∎

~~Proposal 3: Advisory vote to approve executive compensation.~~Advisory approval of the resolution on executive compensation of our NEOs as disclosed in this proxy statement requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted “for” such proposal must exceed the number of shares voted “against” such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the annual meeting at which a quorum is present. This resolution, commonly referred to as a~~“say-on-pay”~~ ~~resolution, isnon-binding~~ ~~on our Board of Directors. Althoughnon-binding,~~ ~~our Board of Directors and the Compensation Committee will review and consider the voting results when making future decisions regarding our executive compensation program.~~

Brokers may not use discretionary authority to vote shares on the advisory vote to approve executive compensation if they have not received specific instructions from their clients. If you are a beneficial owner of shares, for your vote to be counted in the advisory vote to approve executive compensation, you will need to communicate your voting decisions to your bank, broker or other nominee before the date of the annual meeting in accordance with their specific instructions. Abstentions and broker~~non-votes~~ ~~are not considered votes cast for purposes of tabulation of such vote, and will have no effect on the advisory vote to approve executive compensation.~~

∎

~~Proposal 4: Advisory vote on frequency of future advisory votes to approve executive compensation.~~Advisory determination of the preference of the frequency of future advisory votes to approve executive compensation will be based on one of four choices for this proposal as indicated on the proxy card or voting instruction: one year, two years, three years or abstain. The voting frequency option that receives the highest number of votes cast by stockholders at the annual meeting or any adjournment or postponement of the annual meeting will be the frequency for the advisory vote to approve executive compensation that has been selected by stockholders. However, the vote is not binding on our Board of Directors and the Compensation Committee. Although~~non-binding,~~ our Board of Directors and the Compensation Committee will carefully review the voting results. Notwithstanding our Board’s recommendation and the outcome of the stockholder vote, our Board may, in the future, decide to conduct advisory votes on a more or less frequent basis and may vary its practice based on factors such as discussions with stockholders and the adoption of material changes to compensation programs.

Brokers may not use discretionary authority to vote shares on the advisory vote on frequency of future advisory votes to approve executive compensation if they have not received specific instructions from their clients. If you are a beneficial owner of shares, for your vote to be counted in the advisory vote on frequency of future advisory votes to approve executive compensation, you will need to communicate your voting decisions to your bank, broker or other nominee before the date of the annual meeting in accordance with their specific instructions. Abstentions and broker~~non-votes~~ ~~are not considered votes cast for purposes of tabulation of such vote, and will have no effect on the advisory vote on the frequency of future advisory votes to approve executive compensation.~~

∎

~~Proposal 5: Stockholder proposal regarding an annual sustainability report.~~Approval of the issuance of an annual sustainability report regarding environmental, social and governance related issues affecting the company requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted “for” such proposal must exceed the number of shares voted “against” such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the annual meeting at which a quorum is present.

Brokers may not use discretionary authority to vote shares on this stockholder proposal if they have not received specific instructions from their clients. If you are a beneficial owner of shares, for your vote to be counted for or against the stockholder proposal regarding annual sustainability reporting, you will need to communicate your voting decision to your bank, broker or other nominee before the date of the annual meeting in accordance with their specific instructions. Abstentions and broker~~non-votes~~

Table of Contents ~~are not considered votes cast for purposes of tabulation of such vote, and will have no effect on the vote on this stockholder proposal.~~

∎

~~Proposal 6: Stockholder proposal regarding the company’s executive compensation clawback policy.~~Approval of an amendment to the company’s executive compensation clawback policy to require the company to recoup compensation from its senior executives under certain conditions requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted “for” such proposal must exceed the number of shares voted “against” such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the annual meeting at which a quorum is present.

Brokers may not use discretionary authority to vote shares on this stockholder proposal if they have not received specific instructions from their clients. If you are a beneficial owner of shares, for your vote to be counted for or against the stockholder proposal regarding an amendment to the clawback policy, you will need to communicate your voting decision to your bank, broker or other nominee before the date of the annual meeting in accordance with their specific instructions. Abstentions and broker~~non-votes~~ ~~are not considered votes cast for purposes of tabulation of such vote, and will have no effect on the vote on this stockholder proposal.~~


						6						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						6						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

In general, other business properly brought before the annual meeting requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted “for” such proposal must exceed the number of shares voted “against” such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the annual meeting

Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the Annual Meeting at which a quorum is present.

: Brokers may not use discretionary authority to vote shares of our common stock on this proposal if they have not received specific instructions from their clients. If you are a beneficial owner of shares of our common stock, in order for your vote to be counted for or against the amendment to the company's 2016 Omnibus Incentive Compensation Plan, you will need to communicate your voting decision to your bank, broker or other nominee before the date of the Annual Meeting in accordance with their specific instructions. Abstentions and broker non-votes are not considered votes cast for purposes of tabulation and will have no effect on the vote on this proposal.
■: Proposal 4: Advisory vote to approve executive compensation. Advisory approval of the resolution on executive compensation of our NEOs as disclosed in this Proxy Statement requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted "for" such proposal must exceed the number of shares voted "against" such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the Annual Meeting at which a quorum is present. This resolution, commonly referred to as a "say-on-pay" resolution, is non-binding on our Board of Directors. Although non-binding, our Board of Directors and the Compensation Committee will review and consider the voting results when making future decisions regarding our executive compensation program.
: Brokers may not use discretionary authority to vote shares of our common stock on the advisory vote to approve executive compensation if they have not received specific instructions from their clients. If you are a beneficial owner of shares of our common stock, in order for your vote to be counted in the advisory vote to approve executive compensation, you will need to communicate your voting decisions to your bank, broker or other nominee before the date of the Annual Meeting in accordance with their specific instructions. Abstentions and broker non-votes are not considered votes cast for purposes of tabulation and will have no effect on the advisory vote to approve executive compensation.
■: Proposal 5: Stockholder proposal regarding the requirement that the chairman of the board be an independent director. Approval of a policy requiring that the chairman of the board of directors be appointed from among independent directors requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted "for" such proposal must exceed the number of shares voted "against" such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the Annual Meeting at which a quorum is present.
: Brokers may not use discretionary authority to vote shares of our common stock on this stockholder proposal if they have not received specific instructions from their clients. If you are a beneficial owner of shares of our common stock, for your vote to be counted for or against the stockholder proposal, you will need to communicate your voting decision to your bank, broker or other nominee before the date of the Annual Meeting in accordance with their specific instructions. Abstentions and broker non-votes are not considered votes cast for purposes of tabulation and will have no effect on the vote on this stockholder proposal.
■: Proposal 6: Stockholder proposal regarding ways to strengthen the prevention of workplace sexual harassment and align senior executive compensation incentives. Approval of a policy requiring the company to adopt measures to strengthen prevention of workplace sexual harassment and align senior executive compensation incentives requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted "for" such proposal must exceed the number of shares voted "against" such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the Annual Meeting at which a quorum is present.
: Brokers may not use discretionary authority to vote shares of our common stock on this stockholder proposal if they have not received specific instructions from their clients. If you are a beneficial owner of shares of our common stock, for your vote to be counted for or against the stockholder proposal, you will need to communicate your voting decision to your bank, broker or other nominee before the date of the Annual Meeting in accordance with their specific instructions. Abstentions and broker non-votes are not considered votes cast for purposes of tabulation and will have no effect on the vote on this stockholder proposal.

In general, other business properly brought before the Annual Meeting requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted "for" such proposal must exceed the number of shares voted "against" such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the Annual Meeting at which a quorum is present.

How does the Board of Directors recommend that I vote?

Our Board of Directors, after careful consideration, recommends that our stockholders vote"FOR" the election of each director nominee named in this proxy statement,"FOR" ratification of KPMG as our independent registered public accounting firm for fiscal year 2019,"FOR" approval of an amendment to the company's incentive compensation plan,"FOR" advisory

~~Our Board of Directors, after careful consideration, recommends that our stockholders vote~~~~“FOR”~~ ~~the election of each director nominee named in this proxy statement,~~~~“FOR”~~ ~~ratification of KPMG as our independent registered public accounting firm for fiscal year 2018,~~~~“FOR”~~ ~~advisory approval of the resolution to approve executive compensation, for the option of every~~~~“ONE YEAR”~~ ~~as the preferred frequency for future advisory votes to approve executive compensation,~~~~“AGAINST”~~ ~~the approval of the stockholder proposal regarding annual sustainability reporting, if such proposal is properly presented at the meeting, and~~~~“AGAINST”~~ ~~the approval of the stockholder proposal regarding the company’s executive compensation clawback policy, if such proposal is properly presented at the meeting.~~
	8	©2019 XPO Logistics, Inc.

