(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No 

Common shares of the registrant outstanding at July ~~22, 2022~~27, 2023 were ~~63,505,194~~45,852,997.

This Quarterly Report on Form 10-Q (this Report) of Daseke, Inc. ~~(Daseke or the Company)~~(Daseke) contains ~~forward-looking statements~~“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Except as otherwise indicated by the context, references in this Report to the “Company,” “we,” “us” and “our” are to ~~the~~Daseke together with its consolidated ~~business of the Company.~~subsidiaries. All statements in this Report, other than statements of historical fact, are forward-looking statements. Forward-looking statements may be identified by the use of words such as “may,” “will,” “expect,” “anticipate,” “continue,” “estimate,” “project,” “believe,” “plan,” “should,” “could,” “would,” “forecast,” “seek,” “target,” “predict,” and “potential,” the negative of these terms, or other comparable terminology. Forward-looking statements may include statements about the Company’s ~~goals; the Company’s~~goals, business strategy and plans; the Company’s financial strategy, liquidity and capital required for its business strategy and plans; the Company’s competition and government regulations; general economic conditions; and the Company’s future operating results.

These forward-looking statements are based on information available as of the date of this Report, and current expectations, forecasts, and assumptions. While management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting us will be those that the Company anticipates. Accordingly, forward-looking statements should not be relied upon as representing the Company’s views as of any subsequent date, and the Company does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Readers are cautioned not to place undue reliance on the forward-looking statements.

Forward-looking statements are subject to risks and uncertainties (many of which are beyond ~~the Company’s~~our control) that could cause actual results ~~to differ materially from the Company’s historical experience and our present expectations~~ or ~~projections. Important factors that could cause actual results~~outcomes to differ materially from those ~~in the~~indicated by such forward-looking ~~statements~~statements. These factors include, but are not limited to, general economic and business risks, such as downturns in customers’ business cycles and recessionary economic cycles, changes in customers’ inventory levels and in the availability of funding for their working capital, disruptions in capital and credit markets, ~~and~~ inflationary cost ~~pressures;~~pressures and rising interest rates; the Company’s ability to adequately address downward pricing and other competitive pressures; the Company’s insurance or claims expense; driver shortages and increases in driver compensation or ~~owner operator~~owner-operator contracted rates; fluctuations in the price or availability of diesel fuel; increased prices for, or decreases in the availability of, new revenue equipment and decreases in the value of used revenue equipment; ~~impact to the Company’s business~~supply chain disruptions and ~~operations resulting from the COVID-19 pandemic;~~constraints generally; seasonality and the impact of weather and other catastrophic events; the Company’s ability to secure the services of third-party capacity providers on competitive terms; loss of key personnel; a failure of the Company’s information systems, including disruptions or failures of services essential to our operations or upon which our information technology platforms rely, data or other security breach, or cybersecurity incidents; the Company’s ability to execute and realize all of the expected benefits of its integration, business improvement and comprehensive restructuring plans; the Company’s ability to realize all of the intended benefits from acquisitions ~~and~~or investments; the Company’s ability to complete divestitures successfully; the Company’s ability to generate sufficient cash to service all of the Company’s ~~indebtedness and~~indebtedness; the Company’s ability to finance its capital requirements; ~~restrictions in its existing and future debt agreements; increases in interest rates;~~ changes in existing laws or regulations, including environmental and worker health safety laws and regulations and those relating to tax rates or taxes in general; the impact of governmental regulations and other governmental actions related to the Company and its operations; and litigation and governmental proceedings. For additional information regarding known material factors that could cause the Company’s actual results to differ from its projected results, please see the Company’s filings with the Securities and Exchange Commission (the SEC), particularly the section titled “Part I. Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 23, ~~2022.~~2023. Additional risks or uncertainties that are not currently known to us, that we currently deem to be immaterial, or that could apply to any company could also materially adversely affect our business, financial condition, or future results.

All forward-looking statements, expressed or implied, attributed to the Company or persons acting on its behalf are expressly qualified in their entirety by this cautionary statement.

The accompanying notes are an integral part of the consolidated financial statements.

NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

~~Daseke is~~We are a premier North American transportation solutions specialist dedicated to servicing challenging industrial end-markets through experienced people and a fleet of more than ~~4,500~~4,800 tractors and ~~11,000~~10,800 flatbed and specialized ~~trailers, and has operations throughout~~trailers. The Company delivers its diverse offering of solutions to thousands of customers across the United States, Canada and Mexico. ~~The~~In addition to transporting freight with tractors and trailers, the Company also provides logistical planning and warehousing ~~services~~solutions to customers. The Company is subject to regulation by the Department of Transportation, the Department of Defense, the Department of Energy, and various state regulatory authorities in the United States. The Company is also subject to regulation by the Ministries of Transportation and Communications and various provincial regulatory authorities in Canada.

Basis of Presentation

These interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (US GAAP) for interim financial information and with the instructions for Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended June 30, ~~2022~~2023 are not necessarily indicative of the results that may be expected for the year ended December 31, ~~2022.~~2023.

The consolidated balance sheet as of December 31, ~~2021~~2022 has been derived from the audited consolidated financial statements at that date. For additional information, including the Company’s significant accounting policies, refer to the consolidated financial statements and related footnotes for the year ended December 31, ~~2021~~2022 as set forth in the Company’s Annual Report on Form 10-K, filed with the SEC on February 23, ~~2022.~~2023.

~~Fair Value Measurements~~

The Company follows the accounting guidance for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It also establishes a framework for measuring fair value and expands disclosures about fair value measurements. The three levels of the fair value framework are as follows:

~~Level 1 – Quoted market prices in active markets for identical assets or liabilities.~~

~~Level 2 – Observable market-based inputs or unobservable inputs that are corroborated by market data.~~

~~Level 3 – Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets.~~

~~A financial asset or liability’s classification within the framework is determined based on the lowest level of input that is significant to the fair value measurement.~~

The Company may be required, on a non-recurring basis, to adjust the carrying value of the Company’s property and equipment, intangible assets, goodwill and contingent consideration. When necessary, these valuations are determined by the Company using Level 3 inputs. These assets are subject to fair value adjustments in certain circumstances, such as when there is evidence that impairment may exist.

~~The Company’s warrant liabilities are included within the Level 1 and Level 3 fair value hierarchy. There was~~ 0 ~~warrant liability as of June 30, 2022.~~ ~~The following table sets forth by level within the fair value hierarchy the Company’s warrant liability that were accounted for at fair value as of December 31, 2021 (in millions):~~

Fair value as of December 31, 2021

Liabilities:

Level 1

Level 2

Level 3

Total

Warrant liability

$
2.7

$
0

$
2.0

$
4.7

Total fair value

$
2.7

$
0

$
2.0

$
4.7

~~The table below is a summary of the changes in the fair value of the warrant liability within the Level 3 fair value hierarchy for the six months ended June 30, 2022 (in millions):~~

Six Months Ended

June 30, 2022

Balance at beginning of period

$
2.0

Change in fair value

(2.0
)
Balance at end of period

$
0

~~Table of Contents~~

Common Stock Purchase Warrants

~~The Company’s~~Daseke’s common stock purchase warrants expired in accordance with their terms on February 27, 2022 and are no longer exercisable. During the first quarter of 2022, prior to their expiration, there were 1,635,296 warrants exercised for 817,648 shares of ~~the Company’s~~Daseke’s common stock in exchange for $9.4 million in proceeds to the Company.

Series B Preferred Stock

In May 2023, Daseke redeemed all 20,000 shares of issued and outstanding Series B-1 perpetual preferred stock by paying $20.3 million in cash, which consisted of $20.0 million liquidation preference, plus $0.3 million in accrued and unpaid dividends. As of June 30, 2023, as a result of such redemption, the Company has recorded an estimated $0.2 million excise tax liability for share repurchases, net of issuances.

Recently Issued Accounting Pronouncements

In ~~August 2020,~~June 2016, the Financial Accounting Standards Board (the FASB) issued ~~ASU 2020-06 – Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40):~~ Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The guidance simplifies the accounting for convertible debt and convertible preferred stock by removing the requirements to separately present certain conversion features in equity. In addition, the amendments also simplify the guidance in ASC Subtopic 815-40, Derivatives and Hedging: Contracts in Entity’s Own Equity, by removing certain criteria that must be satisfied in order to classify a contract as equity, which is expected to decrease the number of freestanding instruments and embedded derivatives accounted for as assets or liabilities. Finally, the amendments revise the guidance on calculating earnings per share, requiring use of the if-converted method for all convertible instruments and rescinding an entity’s ability to rebut the presumption of share settlement for instruments that may be settled in cash or other assets. The Company adopted this guidance as of January 1, 2022. The adoption did not have a material impact on the Company’s consolidated financial statements.

~~In March 2020, the FASB issued ASU 2020-04~~– Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments provide optional guidance for a limited time to ease the potential burden in accounting for reference rate reform. The new guidance provides optional expedients and exceptions for applying US GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The provisions of this update are effective for all entities as of March 20, 2020 through December 31, 2022 and apply only to contracts and hedging relationships that reference LIBOR or another reference rate expected to be discontinued due to reference rate reform. In addition, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848) – Scope, to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. ASU 2020-04 ~~is not expected to have a material impact on the Company’s consolidated financial statements.~~

In ~~December 2019, the~~ ~~FASB issued ASU No.2019~~-~~12 – Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes, as part of its initiative to reduce complexity in the accounting standards. The amendments in ASU 2019~~-12 eliminate certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-~~12 also clarifies and simplifies other aspects of the accounting for income taxes.~~ ~~The Company adopted this guidance as of January 1, 2022. The adoption of this standard did not have a material impact on the Company's consolidated financial statements.~~

~~In June 2016, the FASB issued ASU~~Standard Update (ASU) No. 2016-13, Accounting for Credit Losses (Topic 326). ASU 2016-13 requires the use of an “expected loss” model on certain types of financial instruments. The ASU sets forth a “current expected credit loss” model which requires the Company to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets, including trade receivables. In addition, in March 2022, the FASB issued ASU No. 2022-02, Financial Instruments - Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage Disclosures to improve the decision usefulness of information provided to investors concerning certain loan refinancings, restructurings and writeoffs. The ~~new standard will become effective for the~~ Company ~~beginning with the first quarter~~adopted these ASUs as of ~~2023 and is~~January 1, 2023. The adoption did not ~~expected to~~ have a material impact on the ~~Company’s~~Company's consolidated financial statements.

Table of Contents

Lease Income

The Company leases tractors and trailers to certain of its owner operators and accounts for these transactions as operating leases. These leases typically have terms of 30 to 72 months and are collateralized by a security interest in the related revenue equipment. The Company recognizes income for these leases as payments are received over the lease term, which are reported inas a reduction of purchased freight on the consolidated statements of operations and comprehensive income. The Company's equipment leases may include options for the lessee to purchase the equipment at the end of the lease term or terminate the lease prior to the end of the lease term. When an asset reaches the end of its useful economic life, the Company disposes of the asset.

Lease income from lease payments related to these operating leases for the three ~~and six~~ months ended June 30, 2023 and 2022 was $~~8.1~~8.2 million and $~~15.7~~8.1 million, respectively. Lease income from lease payments related to these operating leases for the ~~three and~~ six months ended June 30, ~~2021~~2023 and 2022 was $~~7.0~~16.1 million and $~~13.0~~15.7 million, respectively.

NOTE 2 ~~– ACQUISITIONS~~

~~On March 3, 2022, the Company acquired~~ ~~100% of the outstanding stock of SJ Transportation Co., Inc. (SJ Transportation) for consideration net of cash acquired of $19.3~~ million, which was funded with cash on hand. The acquisition was a stock purchase under US GAAP. A Section 338(h)(10) election is being filed for the entity acquired which will deem the acquisition as an asset purchase for tax purposes; therefore approximately $~~8.1~~ ~~million of the values assigned to goodwill are expected to be deductible for tax purposes. Approximately $0.2~~ ~~million of transaction expenses were incurred in the acquisition, which are not deductible for tax purposes.~~

~~The following is a summary of the preliminary allocation of the purchase price paid to the fair values of the net assets, net of cash acquired (in millions):~~

SJ Transportation

Accounts receivable

$
3.4

Other current assets

1.8

Property and equipment

10.0

Goodwill

8.1

Accounts payable and other liabilities

(4.0
)
Total

$
19.3

The aggregate purchase price noted above was allocated to the major categories of assets acquired and liabilities assumed at estimated fair values as of the acquisition date, which were based, in part, upon outside preliminary appraisals for certain assets and subject to change when additional information concerning final asset and liability values is obtained.

The Company has not completed its assessments of the fair value of purchased intangible assets and no value has been allocated to them at this time. The final purchase price allocations may result in adjustments to certain assets and liabilities, including the residual amount allocated to goodwill.

~~For the~~ ~~three months ended June 30, 2022, revenue and net income of the acquired company, post-acquisition date, was $6.8~~ ~~million and $0.6~~ ~~million, respectively, and for the six months ended June 30, 2022, $8.7~~ ~~million and $0.7~~ ~~million, respectively.~~

~~Supplemental Pro Forma Information (Unaudited)~~

The following supplemental pro forma financial information reflects the SJ Transportation acquisition as if it occurred on January 1, 2021 (in millions). This pro forma financial information has been presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been achieved had the pro forma events taken place on January 1, 2021. Further, the pro forma financial information does not purport to project the future operating results of the consolidated company.

Three Months Ended June 30,

Six Months Ended June 30,

(in millions, except per share amounts)

2022

2021

2022

2021

Pro forma revenue

$
481.3

$
409.9

$
906.2

$
749.9

Pro forma net income

$
17.7

$
36.0

$
30.9

$
29.4

Pro forma earnings per common share:

Basic

$
0.26

$
0.53

$
0.44

$
0.41

Diluted

$
0.24

$
0.50

$
0.43

$
0.40

~~Table of Contents~~

~~NOTE 3~~ – OTHER CURRENT ASSETS

The components of other current assets are as follows ~~as of June 30, 2022 and December 31, 2021~~ (in millions):


	June 30,		December 31,		June 30,		December 31,
	2022		2021		2023		2022
Income tax receivable					$	12.1	$	13.8
Prepaid insurance	$	7.7	$	7.5		10.2		8.4
Prepaid licensing, permits and tolls		7.3		4.8		5.3		5.0
Prepaid income taxes		2.8		0.1
Parts supplies		4.7		3.5		4.3		4.2
Other prepaids		2.3		2.6		3.5		2.9
Income tax receivable		1.9		1.9
Prepaid software		1.7		1.1		1.2		1.3
Prepaid highway and fuel taxes		0.2		1.1		0.3		1.1
Prepaid taxes						1.3		1.2
Total	$	28.6	$	22.6	$	38.2	$	37.9

NOTE 43 – INTEGRATION AND RESTRUCTURING

During the first quarter of 2022, the Company internally announced a phased integration and restructuring plan ~~(Transformation Plan or the~~(the Plan)~~, with the first phase integrating~~ 5 ~~operating segments into~~ 3 ~~other operating segments,~~. Our goal is to drive synergies and improve profitability through cost reduction, network optimization and commercial initiatives which will ~~reduce~~be facilitated by the ~~number~~continued integration of ~~overall~~our operating ~~segments from~~companies into a subset of our highest-performing platform companies. We believe these measures will unite teams across the Company around a culture of close coordination and continuous improvement, providing for opportunistic expansion into incremental services, geographies, and industrial end markets. These efforts provide a preview of the potential of 11One Daseke to 6~~. The second~~, our name for the initiatives through which we are driving the next phase of our Company’s growth - one that benefits from the ~~Plan will integrate those~~ 6 ~~operating segments into~~ 4 or 5 ~~operating segments.~~sharing of best practices, the optimization of processes, and the technology enablement necessary to better engage our customers and drivers. As of June 30, ~~2022,~~2023, we had 10nine operating segments. The Transformation Plan is intended to reduce the Company’s cost base, right size its organization and management team and increase and accelerate its previously announced operational improvement goals. In addition, the Company anticipates additional revenue opportunities driven by synergies from optimizing a consolidated operation, including empty mile reduction, pricing improvements, and additional seated truck contribution.

The integration and restructuring costs, which we expect to incur over the next several years, may consist of employee-related costs and other transition and termination costs related to restructuring activities. Employee-related costs include severance, tax preparation, and relocation costs, which are accounted for in accordance with ASC 420 Exit or Disposal Cost Obligations. Other transition and termination costs may include fixed asset-related charges, contract and lease termination costs, professional fees, and other miscellaneous expenditures associated with the integration or restructuring activities, which are expensed as incurred. Costs are reported in restructuring ~~charges~~ in the consolidated statements of operations and comprehensive income. ~~The obligation related to employee separation costs is included in other current liabilities in the consolidated balance sheets.~~

The Company recorded a $~~0.6~~0.7 million reduction to integration and restructuring expenses, related to a prior quarter reclassification of $0.7 million to acquisition-related transaction expenses in the three months ended June 30, 2023, comprised of a $0.4 million reduction in the Specialized Solutions segment and $~~1.2~~0.3 million reduction in the Flatbed Solutions segment. The Company recorded $0.3 million of integration and restructuring expenses, primarily related to $1.0 million in professional fees partially offset by a $0.7 million prior quarter reclassification to acquisition-related transaction expenses, in connection with the Plan in the ~~three and~~ six months ended June 30, ~~2022, respectively~~2023, .comprised of $0.3 million in the Specialized Solutions segment and $0 in the Flatbed Solutions segment. As of June 30, ~~2022,~~2023, we have incurred a cumulative total of $~~1.2~~2.7 million in integration and restructuring costs since inception of the Plan.

Impairments

During the three months ended June 30, 2023, the Company made a decision to no longer use the trade name of an operating segment within the Flatbed Solutions segment. As a result, the Company determined there were indicators of impairment regarding this operating segment’s trade name intangibles and goodwill. The Company ~~completed~~determined that the ~~previously announced internal restructuring (Project Pivot) and integration (Project Synchronize) plans as of December 31, 2021 and does not expect any future material restructuring costs~~carrying value was less than the fair value associated with ~~those prior plans. As~~this integrated operating segment’s goodwill, which was determined using a combination of ~~December 31, 2021, the Company had incurred a cumulative total of $~~discounted expected future cash flows (income~~9.9~~ ~~million in integration and restructuring costs related to Project Pivot and Project Synchronize.~~

108

Table of Contents

~~The following table summarizes~~approach) and guideline public companies method (market approach). However, it was determined that the ~~integration and restructuring costs as~~trade name intangibles carrying value was greater than its fair value. As such, the Company recorded a trade name intangibles impairment charge of $1.5 million in the Flatbed Solutions segment during the three months ended June 30, ~~2022 (in millions):~~

Severance

Operating

and

Lease

Other Payroll

Termination

Other

Total

Balance at December 31, 2021

$
—

$
—

$
—

$
—

Specialized Solution

Costs accrued

0.2

—

0.3

0.5

Amounts paid or charged

(0.2
)

—

(0.3
)

(0.5
)
Specialized Solution balance at June 30, 2022

—

—

—

—

Flatbed Solution

Costs accrued

—

—

—

—

Amounts paid or charged

—

—

—

—

Flatbed Solution balance at June 30, 2022

—

—

—

—

Corporate

Costs accrued

—

—

0.7

0.7

Amounts paid or charged

—

—

(0.7
)

(0.7
)
Corporate balance at June 30, 2022

—

—

—

—

Consolidated

Costs accrued

0.2

—

1.0

1.2

Amounts paid or charged

(0.2
)

—

(1.0
)

(1.2
)
Consolidated balance at June 30, 2022

$
—

$
—

$
—

$
—

~~Impairments~~2023. The impairment charge is included in impairment in the consolidated statements of operations and comprehensive income.

