3.82			•Stock repurchases $104.4 million
•Operating ratio 88.7%			•Stockholders’ equity $1.3 billion

2021 Executive Compensation Program. Our executive compensation program has been instrumental to achieving our business objectives. Our total compensation mix allows us to retain qualified, innovative executive officers who possess the necessary experience and expertise to effectively lead and manage the Company, contribute to our long-standing success and create value for our stockholders. The overall design of our compensation program, including the three primary pay components, has remained consistent year over year.


Annual Base Salary			•Fixed element of annual compensation
			•Base salary increases in 2021 averaging 10% to better align with our competitive peer group base salaries
Cash Annual Incentive Compensation			•Short-term cash incentive with variable payout opportunities based on two Company performance metrics measured against pre-defined annual goals and an individual performance metric
			•No change in payout opportunities for 2021
Long-Term Incentive Compensation			•Long-term equity-based incentives split between restricted stock and performance stock with three-year vesting schedules
			•Changed from absolute total shareholder return (“TSR”) modifier to relative TSR modifier for performance stock awards

Our executive compensation program includes the following best practices:


What we do			What we don’t do
•Pay for performance			•Employment agreements for executive officers
•Short-term and long-term incentive compensation			•Single-trigger severance arrangements
•Recoupment policy for performance-based cash and equity awards			•Dividends or dividend equivalents on unvested or unearned equity awards
•Annual say-on-pay vote			•Hedging and pledging of Werner securities
•Independent compensation consultant
•Stock ownership guidelines
•Limited perquisites

Environmental, Social and Governance (“ESG”). At Werner, we are proud of the strong foundation of driving greater sustainability and inclusion throughout the over 65 years of our organization. As an award-winning EPA SmartWay Transportation Partner, Werner eliminated over 300 million gallons in fuel consumption, improved fuel efficiency by over 29% and reduced over 3.3 million tons of CO2 since 2007. Werner is proud of its highly-skilled and safety-conscious driver workforce. Our female driver workforce is well over the national average, and approximately half of our driver associates are ethnically diverse. Werner was also honored to be the only trucking company recognized as a 2021 Military Friendly® Company by VIQTORY Media. It is the fifth consecutive year Werner has received this designation. We are widely recognized as a transportation leader in military hiring with veterans and veteran spouses. Werner’s talented Board of Directors has strong business experience, relevant leadership skills and increasing diversity among its membership. Seven of our eight directors are independent and four of our eight directors are gender or ethnically diverse.

In October 2020, we launched a codified approach to sustainability organization-wide and unveiled key ESG milestones. As an important part of the Social component of ESG, we added “Inclusion” to our core values and adopted a Diversity, Equity and Inclusion (“DEI”) vision statement. Our ESG strategy will continue to evolve through five key themes:

(i)Establish a formalized ESG framework and strategy.

(ii)Identify meaningful, reportable metrics and goals to monitor, measure and report on our ESG performance and progress.

(iii)Build on our strong foundation as an industry leader focused on reducing our environmental impact and carbon footprint through a young, innovative and modern truck and trailer fleet.

(iv)Foster and empower an inclusive culture that upholds our core values and provides equal opportunities for all.

(v)Continue to uphold transparency, ethics and integrity in our governance practices with an emphasis on creating a more diverse Board with complementary skills that align with our long-term strategy.

Our recent accomplishments under our ESG program include:


Environmental			•Launched WernerBlue, our branded Sustainability endeavor
			•Earned SmartWay Excellence award from the EPA for the 5th consecutive year and eight of the last nine years
			•Purchased a battery diesel hybrid vehicle and initiated purchase of 10 battery electric vehicle (BEV) trucks
Social			•Created eight associate resource groups (“ARG”) in 2021
			•Added WEbelieve ARG in March 2022; Abled & Disabled Partnering Together (ADAPT) ARG will launch in June 2022
			•Participated in Commitment to Opportunity, Diversity and Equity (CODE) assessment focusing on inclusion, perspective, and company culture
Governance			•Established a stand-alone ESG Committee of our Board of Directors
			•Created two new leadership positions: AVP of Sustainability and AVP of Diversity, Inclusion, and Learning
			•Published inaugural Corporate Social Responsibility Report
			•Gained endorsement by Sustainability Accounting Standards Board (SASB) as a reporter under its framework; also aligned with specific United Nations Sustainable Development Goals that support our values, strategy, and aspirations

As we further develop our ESG strategy, we will continue to advance these efforts, and others, and report on our progress in future Corporate Social Responsibility Reports to be available on our website.

PROPOSAL 1 — ELECTION OF DIRECTORS

Our Articles of Incorporation provide that the Board may be divided into two or three separate classes of directors. Each class must consist of not less than two, nor more than five, directors, and the classes should be nearly equal in number as possible. Our By-Laws provide for a range of not less than seven nor more than nine directors, divided into three classes (Class I, II and III), and each class should have the same number of directors to the extent possible. Directors hold office for a term of three years and until a successor is elected and qualified. The terms of office for each class of current directors expire at the annual meeting of stockholders in the following years: Class I, 2022; Class II, 2023; and Class III, 2024.

DIRECTOR NOMINEES

You will be asked to elect three directors in Class I to each serve for a three-year term expiring at the 2025 Annual Meeting of Stockholders. The nominees for director at the 2022 Annual Meeting are:


Kenneth M. Bird, Ed.D.			Jack A. Holmes			Carmen A. Tapio

The individual qualifications, skills and experience of the nominees for director are discussed in their respective biographies in the following Director Information section.

Each of the nominees designated in this Proxy Statement has indicated his or her intention to serve as a director if elected, and the Board does not know of any reason why any nominee will be unavailable for election. In the event any nominee becomes unwilling or unable to serve as a director, the shares represented by your accompanying proxy will be voted for any substitute nominee designated by the Board, unless you expressly withhold (whether on your proxy or in person at the Annual Meeting) authority to vote your shares for the unavailable nominee or substitute nominee.

There are no arrangements or understandings between any of the nominees and any other person pursuant to which any of the nominees was selected as a nominee.

DIRECTOR INFORMATION

Identified in the table below are the director nominees and the directors whose terms will continue after the 2022 Annual Meeting. Certain information provided to us by our directors and director nominees regarding their qualifications, skills and experience is also set forth in the Director Biographies and Director Skills and Qualifications matrix following the table. None of the corporations or other organizations referenced in the biographies is a parent, subsidiary or affiliate of the Company.

MEMBERS AND NOMINEES OF THE BOARD OF DIRECTORS

Name

Principal Occupation

Term Ends

Class

Scott C. Arves

Former Director, President & Chief Executive Officer of Transport America, Inc.

2024

III

Kenneth M. Bird, Ed.D.

President & Chief Executive Officer
of Avenue Scholars

2022

Diane K. Duren

Former Executive Vice President and Corporate
Secretary of Union Pacific Corporation

2023

Jack A. Holmes

Chairman of EmergeTMS;
Former President of UPS Freight

2022

Derek J. Leathers

Chairman, President & Chief Executive Officer of Werner Enterprises, Inc.

2023

Vikram Mansharamani, Ph.D.

Harvard University Lecturer

2024

III

Carmen A. Tapio

Founder, President and Chief Executive Officer of North End Teleservices, LLC

2022

Alexi A. Wellman

Chief Executive Officer of Altaba, Inc.

2024

III

Director Biographies. The information below includes the name, age, principal occupation for at least the last five years and other biographical information for each of our continuing directors and director nominees.

SCOTT C. ARVES, 65, was elected as a Company director in May 2021. In January 2017, Mr. Arves retired from Transport America, Inc. after serving as Director, President & Chief Executive Officer for ten years. Prior to that, he had a 27-year career with Schneider National, Inc., where he most recently served as President of the Transportation Sector from May 2000 to June 2006. In that capacity, he was responsible for all of Schneider’s trucking and intermodal business, which was a $3 billion business employing approximately 20,000 people. He is currently a member of the Board of Advisors of CSM Companies and was a director of Commercial Vehicle Group (CVGI) from May 2005 to May 2019 and a director of TFI International (TFII) from May 2016 to December 2018. Mr. Arves brings to our Board substantial business experience in the truckload industry and previous board experience.

KENNETH M. BIRD, ED.D., 74, was appointed by our Board of Directors in 2002 to fill a vacant directorship position and was subsequently elected by the stockholders. Dr. Bird is currently the President & Chief Executive Officer of Avenue Scholars, a nonprofit entity that serves youth education in Omaha, Nebraska. Dr. Bird previously served as Superintendent of Westside Community Schools in Omaha, Nebraska from 1992 until May 2008, and he also held various administrative positions with Westside Community Schools since 1981. He was employed by the Nebraska Department of Education from 1974 to 1981 and as a special education teacher at Westside Community Schools from 1970 to 1974. Dr. Bird’s broad range of board experience is also considerable and extensive. He is active in local, state and national professional organizations as a member of various advisory councils, committees and task forces. Dr. Bird serves as a director or trustee on a number of civic boards, and he has been the recipient of several professional, leadership and community service awards. He possesses significant overall board experience, administrative competence, executive and financial experience and proven leadership skills that enhance our Board’s diversity and discussions. As a result of these professional and other experiences, Dr. Bird brings to the Board a broad perspective of our community and an appreciation of corporate governance principles that contribute to the collective qualifications, skills and experience of our Board of Directors.

DIANE K. DUREN, 62, was elected as a Company director in 2017. In February 2017, Ms. Duren retired from Union Pacific Corporation, having served as Executive Vice President, Chief Administrative Officer and Corporate Secretary for four years, after serving as Vice President and General Manager–Chemicals in Marketing & Sales. Since joining Union Pacific in 1985, she held a variety of positions in the Finance and Marketing & Sales departments, including Vice President and General Manager–Agricultural Products. In 2011, she was awarded the Creighton University College of Business Alumni Merit Award. Prior to her employment at Union Pacific, she was a certified public accountant with Deloitte, Haskins & Sells in Omaha. Ms. Duren is a member of the board of directors of U.S. Silica Holdings, Inc. (SLCA) and serves on its audit committee and is chair of its compensation committee. She has been active on multiple community and industry boards including American Red Cross, of which she served as chair of the Heartland Chapter in 2010 and 2011. In 2014, Ms. Duren was appointed by Omaha Mayor Jean Stothert to the Metropolitan Entertainment & Convention Authority Board of Directors and in 2019 was reappointed by the Omaha City Council and is the current Chairwoman of the Board. She also serves on the Board of Children’s Hospital and Medical Center where she was chair from 2019 to 2021. In 2018, Ms. Duren joined Peter Kiewit Foundation as a Community Advisor, and in 2019 became a trustee of the foundation. Ms. Duren also became a member of Creighton University’s Board of Trustees in 2019. In September 2021, Ms. Duren became a member of the board of directors of Savage Companies, a privately held transportation, logistics, materials handling, and industrial services company, and serves on its audit and compensation committees. Ms. Duren’s vast experience in the transportation industry, multiple leadership roles, and accounting and financial experience add great value and insight to the Board. Ms. Duren also qualifies as an audit committee financial expert. Ms. Duren served as Chair of our Nominating and Corporate Governance Committee during 2019 and was appointed Chair of our Compensation Committee effective April 2020.

JACK A. HOLMES, 62, was appointed by our Board of Directors in August 2018 to fill the directorship position created by the expansion of the Board in 2018 and was elected by the stockholders at the 2019 Annual Meeting. Mr. Holmes served as President of UPS Freight from 2007 until his retirement in 2016. He began his career in transportation in 1979 outside of Philadelphia, Pennsylvania, when he joined UPS and served in several positions before holding leadership positions in Operations, Engineering and Human Resources. He also led the UPS transition team for the 2005 purchase of Overnite Transportation, now UPS Freight. Mr. Holmes currently serves as the Chairman and a director of EmergeTMS in Scottsdale, Arizona; a director of Sharps Compliance (SMED), on which he serves as Chairman of the Nominating and Governance Committee and the Compensation Committee; and is a member of the board of directors of Redwood Logistics and LaserShip. With his extensive leadership experience in the transportation industry, Mr. Holmes adds thoughtful insight through industry expertise to our Board of Directors. Mr. Holmes was appointed Chair of our Governance Committee effective April 2020.