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approval of the resolution to approve executive compensation,"AGAINST" the approval of the stockholder proposal regarding the requirement that the chairman of the board be an independent director, if such proposal is properly presented at the meeting, and"AGAINST" the approval of the stockholder proposal regarding ways to strengthen the prevention of workplace sexual harassment and align senior executive compensation incentives, if such proposal is properly presented at the meeting.

What do I need to do now?

We urge you to read this proxy statement carefully, then mail your completed, dated and signed proxy card in the enclosed return envelope as soon as possible so that your shares can be voted at the annual meeting

We urge you to read this Proxy Statement carefully, then mail your completed, dated and signed proxy card in the enclosed return envelope as soon as possible so that your shares of our common stock can be voted at the Annual Meeting of stockholders. Holders of record may also vote by telephone or the internet by following the instructions on the proxy card.

How do I cast my vote?

~~Registered Stockholders.~~ If you are a registered stockholder (i.e., you hold your shares in your own name through our transfer agent, Computershare Trust Company, N.A., and not through a broker, bank or other nominee that holds shares for your account in “street name”), you may vote by proxy via the internet, by telephone, or by mail by following the instructions provided on the proxy card. Proxies submitted via telephone or internet must be received by 1:00 a.m. Eastern Daylight Time on May 17, 2018. Please see the proxy card provided to you for instructions on how to submit your proxy by telephone or the internet. Stockholders of record who attend the annual meeting may vote in person by obtaining a ballot from the inspector of elections.

~~Beneficial Owners.~~ If you are a beneficial owner of shares (i.e., your shares are held in the name of a brokerage firm, bank or a trustee), you may vote by proxy by following the instructions provided in the voting instruction form or other materials provided to you by the brokerage firm, bank or other nominee that holds your shares. To vote in person at the annual meeting, you must obtain a legal proxy from the brokerage firm, bank or other nominee that holds your shares.

Registered Stockholders. If you are a registered stockholder (i.e., you hold your shares in your own name through our transfer agent, Computershare Trust Company, N.A., and not through a broker, bank or other nominee that holds shares for your account in "street name"), you may vote by proxy via the internet, by telephone, or by mail by following the instructions provided on the proxy card. Proxies submitted via telephone or internet must be received by 1:00 a.m. Eastern Daylight Time on May 15, 2019. Please see the proxy card provided to you for instructions on how to submit your proxy by telephone or the internet. Stockholders of record who attend the Annual Meeting may vote in person by obtaining a ballot from the inspector of elections.

Beneficial Owners. If you are a beneficial owner of shares (i.e., your shares are held in the name of a brokerage firm, bank or a trustee), you may vote by proxy by following the instructions provided in the voting instruction form or other materials provided to you by the brokerage firm, bank or other nominee that holds your shares. To vote in person at the Annual Meeting, you must obtain a legal proxy from the brokerage firm, bank or other nominee that holds your shares.

What is the deadline to vote?

If you hold shares as the stockholder of record, your vote by proxy must be received before the polls close at the annual meeting. As indicated on the proxy card provided to you, proxies submitted via telephone or internet must be received by 1:00 a.m. Eastern Daylight Time on May 17, 2018.

If you hold shares as the stockholder of record, your vote by proxy must be received before the polls close at the Annual Meeting. As indicated on the proxy card provided to you, proxies submitted via telephone or internet must be received by 1:00 a.m. Eastern Daylight Time on May 15, 2019.

If you are the beneficial owner of shares of our common stock, please follow the voting instructions provided by your broker, trustee or other nominee.

What happens if I do not respond, or if I respond and fail to indicate my voting preference, or if I abstain from voting?

If you fail to sign, date and return your proxy card or fail to vote by telephone or internet as provided on your proxy card, your shares will not be counted towards establishing a quorum for the annual meeting, which requires holders representing a majority of the outstanding shares of our common stock (including those that would be issued if all of our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) to be present in person or by proxy. Failure to vote, assuming the presence of a quorum, will have no effect on the tabulation of the vote on the proposals.

~~If you are a stockholder of record and you properly sign, date and return your proxy card, but do not indicate your voting preference, we will count your proxy as a vote~~~~“FOR”~~ ~~the election of the seven nominees for director named in “Proposal 1—Election of Directors,”~~~~“FOR”~~ ~~ratification of KPMG as our independent registered public accounting firm for fiscal year 2018,~~~~“FOR”~~ ~~advisory approval of the resolution to approve executive compensation, for a frequency of every~~~~“ONE YEAR”~~ ~~as the preferred frequency for future advisory votes to approve executive compensation,~~~~“AGAINST”~~ ~~the approval of the stockholder proposal regarding annual sustainability reporting, if properly presented at the annual meeting, and~~~~“AGAINST”~~ ~~the approval of the stockholder proposal regarding the company’s executive compensation clawback policy, if properly presented at the annual meeting.~~

If you fail to sign, date and return your proxy card or fail to vote by telephone or internet as indicated on your proxy card, your shares will not be counted towards establishing a quorum for the Annual Meeting, which requires holders representing a majority of the outstanding shares of our common stock (including those that would be issued if all of our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) to be present in person or by proxy.

Failure to vote, assuming the presence of a quorum, will have no effect on the tabulation of the votes on the proposals. If you are a stockholder of record and you properly sign, date and return your proxy card, but do not indicate your voting preference, we will count your proxy as a vote"FOR" the election of the eight nominees for director named in "Proposal 1–Election of Directors,""FOR" ratification of KPMG as our independent registered public accounting firm for fiscal year 2019,"FOR" approval of an amendment to the company's incentive compensation plan to increase the number of available shares, extend the term of the plan and make certain other changes,"FOR" advisory approval of the resolution to approve executive compensation,"AGAINST" the approval of the stockholder proposal regarding the requirement that the chairman of the Board be an independent director, if properly presented at the Annual Meeting, and"AGAINST" the approval of the stockholder proposal regarding ways to strengthen the prevention of workplace sexual harassment and align senior executive compensation incentives, if properly presented at the Annual Meeting.

						7						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						7						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

If my shares are held in ~~“street name”~~"street name" by my broker, dealer, commercial bank, trust company or other nominee, will such broker or other nominee vote my shares for me?

You should instruct your broker or other nominee on how to vote your shares of our common stock using the instructions provided by such broker or other nominee. Absent specific voting instructions, brokers or other nominees who hold shares of our common stock in "street name" for customers are prevented by the rules set forth in the Listed Company Manual (the "NYSE Rules") of the New York Stock Exchange (the "NYSE") from exercising voting discretion with respect to non-routine or contested matters. We expect that when the NYSE evaluates the proposals to be voted on at the Annual Meeting to determine whether each proposal is a routine or non-routine matter, only "Proposal 2–Ratification of the Appointment of KPMG LLP as Our Independent Registered Public Accounting Firm for Fiscal Year 2019" will be determined to be routine. Shares not voted

You should instruct your broker or other nominee on how to vote your shares using the instructions provided by such broker or other nominee. Absent specific voting instructions, brokers or other nominees who hold shares of our common stock in “street name” for customers are prevented by the rules set forth in the Listed Company Manual (the “NYSE Rules”) of the New York Stock Exchange (the “NYSE”) from exercising voting discretion in respect of
	~~non-routine~~ ~~or contested matters. We expect that when the NYSE evaluates the proposals to be voted on at the annual meeting to determine whether each proposal is a routine or~~	~~non-routine~~ matter, only “Proposal 2—Ratification of the Appointment of KPMG LLP as Our Independent Registered Public Accounting Firm for fiscal year 2018” will be determined to be routine. Shares not voted by a broker or other nominee because such broker or other nominee does not have instructions or cannot exercise discretionary voting power with respect to one or more proposals are referred to as “broker	~~non-votes.”~~9 ~~It is important that you instruct your broker or other nominee on how to vote your shares of our common stock held in “street name”~~	©2019 XPO Logistics, Inc.

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by a broker or other nominee, because such broker or other nominee does not have instructions or cannot exercise discretionary voting power with respect to one or more proposals, are referred to as "broker non-votes." It is important that you instruct your broker or other nominee on how to vote your shares of our common stock held in "street name" in accordance with the voting instructions provided by such broker or other nominee.

Can I change my vote after I have mailed my proxy card?

Yes. Whether you attend the annual meeting or not, you may revoke a proxy at any time before your proxy is voted at the annual meeting. You may do so by properly delivering a later-dated proxy either by mail, the internet or telephone or by attending the annual meeting in person and voting. Please note, however, your attendance at the annual meeting will not automatically revoke any prior proxy, unless you vote again at the annual meeting or specifically request in writing that your prior proxy be revoked. You also may revoke your proxy by delivering a notice of revocation to our company (Attention: Secretary, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831) prior to the vote at the annual meeting.