During the three months ended June 30, 2022, the Company made a decision to no longer use the trade name of an operating segment within the Specialized Solutions segment that had been integrated into another operating segment as part of the Plan. In addition, as of June 30, 2022, there were no remaining customer relationships associated with this integrated operating segment. As such, the Company determined there were indicators of impairment regarding this operating segment’s trade name intangibles, customer ~~relationships~~relationship intangibles, and goodwill. The Company determined there was no fair value associated with this integrated operating segment’s intangibles. As such, the Company recorded an impairment charge of $7.8 million in the Specialized Solutions segment during the three months ended June 30, 2022, consisting of $1.9 million of trade name intangibles, $0.2 million of customer relationships, and $5.7 million of goodwill. The impairment charge is included in impairment in the consolidated statements of operations and comprehensive income.

NOTE 54 – PROPERTY AND EQUIPMENT

The components of property and equipment are as follows (in millions):


	June 30,			December 31,			June 30,			December 31,
	2022			2021			2023			2022
Revenue equipment	$	546.9		$	520.5		$	666.5		$	611.3
Revenue equipment leased and available for lease to owner operators		141.3			123.4			143.3			145.1
Buildings and improvements		58.7			58.0			62.9			62.4
Furniture and fixtures, office and computer equipment, vehicles and capitalized software development		35.0			33.3			47.8			40.7
		781.9			735.2
Property and equipment, gross								920.5			859.5
Accumulated depreciation		(360.9	)		(337.5	)		(388.1	)		(371.2	)
Property and equipment, net	$	421.0		$	397.7		$	532.4		$	488.3

Depreciation expense on property and equipment was $~~21.0~~24.3 million and $~~20.4~~21.0 million for the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively. Depreciation expense on property and equipment was $~~40.9~~47.9 million and $40.9 million for the six months ended June 30, ~~2022~~2023 and ~~2021,~~2022, respectively.

~~Table of Contents~~

NOTE 65 – ACCRUED EXPENSES AND OTHER LIABILITIES

The components of accrued expenses and other liabilities are as follows as of June 30, ~~2022~~2023 and December 31, ~~2021~~2022 (in millions):


	June 30,		December 31,		June 30,		December 31,
	2022		2021		2023		2022
Brokerage and escorts	$	22.8	$	15.6	$	14.5	$	14.1
Unvouchered payables		11.2		8.7		11.5		9.4
Owner operator deposits		11.2		11.3		9.0		9.7
Other accrued expenses						9.9		5.6
Fuel and fuel taxes		7.0		1.2		4.7		2.7
Other accrued expenses		6.4		3.7
Accrued property taxes and sales taxes payable		1.7		2.3		1.1		2.4
Interest		0.8		1.1		1.0		1.0
Share repurchase excise taxes						0.2		—
	$	61.1	$	43.9	$	51.9	$	44.9

Table of Contents

NOTE 76 – LONG-TERM DEBT

Long-term debt consists of the following as of June 30, ~~2022~~2023 and December 31, ~~2021~~2022 (in millions):


	June 30,			December 31,			June 30,			December 31,
	2022			2021			2023			2022
Term Loan Facility	$	395.0		$	397.0		$	341.0		$	393.0
ABL Facility		0			0			—			—
Equipment and real estate term loans		182.6			169.0			287.2			249.1
Finance lease liabilities		26.7			28.5			24.4			25.0
Total debt and finance lease liabilities		604.3			594.5			652.6			667.1
Less current portion		(60.4	)		(55.5	)		(90.3	)		(78.4	)
Less unamortized deferred financing fees		(7.0	)		(7.6	)		(5.0	)		(6.4	)
Long-term debt and finance lease liabilities, less current portion and unamortized deferred financing fees	$	536.9		$	531.4		$	557.3		$	582.3

Term Loan Facility

~~On March 9, 2021, the~~The Company ~~and Daseke Companies, Inc.,~~has a ~~wholly-owned subsidiary of the Company~~senior secured term loan credit facility (the Term Loan ~~Borrower), entered into a Refinancing Amendment (Amendment No. 3 to Term Loan Agreement) (the Term Loan Amendment)~~Facility) with JPMorgan Chase Bank, N.A., as ~~successor~~ administrative agent, ~~and~~ collateral agent and a ~~replacement~~ lender, ~~Credit Suisse AG, Cayman Islands Branch, as predecessor administrative agent and collateral agent, the~~ other ~~loan parties~~lenders party thereto and ~~the~~ other financial institutions party thereto. ~~Pursuant to~~During the second quarter of 2023, the Company made a $50.0 million cash prepayment of the Term Loan ~~Amendment, the Company prepaid, refinanced~~Facility, and ~~replaced all of the then-issued and~~accordingly wrote off $0.7 million in deferred financing fees. The Term Loan Facility has an outstanding ~~term loans, which had an aggregate principal amount~~balance of $~~484~~341.0 million ~~with cash on hand and new replacement terms loans in an aggregate principal amount~~as of $~~400~~ ~~million (the Replacement~~June 30, 2023. The Term ~~Loans). The Replacement Term Loans have~~Loan Facility has a scheduled maturity date of March 9, 2028. At June 30, ~~2022~~2023 and December 31, ~~2021,~~2022, the interest rate on the ~~Replacement~~ Term ~~Loans~~Loan Facility was ~~5.6~~9.27% and ~~4.75~~8.39%, respectively. As of June 30, ~~2022,~~2023, the Company was in compliance with all covenants contained in the agreement governing the ~~Replacement~~ Term ~~Loans.~~Loan Facility.

ABL Facility

The Company has a senior secured asset-based revolving line of credit (the ABL Facility) under a credit agreement (as amended, restated, supplemented or otherwise modified from time to time, the ABL Credit Agreement) with PNC Bank, National Association, as administrative agent and the lenders party thereto.

As of June 30, ~~2022,~~2023, the Company had 0no borrowings, $~~23.3~~27.1 million in letters of credit outstanding, and could incur approximately $~~125.3~~104.3 million of additional indebtedness under the ABL Facility, based on current qualified collateral. As of June 30, ~~2022,~~2023, the interest rate on the ABL Facility was approximately ~~5.25~~6.7%. As of June 30, ~~2022,~~2023, the Company was in compliance with all covenants contained in the ABL Credit Agreement.

Equipment and Real Estate Term Loans

As of June 30, ~~2022,~~2023, the Company had term loans collateralized by equipment in the aggregate amount of $~~180.3~~285.0 million with 1614 lenders (Equipment Term Loans). The Equipment Term Loans bear interest at rates ranging from 2.6% to ~~5.9~~7.4%, require monthly payments of principal and interest and mature at various dates through July ~~2029.~~2030. As of June 30, ~~2022,~~2023, the weighted average interest rate was ~~4.1~~5.2%.

As of June 30, ~~2022,~~2023, the Company has a bank mortgage loan with a balance of $~~2.3~~2.2 million incurred to finance the construction of ~~the headquarters and terminal~~certain facilities in Redmond, Oregon.

~~Table of Contents~~

NOTE 87 – INCOME TAXES

The effective tax rates for the three months ended June 30, ~~2022~~2023 and ~~2021~~2022 were ~~30.3~~40.0% and ~~23.3~~30.3%, respectively. The effective tax rates for the six months ended June 30, ~~2022~~2023 and ~~2021~~2022 were ~~26.6~~40.4% and ~~26.1~~26.6%, respectively. The ~~difference between the Company’s~~Company's effective tax rate ~~and~~differs from the federal statutory rate ~~primarily results from the mix of earnings with~~due to state ~~jurisdictions, combined with~~and foreign income taxes, global intangible low-taxed income inclusion, and the impact of ~~nontaxable income, primarily related to the change in fair value of the warrant liability, and~~certain nondeductible expenses ~~primarily~~ related to executive compensation and ~~goodwill impairment.~~driver per diem as compared to forecasted full-year earnings. State tax rates vary among states and typically range from 1% to 6%, although some state rates are higher and a small number of states do not impose an income tax. The effective tax rate for the three and six months ended June 30, ~~2022~~2023 differs from the effective tax rate for the same ~~period~~periods in ~~2021~~2022 primarily due to the current forecasted full-year earnings, in which the unfavorable permanent ~~disallowance of goodwill impairment in~~adjustments noted above generated a greater impact on the ~~second quarter of 2022. The~~ effective tax ~~rate for the six months ended June 30, 2022 is relatively consistent with the same period in 2021.~~rate.

There were 0no changes in uncertain tax positions during the three and six months ended June 30, ~~2022.~~2023.

~~NOTE 9 – STOCK-BASED COMPENSATION~~

Under the 2017 Omnibus Incentive Plan (as amended from time to time, the Incentive Plan), the Company may grant awards of stock options, stock appreciation rights, restricted stock, restricted stock units, other stock-based awards and performance awards. As of June 30, 2022, the Company has ~~0.7~~ ~~million shares of common stock available for issuance under the Incentive Plan, assuming the maximum potential number of shares that may be issued from outstanding awards.~~

~~Aggregate stock-based compensation charges, net of forfeitures, were $2.2~~ ~~million and $0.8~~ ~~million for the three months ended June 30, 2022 and 2021, respectively, and $6.4~~ ~~million and $3.2~~ ~~million for the six months ended June 30, 2022 and 2021, respectively. As of June 30, 2022, there was $1.2~~ ~~million, $5.1~~ ~~million, and $10.0~~ million of unrecognized stock-based compensation expense related to stock options, restricted stock units (RSUs) and performance stock units (PSUs) (both equity and liability awards), respectively. This expense will be recognized over the weighted average periods of ~~0.8~~ ~~years for stock options,~~ ~~1.6~~ ~~years for RSUs and~~ ~~1.3~~ ~~years for PSUs.~~

~~During the six months ended June 30, 2022, there were~~ ~~203,821~~ ~~RSUs awarded to participants that are classified as equity. In addition, during the six months ended June 30, 2022, there were~~ ~~235,393~~ ~~PSUs awarded to participants that are classified as liabilities. During the six months ended June 30, 2022, there were no stock options granted.~~

~~Restricted Stock Units~~

~~The following table summarizes RSU grants under the Incentive Plan:~~

Grantee Type

# of
RSUs Granted

Issued and Outstanding

Vesting
Period

Weighted Average Grant Date Fair Value (Per Unit)

Director Group

830,978

71,771

1-2 years

$
11.21

Employee Group

2,393,066

656,392

3-5 years

$
9.36

Total

728,163

~~A summary of RSU awards activity under the Incentive Plan as of June 30, 2022, and the changes during the six months ended June 30, 2022 are as follows:~~

Units

Weighted
Average Grant
Date Fair Value
(Per Unit)

Non-vested as of January 1, 2022

673,830

$
8.56

Granted

203,821

12.16

Vested

(137,640
)

8.60

Forfeited

(11,848
)

9.76

Non-vested as of June 30, 2022

728,163

$
9.54

~~The weighted average grant date fair value of RSUs granted during the six months ended June 30, 2022 and 2021 was $12.16~~ ~~and $6.92, respectively. The total fair value of RSUs vested during the six months ended June 30, 2022 and 2021 was $1.2~~ ~~million and $1.4~~ ~~million, respectively.~~

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~~Performance Stock Units~~

~~As of June 30, 2022, the Company had~~ ~~3,100,571~~ ~~PSUs outstanding, of which~~ ~~1,355,571~~ ~~were classified as liabilities.~~

~~As of June 30, 2022, there~~ were 630,571 PSUs classified as liabilities in which the vesting occurs upon the achievement of specific performance-based conditions related to the Company’s financial performance over a three-year period, modified based on the Company’s Relative Total Shareholder Return (TSR) and subject to final vesting based on the participant’s continued employment through the end of the requisite service periods. The ultimate amount to vest may be downwardly adjusted by the Compensation Committee of the Company’s Board of Directors if the TSR is negative. The amount of awards that will ultimately vest for these PSUs can range from 0% to 200% based on the TSR calculated over a three-year period beginning January 1 of the year each grant was made. The Company currently expects that these PSUs will vest between 95% and 128%. The fair value of these PSUs will be remeasured at each period-end until the earlier of the date they are reclassified to equity or the vesting date. The inputs and assumptions used to calculate the fair value ranged from a remaining term of ~~1.50~~ to ~~2.50~~ ~~years, risk-free interest rate of~~ ~~2.11% to~~ ~~2.39%, the expected volatility of~~ ~~58.2% to~~ ~~89.3%, and the expected dividend yield of~~ ~~0.0~~%.

~~In addition, there are~~ ~~725,000~~ PSUs classified as liabilities in which the vesting occurs upon the achievement of specific performance-based conditions related to the Company’s financial performance over a two-year period, subject to various subjective individual performance goals and subject to final vesting based on the participant’s continued employment through the end of the requisite service periods. The fair value of these PSUs will be remeasured at each period-end until the earlier of the date they are reclassified to equity or the vesting date. The Company currently expects that these PSUs will vest at 100%. The fair value is equal to the market value of the common stock at each period-end.

~~As of June 30, 2022, the total fair value of liability-classified awards was approximately $9.8~~ ~~million, of which $3.3~~ ~~million was recorded as a liability within other non-current liabilities on the consolidated balance sheet.~~

NOTE 108 – COMMITMENTS AND CONTINGENCIES

Letters of Credit

The Company had outstanding letters of credit as of June 30, ~~2022~~2023 and December 31, ~~2021~~2022 totaling approximately $~~25.7~~29.5 million and $24.9 million, respectively, including those disclosed in Note 7.6. These letters of credit are related to security provided for potential liability and workers’ compensation insurance claims.

Contingencies

The Company is involved in certain claims and pending litigation arising in the normal course of business. These proceedings primarily involve claims for personal injury or property damage incurred in the transportation of freight or for personnel matters. The Company maintains liability insurance to cover liabilities arising from these matters but is responsible ~~to pay~~for paying self-insurance and deductibles on such matters up to a certain threshold before the insurance is applied.

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NOTE 119 – REPORTABLE SEGMENTS

The Company evaluates the performance of the segments primarily based on their respective revenues and operating income. ~~Accordingly, interest expense~~During the fourth quarter of 2022, the Company began reporting segment results to its chief operating decision maker with intersegment revenues and ~~other non-operating items are not reported in~~expenses eliminated at the applicable reportable segment ~~results. The~~level, as well as corporate costs allocated to its two reportable segments based upon respective reportable segment revenue. Previously, the Company ~~has~~had disclosed a corporate segment, which iswas not an operating segment and ~~includes~~included acquisition transaction expenses, corporate salaries, interest expense and certain other corporate administrative expenses and intersegment eliminations. ~~In addition,~~As a result of this change, the ~~corporate~~Company has restated its prior period segment ~~from time~~results below to ~~time when advantageous to do so, purchases and resells certain revenue equipment. During the three months ended June 30, 2022, the corporate~~reflect these changes in its segment ~~purchased $~~financial data.~~2.1~~ ~~million in revenue equipment, which it resold for $2.2~~ ~~million. During the six months ended June 30, 2022, the corporate segment purchased $6.7~~ ~~million in revenue equipment, which it resold for $7.1~~ ~~million. This resulted in gains of $0.1~~ ~~million and $0.4~~ million for the three and six months ended June 30, 2022 and was recognized within Gain on disposition of property and equipment on the consolidated statements of operations. During the three and six months ended June 30, 2021, the corporate segment did 0~~t purchase or resell any revenue equipment.~~

The corporate segment also leases certain revenue equipment to the Company’s operating segments. Such leases are generally billed at estimated market rates, and the intersegment expenses included within operating income (loss) are eliminated in the Company’s consolidated results. Intersegment lease expenses for the Specialized Solutions segment totaled $~~0.1~~ ~~million for the three and six months ended June 30, 2022. There were~~ 0 ~~intersegment lease expenses for the Flatbed Solutions segment for the three and six months ended June 30, 2022. There were~~ 0 ~~intersegment lease expenses in any reportable segments for the three and six months ended June 30, 2021.~~

The Company’s operating segments, ~~also~~from time to time, provide transportation and related services for one another. Such services are generally billed at cost, and no profit is earned. Such intersegment revenues and expenses are eliminated in the Company’s ~~consolidated~~reportable segment results. Intersegment transportation and related services revenues and expenses for the Flatbed Solutions segment totaled $1.1 million and $1.7 million for the three and six months ended June 30, 2023, respectively. Intersegment transportation and related services revenues and expenses for the Specialized Solutions segment totaled $1.4 million and $3.1 million for the three and six months ended June 30, 2023, respectively. Intersegment transportation and related services revenues and expenses for the Flatbed Solutions segment totaled $1.0 million and $1.8 million for the three and six months ended June 30, 2022, respectively. Intersegment transportation and related services revenues and expenses for the ~~Flatbed Solutions segment totaled $0.9~~ ~~million and $1.8~~ ~~million for the three and six months ended June 30, 2021, respectively. Intersegment transportation and related services revenues and expenses for the~~ Specialized Solutions segment totaled $2.6 million and $4.5 million for the three and six months ended June 30, 2022, ~~respectively. Intersegment transportation and related services revenues and expenses for the Specialized Solutions segment totaled $2.0~~ ~~million and $4.3~~ ~~million for the three and six months ended June 30, 2021,~~ respectively.

The following tables reflect certain financial data of the Company’s reportable segments for the three and six months ended June 30, ~~2022~~2023 and ~~2021~~2022 (in millions):


	Flatbed			Specialized			Corporate/			Consolidated			Flatbed			Specialized			Consolidated
													Solutions Segment			Solutions Segment			Total
Three Months Ended June 30, 2023
Total revenue													$	167.9		$	239.4		$	407.3
Company freight														47.0			123.9			170.9
Owner operator freight														74.7			38.1			112.8
Brokerage														22.6			40.6			63.2
Logistics														1.1			13.9			15.0
Fuel surcharge														22.5			22.9			45.4
Operating income														3.7			17.4			21.1
Depreciation														11.9			12.4			24.3
Amortization of intangible assets														0.6			1.0			1.6
Restructuring														(0.3	)		(0.4	)		(0.7	)
Non-cash operating lease expense														—			—			—
Interest expense														5.6			7.5			13.1
Total property and equipment additions														24.8			38.4			63.2
	Solutions Segment			Solutions Segment			Eliminations			Total
Three Months Ended June 30, 2022
Total revenue	$	216.0		$	268.6		$	(3.3	)	$	481.3		$	215.1		$	266.2		$	481.3
Company freight		42.9			127.5			(2.6	)		167.8			42.7			125.1			167.8
Owner operator freight		90.2			48.2			(0.5	)		137.9			89.7			48.2			137.9
Brokerage		47.6			44.2			0.1			91.9			47.6			44.3			91.9
Logistics		1.1			12.9			0			14.0			1.1			12.9			14.0
Fuel surcharge		34.2			35.8			(0.3	)		69.7			34.0			35.7			69.7
Operating income (loss)		24.6			22.7			(14.5	)		32.8
Operating income														18.4			14.4			32.8
Depreciation		8.6			11.9			0.5			21.0			8.8			12.2			21.0
Amortization of intangible assets		0.8			0.9			0			1.7			0.8			0.9			1.7
Restructuring		0			0.4			0.2			0.6			0.1			0.5			0.6
Non-cash operating lease expense		(0.1	)		0			0			(0.1	)		(0.1	)		—			(0.1	)
Interest expense		0.8			1.3			5.4			7.5			3.2			4.3			7.5
Capital expenditures		17.1			20.0			13.3			50.4

Three Months Ended June 30, 2021
Total revenue	$	180.9		$	226.1		$	(3.0	)	$	404.0
Company freight		47.7			118.3			(2.4	)		163.6
Owner operator freight		88.9			40.7			(0.5	)		129.1
Brokerage		25.3			41.5			(0.1	)		66.7
Logistics		1.3			9.3			0			10.7
Fuel surcharge		17.7			16.3			(0.1	)		33.9
Operating income (loss)		22.9			29.0			(6.6	)		45.3
Depreciation		8.1			12.1			0.2			20.4
Amortization of intangible assets		0.8			1.0			0			1.8
Restructuring		0			0.1			0			0.1
Non-cash operating lease expense		(0.1	)		(0.3	)		0			(0.4	)
Interest expense		0.9			1.3			5.4			7.6
Capital expenditures		7.7			13.5			6.4			27.6
Total property and equipment additions														23.1			27.3			50.4