DEREK J. LEATHERS, 52, was appointed by our Board of Directors in May 2020 to fill a directorship vacancy and appointed Vice Chairman of the Board. In May 2021, Mr. Leathers was elected as a Company director by the stockholders and appointed Chairman of the Board. Mr. Leathers has been our President since 2011 and Chief Executive Officer (“CEO”) since May 2016, and he currently serves in both positions. Mr. Leathers has worked in the transportation and logistics industry for over 30 years. Throughout his tenure at Werner, he has held integral roles in many facets of the organization, including the establishment of Werner’s Mexico operations and oversight for all the asset operating groups. Prior to joining Werner in 1999, Mr. Leathers was employed by Schneider National, a large truckload carrier, for eight years, during which time he was based out of Mexico City for several years and was one of the first foreign members of Mexico’s trucking association (CANACAR). Mr. Leathers is active in a number of local, state and national professional organizations and boards. He currently serves on the board of directors of the American Transportation Research Institute, is a founder and board member of PlaySmart, and is a board member and Executive Committee member of the Greater Omaha Chamber of Commerce, among others. Mr. Leathers brings to the Board a unique understanding of our business and operations as well as his significant and extensive knowledge of the transportation industry.

VIKRAM MANSHARAMANI, PH.D., 48, was elected as a Company director in May 2021. Dr. Mansharamani has been a Lecturer at Harvard University since 2017. Prior to that, he taught courses on finance and business ethics at Yale University from 2009 to 2017. He is an author, and his ideas and writings have appeared in Fortune, Forbes, the New York Times, and many other publications. Dr. Mansharamani also advises several Fortune 500 CEO’s and their boards on how to navigate uncertainty in today’s dynamic global business and regulatory environment. He is the Founder and President of Kelan Advisors, LLC and served on the board of directors of the Africa Opportunity Fund from April 2014 to August 2019. Dr. Mansharamani has a Ph.D. and two masters degrees from MIT and a

bachelors degree from Yale University. Dr. Mansharamani has a very diverse financial background with a wide variety of experiences which bring a valuable perspective to our Board.

CARMEN A. TAPIO, 56, was appointed by our Board of Directors in November 2020 to fill a directorship vacancy. Ms. Tapio is the Founder, President and Chief Executive Officer of North End Teleservices, LLC in Omaha, Nebraska. She has held this position since 2017 and previously served as President and Chief Operating Officer of North End Teleservices from 2015 to 2017. From 2010 to 2015, Ms. Tapio was the owner and manager of Core Advantage Consulting in Omaha, Nebraska and from 2001 to 2009 served in several leadership positions with Carlson Companies of Minneapolis, Minnesota. Ms. Tapio is active in local community organizations and is currently on the Greater Omaha Chamber of Commerce board of directors and executive committee, serving as chair for both the Diversity and Inclusion Council and the CEO’s for Commitment to Opportunity, Diversity and Equity Council. Ms. Tapio also served as council chair for Leadership, Diversity, Equity and Inclusion for the state of Nebraska’s Blueprint Nebraska Task Force. In March 2022, Ms. Tapio was named USA TODAY’s Women of the Year honoree from Nebraska. Ms. Tapio brings a unique perspective to business, having worked for Fortune 500 and 100 companies in the United States, Australia, Mexico and throughout Europe. Her career has taken multiple paths, holding both executive and general management business roles and executive cultural roles, including chief diversity officer and vice president of Responsible Business. Ms. Tapio was appointed Chair of our Environmental Social and Governance Committee (“ESG Committee”) effective January 2022.

ALEXI A. WELLMAN, 51, was elected as a Company director in 2021. Ms. Wellman has been the Chief Executive Officer of Altaba, Inc. since January 2022. From June 2017 until her current appointment, Ms. Wellman served as Chief Financial Officer of Altaba, Inc. She was Vice President, Finance and ultimately Vice President, Global Controller of Yahoo, Inc. from November 2013 to June 2017 and Chief Financial Officer of Nebraska Book Company from December 2011 to June 2013. Prior to her employment with Nebraska Book Company, she was a practicing certified public accountant with KPMG LLP for 18 years, 7 years of which she served as an audit partner. She was the audit engagement partner on the Company’s annual audit for the year ended December 31, 2010, prior to her departure in 2011. Ms. Wellman currently serves on the Board of Directors and is an audit committee chair of ESS Inc. (GWH). Ms. Wellman has significant knowledge and experience in financial management, accounting processes and corporate governance. She brings substantial accounting and financial expertise, overall board experience and comprehension of our business operations and industry that contribute to the Board’s collective qualifications, skills and experience. Ms. Wellman also qualifies as an audit committee financial expert. Ms. Wellman was appointed Chair of our Audit Committee effective May 2021.

Director Skills and Qualifications. The Governance Committee considers the particular experience, qualifications, and skills of each director and the relevance of such key competencies to the Company’s business and operations when determining whether an individual should serve as a Company director. The matrix that follows summarizes the skills and qualifications of the continuing directors and director nominees, which the Governance Committee considered in its evaluation. The Company is continuing to refresh, diversify and add new capabilities to our Board, and as a result seven of the eight directors have a tenure of less than five years.

DIRECTOR SKILLS AND QUALIFICATIONS

Skills and

Qualifications

Scott C.

Arves

Kenneth

M. Bird,

Ed.D.

Diane K.

Duren

Jack A.

Holmes

Derek J.

Leathers

Vikram

Mansharamani,

Ph.D.

Carmen

A. Tapio

Alexi A.

Wellman

Strategy development and risk management

88%

CEO experience

63%

Marketing and sales

63%

Public company officer or director

75%

Government affairs, public policy, regulatory

50%

Industry

50%

Corporate governance

75%

Financial

75%

Gender or ethnic diversity

50%

RECOMMENDATION OF THE BOARD OF DIRECTORS — PROPOSAL 1

The Board of Directors unanimously recommends that stockholders vote FOR the election of each director nominee. The Designated Proxy Holder of proxies solicited by the Board in this Proxy Statement will vote the proxies as directed on each proxy, or if no instruction is made, for the election of all director nominees.

CORPORATE GOVERNANCE

DIRECTOR INDEPENDENCE DETERMINATIONS

The Board has affirmatively determined that all members of and nominees to our Board of Directors are independent pursuant to SEC rules and the listing standards adopted by NASDAQ, except for Mr. Leathers. The Board has also determined that each member of the Board committees satisfies the applicable independence requirements of NASDAQ and the SEC.

At its annual meeting, the Nominating and Corporate Governance Committee reviewed the (i) legal and regulatory standards for assessing Board and Board committee independence, (ii) criteria for determining a director’s “audit committee financial expert,” “non-employee director” and “outside director” status and (iii) responses to annual questionnaires completed by our directors and director nominees. After completing its review, the Nominating and Corporate Governance Committee submitted its independence recommendations to our Board. Our Board then made its independence determinations based on the committee’s recommendations and after considering the information available to the committee.

ROLE AND LEADERSHIP OF THE BOARD OF DIRECTORS

One of the primary roles of the Board of Directors is to oversee our senior management in the competent and ethical operation of our business and to ensure that our stockholders’ interests are being properly served. To achieve these objectives, the Board establishes and maintains high standards of responsibility and ethics that, when consistently applied and followed, contribute to our business’s overall success.

The Chairman presides over each Board meeting and is actively involved in determining agendas for Board meetings and serving as a liaison between our Board and management. The Board appoints our Chairman and our Chief Executive Officer. Derek J. Leathers currently serves as our Chairman, President and Chief Executive Officer, and Clarence L. Werner served as our Chairman until his retirement in May 2021. Mr. Leathers was appointed by our Board to serve in his current position until he resigns, is removed, or is unable to serve due to death or incapacity, pursuant to Section 2 of Article III of our By-Laws.

In recent years, the positions of Chairman and CEO have been held by two individuals but currently are held by one. Although Mr. Leathers is not an independent director, we believe our current leadership structure is effective for us. This configuration demonstrates to our stockholders, employees and customers that our primary leadership roles are served by a qualified person who has an extensive depth of knowledge about the Company’s business and industry and is committed to our development and success.

Our independent directors regularly meet in “executive sessions,” which are meetings conducted without the presence of management. These executive sessions are typically conducted after each quarterly Board of Director meeting and may also be held when deemed appropriate by the independent directors. Our independent directors do not formally select a lead independent director to preside over their executive sessions. Rather, Mr. Holmes, Chair of the Nominating and Corporate Governance Committee, presides over the executive sessions of the independent directors, and he also acts as a liaison between the independent directors, management and the full Board. Further information regarding the 2021 executive sessions is provided under the Committees of the Board of Directors section.

We believe that having the majority of our Board and each Board committee comprised of independent directors (who meet regularly in executive sessions) and having independent directors serve as Chairs of our Board committees provides an effective and strong leadership structure for the Company. Our Board has the flexibility to continue or modify our leadership structure in the future, as the Board deems appropriate.

BOARD OVERSIGHT OF RISK MANAGEMENT

Company management is responsible for risk assessment and mitigation on a Company-wide basis, and our Board oversees and reviews these risk management efforts overall. Our Board believes that risk oversight fundamentally includes understanding the material risks we confront and how management responds to such risks, as well as a comprehension of what risk levels are appropriate for us. Typically, management identifies and measures various risks facing the Company and analyzes the factors associated with such risks, such as the probability and frequency of occurrence and potential impact on our cash flow, financial results and overall business and operations. Diverse types of risk are identified which are generally competitive, economic, regulatory or technological in nature. Management then develops response plans to address, mitigate and monitor identified risks and also reports and discusses these risks and plans with the Board. In its risk oversight role, our Board regularly evaluates and confers with management about the objectives of and risks involved with each plan. The Board also considers risk when assessing our business strategies and objectives, which is also integral to the Board’s risk management and tolerance evaluations.

While our Board has overall responsibility for risk oversight, each of the Board committees considers certain risks within its respective area of responsibility. Our Audit Committee has primary oversight responsibility with respect to risks relating to internal controls over financial reporting and contingent liabilities and risks that may be material to the Company. As discussed in the Risk Management Related to Compensation section, our Compensation Committee considers the Company’s risks in determining whether our executive compensation program encourages executive officers to take unreasonable risks relating to our business. Our Nominating and Corporate Governance Committee reviews risks related to legal and regulatory compliance concerning various corporate governance matters. The risk oversight roles of the Board, Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee did not impact our leadership structure because our Board is comprised of a majority, and such Board committees consist entirely, of independent directors.

CORPORATE GOVERNANCE POLICIES AND MATERIALS

The members of our Board of Directors possess a variety of experience, knowledge and judgment, and the diversity of these skills complements our corporate governance structure. Our corporate governance policies are designed to enable effective and thorough decision-making and to allow proper and comprehensive monitoring of the Company’s performance and compliance. These policies are also meant to provide our Board with practical guidelines that are regularly reviewed and can be appropriately revised and updated in response to regulatory developments and evolving business and governance practices. Our fundamental corporate governance principles and practices are set forth in our Code of Corporate Conduct and other policies, each of which is available on our website. Pursuant to SEC rules, we will disclose amendments to or waivers from our Code of Corporate Conduct, as they relate to our CEO, Chief Financial Officer (“CFO”) and Chief Accounting Officer (“CAO”), on our website or in a Current Report on Form 8-K filed with the SEC. To date, we have not granted any waivers from our Code of Corporate Conduct to the CEO, CFO or CAO.

HEDGING AND PLEDGING POLICY

The Board of Directors has formally adopted a policy on hedging and pledging of the Company’s common stock by directors and executive officers (officers who are subject to Section 16). The policy prohibits purchasing any financial instrument or entering into any transaction that is designed to hedge or offset any decrease in the market value of the Company’s common stock, including puts, calls, prepaid variable forward contracts, equity swaps, collars, exchange funds (excluding broad-based index funds), and other financial instruments that are designed to or have the effect of hedging or offsetting any decrease in the market value of the Company’s common stock. The policy also provides that directors and executive officers shall not pledge, hypothecate, or otherwise encumber shares of the Company’s common stock as collateral for indebtedness including, but not limited to, holding shares in a margin account or any other account that could cause the Company’s common stock to be subject to a margin call or otherwise be available as collateral for a margin loan. Each director and executive officer certified to compliance with this policy in their annual questionnaire completed at the end of 2021.

COMMITTEES OF THE BOARD OF DIRECTORS

The Board of Directors conducts its business through (i) meetings of the Board, (ii) actions taken by written consent in lieu of meetings, (iii) actions of its committees and (iv) discussions with management, the independent auditors and other consultants. The Board has four standing committees: the Audit Committee, the Compensation Committee; the Nominating and Corporate Governance Committee (the “Governance Committee”), and the ESG Committee. The Governance Committee evaluates each committee’s composition and appoints committee members annually, subject to Board approval. A majority of full committee membership elects committee Chairs, unless elected by the full Board. Committee members cannot be removed except by a majority vote of independent directors in office at the time.