Yes. Whether you attend the Annual Meeting or not, you may revoke a proxy at any time before your proxy is voted at the Annual Meeting. You may do so by properly delivering a later-dated proxy either by mail, the internet or telephone or by attending the Annual Meeting in person and voting. Please note, however, your attendance at the Annual Meeting will not automatically revoke any prior proxy, unless you vote again at the Annual Meeting or specifically request in writing that your prior proxy be revoked. You also may revoke your proxy by delivering a notice of revocation to our company (Attention: Secretary, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831) prior to the vote at the Annual Meeting. If you hold your shares through a broker, dealer, commercial bank, trust company or other nominee, you should follow the instructions of such broker or other nominee regarding revocation of proxies.

How will the persons named as proxies vote?

If you are a registered stockholder (i.e., you hold your shares of our common stock in your own name through our transfer agent, Computershare Trust Company, N.A., and not through a broker, bank or other nominee that holds shares for your account in "street name") and you complete and submit a proxy, the persons named as proxies will follow your instructions. If you submit a proxy but do not provide instructions, or if your instructions are unclear, the persons named as proxies will vote as recommended by our Board of Directors or, if no recommendation is given, by using their own discretion.

Where can I find the results of the voting?

~~We intend to announce preliminary voting results at the annual meeting and will publish final results through a Current Report on Form~~We intend to announce preliminary voting results at the Annual Meeting and will publish final results on a Current Report on Form 8-K to be filed with the U.S. Securities and Exchange Commission ("SEC") within four (4) business days after the Annual Meeting. The Current Report on Form 8-K ~~to be filed with the Securities and Exchange Commission (“SEC”) within four (4) business days after the annual meeting. The Current Report on Form8-K~~ will be available on the internet at our website,www.xpo.com.

Who will pay for the cost of soliciting proxies?

~~We will pay for the cost of soliciting proxies. We have engaged Innisfree M&A Incorporated to assist us in soliciting proxies in connection with the annual meeting,~~

The company will pay for the cost of soliciting proxies. We have engaged Innisfree M&A Incorporated to assist us in soliciting proxies in connection with the Annual Meeting and have agreed to pay them approximately $12,500 plus their expenses for providing such services. Our directors, officers and other employees, without additional compensation, may solicit proxies personally, in writing, by telephone, by ~~telephone, by~~e-mail or otherwise. As is customary, we will reimburse brokerage firms, fiduciaries, voting trustees and other nominees for forwarding our proxy materials to each beneficial owner of shares of our common stock or Series A Preferred Stock held of record by them.

What is ~~“householding”~~"householding" and how does it affect me?

In accordance with notices to many stockholders who hold their shares through a bank, broker or other holder of record (a “street-name stockholder”) and share a single address, only one copy of our proxy statement and 2017 annual report to stockholders is being delivered to that address unless contrary instructions from any stockholder at that address are received. This practice, known as “householding,” is intended to reduce our printing and postage costs. However, any such street-name stockholder residing at the same address who wishes to receive a separate copy of this proxy statement and annual report may request a copy by contacting the bank, broker or other holder of record, or by sending a written request to: Investor Relations, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831, or by contacting Investor Relations by telephone at (855)~~976-6951.~~

In accordance with notices to many stockholders who hold their shares through a bank, broker or other holder of record (a "street-name stockholder") and share a single address, only one copy of our Proxy Statement and 2018 Annual Report to stockholders is being delivered to that address unless contrary instructions from any stockholder at that address are received. This practice, known as "householding," is intended to reduce our printing and postage costs. However, any such street-name stockholders residing at the same address who wish to receive a separate copy of this Proxy Statement and the 2018 Annual Report may request a copy by contacting their bank, broker or other holder of record, or by sending a written request to: Investor Relations, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831, or by contacting Investor Relations by telephone at 1-855-976-6951. The voting instruction form sent to a street-name stockholder should provide information on how to request: (1) householding of future company materials, or (2) separate materials if only one set of documents is being sent to a household. ~~A stockholder who would like to make one of these requests should contact us as indicated above.~~

Can I obtain an electronic copy of the Company's proxy materials?

~~Yes, this proxy statement, annual report and proxy card are available on the internet atwww.edocumentview.com/XPO~~.

©~~2018~~ ~~XPO Logistics,~~

Yes, this Proxy Statement and our 2018 Annual Report are available on the internet atwww.edocumentview.com/XPO.


				10				©2019 XPO Logistics, Inc.

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BOARD OF DIRECTORS AND


CORPORATE GOVERNANCE

~~BOARD OF DIRECTORS AND~~

~~CORPORATE GOVERNANCE~~

~~Introduction –~~An Overview of Our Mission and How Our Board Composition Is Aligned with Our Strategy

Our mission is to be the leading provider of cutting-edge supply chain solutions to the most successful companies in the world, and to do this by using our highly integrated network of people, technology and physical assets to help our customers manage their goods most efficiently throughout their supply chains. We run our business on a global basis, with over 50,000 customers served by more than 100,000 employees and 1,535 locations in 32 countries, including the United States, France, the United Kingdom and Spain. Our transportation segment offers customers an unmatched network of multiple modes, flexible capacity and route density that transports freight quickly and cost effectively from origin to destination. Through our logistics segment, we provide a range of differentiated and data-intensive services, including highly engineered and customized solutions, value-added warehousing and distribution, omnichannel fulfillment, cold chain distribution, reverse logistics, surge management and other inventory management solutions.

Our blueprint for transforming transportation and logistics is rooted in innovation and revolves around our people. We care deeply about keeping our employees and customers happy, and we view safety, sustainability, strong governance and a purpose-driven culture as essential components of value creation. In addition, our company is a leading proponent of technology, with a global team of technologists and data scientists who concentrate their efforts in four areas of innovation: (1) automation and intelligent machines, (2) visibility and customer service, (3) the digital freight marketplace and (4) dynamic data science. Our success depends on our people.

Our Board of Directors consists of a highly skilled group of leaders who share our values and reflect our culture. Many of our directors have served as executive officers or served on boards of major companies and have an extensive understanding of the principles of corporate governance. In addition, our directors have a strong owner orientation—approximately 18.3% of the voting power of our capital stock on a fully-diluted basis is held by our directors or by entities or persons related to our directors (as of the Record Date). As described on page 17, our Board as a whole has broad expertise with the following skill sets that are relevant to our company, business, industry and strategy:

■: Business operations;
■: Corporate governance;
■: Customer service;
■: Environmental sustainability and corporate responsibility;
■: Effective capital allocation;
■: Critical analysis of corporate financial statements and capital structures;
■: Human resource management;
■: Multinational corporate management;
■: Sales and marketing;
■: Mergers and acquisitions, integration and optimization;
■: The transportation and logistics industry;
■: Risk management;
■: Talent management and engagement; and
■: Technology and information systems.

Our mission is to be the leading provider of cutting-edge supply chain solutions to the most successful companies in the world by using our highly integrated network of people, technology and physical assets to help our customers manage their goods more efficiently throughout their supply chains. We run our business on a global basis, with customers and employees in over 1,455 locations in 32 countries, including the United States, France, the United Kingdom and Spain. Our transportation segment offers customers an unmatched network of multiple modes, flexible capacity and route density that transports freight quickly and cost effectively from origin to destination. Through our logistics segment, we provide a range of differentiated and data-intensive services, including highly engineered and customized solutions, value-added warehousing and distribution, cold chain distribution and other inventory management solutions.	Our blueprint for transforming transportation and logistics revolves around innovation and people. Our company is a leading champion of technology, with a global team of technologists and data scientists who concentrate their efforts in four areas of innovation: automation and intelligent machines, visibility and customer service, the digital freight marketplace and dynamic data science. Our success depends on our people. We care deeply about keeping our employees and customers happy, and view giving back to communities, focusing on safety and sustainability and maintaining strong governance as essential components of value creation.	Our Board of Directors consists of a highly experienced group of business leaders who share our values and reflect our culture. Many of our directors have served as executive officers or on boards and board committees of major companies and have an extensive understanding of the principles of corporate governance. In addition, our directors have a strong owner orientation—approximately 15.4% of the voting power of our capital stock on a fully-diluted basis is held by our directors or by entities or persons related to our directors (as of the Record Date). As described on page 13, our Board as a whole has broad expertise with the following skill sets that are relevant to our company, business, industry and strategies:
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∎

~~business administration;~~

∎

~~business operations;~~

∎

~~corporate governance;~~

∎

~~the customer service sector;~~

∎

~~environmental, sustainability and corporate responsibility;~~

∎

~~finance/capital allocation;~~

∎

~~the evaluation of financial statements and capital structure;~~

∎

~~human capital management;~~

∎

~~international business;~~

∎

~~investments;~~

∎

~~sales and marketing;~~

∎

~~mergers & acquisitions and integration;~~

∎

~~the logistics industry;~~

∎

~~risk management;~~

∎

~~talent management; and~~

∎

~~technology and information systems.~~

Directors

Name

Occupation

Bradley S. Jacobs

Chairman and Chief Executive Officer, XPO Logistics, Inc.