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	Flatbed			Specialized			Corporate/			Consolidated				Flatbed			Specialized		Consolidated
														Solutions Segment			Solutions Segment		Total
Six Months Ended June 30, 2023
Total revenue														$	337.0		$	470.1	$	807.1
Company freight															91.9			239.3		331.2
Owner operator freight															148.6			76.4		225.0
Brokerage															46.0			77.8		123.8
Logistics															2.1			28.1		30.2
Fuel surcharge															48.4			48.5		96.9
Operating income															6.9			26.1		33.0
Depreciation															23.4			24.5		47.9
Amortization of intangible assets													��		1.2			1.9		3.1
Restructuring															—			0.3		0.3
Non-cash operating lease expense															(0.1	)		—		(0.1	)
Interest expense															10.8			14.9		25.7
Total property and equipment additions															56.7			39.6		96.3
	Solutions Segment			Solutions Segment			Eliminations			Total
Six Months Ended June 30, 2022
Total revenue	$	411.1		$	497.1		$	(5.9	)	$	902.3			$	409.5		$	492.8	$	902.3
Company freight		84.4			244.0			(4.6	)		323.8				84.0			239.8		323.8
Owner operator freight		178.3			90.3			(0.9	)		267.7				177.4			90.3		267.7
Brokerage		88.8			81.3			0			170.1				88.8			81.3		170.1
Logistics		2.0			23.4			0			25.4				2.1			23.3		25.4
Fuel surcharge		57.6			58.1			(0.4	)		115.3				57.2			58.1		115.3
Operating income (loss)		40.5			40.3			(29.8	)		51.0
Operating income															27.8			23.2		51.0
Depreciation		16.9			23.3			0.7			40.9				17.1			23.8		40.9
Amortization of intangible assets		1.5			1.9			0			3.4				1.6			1.8		3.4
Restructuring		0			0.5			0.7			1.2				0.3			0.9		1.2
Non-cash operating lease expense		(0.1	)		0			0			(0.1	)			(0.1	)		—		(0.1	)
Interest expense		1.6			2.5			10.5			14.6				6.4			8.2		14.6
Capital expenditures		20.4			27.9			18.2			66.5

Six Months Ended June 30, 2021
Total revenue	$	334.4		$	409.8		$	(6.3	)	$	737.9
Company freight		92.4			221.1			(4.8	)		308.7
Owner operator freight		159.9			75.3			(1.0	)		234.2
Brokerage		47.5			68.1			(0.4	)		115.2
Logistics		2.5			16.5			0.2			19.2
Fuel surcharge		32.1			28.8			(0.3	)		60.6
Operating income (loss)		33.9			39.5			(20.0	)		53.4
Depreciation		16.1			24.2			0.6			40.9
Amortization of intangible assets		1.5			2.0			0			3.5
Restructuring		0			0.1			0			0.1
Non-cash operating lease expense		(0.2	)		(0.6	)		0			(0.8	)
Interest expense		2.6			3.4			12.7			18.7
Capital expenditures		16.7			24.1			6.4			47.2
Total property and equipment additions															28.6			37.9		66.5

A measure of assets is not applicable, as segment assets are not regularly reviewed by the chief operating decision maker for evaluating performance or allocating resources.

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NOTE 1210 – EARNINGS ~~(LOSS)~~ PER SHARE

Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and are included in the computation of earnings per share pursuant to the two-class method. ~~The~~A portion of the Company’s outstanding non-vested RSUs are participating securities unless there is a net loss attributable to common stockholders. Accordingly, earnings per common share are computed using the two-class method.

Basic earnings per common share is calculated by dividing net income available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the Company’s earnings.

For the three and six months ended June 30, ~~2021,~~2023, shares of the Company’s 7.625% Series A Convertible Cumulative Preferred Stock (Series A Preferred Stock), convertible into approximately 5.7 million shares of common stock, were not included in the computation of diluted earnings ~~(loss)~~ per share as their effects were anti-dilutive. In addition, for the three and six months ended June 30, 2023, approximately 1.0 million shares of outstanding stock options were not included in the computation of diluted earnings per share as their exercise price was greater than the average market price of the common stock. Further, for the three and six months ended June 30, 2023, approximately 0.5 million shares of common stock underlying outstanding liability-classified performance stock units (PSUs) (that can ultimately vest from 0% to 200%) and 0.7 million shares of common stock underlying outstanding PSUs (that can ultimately vest from 0% to 100%) that are considered contingently issuable were excluded from the computation of diluted earnings per share as the performance measure had not yet been achieved as of the end of the reporting period.

For the three and six months ended June 30, 2022, approximately 1.2 million shares of common stock issuable upon exercise of outstanding stock options were not included in the computation of diluted earnings per share as their exercise price was greater than the average market price of the common stock. In addition, for the three and six months ended June 30, 2022, approximately 0.6 million shares of common stock underlying outstanding PSUs (that can ultimately vest from 0% to 200%) and 0.7 million shares of common stock underlying outstanding PSUs (that can ultimately vest from 0% to 100%) that are considered contingently issuable were excluded from the computation of diluted earnings per share as the performance measure had not yet been achieved as of the end of the reporting period.

Table of Contents

The following table sets forth the computation of basic and diluted earnings per share under the two-class method:


	Three Months Ended						Six Months Ended						Three Months Ended						Six Months Ended
	June 30,						June 30,						June 30,						June 30,
(in millions, except per share data)	2022			2021			2022			2021			2023			2022			2023			2022

Numerator:
Net income	$	17.7		$	35.3		$	30.7		$	28.0		$	5.7		$	17.7		$	6.2		$	30.7
Less Series A Preferred Stock dividends		(1.2	)		(1.3	)		(2.5	)		(2.5	)		(1.2	)		(1.2	)		(2.4	)		(2.5	)
Less Series B Preferred Stock dividends														(1.3	)		—			(2.8	)		—
Net income attributable to common stockholders		16.5			34.0			28.2			25.5			3.2			16.5			1.0			28.2
Allocation of earnings to non-vested participating RSUs		(0.2	)		(0.3	)		(0.3	)		(0.2	)		—			(0.2	)		—			(0.3	)
Numerator for basic EPS - income available to common stockholders - two class method	$	16.3		$	33.7		$	27.9		$	25.3		$	3.2		$	16.3		$	1.0		$	27.9

Effect of dilutive securities:
Add back Series A Preferred Stock dividends	$	1.2		$	1.3		$	2.5		$	0		$	—		$	1.2		$	—		$	2.5
Add back allocation earnings to participating securities		0.2			0.3			0.3			0.2			—			0.2			—			0.3
Reallocation of earnings to participating securities considering potentially dilutive securities		(0.2	)		(0.3	)		(0.3	)		(0.2	)		—			(0.2	)		—			(0.3	)
Numerator for diluted EPS - income available to common shareholders - two class method	$	17.5		$	35.0		$	30.4		$	25.3
Numerator for diluted EPS - income (loss) available to common stockholders - two class method													$	3.2		$	17.5		$	1.0		$	30.4

Denominator:
Denominator for basic EPS - weighted-average shares		63,470,040			64,842,620			63,182,277			64,960,833			45,521,935			63,470,040			45,333,840			63,182,277

Effect of dilutive securities:
Stock options and PSUs		2,432,826			1,371,510			2,484,663			1,193,738
Non-participating outstanding share-based payment awards														1,992,163			2,432,826			2,283,972			2,484,663	��
Series A Preferred Stock		5,652,173			5,652,173			5,652,173			0			—			5,652,173			—			5,652,173
Denominator for diluted EPS - weighted-average shares		71,555,039			71,866,303			71,319,113			66,154,571			47,514,098			71,555,039			47,617,812			71,319,113

Basic earnings per share	$	0.26		$	0.52		$	0.44		$	0.39		$	0.07		$	0.26		$	0.02		$	0.44
Diluted earnings per share	$	0.24		$	0.49		$	0.43		$	0.38		$	0.07		$	0.24		$	0.02		$	0.43

~~NOTE 13 – SUBSEQUENT EVENTS~~

~~Subsequent to June 30, 2022, the Company completed one additional integration under the Transformation Plan, which reduced our operating segments from~~ 10 to 9.

1715

Table of Contents

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

~~The Company believes it provides one of the most comprehensive transportation and logistics solutions offerings in the industry.~~trailers. The Company delivers its diverse offering of ~~transportation and logistics~~ solutions to thousands of customers across the United States, Canada and ~~Mexico through~~Mexico. In addition to transporting freight with tractors and trailers, the Company also provides logistical planning and warehousing solutions to customers.

The Company has two reportable segments: Flatbed Solutions and Specialized Solutions. The Flatbed Solutions segment focuses on delivering transportation and logistics solutions that principally require the use of flatbed and retractable-sided transportation equipment, and the Specialized Solutions segment focuses on delivering transportation and logistics solutions that require the use of specialized trailering transportation equipment.

Both of the Company’s reportable segments operate highly flexible business models comprised of company-owned tractors and trailers and asset-light operations (which consist of owner operator transportation, freight brokerage and logistics). The Company’s asset-based operations have the benefit of providing committed capacity and continuity of operations to meet ~~shippers~~shippers’ needs. Alternatively, the Company’s asset-light operations offer flexibility and scalability to meet customers’ dynamic needs and have lower capital expenditure requirements and fixed costs.

~~Recent Developments~~Trends and Outlook

Thus far in 2022, like others in our industry, we have experienced inflationary cost headwinds in driver pay, operations and maintenance, and insurance expenses. The U.S. inflation rate is the highest experienced in four decades. Inflation can have an impact on the Company’s operating costs. A prolonged period of inflation could cause interest rates, fuel, wages and other costs to increase, which would adversely affect the Company’s results of operations unless freight rates correspondingly increase. We continue to see strong freight rates, which have been supported by our strategic alignment with niche end-markets in the industrial economy, as opposed to the commodity-oriented consumer retail markets. Strong freight rates, along with our increases in fuel surcharges, have helped to partially offset these inflationary cost headwinds.

In addition to inflation, like others in our industry, we have observed ongoing delays in receiving new equipment as the supply chain disruptions persisted throughout the first half of 2022. However, we are expecting to see ando not expect any substantive improvement in ~~receiving new equipment during~~current freight market conditions for the second half of ~~2022.~~the year. We expect load availability to remain tight but stable, and absent a deceleration in the wider economy, we expect freight rates to be stifled in the near-term as capacity continues its slow exit from the industry. Further, we expect current conditions to persist for the remainder of the third quarter, followed by a more gradual fourth-quarter slowdown, typical of the seasonality in our prior years. We have seen some demand degradation in the building materials complex served by our Northwest flatbed operations, and we are expecting a shift in the resurgence of wind demand from the back-half of 2023 to 2024. We continue to make organic investments in company tractors, which support our asset-right strategy and maintain a low average age of fleet, thereby reducing maintenance costs.

During the first quarter of 2022, the Company internally announced a phased integration and restructuring plan, with the first phase integrating five operating segments into three other operating segments, which will reduce the number of overall operating segments from eleven to six. The second phase of the Plan will integrate those six operating segments into four or five operating segments. The Plan is intended to reduce the Company’s cost base, right size its organization and management team and increase and accelerate its previously announced operational improvement goals. In addition, the Company anticipates additional revenue opportunities driven by synergies from optimizing a consolidated operation, including empty mile reduction, pricing improvements, and additional seated truck contribution. The Company has completed two integrations under the Plan, which has reduced our operating segments from eleven to nine. During the second quarter of 2022, the Company determined there was no fair value associated with one of these integrated operating segments goodwill and intangible assets, which was within the Specialized Solutions segment, and recorded an impairment charge of $7.8 million in the Specialized Solutions segment.

1816

Table of Contents

Results of Operations

The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue), derived from the Company’s consolidated statements of operations, for the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.


	Three Months Ended June 30,																					Three Months Ended June 30,
	2022							2021							Increase (Decrease)							2023							2022							Change
(Dollars in millions, except Rate per mile and Revenue per tractor)	Amount			%				Amount			%				Absolute			Relative				Amount			%				Amount			%				Absolute			Relative
REVENUE:
Company freight	$	167.8			34.9		%	$	163.6			40.5		%	$	4.2			2.6		%	$	170.9			42.0		%	$	167.8			34.9		%	$	3.1			1.8		%
Owner operator freight		137.9			28.7				129.1			32.0				8.8			6.8				112.8			27.7				137.9			28.7				(25.1	)		(18.2	)
Brokerage		91.9			19.1				66.7			16.5				25.2			37.8				63.2			15.5				91.9			19.1				(28.7	)		(31.2	)
Logistics		14.0			2.9				10.7			2.6				3.3			30.8				15.0			3.7				14.0			2.9				1.0			7.1
Fuel surcharge		69.7			14.4				33.9			8.5				35.8			105.6				45.4			11.1				69.7			14.4				(24.3	)		(34.9	)
Total revenue	$	481.3			100.0		%	$	404.0			100.0		%	$	77.3			19.1		%	$	407.3			100.0		%	$	481.3			100.0		%	$	(74.0	)		(15.4	)	%

OPERATING EXPENSES:
Salaries, wages and employee benefits	$	97.2			20.2		%	$	93.4			23.1		%	$	3.8			4.1		%	$	106.1			26.0		%	$	97.2			20.2		%	$	8.9			9.2		%
Fuel		45.3			9.4				27.0			6.7				18.3			67.8				32.4			8.0				45.3			9.4				(12.9	)		(28.5	)
Operations and maintenance		40.1			8.3				37.3			9.2				2.8			7.5				43.3			10.6				41.1			8.5				2.2			5.4
Communications		1.0			0.2				1.1			0.3				(0.1	)		(9.1	)
Purchased freight		197.0			40.9				155.3			38.4				41.7			26.9				143.6			35.3				197.0			40.9				(53.4	)		(27.1	)
Administrative		17.1			3.6				12.7			3.1				4.4			34.6				16.2			4.0				17.7			3.7				(1.5	)		(8.5	)
Sales and marketing		0.6			0.1				0.5			0.1				0.1			20.0
Taxes and licenses		4.1			0.9				3.8			0.9				0.3			7.9				4.1			1.0				4.1			0.9				—			—
Insurance and claims		17.6			3.7				9.9			2.5				7.7			77.8				16.2			4.0				17.6			3.7				(1.4	)		(8.0	)
Acquisition-related transaction expenses		1.9			0.4				—			—				1.9			100.0				0.8			0.2				1.9			0.4				(1.1	)		(57.9	)
Depreciation and amortization		22.7			4.7				22.2			5.5				0.5			2.3				25.9			6.4				22.7			4.7				3.2			14.1
Gain on disposition of revenue property and equipment		(4.5	)		(0.8	)			(4.6	)		(1.1	)			0.1			(2.2	)			(3.2	)		(0.8	)			(4.5	)		(0.9	)			1.3			(28.9	)
Impairment		7.8			1.7				—			—				7.8			100.0				1.5			0.4				7.8			1.6				(6.3	)		(80.8	)
Restructuring charges		0.6			0.1				0.1			—				0.5			500.0
Restructuring																							(0.7	)		(0.2	)			0.6			0.1				(1.3	)		(216.7	)
Total operating expenses	$	448.5			93.2		%	$	358.7			88.8		%	$	89.8			25.0		%	$	386.2			94.8		%	$	448.5			93.2		%	$	(62.3	)		(13.9	)	%

INCOME FROM OPERATIONS	$	32.8			6.8		%	$	45.3			11.2		%	$	(12.5	)		(27.6	)	%	$	21.1			5.2		%	$	32.8			6.8		%	$	(11.7	)		(35.7	)	%

Other expense (income):
Interest income	$	(0.7	)		(0.1	)	%	$	(0.1	)		—		%	$	(0.6	)		600.0		%	$	(1.2	)		(0.3	)	%	$	(0.7	)		(0.1	)	%	$	(0.5	)		71.4		%
Interest expense		7.5			1.6				7.6			1.9				(0.1	)		(1.3	)			13.1			3.2				7.5			1.6				5.6			74.7
Change in fair value of warrant liability		—			—				(7.8	)		(1.9	)			7.8			(100.0	)
Other		0.6			0.1				(0.4	)		(0.1	)			1.0			(250.0	)			(0.3	)		(0.1	)			0.6			0.1				(0.9	)		(150.0	)
Total other expense (income)	$	7.4			1.5		%	$	(0.7	)		(0.2	)	%	$	8.1			(1,157.1	)	%
Total other expense																						$	11.6			2.8		%	$	7.4			1.5		%	$	4.2			56.8		%

Income before income taxes	$	25.4			5.3		%	$	46.0			11.4		%	$	(20.6	)		(44.8	)	%	$	9.5			2.3		%	$	25.4			5.3		%	$	(15.9	)		(62.6	)	%
Income tax expense		7.7			1.6				10.7			2.6				(3.0	)		(28.0	)			3.8			0.9				7.7			1.6				(3.9	)		(50.6	)
Net income	$	17.7			3.7		%	$	35.3			8.7		%	$	(17.6	)		(49.9	)	%	$	5.7			1.4		%	$	17.7			3.7		%	$	(12.0	)		(67.8	)	%

OPERATING STATISTICS:
Company miles		53.6							57.7							(4.1	)		(7.1	)	%		59.3							53.6							5.7			10.6		%
Owner operator miles		43.8							47.9							(4.1	)		(8.6	)			40.4							43.8							(3.4	)		(7.8	)
Total miles (in millions)		97.4							105.6							(8.2	)		(7.8	)	%		99.7							97.4							2.3			2.4		%

Rate per mile	$	3.14						$	2.77						$	0.37			13.4		%	$	2.85						$	3.14						$	(0.29	)		(9.2	)	%
Revenue per tractor	$	65,800						$	60,400						$	5,400			8.9		%	$	58,600						$	65,800						$	(7,200	)		(10.9	)	%

Company owned tractors, at quarter-end		2,652							2,715							(63	)		(2.3	)	%		2,984							2,652							332			12.5		%
Owner operator tractors, at quarter-end		2,038							2,112							(74	)		(3.5	)			1,877							2,038							(161	)		(7.9	)
Number of trailers, at quarter-end		11,050							11,266							(216	)		(1.9	)	%		10,886							11,050							(164	)		(1.5	)	%

Company owned tractors, average for the quarter		2,610							2,723							(113	)		(4.1	)	%		2,956							2,610							346			13.3		%
Owner operator tractors, average for the quarter		2,039							2,123							(84	)		(4.0	)			1,883							2,039							(156	)		(7.7	)
Total tractors, average for the quarter		4,649							4,846							(197	)		(4.1	)	%		4,839							4,649							190			4.1		%

1917

Table of Contents

The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue) of the Company’s Specialized Solutions segment for the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.