Our Board delegates various responsibilities and authority to the committees to foster the effective governance of the Company. Each committee also meets periodically or when appropriate and reports their respective activities and actions to the full Board. The committees operate pursuant to written charters (including any amendments thereto) approved and adopted by the Board. Each committee charter is available under the Corporate Governance heading of our website.

The composition of each Board committee is as follows:

BOARD COMMITTEE MEMBERSHIP AND 2021 MEETINGS HELD

Name

Audit

Committee

Compensation

Committee

Governance

Committee

ESG Committee (3)

Board of

Directors

Scott C. Arves (1)

Kenneth M. Bird, Ed.D.

Diane K. Duren

Chair

Jack A. Holmes

Chair

Derek J. Leathers

Vikram Mansharamani, Ph.D. (1)

Carmen A. Tapio

Chair

Alexi A. Wellman (1)

Chair (2)

Number of Meetings

N/A

5(4)

(1)

Mr. Arves, Dr. Mansharamani and Ms. Wellman were elected to the Board on May 11, 2021.

(2)

Mr. Patrick J. Jung served as Chair of the Audit Committee during 2021 until his retirement in May 2021. Ms. Wellman was appointed to the Audit Committee and elected its Chair in May 2021.

(3)

In November 2021, the Board approved the formation of the ESG Committee effective January 2022, appointed its members, and elected Ms. Tapio as its Chair.

(4)

Four (4) executive sessions of the independent directors were held in 2021.

ATTENDANCE AT BOARD AND BOARD COMMITTEE MEETINGS AND ANNUAL MEETING

During 2021, each incumbent director attended and participated in at least 75% or more of the aggregate of (i) the total number of meetings of the Board of Directors (held during the period for which he or she has been a director) and (ii) the total number of meetings held by all Board committees on which he or she served (during the periods that he or she served). Under normal circumstances, we encourage directors to attend annual meetings of stockholders, although we do not have a formal policy regarding director attendance at these meetings. Due to COVID-19 meeting restrictions, our directors then serving were unable to attend our Annual Meeting of Stockholders in May 2021. The number of meetings conducted in 2021 by the Board and each Board committee are provided in the Board Committee Membership and 2021 Meetings Held table.

AUDIT COMMITTEE

In accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (the “Exchange Act”), our Board of Directors established a separately-designated standing Audit Committee to oversee our accounting and financial reporting policies and processes, our internal control systems, and the services performed by our independent registered public accounting firm. Such oversight is performed in accordance with applicable SEC rules and

NASDAQ listing standards. Please refer to the Report of the Audit Committee section for the 2021 report. As more fully described in its charter, the Audit Committee’s responsibility for overseeing our accounting and financial reporting processes includes but is not limited to:

•Discussing the annual audit and resulting letter of comments with management;

•Consulting with the auditors and management regarding the adequacy of internal controls;

•Reviewing our financial statements with management and the independent auditors prior to their release;

•Evaluating with management the process used to support the CEO and CFO certifications that accompany our periodic SEC filings;

•Appointing the independent auditors for the next fiscal year;

•Reviewing and approving all audit and non-audit services and fees;

•Overseeing the work of our internal audit department and independent auditors; and

•Assessing and maintaining procedures for the anonymous submission of complaints concerning accounting and auditing irregularities.

The Audit Committee meets in executive session with our independent auditors and also in a separate executive session with the head of our internal audit department. These meetings are conducted without the presence of our management and occur at each quarterly Audit Committee meeting. In 2021, as Audit Committee Chairs, Mr. Jung and Ms. Wellman, each participated in two additional meetings with management and the independent auditors for the purpose of reviewing the Company’s financial results prior to the issuance of our quarterly earnings press releases.

Audit Committee Independence and Financial Expert. Our Board of Directors has determined that each Audit Committee member (i) meets the independence criteria prescribed by Rule 10A-3(b)(1) and Section 10A(m)(3) of the Exchange Act; (ii) is independent under the NASDAQ listing standards and (iii) has sufficient knowledge and sophistication in financial and auditing matters under the NASDAQ rules. The Board also designated Mses. Duren and Wellman as “audit committee financial experts” as defined under the SEC rules upon determining that Mses. Duren and Wellman possess the requisite qualifications and experience.

COMPENSATION COMMITTEE

The Compensation Committee is responsible for determining and approving the compensation of our executive officers. The Compensation Committee may consider the recommendations of our Chairman, President & CEO. Prior to making any such compensation determinations, the committee performs an annual review of all compensation elements for our executive officers, including but not limited to base salary, incentive cash bonuses and stock awards. Our Compensation Committee is tasked with evaluating and approving our overall executive compensation strategy and elements to ensure such components align with our business objectives, stockholder interests and responsible corporate practices and culture. Additionally, the Compensation Committee is responsible for recommending to the Board the compensation policies for our independent directors and overall Board members. The Compensation Committee has responsibility for oversight of and determining awards of equity compensation pursuant to the Werner Enterprises, Inc. Amended and Restated Equity Plan (the “Equity Plan”).

The Report of the Compensation Committee section contains the 2021 report. For more information about the Compensation Committee’s activities, refer to the Compensation Discussion and Analysis and Report of the Compensation Committee sections of this Proxy Statement. The Compensation Committee’s functions are also described in its charter.

Compensation Committee Independence. Our Board of Directors has determined that all current Compensation Committee members satisfy the applicable SEC and NASDAQ independence requirements. Each Compensation Committee member is also (i) a “non-employee director” as defined by Rule 16b-3 under the Exchange Act and (ii) an “outside director” as defined in Section 162(m) of the Internal Revenue Code and U.S. Treasury Regulation Section 1.162-27.

Compensation Committee Interlocks and Insider Participation. No member of the Compensation Committee was an officer or employee of the Company at any time during 2021 or on the date of this Proxy Statement. In 2021, no

member of the Compensation Committee had any relationships or transactions with the Company that would require disclosure as a “related person transaction” under the SEC rules and regulations and in the Proxy Statement section entitled Transactions with Related Persons. During 2021, none of our executive officers served on the board of directors or compensation committee of any other entity whose executive officer(s) served as a member of our Board of Directors or Compensation Committee.

NOMINATING AND CORPORATE GOVERNANCE COMMITTEE

Our Governance Committee is comprised only of directors whom the Board has determined satisfy the applicable SEC and NASDAQ independence requirements. The Governance Committee is responsible for the director nomination process. These duties include assisting the Board in identifying, evaluating and recruiting qualified potential candidates for election to the Board. The Governance Committee recommends for the Board’s approval the director nominees for any election of directors. This process is described further in the Director Nomination Process section.

The Governance Committee is also responsible for various corporate governance matters, including the development and oversight of our corporate governance policies, compliance practices and ethical standards of conduct for our directors, officers and employees. The committee makes recommendations to the Board regarding our corporate governance processes and reviews our Code of Corporate Conduct. The Governance Committee also monitors the effectiveness, and advises on the composition, structure and size, of our Board and Board committees. It also annually assists our Board with its independence and expertise determinations. The Governance Committee has oversight of the administration of our policies regarding “related person transactions” (as discussed under the Transactions with Related Persons section herein), and the committee reviews and approves or disapproves any such transaction when such approval is required by SEC and NASDAQ rules and regulations. A more complete description of the Governance Committee’s functions is provided in its charter.

ENVIRONMENTAL SOCIAL AND GOVERNANCE COMMITTEE

The Company formed an ESG Committee effective January 1, 2022. The primary functions of the ESG Committee are to: (i) support and oversee Company policies relating to relevant environmental, social, corporate social responsibility, sustainability, and public policy matters; (ii) work closely with other Board Committees, including the Nominating and Corporate Governance Committee in the development and oversight of corporate governance policies and the Audit Committee to ensure the Company has appropriate disclosure controls and procedures in place relating to ESG matters; and (iii) assist management in setting general strategy relating to ESG matters and provide oversight to the Company’s underlying ESG programs and policies. The ESG Committee makes policy, program and strategy recommendations to the Board concerning current and emerging ESG trends that may affect our business, operations, performance, or public image. Committee members also play an active role in the creation of our periodic Corporate Responsibility Report. A more complete description of the ESG Committee’s functions is provided in its charter.

STOCKHOLDER COMMUNICATIONS WITH THE BOARD OF DIRECTORS

The Board of Directors established a process by which stockholders and other parties may communicate directly with members of the Board or the independent directors as a group. This process is described in our Stockholder Communications Procedure for Communicating with the Board of Directors, included on our website. You may direct any matter intended for the Board or independent directors by writing to the intended recipients in care of our Corporate Secretary at our executive offices. Generally, the Corporate Secretary will forward any received correspondence according to the stockholder’s instructions. The Corporate Secretary, however, reserves the right not to forward any abusive, threatening or otherwise inappropriate materials. A majority of our independent directors approved the process for collecting stockholder communications received by our Corporate Secretary on the Board’s behalf.

DIRECTOR NOMINATION PROCESS

Generally, the Governance Committee considers director candidates recommended by Board members, management and stockholders. Nominees for the Board of Directors are then selected by the Governance Committee according to the process summarized below and described in our current Nominating and Corporate Governance Committee

Directorship Guidelines and Selection Policy (the “Directorship Guidelines Policy”) and Policy Regarding Director Recommendations by Stockholders (the “Stockholder Recommendation Policy”). Both policies are available free of charge on our website. Stockholders may also request a copy of these policies by contacting our Corporate Secretary at our executive office address or telephone number provided in this Proxy Statement. Each policy was approved by the Board of Directors and is administered by the Governance Committee. The Governance Committee evaluates the policies regularly and may update and revise the policies from time to time, subject to Board approval, when appropriate and as applicable legal or listing standards change.

Stockholder Recommendations for Director Candidates. With respect to director candidates identified by stockholders, the Stockholder Recommendation Policy applies. In accordance with the Stockholder Recommendation Policy, the Governance Committee will consider candidates proposed by only “qualified stockholders.” A “qualified stockholder” is an individual stockholder or group of stockholders that has beneficially owned at least 2% of our issued and outstanding common stock for at least one year (and will hold such percentage of stock through the date of the annual meeting, and if the recommended candidate is elected, through his or her term of service). Such stock ownership is determined as of the date the stockholder recommendation is submitted. You must submit stockholder director candidate recommendations in a written proposal, and each proposal must include all information required and requested by the Stockholder Recommendation Policy.

In order for a stockholder’s candidate to be evaluated and considered as a prospective nominee, you must submit your recommendation to our Corporate Secretary not less than 120 days before the one-year anniversary of the release date of the previous year’s proxy statement. (For example, the release date of the 2021 proxy statement was April 2, 2021. Stockholder recommendations intended for consideration for the director elections at the 2022 Annual Meeting needed to be submitted on or before December 3, 2021.) Stockholder recommendations for director nominees must be submitted no later than the close of business on December 2, 2022 for the 2023 Annual Meeting of Stockholders.

Stockholder recommendations for director candidates must be accompanied by a description of each candidate’s qualifications in sufficient detail to permit the Governance Committee to evaluate whether each candidate satisfies the independence, financial literacy and experience requirements of the SEC, NASDAQ or other applicable laws or regulations. Director candidates proposed by stockholders in accordance with the Stockholder Recommendation Policy are evaluated by the Governance Committee in the same manner as any other prospective candidate during the director nominee selection process. We have not engaged and have not paid any fees to any third party for assistance with the director nomination process.

In addition to the requirements described above and in the Stockholder Recommendation Policy, all written stockholder proposals containing director candidate recommendations must comply with Rule 14a-8 of the Exchange Act. Rule 14a-8 sets forth the requirements for the inclusion of stockholder proposals in company-sponsored proxy materials. Contact information for our Corporate Secretary is provided in the Contacting the Corporate Secretary and Executive Offices section.

Desirable Skills and Traits for Director Candidates. Generally, candidates for director positions should possess the following skills and traits:

•Relevant business and financial expertise and experience, including an understanding of fundamental financial statements;

•The highest character and integrity and a reputation for working constructively with others;

•Sufficient time to devote to meetings and consultation on Board matters; and

•Freedom from conflicts of interest that would interfere with the candidate’s performance as a director.

The Governance Committee evaluates prospective nominees against certain minimum standards and qualifications, as identified in the Directorship Guidelines Policy, and the Committee will strive to recommend director nominees who satisfy these standards and qualifications in large part. The basic standards and qualifications set forth in the Directorship Guidelines Policy include but are not limited to those skills and traits listed above and as follows:

•Representation of our stockholders as a whole;

•Background that contributes to a Board comprised of individuals with varied occupational experience and perspective;

•Leadership experience and ability to exercise sound business judgment;

•Accomplishments, credentials and recognition in their respective field;

•Contributions to the Board’s skills, competency and qualifications through expertise in an area of business significant to our Company;

•Personal and professional reputation for integrity, honesty, fairness and other similar traits; and

•Knowledge of issues affecting us and critical aspects of our business and operations.