Gena L. Ashe

President and Chief Executive Officer, GLA Legal Advisory Group, LLC

Marlene M. Colucci

Executive Director, The ~~current term of each of our directors will expire at the 2018 annual meeting of stockholders. Our Board of Directors has nominated seven (7) of the current directors to stand forre-election~~ ~~at the annual meeting, as set forth in Proposal 1 on page 50 of this proxy statement.~~

Business Council

AnnaMaria DeSalva

Vice Chairman, XPO Logistics, Inc.; Senior Advisor, DowDuPont; Former Chief Communications Officer, E.I. du Pont de Nemours & Co.

Michael G. Jesselson

Lead Independent Director, XPO Logistics, Inc.; President and Chief Executive Officer, Jesselson Capital Corporation

Adrian P. Kingshott

Chief Executive Officer, AdSon, LLC

Jason D. Papastavrou

Founder and Chief Investment Officer, ARIS Capital Management, LLC

Oren G. Shaffer

Former Vice Chairman and Chief Financial Officer, Qwest Communications International, Inc.

©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~Name~~

~~Occupation~~

~~Bradley S. Jacobs~~

~~Chairman and Chief Executive Officer, XPO Logistics, Inc.~~

~~Gena L. Ashe~~

~~Former Senior Vice President, Chief Legal Officer and Corporate Secretary, Adtalem Global Education Inc.~~

~~Louis DeJoy~~

~~Former Chief Executive Officer, Supply Chain, XPO Logistics, Inc.~~

~~AnnaMaria DeSalva~~

~~Former Global Chief Communications Officer, E.I. du Pont de Nemours & Co. (DuPont)~~

~~Michael G. Jesselson~~

~~Lead Independent Director, XPO Logistics, Inc. President and Chief Executive Officer, Jesselson Capital Corporation~~

~~Adrian P. Kingshott~~

~~Chief Executive Officer, AdSon LLC~~

~~Jason D. Papastavrou~~

~~Founder and Chief Investment Officer, ARIS Capital Management, LLC~~

~~Oren G. Shaffer~~

~~Former Vice Chairman and Chief Financial Officer, Qwest Communications International, Inc.~~

While it does not currently exceed the required voting power thresholds, under the terms of an Investment Agreement, dated June 13, 2011 (the “Investment Agreement”), by and among Jacobs Private Equity, LLC (“JPE”), the other investors party thereto (collectively with JPE, the “Investors”

Bradley S. Jacobs

Chairman and Director since 2011

Age: 62

Mr. Jacobs has served as our chief executive officer and chairman of our Board of Directors ~~so long as JPE owns securities (including preferred stock convertible into, or warrants exercisable for, securities) representing specified percentages of~~since September 2, 2011. Mr. Jacobs is also the ~~total voting power of our capital stock on a fully-diluted basis. The foregoing rights~~managing member of JPE, ~~under the Investment Agreement are~~which is our second largest stockholder. Prior to XPO, he led two public companies: United Rentals, Inc. (NYSE: URI), which he founded in ~~addition to,~~1997, and ~~not~~United Waste Systems, Inc., which he founded in ~~limitation~~1989. Mr. Jacobs served as chairman and chief executive officer of ~~JPE’s voting rights~~United Rentals for that company's first six years, and as ~~a holder~~its executive chairman for an additional four years. He served eight years as chairman and chief executive officer of ~~capital stock of our company. JPE is controlled by Bradley S. Jacobs, our Chairman of the~~ United Waste Systems.

Board ~~and Chief Executive Officer. The Investment Agreement and the terms contemplated therein were approved by our stockholders at a special meeting on September 1, 2011.~~

Committees: None of the foregoing will prevent our Board of Directors from acting in accordance with its fiduciary duties or applicable law or stock exchange requirements or from acting in good faith in accordance with our governing documents, while giving due consideration to the intent of the Investment Agreement.

Set forth below is information regarding each of our director nominees, including the experience, qualifications, attributes or skills that led our Board of Directors to conclude that such person should serve as a director.

		Other Public Company Boards: None
~~Bradley S. Jacobs~~	~~Director since 2011~~
~~Age:~~61
Mr. Jacobs has served as our Chief Executive Officer and Chairman of our Board of Directors since September 2, 2011. Mr. Jacobs is also the managing member of JPE, which is our second largest stockholder. Prior to XPO, he led two public companies: United Rentals, Inc. (NYSE: URI), which he founded in 1997, and United Waste Systems, Inc., which he founded in 1989. Mr. Jacobs served as chairman and chief executive officer of United Rentals for that company’s first six years, and as its executive chairman for an additional four years. He served eight years as chairman and chief executive officer of United Waste Systems.
~~Board Committees:~~~~None~~
~~Other Public Company Boards:~~~~None~~
*~~Mr. Jacobs brings to the Board:~~*
~~• In-depth~~ ~~knowledge of the company’s business resulting from his years of service with the company as its Chief Executive Officer;~~
~~• Leadership experience as the company’s Chairman and Chief Executive Officer, and a successful track record of leading companies that execute strategies similar to ours; and~~
~~• Extensive past experience as the chairman of the board of directors of several public companies.~~


~~Gena L. Ashe~~		~~Director since 2016~~
~~Age:~~56
Ms. Ashe has served as a director of the company since March 21, 2016. Ms. Ashe was senior vice president, chief legal officer and corporate secretary of Adtalem Global Education Inc. (NYSE: ATGE) from May 2017 to February 2018, and executive vice president, chief legal officer, and corporate secretary of BrightView Landscapes, LLC (formerly The Brickman Group, Ltd. LLC) from December 2012 to June 2016. Earlier, she served as senior vice president of legal affairs for Catalina Marketing Corporation and held senior legal roles with the Public Broadcasting Service (“PBS”), Darden Restaurants, Inc., Lucent Technologies and AT&T. Earlier in her career, Ms. Ashe served as an electrical engineer and scientist for IBM Corporation before joining IBM’s legal team. Ms. Ashe holds a juris doctorate degree from Georgetown University Law Center, where she serves on the Georgetown Law Advisory Board, a master’s degree in electrical engineering from Georgia Institute of Technology and a bachelor’s degree in mathematics from Spelman College, where she sits on the Board of Trustees. She has completed the executive development program at the Wharton School of the University of Pennsylvania and holds a certificate in international management from Oxford University in England.
~~Board Committees:~~~~Chair of Nominating and Corporate Governance Committee~~
~~Other Public Company Boards:~~~~None~~
*~~Ms. Ashe brings to the Board:~~*
• More than two decades of valuable legal experience with public and private companies, which enables her to provide guidance to the Board and company management on legal matters, compliance and risk assessment and corporate governance best practices; and
~~• Anin-depth~~ ~~understanding of the dynamics of three of our most important customer verticals:e-commerce,~~ ~~technology and food and beverage.~~

Mr. Jacobs brings to the Board:

■

In-depth knowledge of the company's business resulting from his years of service with the company as its chief executive officer;

■

Leadership experience as the company's chairman and chief executive officer, and a successful track record of leading companies that execute strategies similar to ours; and

■

Extensive past experience as the chairman of the board of directors of several public companies.


				12				©2019 XPO Logistics, Inc.