SPECIALIZED SOLUTIONS

Three Months Ended June 30,

2022

2021

Increase (Decrease)
(Dollars in millions, except Rate per mile and Revenue per tractor)

Amount

%

Amount

%

Absolute

Relative
REVENUE(1):

Company freight

$
127.5

47.5

%

$
118.3

52.3

%

$
9.2

7.8

%
Owner operator freight

48.2

17.9

40.7

18.0

7.5

18.4

Brokerage

44.2

16.5

41.5

18.4

2.7

6.5

Logistics

12.9

4.8

9.3

4.1

3.6

38.7

Fuel surcharge

35.8

13.3

16.3

7.2

19.5

119.6

Total revenue

$
268.6

100.0

%

$
226.1

100.0

%

$
42.5

18.8

%

OPERATING EXPENSES(1):

Salaries, wages and employee benefits

$
63.9

23.8

%

$
58.6

25.9

%

$
5.3

9.0

%
Fuel

33.0

12.3

18.6

8.2

14.4

77.4

Operations and maintenance

29.1

10.8

26.9

11.9

2.2

8.2

Purchased freight

79.3

29.5

66.2

29.3

13.1

19.8

Depreciation and amortization

12.8

4.8

13.0

5.7

(0.2
)

(1.5
)

Impairment

7.8

2.9

—

—

7.8

100.0

Restructuring charges

0.4

0.1

0.1

—

0.3

300.0

Other operating expenses

19.6

7.3

13.7

6.1

5.9

43.1

Total operating expenses

$
245.9

91.5

%

$
197.1

87.2

%

$
48.8

24.8

%

INCOME FROM OPERATIONS

$
22.7

8.5

%

$
29.0

12.8

%

$
(6.3
)

(21.7
)
%

OPERATING STATISTICS:

Company miles

37.9

38.3

(0.4
)

(1.0
)
%
Owner operator miles

11.0

12.7

(1.7
)

(13.4
)

Total miles (in millions)

48.9

51.0

(2.1
)

(4.1
)
%

Rate per mile

$
3.59

$
3.12

$
0.47

15.1

%
Revenue per tractor

$
75,500

$
66,700

$
8,800

13.2

%

Company owned tractors, at quarter-end

1,871

1,878

(7
)

(0.4
)
%
Owner operator tractors, at quarter-end

460

511

(51
)

(10.0
)

Number of trailers, at quarter-end

7,171

7,059

112

1.6

%

Company owned tractors, average for the quarter

1,860

1,871

(11
)

(0.6
)
%
Owner operator tractors, average for the quarter

467

512

(45
)

(8.8
)

Total tractors, average for the quarter

2,327

2,383

(56
)

(2.3
)
%


	Three Months Ended June 30,
	2023							2022					Change
(Dollars in millions, except Rate per mile and Revenue per tractor)	Amount			%				Amount		%			Absolute			Relative
REVENUE:
Company freight	$	123.9			51.8		%	$	125.1		47.0	%	$	(1.2	)		(1.0	)	%
Owner operator freight		38.1			15.9				48.2		18.1			(10.1	)		(21.0	)
Brokerage		40.6			17.0				44.3		16.6			(3.7	)		(8.4	)
Logistics		13.9			5.8				12.9		4.8			1.0			7.8
Fuel surcharge		22.9			9.5				35.7		13.5			(12.8	)		(35.9	)
Total revenue	$	239.4			100.0		%	$	266.2		100.0	%	$	(26.8	)		(10.1	)	%

OPERATING EXPENSES:
Salaries, wages and employee benefits	$	71.2			29.7		%	$	67.6		25.4	%	$	3.6			5.3		%
Fuel		22.5			9.4				33.0		12.4			(10.5	)		(31.8	)
Operations and maintenance		30.4			12.7				29.7		11.2			0.7			2.4
Purchased freight		63.1			26.4				76.7		28.8			(13.6	)		(17.7	)
Depreciation and amortization		13.4			5.6				13.1		4.9			0.3			2.3
Impairment		—			—				7.8		2.9			(7.8	)		(100.0	)
Restructuring		(0.4	)		(0.2	)			0.5		0.2			(0.9	)		(180.0	)
Other operating expenses		21.8			9.1				23.4		8.8			(1.6	)		(6.8	)
Total operating expenses	$	222.0			92.7		%	$	251.8		94.6	%	$	(29.8	)		(11.8	)	%

INCOME FROM OPERATIONS	$	17.4			7.3		%	$	14.4		5.4	%	$	3.0			20.8		%

OPERATING STATISTICS:
Company miles		39.8							37.9					1.9			5.0		%
Owner operator miles		8.8							11.0					(2.2	)		(20.0	)
Total miles (in millions)		48.6							48.9					(0.3	)		(0.6	)	%

Rate per mile	$	3.33						$	3.54				$	(0.21	)		(5.9	)	%
Revenue per tractor	$	66,800						$	74,500				$	(7,700	)		(10.3	)	%

Company owned tractors, at quarter-end		2,050							1,871					179			9.6		%
Owner operator tractors, at quarter-end		381							460					(79	)		(17.2	)
Number of trailers, at quarter-end		7,065							7,171					(106	)		(1.5	)	%

Company owned tractors, average for the quarter		2,036							1,860					176			9.5		%
Owner operator tractors, average for the quarter		389							467					(78	)		(16.7	)
Total tractors, average for the quarter		2,425							2,327					98			4.2		%

2018

Table of Contents

The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue) of the Company’s Flatbed Solutions segment for the three months ended June 30, ~~2022~~2023 and ~~2021,~~2022, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.

FLATBED SOLUTIONS


	Three Months Ended June 30,																	Three Months Ended June 30,
	2022					2021					Increase (Decrease)							2023							2022					Change
(Dollars in millions, except Rate per mile and Revenue per tractor)	Amount		%			Amount		%			Absolute			Relative				Amount			%				Amount		%			Absolute			Relative
REVENUE(1):
REVENUE:
Company freight	$	42.9		19.9	%	$	47.7		26.4	%	$	(4.8	)		(10.1	)	%	$	47.0			28.0		%	$	42.7		19.9	%	$	4.3			10.1		%
Owner operator freight		90.2		41.8			88.9		49.1			1.3			1.5				74.7			44.5				89.7		41.7			(15.0	)		(16.7	)
Brokerage		47.6		22.0			25.3		14.0			22.3			88.1				22.6			13.5				47.6		22.1			(25.0	)		(52.5	)
Logistics		1.1		0.5			1.3		0.7			(0.2	)		(15.4	)			1.1			0.7				1.1		0.5			—			—
Fuel surcharge		34.2		15.8			17.7		9.8			16.5			93.2				22.5			13.3				34.0		15.8			(11.5	)		(33.8	)
Total revenue	$	216.0		100.0	%	$	180.9		100.0	%	$	35.1			19.4		%	$	167.9			100.0		%	$	215.1		100.0	%	$	(47.2	)		(21.9	)	%

OPERATING EXPENSES(1):
OPERATING EXPENSES:
Salaries, wages and employee benefits	$	26.6		12.3	%	$	29.1		16.1	%	$	(2.5	)		(8.6	)	%	$	34.9			20.8		%	$	29.6		13.8	%	$	5.3			17.9		%
Fuel		12.4		5.7			8.4		4.6			4.0			47.6				9.9			5.9				12.3		5.7			(2.4	)		(19.5	)
Operations and maintenance		11.1		5.1			10.5		5.8			0.6			5.7				12.9			7.7				11.4		5.3			1.5			13.2
Purchased freight		121.3		56.2			92.2		51.0			29.1			31.6				80.5			47.9				120.3		55.9			(39.8	)		(33.1	)
Depreciation and amortization		9.4		4.4			8.9		4.9			0.5			5.6				12.5			7.4				9.6		4.5			2.9			30.2
Impairment																			1.5			0.9				—		—			1.5			100.0
Restructuring																			(0.3	)		(0.2	)			0.1		—			(0.4	)		(400.0	)
Other operating expenses		10.6		4.9			8.9		4.9			1.7			19.1				12.3			7.3				13.4		6.2			(1.1	)		(8.2	)
Total operating expenses	$	191.4		88.6	%	$	158.0		87.3	%	$	33.4			21.1		%	$	164.2			97.8		%	$	196.7		91.4	%	$	(32.5	)		(16.5	)	%

INCOME FROM OPERATIONS	$	24.6		11.4	%	$	22.9		12.7	%	$	1.7			7.4		%	$	3.7			2.2		%	$	18.4		8.6	%	$	(14.7	)		(79.9	)	%

OPERATING STATISTICS:
Company miles		15.7					19.4					(3.7	)		(19.1	)	%		19.5							15.7					3.8			24.2		%
Owner operator miles		32.9					35.2					(2.3	)		(6.5	)			31.6							32.9					(1.3	)		(4.0	)
Total miles (in millions)		48.6					54.6					(6.0	)		(11.0	)	%		51.1							48.6					2.5			5.1		%

Rate per mile	$	2.74				$	2.50				$	0.24			9.6		%	$	2.38						$	2.72				$	(0.34	)		(12.5	)	%
Revenue per tractor	$	57,300				$	55,500				$	1,800			3.2		%	$	50,400						$	57,000				$	(6,600	)		(11.6	)	%

Company owned tractors, at quarter-end		781					837					(56	)		(6.7	)	%		934							781					153			19.6		%
Owner operator tractors, at quarter-end		1,578					1,601					(23	)		(1.4	)			1,496							1,578					(82	)		(5.2	)
Number of trailers, at quarter-end		3,879					4,207					(328	)		(7.8	)	%		3,821							3,879					(58	)		(1.5	)	%

Company owned tractors, average for the quarter		751					852					(101	)		(11.9	)	%		920							751					169			22.5		%
Owner operator tractors, average for the quarter		1,572					1,611					(39	)		(2.4	)			1,494							1,572					(78	)		(5.0	)
Total tractors, average for the quarter		2,323					2,463					(140	)		(5.7	)	%		2,414							2,323					91			3.9		%

2119

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Revenue. Total revenue ~~increased 19.1%~~decreased 15.4% for the three months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. The ~~increase~~decrease in total revenue was primarily attributed to ~~increased fuel surcharges~~decreased owner operator freight and brokerage revenue due to ~~increased fuel costs~~the macro trend of lower available freight volumes and ~~growth in our brokerage service offering,~~the intentional shift toward loading company-owned tractors as well as lower fuel surcharge due to decreased fuel costs that resulted in lower fuel surcharges to our customers. We invested in additional company-owned tractors, expanded the ~~sustained strong rate environment, with~~company-driver team, and strategically prioritized loads on the company-owned tractors, which led to a 1.8% increase in company freight revenue. Total miles driven increased 2.4%, whereas rate per mile ~~increasing 13.4%~~decreased 9.2%. The ~~increase in total revenue was partially offset by a 7.8%~~ decrease in ~~total miles driven.~~rate per mile was primarily due to a decrease in market rates.

The Company’s Specialized Solutions segment’s revenue ~~increased 18.8%~~decreased 10.1% for the three months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021,~~2022. The decrease in revenue was primarily due to ~~higher~~a 5.9% decrease in rate per mile and a 35.9% decrease in fuel ~~surcharge~~surcharge. We saw revenue increases in the agriculture, energy, mining, and ~~the strong freight rate environment, primarily~~aerospace end markets that were more than offset by revenue declines in the high security cargo, construction, glass, and manufacturing ~~end-markets.~~end markets. Company freight ~~increased 7.8%~~decreased 1.0% for the three months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021~~2022 due to ~~an 8.9% increase~~a 5.7% decrease in company rate per mile, partially offset by a ~~1.0% decrease~~5.0% increase in miles driven due to ~~supply chain delays~~a 9.5% increase in ~~receiving revenue equipment.~~average company owned tractors. Owner operator freight ~~increased 18.4%~~decreased 21.0% due to a ~~36.7% increase~~20.0% decrease in miles driven and a decrease in owner operator rate per ~~mile, partially offset by a 13.4%~~mile. The decrease in owner operator miles ~~driven~~was primarily due to ~~an 8.8%~~a 16.7% decrease in average owner operator tractors. The Company deployed company-owned assets into end-markets with higher rates and margins, and as such, some of the excess volumes, for which the Company was unable to utilize company-owned assets, were captured through our brokerage service offering. This resulted in a 6.5% increase in brokerageBrokerage revenue decreased 8.4% for the three months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021. In this segment,~~2022 due to total brokerage loads ~~were up 2% and~~being down 11% due to lower available loads in the market, partially offset by an increase in brokerage revenue per load ~~was up 4% due to higher rates~~of 3%. We utilized our brokerage service offering for some wind-related projects during the quarter which resulted in the increase in brokerage revenue per load. Fuel surcharge revenue decreased for the three months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021. Fuel surcharge revenue increased 119.6% for the three months ended June 30,~~ 2022 ~~as compared to the same period in 2021~~ due to ~~increased~~decreased fuel ~~costs.~~costs that resulted in lower fuel surcharges to our customers.

The Company’s Flatbed Solutions segment’s revenue decreased 21.9% for the three months ended June 30, 2023 as compared to the same period in 2022, primarily due to a 12.5% decrease in rate per mile and a 33.8% decrease in fuel surcharge, partially offset by a 5.1% increase in total miles, driven by an increase in tractors. Strength primarily in our manufacturing end market was more than offset by declines in the steel and construction end markets. Company freight revenue increased ~~19.4%~~10.1% due to a 24.2% increase in miles driven, partially offset by an 11.4% decrease in company rate per mile. Owner operator freight decreased 16.7% due to a 4.0% decrease in miles driven and a decrease in owner operator rate per mile. There was an increase of 22.5% in the average company owned tractors, and a decrease of 5.0% in the average owner operator tractors for the three months ended June 30, 2023 as compared to the same period in 2022. Brokerage revenue decreased 52.5% for the three months ended June 30, 2023 as compared to the same period in 2022. Our brokerage service offering is typically utilized in strong rate environments in order to capture excess volumes. As a result of the weakening rate environment, total brokerage loads were down 38% and brokerage revenue per load was down 24%, which resulted in the decrease in brokerage revenue. Fuel surcharge revenue decreased 33.8% for the three months ended June 30, 2023 as compared to the same period in 2022 due to decreased fuel costs that resulted in lower fuel surcharges to our customers.

Salaries, Wages and Employee Benefits. Salaries, wages and employee benefits expense, which consists of compensation for all employees, is primarily affected by the number of miles driven by company drivers, the rate per mile paid to company drivers, employee benefits including, but not limited to, health care and workers’ compensation, and to a lesser extent, the number of, and compensation and benefits paid to, non-driver employees. In general, the Specialized Solutions segment drivers receive a higher driver pay per total mile than Flatbed Solutions segment drivers due to the former requiring a higher level of training and expertise.

Salaries, wages and employee benefits expense increased 9.2% for the three months ended June 30, 2023 as compared to the same period in 2022. The increase in salaries, wages and employee benefits expense was primarily due to incremental driver compensation, partially offset by decreased health insurance claims. Salaries, wages and employee benefits expense, as a percentage of consolidated company freight revenue, increased 4.2% for the three months ended June 30, 2023 as compared to the same period in 2022.

The Company’s Specialized Solutions segment’s salaries, wages and employee benefits expense increased 5.3% for the three months ended June 30, 2023 compared to the same period in 2022, primarily as a result of incremental driver compensation, partially offset by decreased health insurance claims. The incremental driver compensation was due to a 2% increase in driver rate and a 5.0% increase in company miles. Salaries, wages and employee benefits expense, as a percentage of Specialized Solutions company freight revenue, increased 3.5% for the three months ended June 30, 2023 as compared to the same period in 2022.

The Company’s Flatbed Solutions segment’s salaries, wages and employee benefits expense increased 17.9% for the three months ended June 30, 2023 compared to the same period in 2022, primarily as a result of incremental driver compensation and increased health insurance premiums. The incremental driver compensation was due to a 24.2% increase in company miles and an 6% increase in driver rate. Salaries, wages and employee benefits expense, as a percentage of Flatbed Solutions company freight revenue, increased 5.0% for the three months ended June 30, 2023 as compared to the same period in 2022.

Fuel. Fuel expense consists primarily of diesel fuel expense for company-owned tractors and fuel taxes. The primary factors affecting fuel expense are the cost of diesel fuel, the miles per gallon realized with company equipment and the number of miles driven by company drivers.

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Total fuel expense decreased 28.5% for the three months ended June 30, 2023 as compared to the same period in 2022. The Company’s Specialized Solutions segment’s fuel expense decreased 31.8% for the three months ended June 30, 2023 as compared to the same period in 2022. The Company’s Flatbed Solutions segment’s fuel expense decreased 19.5% for the three months ended June 30, 2023 as compared to the same period in 2022. These decreases are primarily due to lower fuel costs, partially offset by an increase in company miles driven for the three months ended June 30, 2023 as compared to the same period in 2022. Company miles increased by 5.0% in our Specialized Solutions segment and increased by 24.2% in our Flatbed Solutions segment, when compared to the same period in 2022. The U.S. national average diesel fuel price, as published by the U.S. Department of Energy, was $3.937 for the three months ended June 30, 2023, compared to $5.488 for the same period in 2022.

Operations and Maintenance. Operations and maintenance expense consists primarily of ordinary vehicle repairs and maintenance, costs associated with preparing tractors and trailers for sale or trade-in, driver recruiting, training and safety costs, permitting and pilot car fees and other general operations expenses. Operations and maintenance expense is primarily affected by the age of company-owned tractors and trailers, the number of miles driven in a period and driver turnover.

Operations and maintenance expense increased 5.4% for the three months ended June 30, 2023 as compared to the same period in 2022 primarily due to a $2.2 million increase in maintenance costs primarily related to tractor and trailer repairs as well as preventative maintenance, largely driven by a 10.6% increase in company miles driven. The Company’s Specialized Solutions segment’s operations and maintenance expense increased 2.4% for the three months ended June 30, 2023 as compared to the same period in 2022 primarily as a result of a 5.0% increase in company miles driven. The Company’s Flatbed Solutions segment’s operations and maintenance expense increased 13.2% for the three months ended June 30, 2023 as compared to the same period in 2022 primarily due to a 24.2% increase in company miles driven. Operations and maintenance expense, as a percentage of consolidated revenue (excluding brokerage revenue), for the three months ended June 30, 2023 was generally consistent with the same period in 2022.

Purchased Freight. Purchased freight expense consists of the payments to owner operators, including fuel surcharge reimbursements, and payments to third-party capacity providers that haul loads brokered to them. Purchased freight expense generally takes into account changes in diesel fuel prices, resulting in higher payments during periods of increasing fuel prices.

Total purchased freight expense decreased 27.1% during the three months ended June 30, 2023 as compared to the same period in 2022. Purchased freight expense from owner operators decreased $26.5 million during the three months ended June 30, 2023 as compared to the same period in 2022 as a result of 7.8% decrease in owner operator miles driven. Purchased freight expense from third-party capacity providers decreased $26.9 million during the three months ended June 30, 2023 as compared to the same period in 2022 due to decreased utilization of third-party providers and strategically prioritizing loads on the company-owned tractors. Purchased freight expense, as a percentage of consolidated revenue, for the three months ended June 30, 2023, decreased 5.6% as compared to the same period in 2022.

The Company’s Specialized Solutions segment’s purchased freight expense decreased 17.7% during the three months ended June 30, 2023 as compared to the same period in 2022. Purchased freight expense from owner operators decreased $10.2 million during the three months ended June 30, 2023 as compared to the same period in 2022, as a result of a 20.0% decrease in owner operator miles driven and a 1.2% decrease in owner operators’ rate. Purchased freight expense from third-party capacity providers decreased $3.4 million during the three months ended June 30, 2023 as compared to the same period in 2022 due to decreased utilization of third-party providers and strategically prioritizing loads on the company-owned tractors. Purchased freight expense, as a percentage of Specialized Solutions revenue, for the three months ended June 30, 2023, was generally consistent with the same period in 2022.

The Company’s Flatbed Solutions segment’s purchased freight expense decreased 33.1% for the three months ended June 30, 2023 as compared to the same period in 2022. Purchased freight expense from owner operators decreased $16.3 million for the three months ended June 30, 2023 as compared to the same period in 2022, as a result of a 4.0% decrease in owner operator miles driven and a 13.3% decrease in owner operators’ rate. Purchased freight expense from third-party capacity providers decreased $23.5 million during the three months ended June 30, 2023 as compared to the same period in 2022 due to decreased utilization of third-party providers and strategically prioritizing loads on the company-owned tractors. Purchased freight expense, as a percentage of Flatbed Solutions revenue, for the three months ended June 30, 2023, decreased 8.0% as compared to the same period in 2022.

Depreciation and Amortization. Depreciation and amortization expense consists primarily of depreciation for company-owned tractors and trailers and amortization of finance lease right-of-use assets. The primary factors affecting these expense items include the size of the fleet and age of company-owned tractors and trailers and the cost of new equipment. Amortization of intangible assets is also included in this expense.

Depreciation and amortization expense increased 14.1% for the three months ended June 30, 2023 as compared to the same period in 2022. The Company’s Specialized Solutions segment’s depreciation and amortization expense for the three months ended June 30, 2023 was generally consistent with the same period in 2022. The Company’s Flatbed Solutions segment’s depreciation and amortization expense increased 30.2% for the three months ended June 30, 2023 as compared to the same period in 2022. These increases were primarily related to the increase of company-owned tractors.