The Governance Committee also considers other relevant factors, such as the balance of management and independent directors, the need for Audit Committee or other Board committee expertise, relevant industry experience and the candidate’s understanding of financial matters and financial sophistication, literacy and proficiency. The Governance Committee values diversity in its candidates and considers it desirable if potential nominees complement and contribute to the Board’s overall diversity and composition. In this respect, we broadly construe diversity to mean an array of opinions, perspectives, skills, personal and professional experiences and backgrounds and other attributes, including gender, race and ethnic diversity.

The following table summarizes certain self-identified personal characteristics of our directors in accordance with Nasdaq Listing Rule 5605(f). Each term used in the table has the meaning given to it in the rule and related instructions.


BOARD DIVERSITY MATRIX (AS OF APRIL 1, 2022)
Total Number of Directors	8
	Female	Male	Non-Binary	Did Not Disclose Gender
Part I: Gender Identity
Directors	3	5	0	0
Part II: Demographic Background
African American or Black	1	0	0	0
Alaskan Native or Native American	0	0	0	0
Asian	0	1	0	0
Hispanic or Latinx	0	0	0	0
Native Hawaiian or Pacific Islander	0	0	0	0
White	2	4	0	0
Two or More Races or Ethnicities	0	0	0	0
LGBTQ+	0
Did Not Disclose Demographic Background	1

DIRECTOR COMPENSATION AND BENEFITS

Only independent directors on our Board receive compensation for their service as one of our directors. The independent directors receive an annual compensation package that is designed to attract, motivate and retain highly qualified independent professionals to represent our stockholders. Directors who are employees of the Company do not receive any compensation for their service on our Board of Directors.

Compensation of Directors for 2021. Our current 2021 annual compensation package for independent directors is comprised of the annual cash retainers and restricted stock awards provided in the Independent Director Annual Retainers and Fees table that follows. We will also reimburse each independent director at cost for all of their respective reasonable out-of-pocket travel expenses incurred in connection with their attendance at Board and Board committee meetings and for other reasonable out-of-pocket expenses directly related to their Board and Board committee service.


INDEPENDENT DIRECTOR ANNUAL RETAINERS AND FEES
Fee or Retainer			Amount and Frequency of Payment
Cash Retainer for Board Membership			$50,000 (paid in quarterly installments of $12,500 each)
Cash Retainer for the Audit Committee Chair			$15,000 (paid in quarterly installments of $3,750 each)
Cash Retainer for the Compensation Committee Chair			$10,000 (paid in quarterly installments of $2,500 each)
Cash Retainer for the Governance Committee Chair			$10,000 (paid in quarterly installments of $2,500 each)
Restricted Stock Award for Board Membership			$80,000 (three year vesting period from the date of grant)

The Director Compensation for 2021 table presents the compensation of each individual serving as an independent director during 2021 for service on our Board and its committees. This table does not include those directors who are also Company employees or related parties because such directors are not considered independent directors and thus did not receive any compensation in 2021 for their service on our Board. (Derek Leathers was a director and named executive officer, and the compensation paid to him by the Company is discussed in the Executive Compensation section and provided in the Summary Compensation Table.) Our independent directors do not participate in any benefit, pension or nonqualified deferred compensation plan of the Company. For these reasons, we have omitted those columns from the table.


DIRECTOR COMPENSATION FOR 2021
Name		Fees Earned or Paid in Cash ($)		Stock Awards ($) (1)(2)		All Other Compensation ($)	Total ($)
Scott C. Arves			31,250		80,000	—		111,250
Kenneth M. Bird, Ed.D.			50,000		80,000	—		130,000
Diane K. Duren			60,000		80,000	—		140,000
Michael L. Gallagher (3)			25,000		—	—		25,000
Jack A. Holmes			60,000		80,000	—		140,000
Patrick J. Jung (3)			32,500		—	—		32,500
Vikram Mansharamani, Ph.D.			31,250		80,000	—		111,250
Carmen A. Tapio			50,000		80,000	—		130,000
Gerald H. Timmerman (4)			50,000		80,000	—		130,000
Alexi A. Wellman			40,625		80,000	—		120,625

(1)	On May 11, 2021, each of the independent directors then serving on the Board received an annual award of 1,709 shares of restricted stock with a grant date fair value of $46.80 per share. The grant date fair value is based upon the market price of the underlying common stock on the grant date, reduced by the present value of estimated future dividends because the award is not entitled to receive dividends prior to vesting. The present values of estimated future dividends for the May 11, 2021 grants were calculated based on a $0.12 quarterly dividend amount per share and 0.3% risk-free interest rate. Further discussion of the valuation and assumptions regarding our stock awards is provided in Note 11 of our Consolidated Financial Statements in our Annual Report on Form 10-K for 2021.
(2)	The aggregate number of shares of unvested restricted stock outstanding at December 31, 2021 for each independent director is as follows: Mr. Arves 1,709; Dr. Bird 3,595; Ms. Duren 3,595; Mr. Holmes 3,595; Dr. Mansharamani 1,709; Ms. Tapio 2,366; Mr. Timmerman 3,595; and Ms. Wellman 1,709. No option awards were outstanding.
(3)	Messrs. Gallagher and Jung retired from the Board on May 11, 2021, upon which their unvested restricted stock awards became fully vested.
(4)	Mr. Timmerman retired from the Board effective February 9, 2022.

During 2021, restricted stock was granted to the independent directors on May 11, 2021. The grants of restricted stock to the independent directors were made in accordance with our Amended and Restated Equity Plan, and pursuant to the Restricted Stock Award Agreements with the restricted stock recipients, the restricted stock is subject to service-based vesting provisions. Beginning one year after the grant date of each award, the restricted stock will vest annually in three increments of 34%, 33% and 33%, respectively. The awards will then become fully vested on May 11, 2024. The independent directors do not have any voting or dividend rights with respect to such

stock until it is vested, and there are not any post-vesting sales restrictions on the shares. (The Amended and Restated Equity Plan and the Form of Restricted Stock Award Agreement were both included as exhibits to our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on February 28, 2022.) We did not grant any stock options, stock appreciation rights (“SARs”), or performance stock to our independent directors in 2021.

Compensation of Directors for 2022. In March 2022, the Compensation Committee reviewed the non-employee director compensation program with the assistance of its independent compensation consultant. To better align with market practices based on this review, the Compensation Committee recommended to the Board of Directors that the annual cash retainer be increased to $75,000 (paid in quarterly installments of $18,750 each) effective July 1, 2022 and the annual restricted stock award granted in May 2022 be increased to $100,000. Prior to this change, the Board had not increased its director compensation since 2020. In addition, the Compensation Committee recommended and the Board of Directors approved the adoption of an annual cash retainer for the Environmental Social and Governance Committee Chair of $10,000 (paid in quarterly installments of $2,500 each) effective January 1, 2022. All other committee retainers remain unchanged from the 2021 amounts.

Director Stock Ownership. In February 2020, formal stock ownership guidelines for all independent directors were adopted. Stock ownership includes common stock owned (directly or indirectly) and time-vested restricted stock. The ownership guidelines require independent directors to own stock with a market value equal to or in excess of 3.0 times the current independent director annual cash retainer. Independent directors have three years from adoption of this policy or from their date of election to meet the ownership guidelines and are required to retain all restricted stock granted as fees for Board membership until such time as they meet the ownership guidelines. All independent directors, except Dr. Mansharamani and Mses. Tapio and Wellman (each of whom has served as a director for less than three years), met the ownership guidelines as of December 31, 2021. The individual stock ownership of each independent director is set forth in the table under the Stock Ownership of Directors, Executive Officers and Certain Beneficial Owners section of this Proxy Statement.

EXECUTIVE OFFICERS

Pursuant to the By-Laws, our Board of Directors appoints our executive officers from time to time. Our By-Laws provide that each executive officer holds his or her respective office until he or she resigns, is removed, or is unable to serve due to death or incapacity.

EXECUTIVE OFFICER INFORMATION

The table that follows identifies our current executive officers and the capacities in which they now serve. Set forth following the table is certain biographical information provided to us by these executive officers regarding their acquired business skills and experience.


EXECUTIVE OFFICERS
Name	Position with the Company	Age
Derek J. Leathers	Chairman, President & Chief Executive Officer	52
H. Marty Nordlund	Senior Executive Vice President & Chief Operating Officer	60
John J. Steele	Executive Vice President, Treasurer & Chief Financial Officer	64
Jim S. Schelble	Executive Vice President & Chief Administrative Officer	61
James L. Johnson	Executive Vice President, Chief Accounting Officer & Corporate Secretary	58
Craig T. Callahan	Executive Vice President & Chief Commercial Officer	48
Nathan J. Meisgeier	Executive Vice President & Chief Legal Officer	48
Daragh P. Mahon	Executive Vice President & Chief Information Officer	53

For information regarding the business experience of Derek J. Leathers, please refer to Director Information under the Proposal 1 – Election of Directors section of this Proxy Statement.

H. MARTY NORDLUND joined us in 1994 as an account executive. He then received the following promotions within the Company: (i) Director of Dedicated Fleet Services in 1995; (ii) Senior Director of Dedicated Fleet Services in 1997; (iii) Vice President–Dedicated Fleet Services in 1998; (iv) Vice President–Specialized Services in 2001; (v) Senior Vice President–Specialized Services in 2003; (vi) Executive Vice President–Specialized Services in 2005; and (vii) Senior Executive Vice President—Specialized Services in 2006. In May 2016, Mr. Nordlund was named to his current position as Senior Executive Vice President and Chief Operating Officer. Before joining the Company, Mr. Nordlund held various management positions with Crete Carrier Corporation, a large privately held truckload carrier.

JOHN J. STEELE joined the Company in 1989 as Controller. During his time with us, he was appointed to the following positions: (i) Corporate Secretary in 1992; (ii) Vice President–Controller and Corporate Secretary in 1994; (iii) Vice President, Treasurer and Chief Financial Officer in 1996; and (iv) Senior Vice President, Treasurer and Chief Financial Officer in 2004. He was named to his current position as Executive Vice President, Treasurer and Chief Financial Officer in 2005. Mr. Steele was employed by the independent public accounting firm of Arthur Andersen & Co. as a certified public accountant from 1979 until his employment with the Company in 1989.

JIM S. SCHELBLE joined us in 1998 as Manager of New Business Development. During his tenure with us, Mr. Schelble was promoted to the following positions: (i) Director of National Accounts in 1999; (ii) Senior Director of Dedicated Services in 2000; (iii) Associate Vice President of Corporate and Dedicated Sales in 2002; (iv) Vice President–Sales in 2003; (v) Senior Vice President–Sales in 2004; (vi) Executive Vice President–Sales and Marketing in 2005; and (vii) Executive Vice President of Marketing and Driver Resources in 2015. In May 2016, Mr. Schelble was named to his current position as Executive Vice President and Chief Administrative Officer. Prior to joining the Company, Mr. Schelble spent twelve years with Roadway Express, a less-than-truckload carrier, in a variety of management positions within operations, sales, and marketing. Mr. Schelble also serves on the state board and executive board of the Combined Health Agencies Drive.

JAMES L. JOHNSON joined the Company in 1991 as Manager of Financial Reporting. Since that time, Mr. Johnson was appointed to the following positions with us: (i) Assistant Controller in 1992; (ii) Director of Accounting in 1994; (iii) Corporate Secretary and Controller in 1996; (iv) Vice President, Controller and Corporate Secretary in 2000; and (v) Senior Vice President, Controller and Corporate Secretary in 2005. He was named to his current position as Executive Vice President, Chief Accounting Officer and Corporate Secretary in 2010. Mr. Johnson was employed by the independent public accounting firm of Arthur Andersen & Co. as a certified public accountant from 1985 until his employment with us in 1991.

CRAIG T. CALLAHAN joined the Company in 1995 as a management trainee and has held several leadership positions within Customer Service, Operations and Sales. In 2005, Mr. Callahan joined the Sales team and was promoted to Senior Director of National Accounts. In 2009, Mr. Callahan was named Vice President of Sales, assuming additional sales leadership responsibilities for business development and growth initiatives in Dedicated, Contract Logistics, Intermodal and Cross-Border Services. In 2015, Mr. Callahan was promoted to Senior Vice President of Sales, gaining additional responsibilities for Field and International Sales. In February 2018, Mr. Callahan was promoted to Executive Vice President and Chief Commercial Officer. Mr. Callahan also serves on the board of directors of College World Series of Omaha, Inc.