Gena L. Ashe

Director since 2016

Age: 57

Ms. Ashe has served as a director of the company since March 21, 2016. Ms. Ashe has served as the president and chief executive officer of GLA Legal Advisory Group, LLC since February 2018. Also, Ms. Ashe has served as vice-chairman of the Supervisory Board of XPO Logistics Europe S.A., our majority-owned subsidiary, since February 2017. She was senior vice president, chief legal officer and corporate secretary of Adtalem Global Education Inc. (NYSE: ATGE) from May 2017 to February 2018, and executive vice president, chief legal officer, and corporate secretary of BrightView Landscapes, LLC (formerly The Brickman Group, Ltd. LLC) from December 2012 to June 2016. Earlier, she served as senior vice president of legal affairs for Catalina Marketing Corporation and held senior legal roles with the Public Broadcasting Service ("PBS"), Darden Restaurants, Inc., Lucent Technologies and AT&T. Earlier in her career, Ms. Ashe served as an electrical engineer and scientist for IBM Corporation before joining IBM's legal team. Ms. Ashe holds a juris doctorate degree from Georgetown University Law Center, where she serves on the Georgetown Law Advisory Board, a master's degree in electrical engineering from Georgia Institute of Technology and a bachelor's degree in mathematics from Spelman College, where she sits on the Board of Trustees. She has completed the executive development program at the Wharton School of the University of Pennsylvania and holds a certificate in international management from Oxford University in England.

©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


				57				©2019 XPO Logistics, Inc.

Policy RegardingPre-Approval of Services Provided by the Outside Auditors



Fee Category	2018	2017

Audit Fees	$5,100,000	$6,400,000
Audit-Related Fees	1,300,000	300,000

Tax Fees	1,100,000	1,700,000
All Other Fees	—	—

Total Fees	$7,500,000	$8,400,000

As described above, the Audit Committee is responsible for the appointment, compensation, oversight, evaluation and termination of our outside auditors. Accordingly, the Audit Committee retained KPMG to serve as our independent registered public accounting firm for fiscal year 2017 on April 12, 2017.

~~The following table shows the fees for audit and other services provided by KPMG for fiscal years 2017 and 2016.~~

Fee Category

2017
2016

Audit Fees

$6,400,000

$7,300,000

Audit-Related Fees

300,000

400,000

Tax Fees

1,700,000

200,000

All Other Fees

–

–
Total Fees

$8,400,000

$7,900,000

~~Audit Fees.~~ ~~This category includes fees for professional services rendered by KPMG for 2017 and 2016 for the audits of our financial statements included in our Annual Report on Form~~

~~10-K,~~ ~~and reviews of the financial statements included in our Quarterly Reports on Form~~

~~10-Q.~~

~~Audit-Related Fees.~~ ~~The 2016 fees include financial due diligence services provided by KPMG in connection with dispositions during 2016. The 2017 fees include accounting consultation related to new accounting standards.~~

~~Tax Fees.~~ ~~This category includes fees billed for professional services rendered by KPMG in connection with tax consultation and tax compliance services in 2017 and 2016, respectively.~~

~~All Other Fees.~~ ~~This category represents fees for all other services or products provided that are not covered by the categories above. There were no such fees for 2017 and 2016.~~

PROPOSALS TO BE PRESENTED


~~Our Board of Directors recommends a vote “FOR” the election of each of the nominees listed above to our Board of Directors.~~	59	©2019 XPO Logistics, Inc.

Proposal 2: Ratification of the Appointment of KPMG LLP as our Independent Registered Public Accounting Firm for Fiscal Year ~~2018~~2019

The Audit Committee of our Board of Directors has appointed KPMG LLP to serve as our independent registered public accounting firm for the year ending December 31, 2018. KPMG has served in this capacity since 2011.

~~We are asking our stockholders to ratify the appointment of KPMG as our independent registered public accounting firm for the year ending December 31, 2018.~~


				60				©2019 XPO Logistics, Inc.



Our Fully-Diluted Capitalization:
Shares of common stock				92,233,726

Shares of common stock issuable upon conversion of preferred stock				10,158,571
Shares of common stock issuable upon exercise of 10,113,287 Warrants (using the treasury method and assuming a price of $63.19 per share, which was the closing price of our common stock ~~(including those that would be issued if all our outstanding Series A Preferred~~on the NYSE on April 12, 2019)				8,992,967

Fully-Diluted Common Stock ~~had converted into shares~~Outstanding				111,385,264


				61				©2019 XPO Logistics, Inc.



Potential Overhang with 2,000,000 Additional Shares:
Total equity awards outstanding as of April 12, 2019		3,618,022
Options and Stock Appreciation Rights Outstanding*	635,606
Restricted Stock Units and Performance-based Restricted Stock Units Outstanding	2,982,416
Shares available for grant under the ~~Record Date) at~~2016 Plan		693,986
Additional requested shares		2,000,000
Total Potential Dilution, or Overhang		6,312,008
Potential Dilution as a Percentage of Fully-Diluted Common Stock Outstanding		5.67%

*: Weighted average exercise price: $12.60; weighted average remaining term: 3.05 years


Note:		Burn rate is calculated as (options granted + RSUs granted + Performance-based RSUs vested) / weighted average shares outstanding. All RSUs granted and Performance-based RSUs vested are adjusted using a multiplier of 2.0 options per share (based on the ~~annual meeting~~ISS methodology and the Company's 3-year average stock price volatility).


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Proposal 3:4: Advisory Vote to Approve Executive Compensation

The Dodd-Frank Wall Street Reform and Consumer Protection Act, enacted in July 2010, and Section 14A of the Securities Exchange Act of 1934, require that we provide our stockholders with the opportunity to vote to approve, on a~~non-binding,~~ ~~advisory basis, the compensation of our NEOs as disclosed in this proxy statement~~


				69				©2019 XPO Logistics, Inc.

~~Proposal 4: Advisory Vote on Frequency of Future Advisory Votes to Approve Executive Compensation~~

~~The Dodd-Frank Wall Street Reform and Consumer Protection Act and Section 14A of the Securities Exchange Act provide that stockholders must be given the opportunity to vote, on anon-binding,~~ advisory basis, for their preference as to how frequently we should seek future advisory votes on the compensation of our NEOs as disclosed in accordance with the SEC’s compensation disclosure rules, which we refer to as an advisory vote to approve executive compensation. By voting with respect to this Proposal 4, stockholders may indicate whether they would prefer that we conduct future advisory votes on executive compensation once every one, two or three years. Stockholders may, if they wish, abstain from casting a vote on Proposal 4. At the 2012 annual meeting of stockholders, our stockholders voted to approve an annual holding of the advisory vote on executive compensation. Pursuant to the SEC rules, public companies are required to hold a~~“say-on-frequency”~~ ~~vote every six years to give stockholders the opportunity to determine whether a“say-on-pay”~~ ~~vote to approve executive compensation should be held every year, every two years, or every three years. The company is holding the‘”say-on-frequency”~~ ~~vote this year; therefore, the next“say-on-frequency”~~ ~~vote will take place at the 2024 annual meeting.~~

After careful consideration, our Board has determined that holding an advisory vote to approve executive compensation every year is the most appropriate policy for our company at this time, and recommends that stockholders vote that future advisory votes to approve executive compensation should occur every year. While our company’s executive compensation programs are designed to promote a long-term connection between pay and performance, our Board recognizes that executive compensation disclosures are made annually and that holding an annual advisory vote to approve executive compensation will provide us with more direct and immediate feedback on our compensation disclosures. However, stockholders should note that because the advisory vote to approve executive compensation occurs well after the beginning of the compensation year, and because the different elements of our executive compensation programs are designed to operate in an integrated manner and to complement one another, in many cases it may not be appropriate or feasible to change executive compensation programs in consideration of any one year’s advisory vote on executive compensation by the time of the following year’s annual meeting of stockholders.

~~Required Vote~~

Pursuant to this advisory vote on the frequency of future advisory votes to approve executive compensation, stockholders will be able to specify one of four choices for this proposal on the proxy card or voting instruction: one year, two years, three years or abstain. Stockholders are not voting to approve or disapprove the recommendation of our Board. The voting frequency option that receives the highest number of votes cast by stockholders at the annual meeting or any adjournment or postponement of the annual meeting will be the frequency for the advisory vote to approve executive compensation that has been selected by stockholders. However, the vote is not binding on our Board and the Compensation Committee. Although~~non-binding,~~ our Board and the Compensation Committee will carefully review the voting results. Notwithstanding our Board’s recommendation and the outcome of the stockholder vote, our Board may in the future decide to conduct advisory votes on a more or less frequent basis and may vary its practice based on factors such as discussions with stockholders and the adoption of material changes to compensation programs.