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Insurance and Claims. Insurance and claims expense consists of insurance premiums and the accruals the Company makes for estimated payments and expenses for claims for bodily injury, property damage, cargo damage and other casualty events. Factors affecting the Company’s insurance and claims expense are the frequency and severity of accidents, trends in the development factors used in its accruals and developments in large, prior-year claims. The frequency of accidents tends to correlate with the miles the Company travels; however, insurance and claims expense could increase in periods where there are claims in excess of the Company’s self-insured retention. Insurance and claims expense decreased 8.0% during the three months ended June 30, 2023 as compared to the same period in 2022, primarily due to a $2.9 million decrease in insurance claims, partially offset by a $1.0 million increase in the estimate of incurred but not recorded claims and a $0.5 million increase in insurance premiums.

Impairment. Impairment expense was $1.5 million for the three months ended June 30, 2023 related to trade name intangibles of an integrated operating segment within the Company’s Flatbed Solutions segment. Impairment expense was $7.8 million for the three months ended June 30, 2022 related to goodwill, trade name intangibles, and customer relationships intangibles of an integrated operating segment within the Company’s Specialized Solutions segment. The Company’s Flatbed Solutions segment’s impairment expense was $1.5 million, all related to trade name intangibles, for the three months ended June 30, 2023. The Company’s Specialized Solutions segment had no impairment expense for the three months ended June 30, 2023. The Company’s Specialized Solutions segment’s impairment expense was $7.8 million, consisting of $5.7 million related to goodwill, $1.9 million related to trade name intangibles, and $0.2 million related to customer relationships intangibles, for the three months ended June 30, 2022. The Company’s Flatbed Solutions segment had no impairment expense for the three months ended June 30, 2022.

Other Expense (Income). Interest expense consists of cash interest, amortization and write-off of related issuance costs and fees. Interest expense increased 74.7% for the three months ended June 30, 2023 as compared to the same period in ~~2021,~~2022 primarily due to ~~higher fuel surcharge and the strong~~a rising interest rate environment, ~~driven by strength in the construction, steel and manufacturing industries. Owner operator freight increased 1.5% due to~~ an ~~8.6%~~ increase in ~~owner operator rate per mile, partially offset by~~financed equipment purchases, and a ~~6.5% decrease in miles driven. The Company deployed company-owned assets into end-markets with higher rates and margins, and as such, some~~$0.7 million write-off of deferred amortization fees related to the prepayment of the ~~excess volumes, for which the Company strategically captured through our brokerage service offering. This resulted in an 88.1% increase in brokerage revenue~~Term Loan Facility.

Income Tax. Income tax expense was $3.8 million for the three months ended June 30, 2023 compared to income tax expense of $7.7 million for the same period in 2022. The effective tax rate was 40.0% for the three months ended June 30, 2023, compared to 30.3% for the same period in 2022. The difference between the Company’s effective tax rate and the federal statutory rate is primarily a result of state and foreign income taxes, global intangible low-taxed income inclusion, and the impact of certain nondeductible expenses related to executive compensation and driver per diem as compared to forecasted earnings.

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The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue), derived from the Company’s consolidated statements of operations, for the six months ended June 30, 2023 and 2022, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.


	Six Months Ended June 30,
	2023							2022							Change
(Dollars in millions, except Rate per mile and Revenue per tractor)	Amount			%				Amount			%				Absolute			Relative
REVENUE:
Company freight	$	331.2			41.0		%	$	323.8			35.9		%	$	7.4			2.3		%
Owner operator freight		225.0			27.9				267.7			29.7				(42.7	)		(16.0	)
Brokerage		123.8			15.3				170.1			18.9				(46.3	)		(27.2	)
Logistics		30.2			3.7				25.4			2.8				4.8			18.9
Fuel surcharge		96.9			12.1				115.3			12.7				(18.4	)		(16.0	)
Total revenue	$	807.1			100.0		%	$	902.3			100.0		%	$	(95.2	)		(10.6	)	%

OPERATING EXPENSES:
Salaries, wages and employee benefits	$	211.3			26.2		%	$	194.7			21.6		%	$	16.6			8.5		%
Fuel		68.0			8.4				80.4			8.9				(12.4	)		(15.4	)
Operations and maintenance		85.4			10.6				76.4			8.5				9.0			11.8
Purchased freight		288.0			35.7				368.6			40.9				(80.6	)		(21.9	)
Administrative		35.0			4.3				35.0			3.9				—			—
Taxes and licenses		7.9			1.0				7.7			0.9				0.2			2.6
Insurance and claims		32.9			4.1				41.0			4.5				(8.1	)		(19.8	)
Acquisition-related transaction expenses		1.2			0.1				3.3			0.4				(2.1	)		(63.6	)
Depreciation and amortization		51.0			6.3				44.3			4.9				6.7			15.1
Gain on disposition of revenue property and equipment		(8.4	)		(1.0	)			(9.1	)		(1.0	)			0.7			(7.7	)
Impairment		1.5			0.2				7.8			0.9				(6.3	)		(80.8	)
Restructuring		0.3			—				1.2			0.1				(0.9	)		(75.0	)
Total operating expenses	$	774.1			95.9		%	$	851.3			94.3		%	$	(77.2	)		(9.1	)	%

INCOME FROM OPERATIONS	$	33.0			4.1		%	$	51.0			5.7		%	$	(18.0	)		(35.3	)	%

Other expense:
Interest income	$	(2.6	)		(0.3	)	%	$	(0.8	)		(0.1	)	%		1.8			225.0		%
Interest expense		25.7			3.2				14.6			1.6				11.1			76.0
Change in fair value of warrant liability		—			—				(4.7	)		(0.5	)			(4.7	)		(100.0	)
Other		(0.5	)		(0.1	)			0.1			—				(0.6	)		(600.0	)
Total other expense	$	22.6			2.8		%	$	9.2			1.0		%	$	7.6			82.6		%

Income before income taxes		10.4			1.3		%		41.8			4.6		%		(25.6	)		(61.2	)	%
Income tax expense		4.2			0.5				11.1			1.2				(6.9	)		(62.2	)
Net income	$	6.2			0.8		%	$	30.7			3.4		%	$	(18.7	)		(60.9	)	%

OPERATING STATISTICS:
Company miles		116.1							105.3							10.8			10.3		%
Owner operator miles		80.8							88.7							(7.9	)		(8.9	)
Total miles (in millions)		196.9							194.0							2.9			1.5		%

Rate per mile	$	2.82						$	3.05						$	(0.23	)		(7.5	)	%
Revenue per tractor	$	114,400						$	127,700						$	(13,300	)		(10.4	)	%

Company owned tractors, at period-end		2,984							2,652							332			12.5		%
Owner operator tractors, at period-end		1,877							2,038							(161	)		(7.9	)
Number of trailers, at period-end		10,886							11,050							(164	)		(1.5	)	%

Company owned tractors, average for the period		2,943							2,583							360			13.9		%
Owner operator tractors, average for the period		1,920							2,049							(129	)		(6.3	)
Total tractors, average for the period		4,863							4,632							231			5.0		%

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The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue) of the Company’s Specialized Solutions segment for the six months ended June 30, 2023 and 2022, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.

SPECIALIZED SOLUTIONS


	Six Months Ended June 30,
	2023					2022					Change
(Dollars in millions, except Rate per mile and Revenue per tractor)	Amount		%			Amount		%			Absolute			Relative
REVENUE:
Company freight	$	239.3		50.9	%	$	239.8		48.7	%	$	(0.5	)		(0.2	)	%
Owner operator freight		76.4		16.3			90.3		18.3			(13.9	)		(15.4	)
Brokerage		77.8		16.5			81.3		16.5			(3.5	)		(4.3	)
Logistics		28.1		6.0			23.3		4.7			4.8			20.6
Fuel surcharge		48.5		10.3			58.1		11.8			(9.6	)		(16.5	)
Total revenue	$	470.1		100.0	%	$	492.8		100.0	%	$	(22.7	)		(4.6	)	%

OPERATING EXPENSES:
Salaries, wages and employee benefits	$	141.8		30.2	%	$	133.7		27.1	%	$	8.1			6.1		%
Fuel		47.6		10.1			58.1		11.8			(10.5	)		(18.1	)
Operations and maintenance		60.5		12.9			54.6		11.1			5.9			10.8
Purchased freight		124.4		26.5			141.3		28.7			(16.9	)		(12.0	)
Depreciation and amortization		26.4		5.6			25.6		5.2			0.8			3.1
Impairment		—		—			7.8		1.6			(7.8	)		(100.0	)
Restructuring		0.3		0.1			0.9		0.2			(0.6	)		(66.7	)
Other operating expenses		43.0		9.1			47.6		9.7			(4.6	)		(9.7	)
Total operating expenses	$	444.0		94.4	%	$	469.6		95.3	%	$	(25.6	)		(5.5	)	%

INCOME FROM OPERATIONS	$	26.1		5.6	%	$	23.2		4.7	%	$	2.9			12.5		%

OPERATING STATISTICS:
Company miles		77.5					73.8					3.7			5.0		%
Owner operator miles		17.6					21.6					(4.0	)		(18.5	)
Total miles (in millions)		95.1					95.4					(0.3	)		(0.3	)	%

Rate per mile	$	3.32				$	3.46				$	(0.14	)		(4.0	)	%
Revenue per tractor	$	129,200				$	143,100				$	(13,900	)		(9.7	)	%

Company owned tractors, at period-end		2,050					1,871					179			9.6		%
Owner operator tractors, at period-end		381					460					(79	)		(17.2	)
Number of trailers, at period-end		7,065					7,171					(106	)		(1.5	)	%

Company owned tractors, average for the period		2,033					1,830					203			11.1		%
Owner operator tractors, average for the period		411					476					(65	)		(13.7	)
Total tractors, average for the period		2,444					2,306					138			6.0		%

Table of Contents

The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue) of the Company’s Flatbed Solutions segment for the six months ended June 30, 2023 and 2022, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.

FLATBED SOLUTIONS


	Six Months Ended June 30,
	2023					2022					Change
(Dollars in millions, except Rate per mile and Revenue per tractor)	Amount		%			Amount		%			Absolute			Relative
REVENUE:
Company freight	$	91.9		27.3	%	$	84.0		20.5	%	$	7.9			9.4		%
Owner operator freight		148.6		44.1			177.4		43.3			(28.8	)		(16.2	)
Brokerage		46.0		13.6			88.8		21.7			(42.8	)		(48.2	)
Logistics		2.1		0.6			2.1		0.5			—			—
Fuel surcharge		48.4		14.4			57.2		14.0			(8.8	)		(15.4	)
Total revenue	$	337.0		100.0	%	$	409.5		100.0	%	$	(72.5	)		(17.7	)	%

OPERATING EXPENSES:
Salaries, wages and employee benefits	$	69.5		20.6	%	$	61.0		14.9	%	$	8.5			13.9		%
Fuel		20.4		6.1			22.3		5.4			(1.9	)		(8.5	)
Operations and maintenance		24.9		7.4			21.8		5.3			3.1			14.2
Purchased freight		163.6		48.5			227.3		55.5			(63.7	)		(28.0	)
Depreciation and amortization		24.6		7.3			18.7		4.6			5.9			31.6
Impairment		1.5		0.4			—		—			1.5			100.0
Restructuring		—		—			0.3		0.1			(0.3	)		(100.0	)
Other operating expenses		25.6		7.6			30.3		7.4			(4.7	)		(15.5	)
Total operating expenses	$	330.1		98.0	%	$	381.7		93.2	%	$	(51.6	)		(13.5	)	%

INCOME FROM OPERATIONS	$	6.9		2.0	%	$	27.8		6.8	%	$	(20.9	)		(75.2	)	%

OPERATING STATISTICS:
Company miles		38.6					31.5					7.1			22.5		%
Owner operator miles		63.2					67.1					(3.9	)		(5.8	)
Total miles (in millions)		101.8					98.6					3.2			3.2		%

Rate per mile	$	2.36				$	2.65				$	(0.29	)		(10.9	)	%
Revenue per tractor	$	99,400				$	112,400				$	(13,000	)		(11.6	)	%

Company owned tractors, at period-end		934					781					153			19.6		%
Owner operator tractors, at period-end		1,496					1,578					(82	)		(5.2	)
Number of trailers, at period-end		3,821					3,879					(58	)		(1.5	)	%

Company owned tractors, average for the period		910					753					157			20.8		%
Owner operator tractors, average for the period		1,509					1,573					(64	)		(4.1	)
Total tractors, average for the period		2,419					2,326					93			4.0		%

Table of Contents

Revenue. Total revenue decreased 10.6% for the six months ended June 30, 2023 as compared to the same period in ~~2021. In this segment,~~2022. The decrease in total revenue was primarily attributed to decreased owner operator freight and brokerage ~~loads were up 40%~~revenue due to the macro trend of lower available freight volumes and the ~~brokerage revenue per load was up 34%~~intentional shift toward loading company-owned tractors as well as lower fuel surcharge due to ~~higher rates during~~decreased fuel costs that resulted in lower surcharges to our customers. In addition, rate per mile decreased 7.5%; however, total miles driven increased 1.5%.

The Company’s Specialized Solutions segment’s revenue decreased 4.6% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021. Fuel~~2022, primarily due to decreased owner operator freight and brokerage revenue, due to lower available freight volumes, as well as a decrease in fuel surcharge revenue, ~~increased 93.2%~~ due to ~~increased~~lower fuel ~~costs.~~costs, slightly offset by an increase logistic revenue. We saw revenue increases due to our SJ Transportation acquisition in March 2022, as well as increases in the agriculture and energy end markets and revenue declines in the construction, manufacturing, glass, and high security cargo end markets. Company freight ~~revenue~~for the six months ended June 30, 2023 was generally consistent with the same period in 2022. Owner operator freight decreased ~~10.1%~~15.4% primarily due to ~~supply chain delays in receiving revenue equipment which led to a 19.1%~~an 18.5% decrease in miles, partially offset by a ~~9.6%~~3.8% increase in owner operator rate per mile. The decrease in owner operator miles was primarily due to the 13.7% decrease in owner operator tractors. Total brokerage loads decreased 14% while brokerage revenue per load increased 11%, resulting in a decrease of 4.3% in brokerage revenue for the six months ended June 30, 2023 as compared to the same period in 2022. We utilized our brokerage service offering for some wind-related projects during the six months ended June 30, 2023 which resulted in the increase in brokerage revenue per load. Fuel surcharge revenue decreased 16.5% for the six months ended June 30, 2023 as compared to the same period in 2022 due to decreased fuel costs that resulted in lower fuel surcharges to our customers.

The Company’s Flatbed Solutions segment’s revenue decreased 17.7% for the six months ended June 30, 2023 as compared to the same period in 2022, primarily due to decreases in brokerage revenue, fuel surcharge, and owner operator freight, partially offset by an increase in company freight. We saw strength primarily in our manufacturing end market and declines in the steel and construction end markets. Brokerage revenue decreased 48.2% in for the six months ended June 30, 2023 as compared to the same period in 2022. In this segment, total brokerage loads dropped 38% and the brokerage revenue per load dropped 17% due to lower rates during the six months ended June 30, 2023 as compared to the same period in 2022. Owner operator freight decreased 16.2% due to an 11.1% decrease in owner operator rate per mile and a 5.8% decrease in miles driven. Fuel surcharge revenue decreased 15.4% due to decreased fuel costs that resulted in lower fuel surcharges to our customers. Company freight revenue increased 9.4% due to receiving additional trucks which led to a 22.5% increase in miles, partially offset by a 10.7% decrease in rate per mile.

Salaries, wages and employee benefits expense increased ~~4.1%~~8.5% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. The increase in salaries, wages and employee benefits expense was primarily due to ~~increased stock~~incremental driver compensation, offset by decreased health insurance ~~higher driver pay and increased employee headcount related to the expansion of corporate functions in legal, accounting and risk management, partially offset by a decrease in accrued bonuses.~~claims. Salaries, wages and employee benefits expense, as a percentage of consolidated ompany freight revenue, ~~(excluding brokerage revenue), decreased 2.7%~~increased 3.7% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022.

The Company’s Specialized Solutions segment’s salaries, wages and employee benefits expense increased ~~9.0%~~6.1% for the ~~three~~six months ended June 30, ~~2022~~2023 compared to the same period in ~~2021,~~2022, primarily as a result of ~~increased~~incremental driver compensation, partially offset by decreased health insurance ~~claims and higher~~claims. The incremental driver ~~and non-driver pay. The increased driver pay~~compensation was due to a ~~10%~~2% increase in driver ~~rate, slightly offset by a 1.0% decrease in Company miles.~~rate. Salaries, wages and employee benefits expense, as a percentage of Specialized Solutions company freight revenue, ~~(excluding brokerage revenue), decreased 3.2%~~increased 3.5% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022.

The Company’s Flatbed Solutions segment’s salaries, wages and employee benefits expense ~~decreased 8.6%~~increased 13.9% for the ~~three~~six months ended June 30, ~~2022~~2023 compared to the same period in ~~2021,~~2022, primarily as a result of ~~the~~incremental driver compensation, offset by decreased ~~employee headcount and lower~~health insurance claims. The incremental driver ~~pay~~compensation was due to a ~~19.1% decrease~~22.5% increase in ~~Company~~company miles ~~partially offset by an 11%~~and a 7% increase in driver rate. Salaries, wages and employee benefits expense, as a percentage of Flatbed Solutions company freight revenue, ~~(excluding brokerage revenue), decreased 2.9%~~increased 3.0% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022.

2226

Table of Contents

Total fuel expense ~~increased 67.8%~~decreased 15.4% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021. This increase was primarily due to a 70.9% increase in fuel price, partially offset by a 7.1% decrease in Company miles driven.~~2022. The Company’s Specialized Solutions segment’s fuel expense ~~increased 77.4%~~decreased 18.1% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021, primarily as a result of the increase in~~2022. The Company’s Flatbed Solutions segment’s fuel ~~price, partially offset by a 1.0% decrease in Company miles driven~~expense decreased 8.5% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021. The Company’s Flatbed Solutions segment’s~~2022. These decreases are primarily due to lower fuel ~~expense increased 47.6%~~costs and negotiated fuel rebates, partially offset by an increase in company miles driven for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021, as a result of the increase in fuel price, partially offset by a 19.1% decrease in~~2022. Company miles ~~driven for the three months ended June 30, 2022 as~~increased by 5.0% in our Specialized Solutions segment and increased by 22.5% in our Flatbed Solutions segment, when compared to the same period in ~~2021.~~2022. The U.S. national average diesel fuel price, as published by the U.S. Department of Energy, was ~~$5.488~~$4.175 for the ~~three~~six months ended June 30, ~~2022,~~2023, compared to ~~$3.212~~$4.866 for the same period in ~~2021.~~2022.

Operations and maintenance expense increased ~~7.5%~~11.8% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021~~2022 primarily due to a ~~$2.6~~$5.9 million increase in ~~repairs, tires, and preventive~~ maintenance and upkeep ~~of tractors~~costs and ~~trailers.~~a $3.1 million increase in pilot car and permit fees, largely driven by a 10.3% increase in company miles driven. The Company’s Specialized Solutions segment’s operations and maintenance expense increased ~~8.2%~~10.8% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021~~2022 primarily asdue to a ~~result of a $1.9 million increase in repairs and tires for tractors and trailers.~~5.0% increase.in company miles driven. The Company’s Flatbed Solutions segment’s operations and maintenance expense ~~was generally consistent~~increased 14.2% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022 primarily as a result of a 22.5% increase in company miles driven. Operations and maintenance expense, as a percentage of consolidated revenue (excluding brokerage revenue), ~~was generally consistent~~ for the ~~three~~six months ended June 30, ~~2022 as compared to~~2023 was generally consistent with the same period in ~~2021.~~2022.

Total purchased freight expense ~~increased 26.9%~~decreased 21.9% during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. Purchased freight expense from owner operators ~~was generally consistent~~decreased $56.0 million during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021. Purchased freight expense from third-party capacity providers increased $41.8 million, or 86.0%, during the three months ended June 30,~~ 2022 as compared to the same period in 2021, as a result of an increase in utilization of third-party capacity providers due to supply chain delays in receiving revenue equipment. In addition, the cost of diesel fuel increased by 70.9% during the three months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense, as a percentage of consolidated revenue, for the three months ended June 30, 2022, increased 2.5% as compared to the same period in 2021.