NATHAN J. MEISGEIER joined the Company in 2005 as Senior Counsel of Litigation. Since that time, Mr. Meisgeier has held the titles of Associate Vice President and Associate General Counsel before being promoted to Vice President and General Counsel in 2016. In February 2018, Mr. Meisgeier was promoted to Executive Vice President and Chief Legal Officer. Outside of the Company, Mr. Meisgeier is the Chairman of the American Trucking Associations’ Insurance Task Force and sits on the board of directors for the American Trucking Associations Litigation Center, among other positions with the transportation industry. Mr. Meisgeier practiced at the Kansas City law firm of Stinson, Mag and Fizzell for seven years before joining Werner in 2005.

DARAGH P. MAHON joined the Company in 2020 as Executive Vice President and Chief Information Officer. Prior to joining the Company, Mr. Mahon was employed at Vonage Business Inc. for six years with his last position held being Senior Vice President, Global IT and Business Applications. Prior to that he was employed by Sage North America for 10 years. Mr. Mahon is an advisory board member of Salesforce.

BENEFICIAL OWNERSHIP OF COMMON STOCK

STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN BENEFICIAL OWNERS

The Beneficial Ownership table sets forth certain information as of March 21, 2022, with respect to the beneficial ownership of our common stock by: (i) each of our directors and director nominees; (ii) each of our Named Executive Officers; (iii) each person known to us to beneficially own more than 5% of the outstanding shares of our common stock; and (iv) all current executive officers, directors and director nominees as a group.

On March 21, 2022, we had 65,057,763 shares of common stock outstanding. Except as otherwise indicated in the Beneficial Ownership table, the persons listed have sole voting power and sole investment power with respect to such shares of our common stock indicated as beneficially owned by them. Unless otherwise noted, the physical business address of each beneficial owner set forth in the Beneficial Ownership table is: Werner Enterprises, Inc., 14507 Frontier Road, Omaha, Nebraska 68138.


BENEFICIAL OWNERSHIP
		Amount and Nature of Beneficial Ownership
Name of Beneficial Owner		Shares Owned		Right to Acquire (1)		Total Shares		Percent of Shares Outstanding (2)
Scott C. Arves			1,650		581		2,231		*
Kenneth M. Bird, Ed.D.			11,358		1,826		13,184		*
Diane K. Duren			12,258		1,826		14,084		*
Jack A. Holmes			2,891		1,826		4,717		*
Vikram Mansharamani, Ph.D.			0		581		581		*
Carmen A. Tapio			338		581		919		*
Alexi A. Wellman			0		581		581		*
Derek J. Leathers			263,013		—		263,013		*
H. Marty Nordlund			48,061		—		48,061		*
John J. Steele			67,344		—		67,344		*
Jim S. Schelble			52,051		—		52,051		*
James L. Johnson			71,886		—		71,886		*
BlackRock, Inc.(3)			11,354,158		—		11,354,158		17.5	%
The Vanguard Group (4)			5,552,278		—		5,552,278		8.5	%
Estate of Greg L. Werner (5)			4,020,601				4,020,601		6.2	%
Dimensional Fund Advisors LP (6)			3,650,858		—		3,650,858		5.6	%
Macquarie Parties (7)			3,407,602		—		3,407,602		5.2	%
All current executive officers, directors and director nominees as a group (15 persons) (2)			582,816		7,802		590,618		*
*Indicates beneficial ownership of less than 1%.

(1)	This column represents restricted stock that will vest within 60 days after March 21, 2022. The shares are not outstanding and may not be voted at the 2022 Annual Meeting.
(2)	The percentages are based upon 65,057,763 shares, which equal our outstanding shares as of March 21, 2022. In accordance with SEC rules, for individuals who hold restricted stock that will vest within 60 days of March 21, 2022, the number of shares of common stock on which the percentage is based also includes the number of such shares.
(3)	Based on Schedule 13G/A as of December 31, 2021, as filed with the SEC by BlackRock, Inc. BlackRock, Inc. claims sole voting power of 10,043,715 shares and sole dispositive power of 11,354,158 shares, and does not claim any shared voting power or shared dispositive power with respect to any of these shares. According to the Schedule 13G/A filing, the address of this stockholder is 55 East 52nd Street, New York, New York 10055.



(4)			Based on Schedule 13G/A as of December 31, 2021, as filed with the SEC by The Vanguard Group. The Vanguard Group does not claim sole voting power with respect to any shares and claims shared voting power of 61,182 shares, sole dispositive power of 5,436,644 shares, and shared dispositive power of 115,634 shares. According to the Schedule 13G/A filing, the address of this stockholder is 100 Vanguard Boulevard, Malvern, Pennsylvania 19355.
(5)			Based on Schedule 13G/A as of December 31, 2021, as filed with the SEC by the Estate of Greg L. Werner. The Estate of Greg L. Werner claims sole voting power and sole dispositive power of 4,020,601 shares, and does not claim any shared voting power or shared dispositive power with respect to any of these shares. According to the Schedule 13G/A filing, the address of this stockholder is 5604 South 118th Plaza, Omaha, Nebraska 68137.
(6)			Based on Schedule 13G/A as of December 31, 2021, as filed with the SEC by Dimensional Fund Advisors LP. Dimensional Fund Advisors LP claims sole voting power of 3,549,688 shares and sole dispositive power of 3,650,858 shares, and does not claim any shared voting power or shared dispositive power with respect to any of these shares. According to the Schedule 13G/A filing, the address of this stockholder is Building One, 6300 Bee Cave Road, Austin, Texas 78746.
(7)			Based on Schedule 13G as of December 31, 2021, as jointly filed with the SEC by Macquarie Group Limited, Macquarie Management Holdings Inc, Macquarie Investment Management Business Trust, and Macquarie Investment Management Global Limited (together, the “Macquarie Parties”): (i) Macquarie Group Limited does not claim sole voting power, shared voting power, sole dispositive power, or shared dispositive power with respect to any of these shares; (ii) Macquarie Management Holdings Inc. and Macquarie Investment Management Business Trust each had sole voting power and sole dispositive power of 3,389,817 shares, and each do not claim any shared voting power or shared dispositive power with respect to any of these shares; and (iii) Macquarie Investment Management Global Limited claims sole voting power and sole dispositive power of 1,300 shares, and does not claim any shared voting power or shared dispositive power with respect to any of these shares. The principal business address of Macquarie Group Limited and Macquarie Investment Management Global Limited is 50 Martin Place Sydney, New South Wales, Australia. The principal business address of Macquarie Management Holdings Inc. and Macquarie Investment Management Business Trust is 2005 Market Street, Philadelphia, PA 19103.

DELINQUENT SECTION 16(a) REPORTS

Section 16(a) of the Exchange Act requires our executive officers and directors, and persons who own more than 10% of our registered class of equity securities (common stock), to file with the SEC reports of beneficial ownership and changes in such beneficial ownership. Executive officers, directors and greater than 10% beneficial owners are required by SEC rules to furnish us copies of all Section 16(a) forms they file. We file Section 16(a) reports on behalf of our executive officers and directors to report their initial and subsequent changes in beneficial ownership of our common stock.

Based solely upon our review of (i) the reports (including any amendments thereto) we filed on behalf of our officers and directors, (ii) copies of such forms furnished to us and (iii) written representations from certain reporting persons that no other reports were required for those persons, we believe that all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficial owners were complied with, in a timely manner, during 2021; except that we filed late by one day (i) one Form 4 reporting one transaction for Dr. Mansharamani with respect to a grant of restricted stock, and (ii) one Form 4 reporting one transaction for Mr. Mahon with respect to shares required to satisfy tax withholding obligations in connection with the vesting of restricted stock.

EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

This section of the Proxy Statement identifies our Named Executive Officers and explains how our compensation policies and practices are developed and operate with respect to such Named Executive Officers. In the Compensation Discussion and Analysis, we also discuss and analyze our executive compensation program and the executive compensation amounts shown in such section. This discussion should be read in conjunction with the Summary Compensation Table (including the related tabular and narrative disclosures) and the Compensation Committee section under Corporate Governance in this Proxy Statement. As indicated in that section, the Compensation Committee of the Board of Directors is responsible for establishing our executive compensation policies and overseeing our executive compensation practices. Our Compensation Committee is also comprised solely of independent directors, each of whom is independent pursuant to SEC rules and NASDAQ listing standards.

Named Executive Officers. Our “Named Executive Officers” consist of the CEO, CFO and the three most highly compensated executive officers (other than the CEO and CFO) who were serving as executive officers as of December 31, 2021. Our five Named Executive Officers are identified in the table below.


2021 NAMED EXECUTIVE OFFICERS
Name			Position with the Company
Derek J. Leathers			Chairman, President & Chief Executive Officer
H. Marty Nordlund			Senior Executive Vice President (“SEVP”) & Chief Operating Officer
John J. Steele			Executive Vice President (“EVP”), Treasurer & Chief Financial Officer
Jim S. Schelble			Executive Vice President (“EVP”) & Chief Administrative Officer
James L. Johnson			Executive Vice President (“EVP”), Chief Accounting Officer & Corporate Secretary

Executive Summary. The Company and its Compensation Committee believe our executive compensation program has been instrumental to our business and in helping us accomplish our objectives. We continually review the program to confirm it is appropriate and fair in view of our financial performance and size relative to our competitive peer group. (The peer group is identified in the Competitive Peer Groups and Benchmarking section.) Our total compensation mix allows us to retain qualified, innovative executive officers who possess the necessary experience and expertise to manage the Company, provide effective Company leadership, contribute to our long-standing success and create value for our stockholders.

The table below summarizes and compares our key 2021 and 2020 financial results. Our 2021 financial statements are included in our Annual Report on Form 10-K for 2021 filed with the SEC.


2021 AND 2020 FINANCIAL RESULTS
		2021 (1)			2020 (1)			Change (%)
Total revenues			$2,734,372			$2,372,178			15	%
Net income attributable to Werner			$259,052			$169,078			53	%
Earnings per diluted share			$3.82			$2.44			57	%
Operating ratio (2)			88.7	%		90.4	%
Return on assets			11.2	%		8.0	%
Return on equity			20.4	%		14.7	%
Total shareholder return (1-year)			22.7	%		9.0	%
Total shareholder return (3-year cumulative)			87.2	%		17.7	%

(1)	Dollar amounts in thousands, except for per share amounts.
(2)	Operating expenses expressed as a percentage of operating revenues.

The Company achieved record financial results in 2021. Revenues increased 15% to $2.7 billion, while diluted earnings per share increased 57% to $3.82. Our Truckload Transportation Services segment grew revenues by 11% and operating income by 27%. Our Logistics segment increased revenues by 32% and more than quadrupled their operating income. We believe the Company is built to thrive in any trucking or logistics cycle. Our core strengths and sustainable competitive advantages support our strong consistent performance. The Company’s cumulative total shareholder return (“TSR”) for the three-year period ended December 31, 2021 was 87.2% and for the one-year period ended December 31, 2021 was 22.7%. Please refer to Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for 2021 filed with the SEC for more discussion of our 2021 financial results.

After receiving no base salary increases in 2019, the Named Executive Officers received base salary increases in 2020 but voluntarily took reductions in their base salaries during second quarter of 2020 due to the unknown impact of the COVID-19 pandemic. For 2021 the Named Executive Officers received base salary increases for their performance during the 2020 pandemic relative to the Company’s competitors and to better align with our competitive peer group base salaries. See Base Salary for more discussion of the 2021 base salaries. The Compensation Committee set the performance metrics and target goals for 2021 for the cash annual incentive program (“AIP”) at a 5% increase in revenues and a 15% increase in operating income from 2020. As a result of our record results, the AIP payouts for 2021 for the Named Executive Officers ranged from 185.2% to 161.5% of target. See Cash Annual Incentive Compensation for more discussion of the 2021 AIP.

In February 2021, the Compensation Committee awarded equity-based long-term incentives to the Named Executive Officers split equally between restricted stock and performance stock at the same award values for the Chairman, President and CEO and at award values lower than 2020’s award values for the other Named Executive Officers as the 2020 awards included increased amounts to recognize management’s high performance in 2019 relative to its peers in a difficult market. The restricted stock vests evenly over a three-year period while the performance stock cliff vests at the end of three years. The number of performance shares earned will range from 0% to 200% of the target shares for each Named Executive Officer based on the level of attainment of the performance objectives (two-year cumulative earnings per diluted share with a three-year relative TSR modifier). See Long-Term Incentive Compensation for more discussion of the equity incentive awards.