~~Recommendation~~

~~Our Board unanimously recommends a vote for the option of every “ONE YEAR” as the preferred frequency for future advisory votes to approve executive compensation.~~


						53						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						53						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Proposal 5: Stockholder Proposal Regarding ~~an Annual Sustainability Report~~

~~We have been notified~~the Requirement that ~~a stockholder proponent expects to introduce and support~~ the ~~following proposal at the annual meeting. This stockholder proponent has provided certification indicating that, as of December 11, 2017, it was the beneficial owner of 160 shares~~Chairman of the company’s common stock, or approximately 0.0001%, and that it intends to maintain such ownership through the date of the annual meeting. Information regarding the stockholder proponent’s identity willBoard be ~~made available to requesting stockholders following oral or written request.~~an Independent Director

We have been notified that the International Brotherhood of Teamsters, 25 Louisiana Avenue, NW, Washington, DC 20001, expects to introduce and support the following proposal at the annual meeting. This stockholder proponent has provided certification indicating that, as of December 17, 2018, it was the beneficial owner of 160 shares of the company's common stock, with an approximate value of $16,000, and that it intends to maintain such ownership through the date of the annual meeting. We are not responsible for the content of the stockholder proposal and the stockholder proponent's supporting statement, which are set forth below as they were submitted to us.

Proposal

~~RESOLVED:~~Shareholders request XPO Logistics, Inc. (“XPO”), issue an annual sustainability report describing the Company’s responses to Environmental, Social and Governance (“ESG”) related issues affecting the Company. The report should be prepared at reasonable cost, omitting proprietary information, and be available to shareholders by December 2018.

It should address relevant policies, practices, and metrics on topic, such as human capital management and greenhouse gas emissions, and provide objective quantitative indicators and goals relating to each issue, where feasible.

We recommend using the Global Reporting Initiative’s Sustainability Reporting Guidelines to prepare the report. The Guidelines cover environmental impacts, human rights and labor practices and provide a flexible reporting system that allows omission of content irrelevant to company operations.

~~SUPPORTING STATEMENT:~~~~A global, third-party logistics company providing transportation and logistics services, XPO’s ESG exposure involves a complex set of processes and relationships, including:~~

RESOLVED: Shareholders of XPO Logistics, Inc. ("the company"), urge the Board of Directors (the "Board") to take the steps necessary to adopt a policy, with amendments to governing documents as needed, so that, to the extent feasible, the chairman of the Board shall be an independent director who has not previously served as an executive officer of the company. The policy should be implemented so as not to violate any contractual obligations and should specify the process for selecting a new independent chairman if the chairman ceases to be independent between annual meetings of shareholders or if no independent director is available and willing to serve as chairman.

SUPPORTING STATEMENT: XPO's CEO currently serves as Board chairman. In our view, the chairman should be an independent director, who has not previously served as an executive, in order to provide robust oversight and accountability of management, and to facilitate effective deliberation of corporate strategy, which we believe, is difficult to accomplish when the CEO serves as chairman. Even with robust responsibilities, we believe the position of a lead independent director is inadequate to this task because ultimate responsibility for board leadership remains with the chairman/CEO.

In our opinion, these considerations are especially critical at XPO given the recent media and political scrutiny of the company's culture. On the heels of a front page New York Times investigation into a spate of miscarriages and allegations of pregnancy discrimination at a Memphis facility owned by XPO and operated on behalf of Verizon, nine U.S. Senators wrote to XPO (and Verizon) calling for immediate changes to the "allegedly deleterious workplace practices." Separately, 97 U.S. House representatives have called on the House Committee on Education and the Workforce to investigate allegations of pregnancy discrimination, sexual harassment and hazardous working conditions at the company.

In the midst of such scrutiny, we believe an independent chairman can be invaluable in ensuring XPO maintains good communications and credibility with stakeholders. In addition, independent board leadership could strengthen board management dialogue on corporate culture and compliance.

We urge fellow shareholders to vote FOR this proposal.

~~Meeting the ESG expectations of its clients, which market major consumer brands; many of whom are increasingly concerned with the social and environmental performance of their supply chains.~~

Monitoring the ESG performance of its supply chain partners, which provide many of the trucking and freight services XPO offers, including approximately 11,000 trucks contracted via independent owner operators and more than 1 million brokered trucks.

Managing the ESG performance of its own operations, which include, as of November 2017; 16,000 tractors, 39,000 trailers, 91,000 employees, and 767 contract logistics facilities, and operations in 32 countries.

~~In its Sustainability Yearbook 2017, RobecoSAM highlights climate change, human capital and occupational health and safety as among the sustainability issues facing transportation companies.~~

According to the 2016 Third-Party Logistics Study by C. John Langley, Jr., Ph.D., and Capgemini Consulting, the sector faces unprecedented labor shortages, bringing challenges and opportunities to human capital management. How companies handle human capital management issues, including media and regulatory attention on the classification of independent owner-operators, will help determine competitiveness in the industry, as the Sustainable Accounting Standards Board concluded in its 2014 Air Freight & Logistics Industry Brief. (~~http://www.sasb.org/wp-content/uploads/2014/09/TR0202_~~ ~~AirFreightLogistics_Industry_Brief.pdf~~).

XPO’s human capital management practices in the port drayage industry are of particular importance to shareholders following a year-long investigation by USA Today into the treatment of independent contractors – including those contracted by XPO – in the ports of Los Angeles and Long Beach. The report, which prompted four U.S. Senators to write to leading U.S. retailers about their knowledge of labor violations in the port trucking industry, called conditions in the sector “modern day indentured serv[itude].” (See~~https://www.usatoday.com/pages/interactives/news/rigged-forced-into-debt-work-past-exhaustion-left-with-nothing/~~.)

~~XPO’s sustainability practices are particularly important to shareholders in light of its rapid expansion. FromFY-end~~ ~~2013 toFY-end~~ ~~2016, XPO spent over $6.5 billion on acquisitions and witnessed a twenty-fold increase in revenue.~~

Although XPO’s website provides some information related to ESG, reporting falls short of a comprehensive sustainability report. Competitors, such as Deutsche Post/DHL and UPS, provide disclosure of strategies, goals and performance around human capital and climate change initiatives.


						54						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						54						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Statement in Opposition by our Board of Directors


	70	©2019 XPO is committed to operating in a sustainable way with regard to the environment, human capital management and governance. This stockholder proposal is virtually identical to the one proffered last year by the same proponent. At that time, our response was that the preparation of a comprehensive sustainability report was unnecessary in light of the Company’s demonstrable track record on Environmental, Social and Governance (“ESG”) matters.Logistics, Inc.
As we stated last year, we recognize the value in providing public disclosure regarding the Company’s sustainability focus. We also recognize the importance of meaningful benchmarks and goals that reflect actual


				71				©2019 XPO Logistics, Inc.

Proposal 6: Stockholder Proposal Regarding Ways to Strengthen the ~~Company’s~~Prevention of Workplace Sexual Harassment and Align Senior Executive Compensation ~~Clawback Policy~~Incentives

~~We have been notified that the Service Employees International Union Pension Plans Master Trust, 1800 Massachusetts Ave.,~~

NW Washington DC 20036 expects to introduce and support the following proposal at the Annual Meeting. This stockholder proponent has provided certification indicating that, as of December 15, 2017, it was the beneficial owner of 3,765 shares of the company’s common stock, or approximately $301,576.50, and that it intends to hold at least 160 shares of the company’s common stock through the date of the annual meeting.

We have been notified that the Service Employees International Union Pension Plans Master Trust, 1800 Massachusetts Ave., NW Washington DC 20036 expects to introduce and support the following proposal at the Annual Meeting. This stockholder proponent has provided certification indicating that, as of December 18, 2018, it was the beneficial owner of 3,965 shares of the company's common stock, with an approximate value of $378,000, and that it intends to hold at least the minimum number of shares of the company's common stock required by the SEC through the date of the Annual Meeting. We are not responsible for the content of the stockholder proposal and the stockholder proponent's supporting statement, which are set forth below as they were submitted to us.

Proposal

RESOLVED:Shareholders of XPO Logistics, Inc. (the “Company”) urge the Board of Directors’ Compensation Committee to amend the company’s clawback policy, as applied to senior executives, to add that the Committee will review and determine whether to seek recoupment of incentive compensation paid, granted or awarded to a senior executive if, in the Committee’s judgment, certain conduct resulted in a violation of law or Company policy and caused financial or reputation harm to the Company, and if a senior executive either engaged in the conduct or failed in his or her responsibility to manage or monitor the conduct or risks, with the Company to disclose to shareholders the circumstances of any recoupment or decision not to pursue recoupment in these situations.

“Recoupment” includes both recovery of compensation already paid and forfeiture, recapture, reduction or cancellation of amounts awarded or granted over which the Company retains control. This policy should operate prospectively and be implemented so as not to violate any contract, compensation plan, law or regulation.