The Company’s Specialized Solutions segment’s purchased freight expense increased 19.8% during the three months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense from owner operators increased $3.6 million, or 11.4%, during the three months ended June 30, 2022 as compared to the same period in 2021, as a result of a ~~36.7% increase~~7.7% decrease in owner operators’ rate ~~partially offset by a 13.4%~~and an 8.9% decrease in owner operator miles driven. Purchased freight expense from third-party capacity providers ~~increased $9.5~~decreased $24.6 million ~~or 27.5%,~~ during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021, as a result of an increase in~~2022 due to decreased utilization of third-party ~~capacity~~ providers ~~due to supply chain delays in receiving revenue equipment. As mentioned above, there was also an increase in~~and strategically prioritizing loads on the company-owned tractors. In addition, the cost of diesel fuel decreased, which reduced the fuel surcharge reimbursements to owner operators during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. Purchased freight expense, as a percentage of consolidated revenue, for the six months ended June 30, 2023, decreased 5.2% as compared to the same period in 2022.

The Company’s Specialized Solutions segment’s purchased freight expense decreased 12.0% during the six months ended June 30, 2023 as compared to the same period in 2022. Purchased freight expense from owner operators decreased $15.9 million during the six months ended June 30, 2023 as compared to the same period in 2022, as a result of an 18.5% decrease in owner operator miles driven, partially offset by a 3.8% increase in owner operators' rate. Purchased freight expense from third-party capacity providers decreased $1.0 million during the six months ended June 30, 2023 as compared to the same period in 2022 due to decreased utilization of third-party providers and strategically prioritizing loads on the company-owned tractors. As mentioned above, there was also a decrease in the cost of diesel fuel which led to decreased fuel surcharge reimbursements during the six months ended June 30, 2023 as compared to the same period in 2022. Purchased freight expense, as a percentage of Specialized Solutions revenue, for the ~~three~~six months ended June 30, ~~2022, increased 0.2% as compared to~~2023, was generally consistent with the same period in ~~2021.~~2022.

The Company’s Flatbed Solutions segment’s purchased freight expense ~~increased 31.6%~~decreased 28.0% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. Purchased freight expense from owner operators decreased ~~$3.6~~$40.1 million ~~or 4.8%,~~ for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021,~~2022, as a result of a ~~6.5%~~5.8% decrease in owner operator miles driven ~~partially offset by~~and an ~~8.6% increase~~11.1% decrease in owner operators’ rate. Purchased freight expense from third-party capacity providers ~~increased $32.7~~decreased $23.6 million ~~or 191.2%,~~ during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021, primarily as a result of increased~~2022 due to decreased utilization of third-party ~~capacity~~ providers ~~due to supply chain delays in receiving revenue equipment.~~and strategically prioritizing loads on the company-owned tractors. As mentioned above, there was also ~~an increase~~a decrease in the cost of diesel fuel which led to decreased fuel surcharge reimbursements during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. Purchased freight expense, as a percentage of Flatbed Solutions revenue, for the ~~three~~six months ended June 30, ~~2022, increased 5.2%~~2023, decreased 7.0% as compared to the same period in ~~2021.~~2022.

Depreciation and Amortization. Depreciation and amortization expense consists primarily of depreciation for company-owned tractors and trailers and amortization of those financed with finance leases. The primary factors affecting these expense items include the size of the fleet and age of company-owned tractors and trailers and the cost of new equipment. Amortization of intangible assets is also included in this expense.

2327

Table of Contents

Depreciation and amortization expense ~~was generally consistent~~increased 15.1% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. The Company’s Specialized Solutions segment’s depreciation and amortization expense ~~decreased 1.5%~~increased 3.1% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021~~2022 as a result of ~~a 0.6% decrease~~an 11.1% increase in average tractor count in the segment’s fleet. The Company’s Flatbed Solutions segment’s depreciation and amortization expense increased ~~5.6%~~31.6% for the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021~~2022 as a result of ~~recent revenue equipment additions partially offset by disposals~~a 20.8% increase in average tractor count in the segment’s fleet. The increase of ~~fully depreciated revenue equipment.~~

~~Impairment.~~ ~~Impairment expense was $7.8 million for the three months ended June 30, 2022~~company-owned tractors primarily related to ~~goodwill, trade name intangibles, and customer relationships intangibles of an integrated operating segment within the Company’s Specialized Solutions segment. There was no impairment expense~~capital expenditures that were originally planned for ~~the three months ended June 30, 2021. The Company’s Specialized Solutions segment’s impairment expense was $7.8 million consisting of $5.7 million related~~2022 but were previously delayed due to goodwill, $1.9 million related to trade name intangibles, and $0.2 million related to customer relationships intangibles for the three months ended June 30, 2022. The Company’s Specialized Solutions segment had no impairment expense for three months ended June 30, 2021. The Company’s Flatbed Solutions segment had no impairment expense for the three months ended June 30, 2022 and 2021.supply chain disruptions.

Insurance and Claims. Insurance and claims expense consists of insurance premiums and the accruals the Company makes for estimated payments and expenses for claims for bodily injury, property damage, cargo damage and other casualty events. ~~The primary factor~~Factors affecting the Company’s insurance and claims expense ~~is seasonality (the Company typically experiences higher accident frequency in winter months), the~~are frequency and severity of accidents, trends in the development factors used in its accruals and developments in large, prior-year claims. The frequency of accidents tends to correlate with the miles the Company travels; however, insurance and claims expense could increase in periods where there are claims in excess of the Company’s self-insured retention. Insurance and claims expense ~~increased 77.8%~~decreased 19.8% during the ~~three~~six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021~~2022, primarily due to $16.0 million decrease in insurance claims, partially offset by a ~~$5.8 million~~$7.5 increase in ~~our estimate of~~ incurred but not ~~reported~~recorded claims ~~combined with~~and a ~~$1.9~~$0.4 million increase in insurance ~~claims, primarily resulting from claims over the Company’s self-insured retention. In addition, there was a $0.3 million increase in certain insurance~~ premiums.

~~Other (Income) Expense.~~Impairment. ~~Interest expense consists of cash interest, amortization and write-off of related issuance costs and fees. Interest~~Impairment expense was ~~generally consistent for the three months ended June 30, 2022 as compared to the same period in 2021.~~ ~~The Company’s common stock purchase warrants expired during~~ ~~three months ended March 31, 2022~~ ~~and are no longer exercisable.~~ ~~Change in fair value of warrant liability was a gain of $7.8~~$1.5 million ~~for the same period in 2021. The change in fair value is directly related to the fair value of the warrant liability as of each period end as calculated using Level 1 and Level 3 inputs.~~

~~Income Tax.~~ Income tax expense was $7.7 million for the three months ended June 30, 2022 compared to income tax expense of $10.7 million for the same period in 2021. The effective tax rate was 30.3% for the three months ended June 30, 2022, compared to 23.3% for the same period in 2021. The difference between the Company’s effective tax rate and the federal statutory rate primarily results from the impact of the permanent disallowance of goodwill impairment in the second quarter of 2022.

~~Table of Contents~~

The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue), derived from the Company’s consolidated statements of operations, for the six months ended June 30, ~~2022 and 2021, as well as certain~~2023 related to trade name intangibles of an integrated operating statistics for the same periods. In addition, the absolute and relative changes for each are presented. Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.

Six Months Ended June 30,

2022

2021

Increase (Decrease)
(Dollars in millions, except Rate per mile and Revenue per tractor)

Amount

%

Amount

%

Absolute

Relative
REVENUE:

Company freight

$
323.8

35.9

%

$
308.7

41.8

%

$
15.1

4.9

%
Owner operator freight

267.7

29.7

234.2

31.7

33.5

14.3

Brokerage

170.1

18.9

115.2

15.6

54.9

47.7

Logistics

25.4

2.8

19.2

2.6

6.2

32.3

Fuel surcharge

115.3

12.7

60.6

8.3

54.7

90.3

Total revenue

$
902.3

100.0

%

$
737.9

100.0

%

$
164.4

22.3

%

OPERATING EXPENSES:

Salaries, wages and employee benefits

$
194.7

21.6

%

$
184.1

24.9

%

$
10.6

5.8

%
Fuel

80.4

8.9

52.4

7.1

28.0

53.4

Operations and maintenance

74.5

8.3

67.6

9.2

6.9

10.2

Communications

1.9

0.2

2.2

0.3

(0.3
)

(13.6
)

Purchased freight

368.6

40.9

276.7

37.5

91.9

33.2

Administrative

34.0

3.8

29.2

4.0

4.8

16.4

Sales and marketing

1.0

0.1

1.1

0.1

(0.1
)

(9.1
)

Taxes and licenses

7.7

0.9

7.7

1.0

—

—

Insurance and claims

41.0

4.5

26.7

3.6

14.3

53.6

Acquisition-related transaction expenses

3.3

0.4

—

—

3.3

100.0

Depreciation and amortization

44.3

4.9

44.4

6.0

(0.1
)

(0.2
)

Gain on disposition of revenue property and equipment

(9.1
)

(1.0
)

(7.7
)

(1.0
)

(1.4
)

18.2

Impairment

7.8

0.9

—

—

7.8

100.0

Restructuring charges

1.2

0.1

0.1

—

1.1

1,100.0

Total operating expenses

$
851.3

94.3

%

$
684.5

92.8

%

$
166.8

24.4

%

INCOME FROM OPERATIONS

$
51.0

5.7

%

$
53.4

7.2

%

$
(2.4
)

(4.5
)
%

Other expense:

Interest income

$
(0.8
)

(0.1
)
%

$
(0.2
)

—

%

$
(0.6
)

300.0

%
Interest expense

14.6

1.6

18.7

2.5

(4.1
)

(21.9
)

Change in fair value of warrant liability

(4.7
)

(0.5
)

(2.2
)

(0.3
)

(2.5
)

113.6

Other

0.1

—

(0.8
)

(0.1
)

0.9

(112.5
)

Total other expense

$
9.2

1.0

%

$
15.5

2.1

%

$
(6.3
)

(40.6
)
%

Income before income taxes

41.8

4.6

%

37.9

5.1

%

3.9

10.3

%
Income tax expense

11.1

1.2

9.9

1.3

1.2

12.1

Net income

$
30.7

3.4

%

$
28.0

3.8

%

$
2.7

9.6

%

OPERATING STATISTICS:

Company miles

105.3

116.4

(11.1
)

(9.5
)
%
Owner operator miles

88.7

92.6

(3.9
)

(4.2
)

Total miles (in millions)

194.0

209.0

(15.0
)

(7.2
)
%

Rate per mile

$
3.05

$
2.60

$
0.45

17.3

%
Revenue per tractor

$
127,700

$
111,100

$
16,600

14.9

%

Company owned tractors, at quarter-end

2,652

2,715

(63
)

(2.3
)
%
Owner operator tractors, at quarter-end

2,038

2,112

(74
)

(3.5
)

Number of trailers, at quarter-end

11,050

11,266

(216
)

(1.9
)
%

Company owned tractors, average for the period

2,583

2,778

(195
)

(7.0
)
%
Owner operator tractors, average for the period

2,049

2,110

(61
)

(2.9
)

Total tractors, average for the period

4,632

4,888

(256
)

(5.2
)
%

~~Table of Contents~~

~~The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue) of the Company’s Specialized Solutions~~ segment ~~for the six months ended June 30, 2022 and 2021, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented.~~ Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.

~~SPECIALIZED SOLUTIONS~~

Six Months Ended June 30,

2022

2021

Increase (Decrease)
(Dollars in millions, except Rate per mile and Revenue per tractor)

Amount

%

Amount

%

Absolute

Relative
REVENUE(1):

Company freight

$
244.0

49.1

%

$
221.1

54.0

%

$
22.9

10.4

%
Owner operator freight

90.3

18.2

75.3

18.4

15.0

19.9

Brokerage

81.3

16.4

68.1

16.6

13.2

19.4

Logistics

23.4

4.7

16.5

4.0

6.9

41.8

Fuel surcharge

58.1

11.6

28.8

7.0

29.3

101.7

Total revenue

$
497.1

100.0

%

$
409.8

100.0

%

$
87.3

21.3

%

OPERATING EXPENSES(1):

Salaries, wages and employee benefits

$
125.8

25.3

%

$
115.2

28.1

%

$
10.6

9.2

%
Fuel

58.1

11.7

35.7

8.7

22.4

62.7

Operations and maintenance

53.3

10.7

46.9

11.4

6.4

13.6

Purchased freight

145.8

29.3

115.5

28.2

30.3

26.2

Depreciation and amortization

25.2

5.1

26.2

6.4

(1.0
)

(3.8
)

Impairment

7.8

1.6

—

—

7.8

100.0

Restructuring charges

0.4

0.1

0.1

—

0.3

300.0

Other operating expenses

40.4

8.1

30.7

7.5

9.7

31.6

Total operating expenses

$
456.8

91.9

%

$
370.3

90.4

%

$
86.5

23.4

%

INCOME FROM OPERATIONS

$
40.3

8.1

%

$
39.5

9.6

%

$
0.8

2.0

%

OPERATING STATISTICS:

��

Company miles

73.8

76.2

(2.4
)

(3.1
)
%
Owner operator miles

21.6

24.1

(2.5
)

(10.4
)

Total miles (in millions)

95.4

100.3

(4.9
)

(4.9
)
%

Rate per mile

$
3.50

$
2.96

$
0.54

18.2

%
Revenue per tractor

$
145,000

$
124,000

$
21,000

16.9

%

Company owned tractors, at quarter-end

1,871

1,878

(7
)

(0.4
)
%
Owner operator tractors, at quarter-end

460

511

(51
)

(10.0
)

Number of trailers, at quarter-end

7,171

7,059

112

1.6

%

Company owned tractors, average for the period

1,830

1,882

(52
)

(2.8
)
%
Owner operator tractors, average for the period

476

509

(33
)

(6.5
)

Total tractors, average for the period

2,306

2,391

(85
)

(3.6
)
%

~~(1)~~

~~Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.~~

~~Table of Contents~~

~~The following table sets forth revenue, operating expenses and income from operations (in dollars and as a percentage of total revenue) of~~within the Company’s Flatbed Solutions ~~segment for the six months ended June 30, 2022 and 2021, as well as certain operating statistics for the same periods. In addition, the absolute and relative changes for each are presented.~~ Rate per mile is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by total number of company and owner operator miles driven in the period. Miles are estimated based on information received as of the filing date and may change quarter to quarter when final information is received from each operating segment. ~~Revenue per tractor is the period’s revenue less fuel surcharge, brokerage and logistics revenues divided by the average number of tractors in the period, including owner operator tractors.~~

~~FLATBED SOLUTIONS~~

Six Months Ended June 30,

2022

2021

Increase (Decrease)
(Dollars in millions, except Rate per mile and Revenue per tractor)

Amount

%

Amount

%

Absolute

Relative
REVENUE(1):

Company freight

$
84.4

20.5

%

$
92.4

27.6

%

$
(8.0
)

(8.7
)
%
Owner operator freight

178.3

43.4

159.9

47.8

18.4

11.5

Brokerage

88.8

21.6

47.5

14.2

41.3

86.9

Logistics

2.0

0.5

2.5

0.7

(0.5
)

(20.0
)

Fuel surcharge

57.6

14.0

32.1

9.7

25.5

79.4

Total revenue

$
411.1

100.0

%

$
334.4

100.0

%

$
76.7

22.9

%

OPERATING EXPENSES(1):

Salaries, wages and employee benefits

$
54.6

13.3

%

$
57.7

17.3

%

$
(3.1
)

(5.4
)
%
Fuel

22.3

5.4

16.7

5.0

5.6

33.5

Operations and maintenance

21.4

5.2

20.8

6.2

0.6

2.9

Purchased freight

229.1

55.7

167.6

50.1

61.5

36.7

Depreciation and amortization

18.4

4.5

17.7

5.3

0.7

4.0

Other operating expenses

24.8

6.0

20.0

6.0

4.8

24.0

Total operating expenses

$
370.6

90.1

%

$
300.5

89.9

%

$
70.1

23.3

%

INCOME FROM OPERATIONS

$
40.5

9.9

%

$
33.9

10.1

%

$
6.6

19.5

%

OPERATING STATISTICS:

Company miles

31.5

40.2

(8.7
)

(21.6
)
%
Owner operator miles

67.1

68.5

(1.4
)

(2.0
)

Total miles (in millions)

98.6

108.7

(10.1
)

(9.3
)
%

Rate per mile

$
2.66

$
2.32

$
0.34

14.7

%
Revenue per tractor

$
112,900

$
101,000

$
11,900

11.8

%

Company owned tractors, at quarter-end

781

837

(56
)

(6.7
)
%
Owner operator tractors, at quarter-end

1,578

1,601

(23
)

(1.4
)

Number of trailers, at quarter-end

3,879

4,207

(328
)

(7.8
)
%

Company owned tractors, average for the period

753

896

(143
)

(16.0
)
%
Owner operator tractors, average for the period

1,573

1,601

(28
)

(1.7
)

Total tractors, average for the period

2,326

2,497

(171
)

(6.8
)
%

~~(1)~~

~~Includes intersegment revenues and expenses, as applicable, which are eliminated in the Company’s consolidated results.~~

~~Table of Contents~~

~~Revenue.~~ Total revenue increased 22.3% for the six months ended June 30, 2022 as compared to the same period in 2021. The increase in total revenue was primarily attributed to growth in our brokerage service offering, increases in fuel surcharge, and the sustained strong rate environment with rate per mile increasing 17.3%. The increase in total revenue was partially offset by a 7.2% decrease in total miles driven.

The Company’s Specialized Solutions segment’s revenue increased 21.3% for the six months ended June 30, 2022 as compared to the same period in 2021, primarily due to higher fuel surcharge and the strong freight rate environment, primarily in the high security cargo, construction and manufacturing end-markets. Company freight increased 10.4% for the six months ended June 30, 2022 as compared to the same period in 2021 due to a 13.9% increase in company rate per mile, partially offset by a 3.1% decrease in miles driven due to supply chain delays in receiving revenue equipment. Owner operator freight increased 19.9% due to a 33.8% increase in owner operator rate per mile, partially offset by a 10.4% decrease in miles driven primarily due to a 6.5% decrease in average owner operator tractors. The Company deployed company-owned assets into end-markets with higher rates and margins, and as such, some of the excess volumes, for which the Company was unable to utilize company-owned assets, were captured through our brokerage service offering. This resulted in a 19.4% increase in brokerage revenue for the six months ended June 30, 2022 as compared to the same period in 2021. In this segment, total brokerage loads were up 9% and the brokerage revenue per load was up 10% due to higher rates during the six months ended June 30, 2022 as compared to the same period in 2021. Fuel surcharge revenue increased 101.7% for the six months ended June 30, 2022 as compared to the same period in 2021 due to increased fuel costs.

The Company’s Flatbed Solutions segment’s revenue increased 22.9% for the six months ended June 30, 2022 as compared to the same period in 2021, primarily due to increases in owner operator freight revenue, fuel surcharge, and brokerage revenue and the strong freight rate environment driven by strength in the construction, manufacturing, steel and agriculture industries. Owner operator freight increased 11.5% due to a 13.8% increase in owner operator rate per mile, partially offset by a 2.0% decrease in miles driven. The Company deployed company-owned assets into end-markets with higher rates and margins, and as such, some of the excess volumes, for which the Company strategically captured through our brokerage service offering. This resulted in a 86.9% increase in brokerage revenue for the six months ended June 30, 2022 as compared to the same period in 2021. In this segment, total brokerage loads were up 36% and the brokerage revenue per load was up 38% due to higher rates during the six months ended June 30, 2022 as compared to the same period in 2021. Fuel surcharge revenue increased 79.4% due to increased fuel costs. Company freight revenue decreased 8.7% due to supply chain delays in receiving revenue equipment which led to a 21.6% decrease in miles, partially offset by a 16.6% increase in rate per mile.