Consideration of Stockholder Say-on-Pay Vote. At the Company’s Annual Meeting held in May 2021, the Board asked Company stockholders to indicate on an advisory and non-binding basis whether they approve the Company’s executive compensation (a “say-on-pay resolution”). This proposal was contained in the Company’s 2021 proxy statement dated April 2, 2021, in accordance with Section 14A of the Exchange Act.

More than 96% of the stockholder votes were cast in favor of our say-on-pay resolution to approve, on an advisory basis, the compensation of our Named Executive Officers. The Company and its Compensation Committee believe this affirms our stockholders’ support of the Company’s approach to executive compensation and executive compensation program objectives. While such vote is advisory and non-binding, the Board and the Compensation Committee value our stockholders’ opinions expressed in such vote and consider the voting outcome in making executive compensation decisions.

2021 Executive Compensation Program and Objectives. Our executive compensation program is designed to achieve the following primary objectives:

•Attract, motivate and retain talented high-quality executives who contribute to the advancement of our strategic, operational and financial goals and to our long-term success in today’s competitive markets and industry.

•Reward our executive officers for their individual performance, leadership and contribution to the achievement of our overall business objectives.

•Support our Purpose Statement and guiding corporate principles. (Our Purpose Statement is included on our website.)

The Compensation Committee carries out our executive compensation objectives by applying the following principles:

•Provide compensation that is competitive with that paid by companies in our industry for executive talent. Our Compensation Committee has the authority to engage the services of an outside advisor and

compensation consultant to assist with determining how our executive compensation program compares to those of other companies.

•Reward performance by considering factors such as (i) our financial performance, (ii) the executive officer’s individual performance and contribution to our overall business goals and (iii) the performance of the executive officer’s area of responsibility when evaluated in light of overall Company performance and the year’s market, industry and economic conditions.

•Encourage our executive team to consider current and long-term opportunities and reasonable risks that result in positive Company performance and financial growth, industry innovation, consistent stockholder value and lasting collaborations with our customers and partners.

•Encourage executive officers to become stockholders and facilitate stock ownership in the Company by offering equity-based compensation. We believe that stock ownership links our executive officers’ interests with those of our stockholders and supports strategic decision-making and actions that will serve our long-term interests. We have adopted executive stock ownership guidelines and a policy on hedging and pledging to further this principle.

•Provide limited executive perquisites.

Elements of Executive Compensation. The elements of our 2021 executive compensation program are: (i) base salary, (ii) cash annual incentive compensation, (iii) long-term incentive compensation, and (iv) perquisites and benefits. The following discussion explains these elements and their primary purposes with respect to our 2021 executive compensation program.

The table below summarizes our total compensation mix for 2021. It excludes certain items that are reflected as “All Other Compensation” in the 2021 Summary Compensation Table. Such items are not typically considered in the Compensation Committee’s pay deliberations because the amounts are not material and, in certain cases, non-recurring.


2021 PAY ELEMENTS
		Base Salary (1)	Annual Incentive Compensation (2)	Restricted Stock	Performance Stock (2)	Variable Compensation (3)
CEO		19%	19%	31%	31%	81%
Other NEOs		41%	26%	16%	16%	58%

(1)	Annual base salary rate set by the Compensation Committee in February 2021.
(2)	Cash and equity incentive compensation calculated at the target level of performance.
(3)	Variable compensation includes annual incentive compensation, restricted stock, and performance stock.

Base Salary. Base salary is a fixed element of compensation that we pay to each executive officer for the performance of his primary duties and responsibilities. Generally, each respective executive officer’s base salary is commensurate with such person’s responsibility, experience, tenure and job performance. Base salaries are reviewed on an annual basis and at the time of promotion or other change in job function and responsibilities. A number of factors are considered when determining individual salary levels. These factors include but are not limited to (i) the individual’s overall performance and the level of responsibility and complexity of the executive’s job; (ii) the performance of the business unit(s) or function(s) under his leadership; (iii) how the executive officer’s salary compares to those of our other executives; (iv) our overall performance and achievements; (v) the economic and business conditions affecting the Company at the time of the review; and (vi) salaries paid by companies within our competitive peer group for the same or similar positions. Market adjustments to executive base salaries may be made when there is a significant change in an officer’s position or responsibilities or if competitive market data indicates a significant deviation compared to market salary practices. However, while we may be guided by such events and data, we do not set compensation levels at targeted or specific levels relative to that of a particular peer, competitor or industry group.

The following 2021 base salaries were approved by the Compensation Committee in February 2021 for the Named Executive Officers.


BASE SALARY
Name	2020 Base Salary ($)	2021 Base Salary ($)	Change (%)
Derek J. Leathers	800,000	850,000	6	%
H. Marty Nordlund	375,000	410,000	9	%
John J. Steele	315,000	340,000	8	%
Jim S. Schelble	350,000	400,000	14	%
James L. Johnson	360,000	420,000	17	%

Cash Annual Incentive Compensation. The 2021 AIP established target cash award amounts as a percentage of base salary, which varies by executive position. The 2021 AIP considers three performance metrics, with the financial metrics tied to pre-defined goals (40% operating income; 30% revenues less fuel surcharge revenues (“FSC”); and 30% individual performance). Individual performance for the executive officers included predefined areas of improvement or strategic milestones under the executive’s purview to be achieved during the year. The 2021 payout opportunities ranged from 0% to 200% of target depending on performance versus the goals. The table below shows the calculation of the AIP performance results.


ANNUAL INCENTIVE PLAN PERFORMANCE RESULTS
AIP Measure		Target (1)	Final Results (1)	Achieved (%)	Weight (%)	2021 AIP Payout (% Target)
Operating income (2)		$267.1	$314.3	200.0%	40%	80.0%
Revenues less FSC (3)		$2,324.3	$2,500.2	175.7%	30%	52.7%
Individual performance		Varies by NEO		95.8% to 175.0%	30%	25.0% to 43.8%
Total					100%	161.5% to 185.2%

(1)	Dollar amounts in millions.
(2)	Final results include adjustment of $5.1 million of insurance and claims expense for interest accrued during 2021 on an adverse jury verdict rendered in 2018, which the Compensation Committee determined should be added back to the 2021 operating income for purposes of the 2021 AIP payouts.
(3)	Operating revenues less trucking fuel surcharge revenues.

The Compensation Committee believes the 2021 AIP aligns pay for performance and the interest of management with stockholders. The table that follows shows the calculation of the AIP payouts achieved for the Named Executive Officers for 2021, which are disclosed in the Summary Compensation Table. The 2021 AIP payments occurred in February 2022. Please refer to the Grants of Plan-Based Awards for 2021 section for additional information regarding the AIP.


CASH ANNUAL INCENTIVE COMPENSATION
Name	2021 Base Salary ($)	Target Payout (% Salary)		Target AIP Payout ($)	AIP Payout (% Target)		2021 AIP Payout ($)
Derek J. Leathers	850,000	100.0	%	850,000	185.2	%	1,574,200
H. Marty Nordlund	410,000	70.0	%	287,000	161.5	%	463,505
John J. Steele	340,000	60.0	%	204,000	162.7	%	331,908
Jim S. Schelble	400,000	60.0	%	240,000	170.2	%	408,480
James L. Johnson	420,000	60.0	%	252,000	170.2	%	428,904

2021 Long-Term Incentive Compensation. Our long-term incentive program is important to us because it helps attract a talented executive team, encourages long-term retention of executive officers and enables us to recognize efforts put forth by executives who contribute to our stock price appreciation and Company development. The periodic vesting periods of long-term incentive compensation directly align executive officer interests and compensation with our stockholders’ interests by rewarding creation and preservation of long-term stockholder value. The Compensation Committee also believes this element of compensation provides equity ownership opportunities for our executive officers.

Under our Equity Plan, the Compensation Committee may grant stock options, SARs, restricted stock, restricted stock units (“RSUs”) and performance stock to our executive officers and non-employee directors. The grant date is the same date as the meeting at which the Compensation Committee decides to grant equity awards, after giving consideration to the timing of such decisions to ensure that awards occur when neither the recipient nor the Compensation Committee possess material nonpublic information. None of our restricted or performance stock awards give the recipient any voting or dividend rights until such stock vests, nor do they have any post-vesting sales restrictions.

In February 2021, the Compensation Committee, in its sole discretion, awarded the Named Executive Officers restricted stock and performance stock for 2021. The restricted stock will vest in three annual increments of 34%, 33% and 33% beginning February 11, 2022 (one year after the grant date), subject to continued employment. The performance stock is earned based upon the level of attainment by the Company of a cumulative earnings per diluted share performance objective for the two-year period from January 1, 2021 to December 31, 2022, as established by the Compensation Committee. The Compensation Committee works with management to develop performance objectives that it believes are rigorous and challenging to achieve and that would contribute to our overall financial goals and create stockholder value. The number of shares that may ultimately be earned will range from 0% to 200% of the target shares stated in each executive’s award agreement based on the level of attainment of the performance objective and subject to a TSR modifier whereby the maximum payout will be capped at 150% or 175% based on the Company’s TSR for the three-year period ending December 31, 2023, relative to the TSR of the following nine trucking peers for the same period: Covenant Logistics Group, Heartland Express, Hub Group, J.B. Hunt, Knight-Swift Transportation, Landstar System, Marten Transport, Schneider National, and U.S. Xpress Enterprises. Any performance stock earned will vest, subject to continued employment, on February 11, 2024. The target grant date values of the stock awards to the Named Executive Officers are as follows: Mr. Leathers–$2,800,000; Mr. Nordlund–$350,000; and Messrs. Steele, Schelble and Johnson–$300,000 each. The target value granted to each Named Executive Officer was split equally between restricted stock and performance stock. The 2021 grants of restricted stock and performance stock to the Named Executive Officers are disclosed in the Summary Compensation Table. Please refer to the Grants of Plan-Based Awards for 2021 section for additional information regarding the equity awards.

2020 Performance Stock. In February 2020, the Compensation Committee awarded the Named Executive Officers restricted stock and performance stock for 2020. The 2020 performance stock is earned based upon the level of attainment by the Company of a cumulative earnings per diluted share performance objective for the two-year period from January 1, 2020 to December 31, 2021, as established by the Compensation Committee. The number of shares that may ultimately be earned will range from 0% to 200% of the target shares stated in each executive’s award agreement based on the level of attainment of the performance objective and subject to a TSR modifier whereby the maximum payout will be capped at 150% of target if absolute TSR during the three-year period ending December 31, 2022 is less than 25%. Any performance stock earned will vest, subject to continued employment, on February 13, 2023. The Compensation Committee has determined that (i) insurance and claims expense of $5.1 million in 2021 and $4.9 million in 2020, for interest accrued during those years related to an adverse jury verdict rendered in 2018 that remains under appeal and (ii) net unrealized gains on investments of $40.3 million in 2021 are unusual items not reflective of management performance that should be adjusted for in the calculation of the two-year cumulative earnings per diluted share for purposes of determining the achievement level of the 2020 performance shares. Cumulative earnings per diluted share from January 1, 2020 to December 31, 2021, adjusted for the accrued interest and net unrealized gains on investments, amounted to $5.91 which exceeded the maximum performance goal of $5.28, which results in a payout of 200% of target before considering the impact of the TSR modifier. As of

December 31, 2021, absolute TSR during the performance period is above 25% which would result in an award payout at 200% of target if the performance period ended on that date. The final performance and payout, including the impact of the TSR modifier, will be determined after December 31, 2022 and will be reported in the 2023 proxy statement.

2019 Performance Stock. In February 2019, the Compensation Committee awarded the Named Executive Officers restricted stock and performance stock for 2019. The 2019 performance stock is earned based upon the level of attainment by the Company of a cumulative earnings per diluted share performance objective for the two-year period from January 1, 2019 to December 31, 2020, as established by the Compensation Committee. The number of shares that may ultimately be earned will range from 0% to 200% of the target shares stated in each executive’s award agreement based on the level of attainment of the performance objective and subject to a TSR modifier whereby the maximum payout will be capped at 150% of target if absolute TSR during the three-year period ending December 31, 2021 is less than 30%. Any performance stock earned will vest, subject to continued employment, on February 11, 2022. The Compensation Committee has determined that insurance and claims expense of $4.9 million in 2020 and $3.9 million in 2019, for interest accrued during those years related to an adverse jury verdict rendered in 2018 that remains under appeal, is an unusual item not reflective of actual performance and should be adjusted for in the calculation of the two-year cumulative earnings per diluted share for purposes of determining the achievement level of the 2019 performance shares. Cumulative earnings per diluted share from January 1, 2019 to December 31, 2020, adjusted for the accrued interest, amounted to $4.91 or 87.8% of the target goal of $5.10. As a result, the TSR modifier that caps achievement at 150% did not impact the achievement level. The performance shares vested on February 11, 2022 for the Named Executive Officers and were paid out at a 87.8% achievement level.