~~SUPPORTING STATEMENT:~~ As long-term shareholders, we believe that compensation policies should promote sustainable value creation. We agree with former GE general counsel Ben Heineman Jr. that recoupment policies are “a powerful mechanism for holding senior leadership accountable to the fundamental mission of the corporation: proper risk taking balanced with proper risk management and the robust fusion of high performance with high integrity.”~~(http//:blogs.law. harvard.edu/corpgov/2010/08/13/making-sense-out-of-clawbacks/)~~

The Company’s current clawback policy allows recoupment of certain incentive pay from a corporate officer if he or she engaged in fraud or other willful misconduct that contributes materially to any significant financial restatements or material loss to the Company or any of its affiliates.

~~In our view, a recoupment policy that is limited to accounting and financial reporting noncompliance or an undefined “material loss” is too narrow.~~

We view recoupment as an important remedy for other kinds of conduct that may not lead to a restatement, but may nonetheless harm the Company’s reputation and prospects, as well as its shareholders. We also believe a clawback policy should apply without regard to “materiality,” an element of the current policy.

The reason for a strong policy is illustrated by the political and reputational risks XPO incurred when it found itself in a political and media firestorm based on allegations of sweatshop-like conditions at a warehouse that XPO operated in the United Kingdom for ASOS, a fashion retailer. (See~~http://www.bbc.com/news/business-37483334~~That shareholders of XPO Logistics ("XPO") urge the Board of Directors to strengthen XPO's prevention of workplace sexual harassment by formalizing the Board's oversight responsibility, aligning senior executive compensation incentives, reviewing (and if necessary overseeing revision of) company policies, and reporting to shareholders by December 31, 2019 on actions taken (omitting confidential and proprietary information, as well as facts relevant to claims against XPO of which XPO has notice). XPO’s human capital management practices in the port drayage industry have also come into sharp relief for investors following a year-long investigation by USA Today into the treatment of independent contractors – including those contracted by XPO – in the ports of Los Angeles and Long Beach. (~~https://www.usatoday.com/pages/interactives/news/rigged-forced-into-debt-worked-part-exhaustion-left-with-nothing/~~). The report, which prompted four U.S. Senators to write to leading U.S. retailers about their knowledge of labor violations in the port trucking industry, called conditions in the sector “modern day indentured serv[itude].”

SUPPORTING STATEMENT: Recently, workplace sexual harassment has generated substantial attention from the media and policy makers and has spurred significant public debate. The high-profile #metoo social media hashtag, and sexual harassment claims involving public figures like Bill O'Reilly, Steve Wynn, and Les Moonves, have highlighted the prevalence and impact of harassment. The proportion of Americans who believe workplace sexual harassment is a serious problem increased from 47% in 2011 to 64% in 2017. (Cornerstone)

Workplace sexual harassment can damage companies in several ways. First, it may harm corporate reputation, alienating consumers. A recent study reported in the Harvard Business Review found that a single sexual harassment claim makes a company seem less equitable and that sexual harassment, more than financial misconduct, is perceived as evincing a problematic corporate culture. (https://hbr.org/2018/06/research-how-sexual-harassment-affects-a-companys-public-image?utm_source=twitter&utm_campaign=hbr&utm_medium=social)

As well, a company whose corporate culture tolerates sexual harassment tends to have higher turnover and less productive employees. The Center for American Progress estimates median turnover costs at 21% of an employee's annual salary. Productivity can fall due to absenteeism, lower motivation, greater conflict and avoiding interaction with harassers. (https://law.vanderbilt.edu/phd/faculty/joni-hersch/2015_Hersch_Sexual_Harassment_in_the_Workplace_IZAWOL_Oct15.pdf) Sexual harassment allegations can also lead to declines in share value. For example, the market capitalization of Wynn Resorts dropped by $3 billion over two days after sexual harassment allegations against CEO Steve Wynn surfaced. (https://www.marketwatch.com/story/wynn-resorts-shares-tank-after-report-of-sexual-misconduct-by-owner-steve-wynn-2018-01-26)

In our view, the Board can play a key role in preventing and remedying sexual harassment. Law firm Wachtell, Lipton, Rosen & Katz, which counsels XPO, has noted workplace sexual misconduct "relates to key areas of board-level governance" such as "tone-at-the-top" and risk management. (https://www.conference-board.org/retrievefile.cfm?filename=Topic-I—Board-Harassment-and-Gender-Diversity.pdf&type=subsite).

Robust Board oversight is especially important at XPO following multiple reports of sexual harassment, as well as gender and pregnancy discrimination—prompting calls for an investigation by 97 U.S. House Representatives. In 2018, at least 12 women at three XPO warehouses filed charges with the Equal Employment Opportunity Commission alleging sexual harassment and discrimination by supervisors, and in certain cases retaliation. In September, The New York Times published a front-page investigation into a spate of miscarriages at a Memphis warehouse currently operated by XPO. The report, which prompted inquiries from nine U.S. Senators into pregnancy discrimination at XPO, asserts that many of the women involved were denied doctor requests for modified work. Accounts of sexual harassment, gender bias, and pregnancy discrimination have also arisen at an XPO-run warehouse in Guadalajara, Spain.

We urge shareholders to support this proposal.

Statement in Opposition by Our Board of Directors

The Board of Directors of XPO has reviewed the proposal and the Company's existing policies and practices with respect to the prevention of sexual harassment. As explained in more depth below, XPO's existing policies and procedures already provide a robust framework to prevent any kind of workplace harassment, including sexual harassment, and thus the Board believes the proposal is unnecessary.

The Board Has Already Formalized Its Oversight Role in the Company's Policies and Public Disclosures.

With regard to the prevention of workplace harassment, including sexual harassment, the Board has already defined its oversight role in a clear and sufficient manner in the Company's policies and public disclosures. The Board has established

XPO’s Board of Directors regularly evaluates the Company’s compensation policies and programs, including its clawback policies, to align the short- and long-term interests of our stockholders and to respond to changing market practices and legal and regulatory requirements. We believe our current compensation structure strikes an appropriate balance in motivating senior executives to deliver long-term results for our stockholders, while simultaneously holding our senior leadership team accountable and discouraging unreasonable risk-taking. Accordingly, XPO’s Board of Directors recommends that stockholders vote~~AGAINST~~ ~~this stockholder proposal for the reasons outlined below.~~

~~Our clawback policies are already sufficiently robust and promote long-term, sustainable value creation for our stockholders.~~ XPO’s “clawback” policies go beyond only reaching situations where our financials are restated. We have a policy in place that, as a general matter, allows all cash and stock-based awards granted under our 2016 Omnibus Incentive Compensation Plan (the “Omnibus Plan”) to be subject to recoupment both with respect to covered financial restatement situations (e.g.

©2019 XPO Logistics, “if the Company’s financial statements are required to be restated due to noncompliance with any financial reporting requirement under the Federal securities laws”) as well as other situations as “otherwise determined” by the Compensation Committee of XPO’s Board of Directors (the “Compensation Committee”). To provide more specificity around potential triggers for pursuing recoupment, currently, all equity incentive compensation awards granted under the Omnibus Plan to our Named Executive Officers (“NEOs”) and other policy-making executive officers contain provisions specifically designed to require recoupment in the event that the NEO or other officer has engaged in “fraud or other willful misconduct that contributesInc.

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the Company's Code of Business Ethics and other Business Ethics Policies (including the No Discrimination, Harassment or Retaliation Policy) that expressly focus on preventing sexual harassment and discrimination.

In addition, as disclosed in this Proxy Statement, the Board provides overall risk oversight with a focus on the most significant risks facing the Company, and regularly discusses current and potential risks and approaches for assessing, monitoring, mitigating and controlling risk exposure. To assist with the Board's risk oversight function, the Board has established four committees, including the Audit Committee, which is specifically responsible for supporting the Board's oversight of the Company's compliance with legal and regulatory requirements, including the prevention of sexual harassment. Such responsibility of the Audit Committee is clearly delineated in its Charter.

XPO Has Already Established Policies and Procedures to Prevent Workplace Sexual Harassment.

The Company has already established policies and procedures intended to prevent any kind of workplace harassment, including sexual harassment. The Company's Code of Business Ethics makes it clear that the Company does not tolerate harassment or discrimination on the basis of any protected category or class and that the Company's employees, officers and directors must not engage in any abusive, harassing or offensive conduct, whether verbal, physical or visual. The Company has further adopted a No Discrimination, Harassment or Retaliation Policy (the "Policy") to further reinforce the prevention of workplace harassment. The Policy provides for, among other things, the prohibition of discrimination, harassment or retaliation in the workplace; the prompt investigation of all claims of discrimination, harassment or retaliation; and appropriate remedial action, up to and including dismissal. The Policy, together with the Company's Code of Business Ethics, also sets forth specific reporting procedures that include the Ethics Hotline, where concerns can be reported anonymously if desired by employees. Accordingly, the Code of Business Ethics, the Policy and the Ethics Hotline provide a robust framework to address any potential incidence of sexual harassment throughout the Company.