~~Salaries, Wages and Employee Benefits.~~ Salaries, wages and employee benefits expense, which consists of compensation for all employees, is primarily affected by the number of miles driven by company drivers, the rate per mile paid to company drivers, employee benefits including, but not limited to, health care and workers’ compensation, and to a lesser extent, the number of, and compensation and benefits paid to, non-driver employees. In general, the Specialized Solutions segment drivers receive a higher driver pay per total mile than Flatbed Solutions segment drivers due to the former requiring a higher level of training and expertise.

Salaries, wages and employee benefits expense increased 5.8% for the six months ended June 30, 2022 as compared to the same period in 2021. The increase in salaries, wages and employee benefits expense was primarily due to increased health insurance claims, higher driver pay in the Specialized Solutions segment and increased employee headcount related to the expansion of corporate functions in legal, accounting and safety departments. Salaries, wages and employee benefits expense, as a percentage of consolidated revenue (excluding brokerage revenue), decreased 3.0% for the six months ended June 30, 2022 as compared to the same period in 2021.

The Company’s Specialized Solutions segment’s salaries, wages and employee benefits expense increased 9.2% for the six months ended June 30, 2022 compared to the same period in 2021, primarily as a result of increased health insurance claims and higher driver and non-driver pay. The increased driver pay was due to a 9% increase in driver rate, slightly offset by a 3.1% decrease in Company miles. Salaries, wages and employee benefits expense, as a percentage of Specialized Solutions revenue (excluding brokerage revenue), decreased 3.4% for the six months ended June 30, 2022 as compared to the same period in 2021.

The Company’s Flatbed Solutions segment’s salaries, wages and employee benefits expense decreased 5.4% for the six months ended June 30, 2022 compared to the same period in 2021, primarily as a result of the decreased employee headcount and lower driver pay due to a 21.6% decrease in Company miles, partially offset by a 15% increase in driver rate. Salaries, wages and employee benefits expense, as a percentage of Flatbed Solutions revenue (excluding brokerage revenue), decreased 3.2% for the six months ended June 30, 2022 as compared to the same period in 2021.

~~Fuel.~~ Fuel expense consists primarily of diesel fuel expense for company-owned tractors and fuel taxes. The primary factors affecting fuel expense are the cost of diesel fuel, the miles per gallon realized with company equipment and the number of miles driven by company drivers.

~~Table of Contents~~

Total fuel expense increased 53.4% for the six months ended June 30, 2022 as compared to the same period in 2021. This increase was primarily due to a 58.9% increase in fuel price, partially offset by a 9.5% decrease in Company miles driven. The Company’s Specialized Solutions segment’s fuel expense increased 62.7% for the six months ended June 30, 2022 as compared to the same period in 2021, primarily as a result of the increase in fuel price, partially offset by a 3.1% decrease in Company miles driven for the six months ended June 30, 2022 as compared to the same period in 2021. The Company’s Flatbed Solutions segment’s fuel expense increased 33.5% for the six months ended June 30, 2022 as compared to the same period in 2021, as a result of the increase in fuel price, partially offset by a 21.6% decrease in Company miles driven for the six months ended June 30, 2022 as compared to the same period in 2021. The U.S. national average diesel fuel price, as published by the U.S. Department of Energy, was $4.866 for the six months ended June 30, 2022, compared to $3.062 for the same period in 2021.

~~Operations and Maintenance.~~ Operations and maintenance expense consists primarily of ordinary vehicle repairs and maintenance, costs associated with preparing tractors and trailers for sale or trade-in, driver recruiting, training and safety costs, permitting and pilot car fees and other general operations expenses. Operations and maintenance expense is primarily affected by the age of company-owned tractors and trailers, the number of miles driven in a period and driver turnover.

Operations and maintenance expense increased 10.2% for the six months ended June 30, 2022 as compared to the same period in 2021 primarily due to a $2.4 million increase in maintenance and upkeep costs and a $1.9 million increase in pilot car and permit fees. The Company’s Specialized Solutions segment’s operations and maintenance expense increased 13.6% for the six months ended June 30, 2022 as compared to the same period in 2021 primarily as a result of a $2.0 million increase in pilot car and permit fees and a $2.1 million increase in maintenance and upkeep costs. The Company’s Flatbed Solutions segment’s operations and maintenance expense was generally consistent for the six months ended June 30, 2022 as compared to the same period in 2021. Operations and maintenance expense, as a percentage of consolidated revenue (excluding brokerage revenue), was generally consistent for the six months ended June 30, 2022 as compared to the same period in 2021.

~~Purchased Freight.~~ Purchased freight expense consists of the payments to owner operators, including fuel surcharge reimbursements, and payments to third-party capacity providers that haul loads brokered to them. Purchased freight expense generally takes into account changes in diesel fuel prices, resulting in higher payments during periods of increasing fuel prices.

Total purchased freight expense increased 33.2% during the six months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense from owner operators increased $23.5 million, or 12.2%, during the six months ended June 30, 2022 as compared to the same period in 2021 as a result of a 19.3% increase in owner operators’ rate, partially offset by a 4.2% decrease in owner operator miles driven. Purchased freight expense from third-party capacity providers increased $68.4 million, or 81.9%, during the six months ended June 30, 2022 as compared to the same period in 2021, as a result of an increase in utilization of third-party capacity providers due to supply chain delays in receiving revenue equipment. In addition, the cost of diesel fuel increased by 58.9% during the six months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense, as a percentage of consolidated revenue, for the six months ended June 30, 2022, increased 3.4% as compared to the same period in 2021.

The Company’s Specialized Solutions segment’s purchased freight expense increased 26.2% during the six months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense from owner operators increased $8.8 million, or 15.2%, during the six months ended June 30, 2022 as compared to the same period in 2021, as a result of a 33.8% increase in owner operators' rate, partially offset by a 10.4% decrease in owner operator miles driven. Purchased freight expense from third-party capacity providers increased $21.5 million, or 37.4%, during the six months ended June 30, 2022 as compared to the same period in 2021, as a result of an increase in utilization of third-party capacity providers due to supply chain delays in receiving revenue equipment. As mentioned above, there was also an increase in the cost of diesel fuel during the six months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense, as a percentage of Specialized Solutions revenue, for the six months ended June 30, 2022, increased 1.1% as compared to the same period in 2021.

The Company’s Flatbed Solutions segment’s purchased freight expense increased 36.7% for the six months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense from owner operators increased $14.7 million, or 10.9%, for the six months ended June 30, 2022 as compared to the same period in 2021, as a result of a 13.8% increase in owner operators’ rate, partially offset by a 2.0% decrease in owner operator miles driven. Purchased freight expense from third-party capacity providers increased $46.8 million, or 144.4%, during the six months ended June 30, 2022 as compared to the same period in 2021, primarily as a result of increased utilization of third-party capacity providers due to supply chain delays in receiving revenue equipment. As mentioned above, there was also an increase in the cost of diesel fuel during the six months ended June 30, 2022 as compared to the same period in 2021. Purchased freight expense, as a percentage of Flatbed Solutions revenue, for the six months ended June 30, 2022, increased 5.6% as compared to the same period in 2021.

~~Depreciation and Amortization.~~ Depreciation and amortization expense consists primarily of depreciation for company-owned tractors and trailers and amortization of those financed with finance leases. The primary factors affecting these expense items include the size of the fleet and age of company-owned tractors and trailers and the cost of new equipment. Amortization of intangible assets is also included in this expense.

~~Table of Contents~~

Depreciation and amortization expense was generally consistent for the six months ended June 30, 2022 as compared to the same period in 2021. The Company’s Specialized Solutions segment’s depreciation and amortization expense decreased 3.8% for the six months ended June 30, 2022 as compared to the same period in 2021 as a result of a 2.8% decrease in average tractor count in the segment’s fleet. The Company’s Flatbed Solutions segment’s depreciation and amortization expense increased 4.0% for the six months ended June 30, 2022 as compared to the same period in 2021 as a result of recent revenue equipment additions partially offset by disposals of fully depreciated revenue equipment.

~~Impairment.~~ Impairment expense was $7.8 million for the six months ended June 30, 2022 related to goodwill, trade name intangibles, and customer relationships intangibles of an integrated operating segment within the Company’s Specialized Solutions segment. ~~There~~The Company’s Flatbed Solutions segment’s impairment expense was $1.5 million, all related to trade name intangibles, for the six months ended June 30, 2023. The Company’s Specialized Solutions segment had no impairment expense for the six months ended June 30, ~~2021.~~2023. The Company’s Specialized Solutions segment’s impairment expense was $7.8 million, consisting of $5.7 million related to goodwill, $1.9 million related to trade name intangibles, and $0.2 million related to customer relationships intangibles, for the six months ended June 30, 2022. The Company’s ~~Specialized Solutions segment had no impairment expense for six months ended June 30, 2021. The Company’s~~ Flatbed Solutions segment had no impairment expense for the six months ended June 30, ~~2022 and 2021.~~

~~Insurance and Claims.~~ Insurance and claims expense consists of insurance premiums and the accruals the Company makes for estimated payments and expenses for claims for bodily injury, property damage, cargo damage and other casualty events. The primary factor affecting the Company’s insurance and claims expense is seasonality (the Company typically experiences higher accident frequency in winter months), the frequency and severity of accidents, trends in the development factors used in its accruals and developments in large, prior-year claims. The frequency of accidents tends to correlate with the miles the Company travels; however, insurance and claims expense could increase in periods where there are claims in excess of the Company’s self-insured retention. Insurance and claims expense increased 53.6% during the six months ended June 30, 2022 as compared to the same period in 2021 primarily due to a $12.9 million increase in insurance claims, primarily resulting from claims over the Company’s self-insured retention, combined with a $4.7 million increase in our estimate of incurred but not recorded. These increases were partially offset by a $3.1 million decrease in certain insurance premiums.2022.

Other (Income) Expense. Interest expense consists of cash interest, amortization and write-off of related issuance costs and fees. Interest expense ~~decreased 21.9%~~increased 76.0% for the six months ended June 30, ~~2022~~2023 as compared to the same period in ~~2021.~~2022. This ~~decrease~~increase was primarily attributable to ~~lower~~rising interest ~~rates achieved through~~rate environment, an increase in financed equipment purchases, and $0.7 million write-off of deferred amortization fees related to the ~~successful refinancing~~prepayment of ~~our Term Loan Facility (as defined below) in March 2021, and decreases in the balance outstanding on~~ the Term Loan Facility. The Company’s common stock purchase warrants expired in February 2022 and are no longer exercisable. Change in fair value of warrant liability was a gain of $4.7 million for the six months ended June 30, 2022 compared to a gain of $2.2 million for the same period in 2021. The change in fair value is directly related to the fair value of the warrant liability as of each period end as calculated using Level 1 and Level 3 inputs. ~~The Company’s common stock purchase warrants expired during~~ ~~six months ended June 30, 2022~~ ~~and are no longer exercisable.~~2022.

Income Tax. Income tax expense was ~~$11.1~~$4.2 million for the six months ended June 30, ~~2022~~2023 compared to income tax expense of ~~$9.9~~$11.1 million for the same period in ~~2021.~~2022. The effective tax rate was ~~26.6%~~40.4% for the six months ended June 30, ~~2022,~~2023, compared to ~~26.1%~~26.6% for the same period in ~~2021.~~2022. The difference between the Company’s effective tax rate and the federal statutory rate primarily results from the mix of earnings with state jurisdictions, combined with the impact of nontaxable income, primarily related to the change in fair value of the warrant liability, and nondeductible expenses, primarily related to executive compensation and ~~goodwill impairment.~~driver per diem.

Liquidity, Capital Resources and Capital Requirements

The Company had the following sources of liquidity available at June 30, ~~2022~~2023 and December 31, ~~2021~~2022 (in millions).


	June 30, 2022		December 31, 2021		June 30,		December 31,
Cash	$	152.0	$	147.5
					2023		2022
Cash and cash equivalents					$	93.7	$	153.4
Availability under line of credit		125.3		107.8		104.3		110.9
Total	$	277.3	$	255.3	$	198.0	$	264.3

The Company’s primary sources of liquidity have been cash provided by operating activities ~~issuances of capital stock~~ and borrowings under its credit facilities. The Company also receives cash from sales of ~~equipment.~~equipment and historically received cash from issuances of capital stock.

The Company’s business requires substantial amounts of cash for operating expenses, including salaries and wages paid to employees, contract payments to independent contractors, insurance and claims payments, tax payments, and others. The Company also uses large amounts of cash and credit for capital ~~expenditures.~~expenditures as well as repurchases of equity securities from time to time.

The Company believes it can finance its expected cash needs, including debt repayment, in the short-term with cash flows from operations and borrowings available under the ABL Facility. The Company expects that the ABL Facility will provide sufficient credit availability to support its ongoing operations, fund debt service requirements, capital expenditures, and working capital needs. Over the long-term, the Company will continue to have significant capital requirements, and ~~expects to~~may devote substantial financial resources to grow its operations and fund its acquisition activities. As a result of these funding requirements, the Company ~~likely will~~may in the future need to sell additional equity or

Table of Contents

debt securities or seek additional financing through additional borrowings, lease financing or equity capital. The availability of financing or

~~Table of Contents~~

equity capital will depend upon the Company’s financial condition and results of operations as well as prevailing market conditions. If such additional borrowings, lease financing or equity capital is not available at the time it needs to incur such expenditures, the Company may be required to extend the maturity of then outstanding indebtedness, rely on alternative financing arrangements or engage in asset sales.

Since its inception, the Company has acquired over twenty transportation companies. The primary reason for each acquisition was to add resources and services in geographic areas, customers and markets that the Company wants to serve. The Company will continue to evaluate potential acquisitions and any other sources of growth it considers in its best interest. Additionally, depending on the Company’s actual and anticipated sources and uses of liquidity, prevailing market conditions and other factors, the Company may from time to time seek to repay or repurchase outstanding debt or equity securities through cash purchases in the open market or privately negotiated transactions. The amounts involved in any such transactions may be material.

Capital Expenditures

The Company follows a dual strategy of both owning assets and employing asset-light activities, the latter of which reduces the capital expenditures required to operate the business. Asset-light activities are conducted utilizing tractors and trailers provided by owner operators and third-party carriers for significant portions of our flatbed and specialized services. Company-owned asset expenditures require substantial cash and financing (including finance and operating leases) to maintain a modern tractor fleet, refresh the trailer fleet, fund replacement and or growth in the revenue equipment fleet, and for the acquisition of real property and improvements to existing terminals and facilities.

Total property and equipment additions for the six months ended June 30, ~~2022~~2023 and ~~2021~~2022 are shown below (in millions):

Six Months Ended June 30,

2022

2021

Net cash capital expenditures (receipts)

$
4.8

$
(8.6
)
Property and equipment acquired with debt or finance lease obligations

41.3

29.2

Total net property and equipment additions

$
46.1

$
20.6


	Six Months Ended June 30,
	2023			2022
Net cash capital (receipts) expenditures	$	(0.7	)	$	4.8
Property and equipment acquired with debt or finance lease obligations		78.8			41.3
Total net property and equipment additions	$	78.1		$	46.1

Total net property and equipment additions increased due to an increase in ~~cash and~~ financed equipment purchases ~~and a decrease in equipment sales~~ during the six months ended June 30, 2023 primarily related to capital expenditures that were originally planned for 2022,. but were previously delayed due to supply chain disruptions. This increase was partially offset by decreases in cash equipment purchases and sales.

The Company currently estimates its ~~2022~~2023 net capital expenditures to be ~~$145~~$135 million to ~~$155~~$145 million.

Operating leases

The Company entered into operating leases for revenue equipment and other equipment with terms of one year to five years and real property with terms of ~~less than~~ one year to ~~twenty~~five years having right-of-use asset values at lease inception of ~~$3.0~~$5.5 million and ~~$15.7~~$4.2 million, respectively, for the six months ended June 30, ~~2022.~~2023.

Material Debt

Overview

As of June 30, ~~2022,~~2023, the Company had the following material debt:

•

the Term Loan Facility and the ABL Facility;

•

equipment and real estate term loans; and

•

finance lease liabilities.

Table of Contents

The amounts outstanding under such agreements were as follows (in millions):

~~Table of Contents~~


	June 30,			December 31,
	2023			2022
Term Loan Facility	$	341.0		$	393.0
ABL Facility		—			—
Equipment and real estate term loans		287.2			249.1
Finance lease liabilities		24.4			25.0
Total debt and finance lease liabilities		652.6			667.1
Less current portion		(90.3	)		(78.4	)
Less unamortized deferred financing fees		(5.0	)		(6.4	)
Long-term debt and finance lease liabilities, less current portion and unamortized deferred financing fees	$	557.3		$	582.3

June 30,

December 31,

2022

2021

Term Loan Facility

$
395.0

$
397.0

ABL Facility

—

—

Equipment and real estate term loans

182.6

169.0

Finance lease liabilities

26.7

28.5

Total debt and finance lease liabilities

604.3

594.5

Less current portion

(60.4
)

(55.5
)
Less unamortized deferred financing fees

(7.0
)

(7.6
)
Long-term debt and finance lease liabilities, less current portion and unamortized deferred financing fees

$
536.9

$
531.4

The Company regularly evaluates its capital structure and liquidity position. From time to time and as opportunities arise, the Company may access the debt capital markets and modify its debt arrangements to optimize its capital structure and liquidity position.

See Note 76 of the Notes to Consolidated Financial Statements included herein for information regarding the Company’s material debt.

ABL and Term Loan Facilities and Equipment Financing Agreements

As of June 30, ~~2022,~~2023, the Company has (i) a ~~$400.0 million~~ senior secured term loan credit facility ~~(the Term Loan Credit Facility),~~with an outstanding balance of $341.0 million, and (ii) an asset-based senior secured revolving credit facility with an aggregate maximum credit amount equal to $150.0 million (that may be increased to $200.0 million, subject to availability under a borrowing base).

As of June 30, 2022, the Company had $182.6 million of equipment and real estate loans and $26.7 million of finance leases collateralized primarily by revenue equipment, with the majority of the equipment loans and finance leases having terms of 48 to 60 months.

~~As of June 30, 2022,~~2023, the Company had no borrowings outstanding on the ABL Facility, ~~$23.3~~$27.1 million in outstanding letters of credit, and ~~$125.3~~$104.3 million available under the ABL Facility, based on current qualified collateral. Under the terms of the ABL Facility, lenders may issue up to $40 million of standby letters of credit on our behalf. Outstanding letters of credit reduce the availability on the $150 million ABL Facility. Standby letters of credit are generally issued for the benefit of regulatory authorities, insurance companies and state departments of insurance for the purpose of satisfying certain collateral requirements, primarily related to automobile, workers’ compensation, and general ~~insurances~~insurance liabilities.

As of June 30, 2023, the Company had $287.2 million of equipment and real estate term loans and $24.4 million of finance leases collateralized primarily by revenue equipment, with the majority of the equipment loans and finance leases having terms of 48 to 60 months.

Cash Flows

The Company’s summary statements of cash flows information for the six months ended June 30, ~~2022~~2023 and ~~2021~~2022 is set forth in the table below (in millions):


	Six Months Ended June 30,						Six Months Ended June 30,
	2022			2021			2023			2022
Net cash provided by operating activities	$	51.9		$	58.1		$	58.9		$	51.9
Net cash (used in) provided by investing activities	$	(24.1	)	$	8.6
Net cash provided by (used in) investing activities							$	0.7		$	(24.1	)
Net cash used in financing activities	$	(23.6	)	$	(130.9	)	$	(119.6	)	$	(23.6	)

Operating Activities. Cash provided by operating activities was ~~$51.9~~$58.9 million during the six months ended June 30, ~~2022~~2023 and consisted of ~~$30.7~~$6.2 million of net income plus ~~$46.6~~$54.2 million of non-cash items, consisting primarily of impairment, depreciation, amortization, deferred taxes, gain on disposition of property and equipment, and stock-based compensation, ~~and impairment, partially~~ offset by ~~$25.4~~$1.5 million of net cash used in working capital and other activities. Cash used in working capital and other activities during the six months ended June 30, ~~2022~~2023 reflect an increase of ~~$46.1~~$0.6 million in accounts receivable, an increase of ~~$4.7~~$0.3 million in drivers’ advances and other receivables, and ~~an increase~~a decrease of ~~$3.9 million in other current assets, partially offset by an increase of $26.1~~$1.0 million in accrued expenses and other liabilities, partially offset by a decrease of $0.2 million in other current assets and an increase of ~~$3.2~~$0.2 million in accounts payable.