Perquisites and Benefits. Our executive compensation program includes limited executive perquisites that we believe are reasonable and consistent with our overall compensation objectives. Our Compensation Committee periodically reviews the perquisites provided to executive officers. The perquisites offered under our 2021 executive compensation program were as follows:

•Country Club Membership. In 2021, we paid country club membership fees and other business-related and reasonably incurred expenses for certain Named Executive Officers, and we received full reimbursement from those individuals for any personal expenses incurred. We provide these memberships for our benefit, notwithstanding the incidental personal benefit.

•Company Vehicle. We provide Company vehicles to certain Named Executive Officers for business and personal use. We are responsible for paying the operating expenses of these vehicles, except for fuel.

•Medical Care Membership Program. We provide each Named Executive Officer with membership in a medical care program, which provides for an annual physical examination and unlimited direct access to a primary care physician. We believe the program allows our Named Executive Officers to devote more time to our business and promotes the health and wellness of these key employees.

•Personal Use of Corporate Aircraft. Mr. Leathers is eligible to use the Company’s aircraft for limited personal use. Personal use for 2021 was limited to $60,000 per year based on the Company’s incremental cost of the personal flights. To the extent any personal travel on our aircraft results in imputed income to the executive, the Company does not provide any gross-up payments to cover the personal income tax obligation.

In 2021, we offered the following benefits to our executives: (i) health, dental and vision plans; (ii) other voluntary insurance plans, including life and disability; (iii) 401(k) retirement savings plan; (iv) employee stock purchase plan; and (v) nonqualified deferred compensation plan (see Nonqualified Deferred Compensation for 2021). These benefits are available to our Named Executive Officers on the same terms as provided to other eligible employees.

The aggregate incremental cost of perquisites and other benefits (and any related tax gross-ups) provided to the Named Executive Officers is shown in the “All Other Compensation” column of the

Summary Compensation Table and detailed in the All Other Compensation for 2021 section of this Proxy Statement.

Role of the Compensation Consultant. Frederic W. Cook & Co. is an independent executive compensation consulting firm engaged by the Compensation Committee. The Compensation Committee has assessed the independence of the Consultant and determined that the Consultant’s work did not raise any conflicts of interest.

The Consultant assists the Committee in its evaluation of the compensation for our executives. The Compensation Committee engages the Consultant to (i) review and recommend any changes to the Company’s competitive peer group, (ii) prepare an executive compensation benchmarking review to include a competitive analysis of the compensation of the Company’s executives in comparison to our peer group, and (iii) review the Company’s compensation program and philosophy and recommend changes based on the Company’s business objectives, compensation trends and best practices to incorporate a mix of short-term and long-term incentive components and align pay for performance.

The Consultant reports directly to the Compensation Committee, although it may work in cooperation with management only as required to carry out its obligations to the Compensation Committee. Without the Compensation Committee’s prior approval, the Consultant will not perform any services for us or our management. During 2021, the Company paid fees to the Consultant only for advising the Compensation Committee on the amount or form of executive and director compensation. The Company did not pay the Consultant any fees for additional projects or services.

Competitive Peer Groups and Benchmarking. The companies in the peer group were selected by first reviewing the Company’s peer group from the prior year. U.S.-based public companies in trucking, air freight & logistics and railroads with revenues approximately one-third to three times the Company’s annual revenues with a preference for long-haul trucking or logistics competitors were then reviewed. From this review it was determined that there would be no changes from the 2020 competitive peer group as shown in the table below.


2021 COMPETITIVE PEER GROUP
ArcBest	J.B. Hunt	Saia
Covenant Logistics Group	Kansas City Southern	Schneider National
Echo Global Logistics	Knight-Swift Transportation	U.S. Xpress Enterprises
Forward Air	Landstar System	YRC Worldwide
Heartland Express	Marten Transport
Hub Group	Old Dominion Freight Line

The Compensation Committee has not historically set compensation elements for each executive to meet specific benchmarks based on peer group data. Instead, we consider these comparisons as one factor in determining executive compensation levels. Generally, the Compensation Committee reviews total compensation levels annually and makes adjustments when job responsibilities, individual performance or market data warrants such modifications. Actual total compensation can vary from year to year based on Company and individual performance.

Compensation Determination Process. The Compensation Committee makes all annual compensation decisions for our Named Executive Officers.

When determining total compensation, we apply a consistent approach for all Named Executive Officers. The structure and levels of our executive compensation program are determined, in large part, by considering all elements of compensation, rather than only a few components in isolation. Our Compensation Committee evaluates each element individually and also takes into account the position and current total direct compensation of the individual being considered. The Compensation Committee’s determination of compensation levels for our Named Executive Officers therefore differs depending upon these factors. Our Compensation Committee also exercises appropriate business judgment in how it applies these standard approaches to the facts and circumstances involving each respective Named Executive Officer.

The Compensation Committee determines each component of a Named Executive Officer’s compensation based on its collective assessment of the officer’s performance, the Company’s overall financial performance and recommendations of our Chairman, President & CEO. Our Compensation Committee may also request executive compensation guidance and advice from an independent outside consultant when deciding compensation for our Named Executive Officers. The Compensation Committee meets annually (near the end of the year) to review the compensation of our Named Executive Officers. The Compensation Committee also meets during the first quarter of each year to determine the level of attainment of prior year performance objectives as they relate to the cash annual incentive program and the grant of performance stock in prior years and to consider base salary levels, the cash annual incentive program and granting new equity or incentive compensation awards for the current year and setting performance objectives related to each. Our Chairman, President and CEO is not present during the Compensation Committee’s deliberation and determination of his own compensation.

Risk Management Related to Compensation. When reviewing and implementing the executive compensation program, the Company and our Compensation Committee formulate and adhere to certain practices that ensure consistent leadership and decision-making among our executive officers. The Compensation Committee assesses whether our program and practices are reasonably likely to have a material adverse effect on the Company and concluded they do not. The Compensation Committee does not believe our executive compensation program and practices are designed to promote or encourage unreasonable risk for the following reasons:

•Base salaries are fixed amounts determined on an annual basis and are established after considering a broad range of factors including competitive pay sources (rather than specific performance measures).

•Annual cash incentive compensation represents a significant portion of our executive officers’ total cash compensation and is awarded under our Annual Incentive Program. The program allows for the Compensation Committee to exercise some discretion through an individual performance metric, in addition to the financial performance metrics. Annual incentive targets are thoroughly vetted by management and the Compensation Committee, and goals are set taking into consideration the probability of achievement. Payouts are capped at 200%, are formulaic based, and are subject to recoupment.

•Long-term incentive compensation is important to further aligning our executive officers’ interests with those of our stockholders, and it balances short- and long-term decision-making by our executives. Long-term incentive compensation is split between time-based restricted stock and performance stock. The time-based restricted stock vests over three years. Performance stock achievement levels are capped at 200%, with a total shareholder return modifier if achievement is over 150%, have a three-year cliff vesting, and are subject to recoupment.

•The vesting of stock awards granted under our Equity Plan may be prohibited if an executive officer is terminated for cause or under other circumstances as provided in the Equity Plan.

•Our executives have significant stock ownership in the Company, subject to stock ownership guidelines and a hedging and pledging policy. With respect to their stock ownership, our executive officers could lose significant value if our stock price was exposed to unreasonable risk.

When structuring overall compensation practices for our non-executive employees, we consider whether our practices incentivize unreasonable risk-taking behavior and could consequently impact our risk management and oversight. We also evaluate the mix of pay and the elements of our compensation programs as they apply to employees generally. Our non-executive employee compensation practices are reviewed in the context of current

and significant risks to determine if the practices encourage or induce employees to take unreasonable risks, and we also take into account our other policies and procedures that operate to monitor and deter unreasonable risk (such as disciplinary or record-keeping policies). Management also notifies our Compensation Committee of significant and across-the-board modifications to employee compensation practices. We concluded that our non-executive employee compensation practices do not encourage risks that are reasonably likely to have a material adverse effect on us.

Hedging and Pledging Policy. Named Executive Officers are subject to a policy on hedging and pledging of the Company’s common stock. The policy prohibits purchasing any financial instrument or entering into any transaction that is designed to hedge or offset any decrease in the market value of the Company’s common stock, including puts, calls, prepaid variable forward contracts, equity swaps, collars, exchange funds (excluding broad-based index funds), and other financial instruments that are designed to or have the effect of hedging or offsetting any decrease in the market value of the Company’s common stock. The policy also provides that Named Executive Officers shall not pledge, hypothecate, or otherwise encumber shares of the Company’s common stock as collateral for indebtedness including, but not limited to, holding shares in a margin account or any other account that could cause the Company’s common stock to be subject to a margin call or otherwise be available as collateral for a margin loan. Each Named Executive Officer certified to compliance with this policy in their annual questionnaire completed at the end of 2021.

Executive Stock Ownership. The Company’s executive officers and Senior Vice Presidents are subject to stock ownership guidelines. Stock ownership includes: (i) common stock owned (directly or indirectly), (ii) time-vested restricted stock, (iii) performance stock already earned and subject to continued time vesting and (iv) benefit plan shares. Ownership guidelines vary based on position and require the executive to own stock with a market value equal to or in excess of a specified multiple of the officer’s base salary. During 2021, the executive ownership guidelines were as follows: Chief Executive Officer–7.0 times, Chief Operating Officer–3.5 times, Executive Vice President–3.5 times and Senior Vice President–2.5 times. Any officer not meeting the ownership guidelines will be required to retain 75% of after-tax shares earned from long-term incentives until the ownership guideline is achieved. All of the Company’s executive officers and members of senior management covered by these guidelines had met their ownership requirement, other than Mr. Mahon who joined the Company in June 2020.

Recoupment Policy. AIP payouts and performance-based restricted stock awards to the executive officers paid within the twelve months following the year of a material accounting restatement may be recouped if the inaccurate financial information was used to determine the AIP or performance-based restricted stock payouts. Determination to recoup any awards will be at the discretion of the Board of Directors of the Company and may apply to current or former Company executive officers. The Company has not had any accounting restatements since becoming a publicly-traded company in 1986.

Tax Deductibility of Executive Compensation; Accounting Considerations. Generally, executive compensation is accrued as expense over the requisite service period related to the particular compensation element (this period is typically equal to the performance period of the executive officer), and we realize a tax deduction upon the payment of the compensation to the executive. Effective January 1, 2018, under the Tax Cuts and Jobs Act of 2017, (i) the performance-based exception to Section 162(m) is eliminated and (ii) the definition of covered employee is expanded to include the CFO and certain former executive officers, resulting in pay in excess of $1 million in 2018 or later generally not being deductible for the Company, subject to the transition rule for plans and agreements in place on November 2, 2017. The Compensation Committee carefully considers and monitors the effect of Section 162(m) on the elements of our executive compensation program and will strive to structure executive compensation to preserve its tax deductibility under Section 162(m) without sacrificing our ability to attract, motivate and retain high-quality executive officers. The Compensation Committee also believes there are circumstances where the interests of the Company and our stockholders are best served by maintaining flexibility in the manner compensation is provided. In those events, the Compensation Committee may, at its discretion, approve payments of nondeductible compensation if the Compensation Committee believes the circumstances warrant such payments. Because of the importance of linking pay and performance, the Compensation Committee expects to continue to impose performance conditions on its annual and long-term incentive compensation elements.

REPORT OF THE COMPENSATION COMMITTEE

The following report of the Compensation Committee shall not be deemed to be “soliciting material” or to otherwise be considered “filed” with the U.S. Securities and Exchange Commission, nor shall this report be subject to Regulation 14A (other than as indicated) or to the liabilities set forth in Section 18 of the Securities Exchange Act of 1934. This report shall not be deemed to be incorporated by reference into any prior or subsequent filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent that the Company specifically incorporates it by reference or treats it as soliciting material.

In conjunction with the preparation of the Annual Report on Form 10-K for 2021 of Werner Enterprises, Inc. (the “Company”) and this Proxy Statement for the Annual Meeting of Stockholders to be held May 10, 2022, the Compensation Committee has reviewed and discussed with management the foregoing Compensation Discussion and Analysis section (required by Item 402(b) of Regulation S-K of the U.S. Securities and Exchange Commission) of this Proxy Statement.