The ~~$6.2~~$7.0 million ~~decrease~~increase in cash provided by operating activities during the six months ended June 30, ~~2022,~~2023, as compared with the six months ended June 30, ~~2021,~~2022, was the result of ~~decreases~~increases in net cash provided by working capital of ~~$6.9~~$23.9 million, ~~and decreases~~increases in ~~non-cash items~~adjustments to reconcile net income to net cash provided by operating activities of ~~$2.0~~$7.6 million, ~~reduced~~offset by a ~~$2.7~~$24.5 million ~~improvement in~~reduction to net income.

Investing Activities. Cash provided by investing activities was $0.7 million for the six months ended June 30, 2023 as compared to cash used in investing activities ~~was~~of $24.1 million for the six months ended June 30, ~~2022 as compared to cash provided by investing activities of $8.6 million for the six months ended June 30, 2021.~~2022. This change is primarily due to a $19.3 million cash payment during the six months ended June 30, 2022 for the acquisition of SJ Transportation ~~acquisition, an increase~~Co., Inc., a decrease of ~~$7.2~~$7.7 million in cash equipment purchases, ~~and~~partially offset by a decrease of ~~$6.2~~$2.2 million in cash receipts from sales of revenue equipment for the six months ended June 30, ~~2022.~~2023.

3230

Table of Contents

Total net cash capital ~~expenditures (receipts)~~receipts for the six months ended June 30, ~~2022~~2023 and ~~2021~~2022 are shown below (in millions):

Six Months Ended June 30,

2022

2021

Revenue equipment (tractors, trailers and trailer accessories)

$
20.4

$
15.2

Buildings and building improvements

2.0

0.3

Other

2.8

2.5

Total cash capital expenditures

25.2

18.0

Less: Proceeds from sales of property and equipment

20.4

26.6

Net cash capital expenditures (receipts)

$
4.8

$
(8.6
)


	Six Months Ended June 30,
	2023			2022
Revenue equipment	$	6.3		$	19.5
Revenue equipment leased and available for lease to owner operators		3.6			0.9
Buildings and improvements		0.5			2.0
Furniture and fixtures, office and computer equipment, vehicles and capitalized software development		7.1			2.8
Total cash capital expenditures		17.5			25.2
Less: Proceeds from sales of property and equipment		18.2			20.4
Net cash capital (receipts) expenditures	$	(0.7	)	$	4.8

Financing Activities. Cash used in financing activities ~~decreased~~increased from ~~$130.9 million for the six months ended June 30, 2021 to~~ $23.6 million for the six months ended June 30, ~~2022.~~2022 to $119.6 million for the six months ended June 30, 2023. During the six months ended June 30, ~~2022,~~2023, we had approximately ~~$87.0~~$62.4 million ~~less~~more net debt-related payments, including a voluntary $50.0 million Term Loan Facility prepayment, $20.0 million in payments for the voluntary redemption of the Series B-1 preferred stock, and $3.4 million in dividend payments related to the Series B preferred stock (which were issued in November 2022) compared to same period in ~~2021, primarily as the result of the Company refinancing the Term Loan Facility during the six months ended June 30, 2021. In addition, during~~2022. During the six months ended June 30, 2022, we received $9.4 million in proceeds from warrant exercises and $0.8 million in stock options exercises compared to none in the same period in 2023.~~2021~~. ~~In addition, during the six months ended June 30, 2021, we repurchased~~ ~~$10.5 million in common stock compared to none in the same period in 2022~~.

Critical Accounting Estimates

The preparation of the Company’s consolidated financial statements in accordance with US GAAP requires it to make estimates and assumptions that impact the amounts reported in its consolidated financial statements and accompanying notes. Therefore, the reported amounts of assets, liabilities, revenue, expenses, and associated disclosures of contingent assets and liabilities are affected by these estimates and assumptions. The Company evaluates these estimates and assumptions on an ongoing basis, utilizing historical experience, consultation with experts and other methods considered reasonable in the particular circumstances. Nevertheless, actual results may differ significantly from these estimates and assumptions, and it is possible that materially different amounts will be reported using differing estimates or assumptions.

The Company considers critical accounting estimates to be those that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on the Company's financial condition or results of operations. See “Critical Accounting Estimates” included in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, ~~2021,~~2022, for a discussion of our critical accounting estimates; there have been no material changes to the Company’s critical accounting estimates as disclosed therein.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes in the Company’s market risk since December 31, ~~2021.~~2022. For further information on the Company’s market risk, refer to ~~“Item~~“Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk” in the Company’s Annual Report on Form 10-K ~~filed on February 23,~~for the year ended December 31, 2022.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of the end of the period covered by this Report, the Company’s management conducted an evaluation, under the supervision and with the participation of the principal executive and principal financial officers, of the effectiveness of the Company’s disclosure controls and procedures (as defined in ~~Rule~~Rules 13a-15(e) and 15d-15(e) of the Securities and Exchange Act of 1934 (the Exchange Act)). Based on this evaluation, the principal executive and principal financial officers concluded our disclosure controls and procedures were effective as of June 30, ~~2022.~~2023.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) orand 15d-15(f) of the Exchange Act) that occurred during the three months ended June 30, ~~2022~~2023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Table of Contents

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

The Company and its subsidiaries are involved in litigation and claims primarily arising in the normal course of business, which include claims for personal injury or property damage incurred in the transportation of freight. Based on its knowledge of the facts and, in certain

~~Table of Contents~~

cases, advice of outside counsel, the Company believes the resolution of claims and pending litigation will not have a material adverse effect on the Company’s financial position, results of operations or cash flows, and the Company and its subsidiaries are not currently a party to, nor is their property currently subject to, any material legal proceedings other than ordinary routine litigation incidental to the business, and we are not aware of any such proceedings contemplated by governmental authorities.

Item 1A. Risk Factors

There have been no material changes in the risks facing the Company as described in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2021.~~2022.

34Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 5. Other Information

During the three months ended June 30, 2023, none of the Company’s director or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Table of Contents

Item 6. Exhibits

EXHIBIT INDEX



Exhibit No.	Exhibit

3.1	Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the registrant on March 3, 2017).

3.2	Charter Amendment to Second Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.2 to the Quarterly Report on Form 10-Q filed by the registrant on August 6, 2020).

3.3	Amended and Restated By-Laws, effective as of November 15, 2022 (incorporated by reference to Exhibit ~~3.1~~3.3 to the Current Report on Form 8-K filed by the registrant on ~~May 25, 2018)~~November 16, 2022).

3.4	~~First Amendment to the By-Laws of Daseke, Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the registrant on August 18, 2020).~~

~~3.5~~	Certificate of Designations, Preferences, Rights and Limitations of 7.625% Series A Convertible Cumulative Preferred Stock (incorporated by reference to Exhibit 3.2 to the ~~registrant’s~~ Current Report on Form 8-K filed by the registrant on March 3, 2017).

3.5	Certificate of Designations, Preferences, Rights and Limitations of Series B-1 Perpetual Redeemable Preferred Stock and Series B-2 Perpetual Redeemable Preferred Stock (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the registrant on November 16, 2022).

3.6	Certificate of Amendment to Certificate of Designations of Preferences, Rights and Limitations of Series B-1 Perpetual Redeemable Preferred Stock and Series B-2 Perpetual Redeemable Preferred Stock (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed by the registrant on November 16, 2022).

10.1*	Amendment No. 4 to Term Loan Agreement, dated as of May 2, 2023, by and among the registrant, Daseke Companies Inc., and each of the subsidiaries party thereto, the financial institutions party thereto as lenders, and JPMorgan Chase Bank, N.A., as administrative agent and collateral agent.

10.2	Daseke, Inc. 2017 Omnibus Incentive Plan, as amended and restated on June 8, 2023 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the registrant on June 9, 2023).

10.3	Employment Agreement, dated as of June 23, 2023, by and between Scott Hoppe and the registrant (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K/A filed by the registrant on June 26, 2023).

31.1*	Chief Executive Officer certification under Section 302 of Sarbanes-Oxley Act of 2002.

31.2*	Chief Financial Officer certification under Section 302 of Sarbanes-Oxley Act of 2002.

32.1**	Chief Executive Officer certification under Section 906 of Sarbanes-Oxley Act of 2002.

32.2**	Chief Financial Officer certification under Section 906 of Sarbanes-Oxley Act of 2002.

101.INS*	Inline XBRL Instance Document.

101.SCH*	Inline XBRL Taxonomy Extension Schema Document.

101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase Document.

101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document.

104	Inline Cover Page Interactive Data File (embedded within the Inline XBRL document).


*	Filed herewith.
**	Furnished herewith.

3533

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


Date: August ~~2, 2022~~03, 2023	DASEKE, INC.

	By:	/s/ ~~Jason Bates~~Aaron Coley
	Name:	~~Jason Bates~~Aaron Coley
	Title:	Chief Financial Officer
		(On behalf of the registrant and as the registrant’s principal financial officer)

3634


15455 Dallas Parkway, Suite 550 Addison, Texas		75001
(Address of principal executive offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.0001 per share	DSKE	The NASDAQ Stock Market LLC


☐ Large accelerated filer				 Accelerated filer
☐ Non-accelerated filer				☐ Smaller reporting company
				☐ Emerging growth company


	June 30,			December 31,			June 30,			December 31,
	2022			2021			2023			2022
ASSETS
Current assets:
Cash and cash equivalents	$	152.0		$	147.5		$	93.7		$	153.4
Accounts receivable, net of allowance of $2.2 and $2.1 at June 30, 2022 and December 31, 2021, respectively		221.4			172.3
Accounts receivable, net of allowance of $1.8 and $2.3 at June 30, 2023 and December 31, 2022, respectively								180.1			179.0
Drivers’ advances and other receivables		10.0			7.7			8.3			7.9
Other current assets		28.6			22.6			38.2			37.9
Total current assets		412.0			350.1			320.3			378.2

Property and equipment, net		421.0			397.7			532.4			488.3
Intangible assets, net		81.3			86.9			76.9			80.6
Goodwill		142.4			140.1			137.5			137.3
Right-of-use assets		109.3			108.3			98.3			107.6
Other non-current assets		3.6			4.3			2.9			3.4
Total assets	$	1,169.6		$	1,087.4		$	1,168.3		$	1,195.4

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	17.9		$	14.7		$	14.1		$	14.7
Accrued expenses and other liabilities		61.1			43.9			51.9			44.9
Accrued payroll, benefits and related taxes		30.8			32.9			30.9			30.8
Accrued insurance and claims		38.5			26.8			43.3			40.6
Current portion of long-term debt		60.4			55.5			90.3			78.4
Warrant liability		0			4.7
Current operating lease liabilities		34.5			33.7			33.5			34.4
Total current liabilities		243.2			212.2			264.0			243.8

Line of credit		0			0			—			—
Long-term debt, net of current portion		536.9			531.4			557.3			582.3
Deferred tax liabilities		86.1			85.1			97.6			95.0
Non-current operating lease liabilities		81.0			81.1			71.0			79.6
Other non-current liabilities		3.7			1.6			1.9			1.7
Total liabilities		950.9			911.4			991.8			1,002.4

Commitments and contingencies (Note 10)
Commitments and contingencies (Note 8)

Stockholders’ equity:
Series A convertible preferred stock, $0.0001 par value; 10,000,000 shares authorized; 650,000 shares issued with liquidation preference of $65.0 at June 30, 2022 and December 31, 2021		65.0			65.0
Common stock, par value $0.0001 per share; 250,000,000 shares authorized, 63,504,018 and 62,489,278 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively		0			0
Preferred stock, 10,000,000 total preferred shares authorized:
Series A convertible preferred stock, $0.0001 par value; 650,000 shares issued and outstanding with liquidation preference of $65.0 at June 30, 2023 and December 31, 2022								65.0			65.0
Series B perpetual preferred stock, $0.0001 par value; 47,597 shares issued and outstanding with liquidation preference of $47.6 at June 30, 2023 and 67,597 shares issued and outstanding with liquidation preference of $67.6 at December 31, 2022								47.6			67.6
Common stock, par value $0.0001 per share; 250,000,000 shares authorized, 45,650,941 and 45,028,041 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively								—			—
Additional paid-in-capital		402.3			387.8			295.1			293.1
Accumulated deficit		(248.5	)		(276.8	)		(231.3	)		(232.3	)
Accumulated other comprehensive loss		(0.1	)		0
Accumulated other comprehensive income (loss)								0.1			(0.4	)
Total stockholders’ equity		218.7			176.0			176.5			193.0
Total liabilities and stockholders’ equity	$	1,169.6		$	1,087.4		$	1,168.3		$	1,195.4


	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Delaware (State or other jurisdiction of incorporation or organization)				47-3913221 (IRS Employer Identification No.)



		Page No.
Part I. Financial Information		1
Item 1. Financial Statements (Unaudited)		1
Consolidated Balance Sheets		1
Consolidated Statements of Operations and Comprehensive Income		2
Consolidated Statements of Changes in Stockholders' Equity		3
Consolidated Statements of Cash Flows		5
Notes to Consolidated Financial Statements		7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		1816
Item 3. Quantitative and Qualitative Disclosures About Market Risk		3331
Item 4. Controls and Procedures		3331
Part II. Other Information		3332
Item 1. Legal Proceedings		3332
Item 1A. Risk Factors		3432
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		32
Item 5. Other Information		32
Item 6. Exhibits		3533
Signatures		3634


	Series A Convertible														Accumulated						Series A Convertible				Series B Perpetual																Accumulated
	Preferred Stock				Common Stock										Other						Preferred Stock				Preferred Stock						Common Stock										Other
							Par		Additional			Accumulated			Comprehensive																		Par		Additional			Accumulated			Comprehensive
	Shares		Amount		Shares		Value		Paid-In Capital			Deficit			Loss			Total			Shares		Amount		Shares			Amount			Shares		Value		Paid-In Capital			Deficit			Income (Loss)			Total
Balance at January 1, 2022		650,000	$	65.0		62,489,278	$	—	$	387.8		$	(276.8	)	$	—		$	176.0
Exercise of options		—		—		91,425		—		0.8			—			—			0.8
Exercise of warrants		—		—		817,648		—		9.4			—			—			9.4
Vesting of restricted stock units		—		—		43,450		—		—			—			—			—
Balance at January 1, 2023																						650,000	$	65.0		67,597		$	67.6			45,028,041	$	—	$	293.1		$	(232.3	)	$	(0.4	)	$	193.0
Vesting of stock awards																						—		—		—			—			158,359		—		(0.2	)		—			—			(0.2	)
Series A convertible preferred stock dividend		—		—		—		—		—			(1.2	)		—			(1.2	)		—		—		—			—			—		—		—			(1.2	)		—			(1.2	)
Stock-based compensation expense		—		—		—		—		2.2			—			—			2.2
Net income		—		—		—		—		—			13.0			—			13.0
Balance at March 31, 2022		650,000	$	65.0		63,441,801	$	—	$	400.2		$	(265.0	)	$	—		$	200.2
Exercise of options		—		—		—		—		—			—			—			—
Vesting of restricted stock units		—		—		62,217		—		(0.2	)		—			—			(0.2	)
Series A convertible preferred stock dividend		—		—		—		—		—			(1.2	)		—			(1.2	)
Series B perpetual preferred stock dividend																						—		—		—			—			—		—		—			(1.5	)		—			(1.5	)
Stock-based compensation expense		—		—		—		—		2.3			—			—			2.3			—		—		—			—			—		—		2.9			—			—			2.9
Foreign currency translation adjustments		—		—		—		—		—			—			(0.1	)		(0.1	)		—		—		—			—			—		—		—			—			(0.1	)		(0.1	)
Net income		—		—		—		—		—			17.7			—			17.7			—		—		—			—			—		—		—			0.5			—			0.5
Balance at June 30, 2022		650,000	$	65.0		63,504,018	$	—	$	402.3		$	(248.5	)	$	(0.1	)	$	218.7
Balance at March 31, 2023																						650,000	$	65.0		67,597		$	67.6			45,186,400	$	—	$	295.8		$	(234.5	)	$	(0.5	)	$	193.4
Exercise of options																						—		—		—			—			4,000		—		—			—			—			—
Vesting of stock awards																						—		—		—			—			460,541		—		(2.3	)		—			—			(2.3	)
Series A convertible preferred stock dividend																						—		—		—			—			—		—		—			(1.2	)		—			(1.2	)
Series B perpetual preferred stock dividend																						—		—		—			—			—		—		—			(1.3	)		—			(1.3	)
Series B perpetual preferred stock redemption																						—		—		(20,000	)		(20.0	)		—		—		—			—			—			(20.0	)
Stock-based compensation expense																						—		—		—			—			—		—		1.6			—			—			1.6
Foreign currency translation adjustments																						—		—		—			—			—		—		—			—			0.6			0.6
Net income																						—		—		—			—			—		—		—			5.7			—			5.7
Balance at June 30, 2023																						650,000	$	65.0		47,597		$	47.6			45,650,941	$	—	$	295.1		$	(231.3	)	$	0.1		$	176.5


	Fair value as of December 31, 2021
Liabilities:	Level 1		Level 2		Level 3		Total
Warrant liability	$	2.7	$	0	$	2.0	$	4.7
Total fair value	$	2.7	$	0	$	2.0	$	4.7


	Six Months Ended
	June 30, 2022
Balance at beginning of period	$	2.0
Change in fair value		(2.0	)
Balance at end of period	$	0


	SJ Transportation
Accounts receivable	$	3.4
Other current assets		1.8
Property and equipment		10.0
Goodwill		8.1
Accounts payable and other liabilities		(4.0	)
Total	$	19.3


	Three Months Ended June 30,					Six Months Ended June 30,
(in millions, except per share amounts)		2022		2021			2022		2021
Pro forma revenue		$	481.3	$	409.9		$	906.2	$	749.9
Pro forma net income		$	17.7	$	36.0		$	30.9	$	29.4
Pro forma earnings per common share:
Basic		$	0.26	$	0.53		$	0.44	$	0.41
Diluted		$	0.24	$	0.50		$	0.43	$	0.40


	Severance			Operating
	and			Lease
	Other Payroll			Termination		Other			Total
Balance at December 31, 2021	$	—		$	—	$	—		$	—
Specialized Solution
Costs accrued		0.2			—		0.3			0.5
Amounts paid or charged		(0.2	)		—		(0.3	)		(0.5	)
Specialized Solution balance at June 30, 2022		—			—		—			—
Flatbed Solution
Costs accrued		—			—		—			—
Amounts paid or charged		—			—		—			—
Flatbed Solution balance at June 30, 2022		—			—		—			—
Corporate
Costs accrued		—			—		0.7			0.7
Amounts paid or charged		—			—		(0.7	)		(0.7	)
Corporate balance at June 30, 2022		—			—		—			—
Consolidated
Costs accrued		0.2			—		1.0			1.2
Amounts paid or charged		(0.2	)		—		(1.0	)		(1.2	)
Consolidated balance at June 30, 2022	$	—		$	—	$	—		$	—


Grantee Type	# of RSUs Granted		Issued and Outstanding		Vesting Period	Weighted Average Grant Date Fair Value (Per Unit)
Director Group		830,978		71,771	1-2 years	$	11.21
Employee Group		2,393,066		656,392	3-5 years	$	9.36
Total				728,163


	Units			Weighted Average Grant Date Fair Value (Per Unit)
Non-vested as of January 1, 2022		673,830		$	8.56
Granted		203,821			12.16
Vested		(137,640	)		8.60
Forfeited		(11,848	)		9.76
Non-vested as of June 30, 2022		728,163		$	9.54