Based on such review and discussion, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis section be included in this Proxy Statement and incorporated by reference into the Company’s Annual Report on Form 10-K for 2021.

Diane K. Duren, Chair

Scott C. Arves

Kenneth M. Bird, Ed.D.

Jack A. Holmes

Carmen A. Tapio

Alexi A. Wellman

EMPLOYMENT ARRANGEMENTS

Each of our Named Executive Officers has been an employee of the Company for at least ten years. None of our Named Executive Officers has any type of written employment agreement with us.

ARRANGEMENTS AND POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL

In February 2021, the Board adopted a Change in Control Severance Plan (the “CIC Plan”) that covers the Named Executive Officers. The CIC Plan only covers qualifying terminations in connection with a change in control (i.e., double trigger). The protection period for the CIC Plan is for 24 months beginning on the date of the change in control. In the event a Named Executive Officer is terminated without “cause” or voluntarily resigns for “good reason” within the protection period noted above, the CIC Plan provides for cash severance payments ranging from 1.5 to 2.0 times annual base salary plus target AIP bonus and provides for limited continuation of some benefits. The definitions of “change in control”, “good reason” and “cause” are similar to the definitions of these terms in the Equity Plan. The Werner Enterprises, Inc. Change in Control Severance Plan is included as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on February 28, 2022.

Our Equity Plan permits the vesting of outstanding equity awards upon certain termination or resignation actions following a change in control. The Equity Plan provides that if a Named Executive Officer is terminated other than for “cause” or voluntarily resigns for “good reason” within the period beginning upon a change in control and ending on the second anniversary of the change in control, then (i) all outstanding stock options and SARs will become fully exercisable and (ii) all conditions, performance objectives and restrictions (other than those imposed by law) on outstanding restricted stock, RSUs and performance stock will be deemed satisfied as of the executive officer’s employment termination date. “Cause,” “good reason” and “change in control” are defined in the current stockholder-approved version of the Equity Plan. Our Equity Plan also provides that upon death of a participant, (i) all service period restrictions applicable to restricted stock and RSUs will lapse and such shares shall become fully vested and (ii) for any unearned performance shares, the performance objectives will be evaluated for actual performance to date and the resulting shares shall become fully vested.

Except for the circumstances described above, none of our Named Executive Officers who were serving as executive officers at the end of 2021 has a severance agreement or severance benefit arrangement with us.

Summary Table - Potential Payments Upon Termination or Change in Control. The following table summarizes potential payments upon termination or change in control for the Named Executive Officers who were still serving as executive officers as of December 31, 2021. Except as specifically indicated in the footnotes to the table below, we used the following assumptions in calculating the amounts included in the table and discussed below:

•As required by SEC rules, we assume the triggering event causing the payment occurred on December 31, 2021, the last business day of our last completed fiscal year, and the price per share of our common stock was $47.66, the NASDAQ closing market price on that date.

•We treat all amounts of base salary and annual cash incentive that were earned and accrued, including any 401k matching contributions, as of the date of the triggering event as paid immediately prior to the triggering event.


POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
Name		Event of Termination	Severance ($) (1)	Stock-Based Awards ($) (2)	Perquisites and Other Benefits ($) (3)	Total ($)
Derek J. Leathers		Change in control	3,400,000	10,548,969	22,542	13,971,511
		Death	—	8,918,902	—	8,918,902
H. Marty Nordlund		Change in control	1,045,500	1,797,163	19,446	2,862,109
		Death	—	1,593,417	—	1,593,417
John J. Steele		Change in control	816,000	1,366,317	19,806	2,202,123
		Death	—	1,191,691	—	1,191,691
Jim S. Schelble		Change in control	960,000	1,366,317	12,031	2,338,348
		Death	—	1,191,691	—	1,191,691
James L. Johnson		Change in control	1,008,000	1,366,317	28,202	2,402,519
		Death	—	1,191,691	—	1,191,691

(1)	Represents lump sum cash severance payments, in accordance with the Change in Control Severance Plan, equal to each Named Executive Officer’s Tier Level Multiplier, ranging from 1.5 to 2.0, times the sum of each Named Executive Officer’s (i) 2021 base salary and (ii) 2021 target cash incentive. The amounts are to be paid within 60 days following the date of the triggering event.
(2)	In certain events, the Equity Plan provides for accelerated vesting of all unvested restricted and performance stock awards. Unless otherwise noted, the amounts represent the estimated fair value of all unvested equity awards as of December 31, 2021 using the $47.66 closing market price as of that date. Additional information regarding the estimated fair value of performance stock is as follows: (i) the 2021 performance stock was deemed to have been earned at the target level (in the event of termination or resignation following a change in control) or unearned (in the event of death); (ii) the 2020 performance stock was deemed to have been earned at 200% because the Company has achieved that level of performance for the two-year performance period and the absolute total shareholder return exceeds the 25% cap at December 31, 2021; and (iii) the 2019 performance stock was deemed to have been earned at 87.8% because the Company has achieved that level of performance for the two-year performance period and the absolute total shareholder return cap does not apply to awards where the level of performance is less than 150%.
(3)	Under the Change in Control Severance Plan, this represents the estimated employer portion of premium costs for the continuation of medical, and dental coverage under COBRA for a period (in months) equal to each Named Executive Officer’s Tier Level Multiplier, ranging from 1.5 to 2.0, times 12 (“Coverage Period”). Premium cost reimbursements by the Company will continue through the Coverage Period unless the Named Executive Officer ceases to be eligible under COBRA or he becomes eligible for coverage under the health benefit plan of a subsequent employer.

SUMMARY COMPENSATION TABLE

The following table presents information about compensation earned during 2021, 2020 and 2019 by our Named Executive Officers. You should read the Summary Compensation Table in conjunction with the Compensation Discussion and Analysis section and the tables and narrative descriptions that follow. Columns required by SEC regulations are omitted where such column is inapplicable for all of the Named Executive Officers.


SUMMARY COMPENSATION TABLE
Name and Principal Position		Year	Salary (1)	Bonus ($)	Stock Awards ($) (2)	Non-Equity Incentive Plan Compensation ($) (3)	All Other Compensation ($) (4)	Total ($)
Derek J. Leathers – President & Chief Executive Officer		2021	844,231	—	2,800,000	1,574,200	95,920	5,314,351
		2020	773,077	—	2,800,000	1,193,600	43,352	4,810,029
		2019	725,000	—	2,250,000	499,525	47,488	3,522,013
H. Marty Nordlund – SEVP & Chief Operating Officer		2021	405,962	—	350,000	463,505	44,236	1,263,703
		2020	376,442	—	450,000	364,350	44,487	1,235,279
		2019	375,000	—	550,000	163,538	45,990	1,134,528
John J. Steele – EVP, Treasurer & Chief Financial Officer		2021	337,116	—	300,000	331,908	10,089	979,113
		2020	311,596	—	400,000	270,270	10,135	992,001
		2019	285,000	—	300,000	117,819	13,177	715,996
Jim S. Schelble – EVP & Chief Administrative Officer		2021	394,231	—	300,000	408,480	33,104	1,135,815
		2020	345,192	—	400,000	317,310	37,703	1,100,205
		2019	310,000	—	300,000	123,132	39,066	772,198
James L. Johnson – EVP, Chief Accounting Officer & Corporate Secretary(5)		2021	413,077	—	300,000	428,904	12,261	1,154,242
		2020	355,231	—	400,000	317,736	10,946	1,083,913


(1)	Base salary for 2020 reflects 27 biweekly payments instead of 26, as well as voluntary base salary reductions by the Named Executive Officers in light of the unknown impact from the COVID-19 pandemic. In April 2020, Mr. Leathers reduced his base salary for second quarter 2020 only by 25%. Messrs. Nordlund, Steele, Schelble, and Johnson reduced their respective base salaries for second quarter 2020 only by 15% each.
(2)	The stock awards reported in this column and the associated valuation assumptions are also disclosed in the Grants of Plan-Based Awards for 2021 table. The stock awarded in 2021 includes both restricted stock and performance stock. Reported amounts for restricted stock represent the grant date fair value and for performance stock represent the grant date fair value based on the probable outcome of the performance conditions (target level). The target value of the 2021 performance awards was as follows: Mr. Leathers $1,400,000, Mr. Nordlund $175,000 and Messrs. Steele, Schelble and Johnson $150,000. If the highest level of performance is achieved, the value of the 2021 awards would be as follows: Mr. Leathers $2,800,000, Mr. Nordlund $350,000 and Messrs. Steele, Schelble and Johnson $300,000.
(3)	Cash awards reported in this column represent the actual amounts earned under the Company’s performance-based AIP for fiscal years 2021, 2020 and 2019 based upon achievement of pre-defined performance metrics, and were paid in February following the end of each fiscal year. Such awards are also disclosed in the Grants of Plan-Based Awards for 2021 table.
(4)	Refer to the All Other Compensation for 2021 table for a more detailed explanation of the compensation reported in this column.
(5)	Mr. Johnson was not a Named Executive Officer in 2019.

ALL OTHER COMPENSATION FOR 2021

The table below shows the components of “all other compensation” provided in 2021 to the Named Executive Officers, as reported in the preceding Summary Compensation Table.


ALL OTHER COMPENSATION FOR 2021
Name		Perquisites & Other Personal Benefits ($)		Tax Reimbursements ($)		Company Contributions to 401(k) Plan ($)		Company Contributions to Employee Stock Purchase Plan ($)		Total ($)
Derek J. Leathers (1)			75,562		12,297		5,000		3,061		95,920
H. Marty Nordlund (2)			23,929		12,246		5,000		3,061		44,236
John J. Steele (3)			2,700		—		5,000		2,389		10,089
Jim S. Schelble (2)			20,858		4,185		5,000		3,061		33,104
James L. Johnson (3)			4,200		—		5,000		3,061		12,261

(1)	Perquisites and other personal benefits for Mr. Leathers include use of one Company vehicle, $54,424 personal use of Company aircraft, Company-paid country club membership, and personal medical care membership program. Tax reimbursements for Mr. Leathers represent tax gross-ups for Company vehicle use.
(2)	Perquisites and other personal benefits for Messrs. Nordlund and Schelble include use of one Company vehicle, Company-paid country club membership, and personal medical care membership program. Tax reimbursements for Messrs. Nordlund and Schelble represent tax gross-ups for Company vehicle use.
(3)	Perquisites and other personal benefits for Messrs. Steele and Johnson include personal medical care membership program. Mr. Johnson also received a years-of-service award.

Our contributions on behalf of the Named Executive Officers to the 401(k) plan and employee stock purchase plan are made on the same terms as provided to all of our eligible employees in the United States. In addition to the above-mentioned compensation, the Named Executive Officers may also participate in voluntary health and welfare benefit programs that are available for all eligible U.S. employees.

GRANTS OF PLAN-BASED AWARDS FOR 2021

Equity and non-equity incentive plan awards granted to Named Executive Officers during 2021 included the following:

•Non-equity incentive plan: cash annual incentive compensation awarded under the performance-based AIP, with performance metrics for operating income, revenues, operating ratio and individual performance for fiscal 2021. The actual AIP payouts earned for 2021 are disclosed in the Summary Compensation Table and were paid in February 2022.

•Equity incentive plan: awards of performance stock under our Equity Plan, with an earnings per diluted share performance metric for the two-year period from January 1, 2021 to December 31, 2022. No shares are earned for performance below the threshold level.

•Stock awards: restricted stock awards subject to time-based vesting.

The following table sets forth information regarding equity and non-equity incentive plan awards granted to Named Executive Officers during 2021. Columns required by the SEC regulations are omitted where such column is not applicable for all of the Named Executive Officers. The awards reported in the following table are also disclosed in the Summary Compensation Table and Outstanding Equity Awards at December 31, 2021 tables and therefore do not constitute additional compensation not otherwise reported in this Proxy Statement.

GRANTS OF PLAN-BASED AWARDS FOR 2021

Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards

Estimated Future Payouts
Under Equity Incentive
Plan Awards

All Other

Stock

Awards:

Number of

Shares of

Stock (#)

Grant Date

Fair Value

of Stock

Awards

($) (1)

Name

Grant

Date

Threshold

($)

Target ($)

Maximum

($)

Threshold

(#)

Target (#)

Maximum

(#)

Derek J. Leathers

212,500

850,000

1,700,000

2/11/21

17,101

34,202

68,404

1,400,000

2/11/21

33,902

1,400,000

H. Marty Nordlund

SEC Form DEF 14A filed by Werner Enterprises Inc.