To ensure that all employees of the Company understand and comply with the Company's values and rules of conduct, the Company distributes an Employee Handbook to each employee. The Employee Handbook explains the internal policies of the Company in detail, including the Code of Business Ethics and the Policy. In addition, the Company provides training on the Code of Business Ethics and Employee Handbook and provides refresher training on the policies prohibiting harassment, discrimination and retaliation (including the Policy) as needed. The Employee Handbook is reviewed annually by Company management.

The Company also regularly reviews and supplements its policies as needed, and the Board participates in various reviews and advises management regarding these topics. For example, on May 10, 2018, the Company engaged Tina Tchen, former Chief of Staff to First Lady Michelle Obama, and Executive Director of the White House Council on Women and Girls, to conduct a review and advise the Company on its workplace culture and policies. Ms. Tchen's review was initially intended to independently identify areas of potential improvement; however, when allegations were raised related to the Company's pregnancy accommodation practices, the Company expanded the scope of her retention to include an independent investigation into these allegations. While Ms. Tchen's investigation found no wrongdoing by the Company, she recommended additional education and training of supervisors and workers, which the Company immediately implemented. In addition, in advance of the conclusion of the investigation, the Company adopted a new Pregnancy Care Policy that far exceeds any federal, state or local requirements, and is one of the most progressive policies in place around the country.

XPO's Executive Compensation Structure Is Aligned with the Interests of XPO's Stockholders.

The Board has already addressed the request of the proposal to "align[...] senior executive compensation incentives." Putting aside the proposal's critical flaw of not providing clarity on what kind of alignment would be expected, the Board has already implemented a compensation structure that strikes an appropriate balance in motivating senior executives to deliver long-term results for the Company's stockholders, while simultaneously holding its senior leadership team accountable. The Company's executive compensation consists of fixed base salaries and variable incentive compensation in the form of annual cash incentives and equity grants that emphasize pay for performance and, in the case of equity-based grants, achievement of long-term performance goals.

Specifically, with regard to the Company's named executive officers (NEOs), the total reward package for each NEO reflects assessments of individual responsibilities, contributions to corporate performance, the company's trend on total stockholder return and overall company success in reaching strategic goals. The Company has also established a broad clawback policy, under which the Company may recoup executive compensation in the event of certain misconduct that violates Company policies. Accordingly, the Company has already aligned its senior executive compensation incentives with the interests of the Company's stockholders.

In summary, the Board believes that the Company's policies effectively articulate and implement its longstanding support for, and continued commitment to, the prevention of sexual harassment, and therefore adoption of the proposal would not provide any additional benefits or safeguards.

For these reasons, the Board of Directors unanimously urges stockholders to vote AGAINST Proposal No. 6.


				73				©2019 XPO Logistics, Inc.

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Required Vote

Approval of a policy requiring the company to adopt measures to strengthen prevention of workplace sexual harassment and align senior executive compensation incentives requires the affirmative vote of a majority of the votes cast (meaning the number of shares voted "for" such proposal must exceed the number of shares voted "against" such proposal) by holders of shares of our common stock (including those that would be issued if all our outstanding Series A Preferred Stock had converted into shares of our common stock as of the Record Date) at the Annual Meeting at which a quorum is present.

Recommendation

Our Board of Directors recommends a vote "AGAINST" this stockholder proposal.


				74				©2019 XPO Logistics, Inc.

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Other Matters

We do not expect that any matter other than the foregoing proposals will be brought before the 2019 Annual Meeting. If, however, such a matter is properly presented at the Annual Meeting or any adjournment or postponement of the Annual Meeting, the persons appointed as proxies will vote as recommended by our Board of Directors or, if no recommendation is given, in accordance with their judgment.


				75				©2019 XPO Logistics, Inc.

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ADDITIONAL INFORMATION	56	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
	56	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

materially to any significant financial restatements or material loss to the company or any of its affiliates.” These awards also require recoupment in the event the officer’s employment is terminated with cause or if the officer breaches his or her noncompetition or other restrictive covenants during the periods in which such covenants apply. Where fraud or willful misconduct is present, reputational harm to the Company would potentially be a basis for recoupment too if such actions contributed to loss experienced by the Company and the materiality standards are met. As noted above, a restatement of our financial statements is not required in all cases in order for clawbacks to be initiated.

Additionally, in order to further align the interests of our senior executives with those of our stockholders, the Compensation Committee made a significant portion of certain executives’ 2016 cash incentive awards subject to repayment if the executive’s employment with us terminates for any reason within two years immediately following the payment.

XPO’s Board of Directors believes that the combination of all of the foregoing recoupment provisions imposes the appropriate level of cautionary scrutiny, while still maintaining a competitive compensation structure that allows the Company to recruit, incentivize and retain our top talent and encourages our executives to take reasonable risks that maximize stockholder value.

~~The proposed clawback policy is overly prescriptive and would inhibit our ability to attract and retain talented executive officers.~~ We believe that the absence of any “materiality” threshold analysis would require our Compensation Committee to apply an undefined, ambiguous and arbitrary clawback policy every time a senior executive is alleged to have possibly violated a Company policy, however minor, or possibly failing to monitor a risk, regardless of the materiality of the financial harm. Such terms and conditions also would place us at a competitive disadvantage in comparison to our peer companies, whose publicly disclosed policies do not subject executives or their compensation to such expansive recoupment and disclosure policies. We believe the adoption of the proposed clawback policy would therefore inhibit our ability to attract and retain talented executive officers, which would be directly detrimental to our long-term business objectives and therefore, ultimately, our stockholders.

The proposed disclosure policy extends beyond what is required under existing and pending legal requirements, is vague in application and could have the result of causing the Company to violate applicable laws. The proposal requires the Company to “disclose to shareholders the circumstances of any recoupment or decision not to pursue recoupment.” We believe this proposal would have the practical effect of requiring the Company to make public any deliberations by the Company, and information used in such deliberations, regarding any decision relating to a potential clawback situation. Such a broad disclosure requirement could result in the violation of privacy or other laws or otherwise require disclosure of confidential information. The proposal also fails to provide any clear guidelines as to proposed timing, detail or method of disclosure.

The SEC has set forth clear guidelines regarding required disclosure in our annual proxy statement as to when, and how much, compensation has been recouped from a listed company’s CEO, CFO or other NEO. When the Company has a legal obligation to disclose any such information, the Company will use its best efforts to meet such obligations. Moreover, when necessary to understanding our compensation policies and compensation decisions regarding our NEOs, we must further disclose in our annual proxy statement the reasons for recoupment and how we determined the amount to be recovered.

Our Board of Directors takes decisions regarding public disclosure very seriously, including taking into account applicable legal requirements and its duties relating to the accuracy of disclosure and protection of confidential information, and so believes this disclosure proposal would cause harm to the Company and its shareholders due to its overly broad and vague nature.

~~Recommendation~~

~~Our Board of Directors recommends a vote “AGAINST” this stockholder proposal.~~


						57						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						57						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~Other Matters~~

We do not expect that any matter other than the foregoing proposals will be brought before the 2018 annual meeting. If, however, such a matter is properly presented at the annual meeting or any adjournment or postponement of the annual meeting, the persons appointed as proxies will vote as recommended by our Board of Directors or, if no recommendation is given, in accordance with their judgment.

Availability of Annual Report and Proxy Statement

If you would like to receive a copy of our 2017 Annual Report or this proxy statement, please contact us at: Investor Relations, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831 or by telephone at (855)~~976-6951,~~

If you would like to receive a copy of our 2018 Annual Report or this Proxy Statement, please contact us at: Investor Relations, XPO Logistics, Inc., Five American Lane, Greenwich, CT 06831 or by telephone at 1-855-976-6951, and we will send a copy to you without charge.

A Note about Our Website

~~Although we include references to our website (~~Although we include references to our website (www.xpo.com) throughout this proxy statement, information that is included on our website is not incorporated by reference into, and is not a part of, this proxy statement. Our website address is included as an inactive textual reference only.

We use our website as one means of disclosing material non-public information and for complying with our disclosure obligations under the SEC's Regulation FD. Such disclosures typically will be included within the Investor Relations section of our website. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, SEC filings and public conference calls and webcasts.

©2019 ) throughout this proxy statement, information that is included on our website is not incorporated by reference into, and is not a part of, this proxy statement. Our website address is included as an inactive textual reference only.XPO Logistics, Inc.

~~We use our website as one means of disclosing materialnon-public~~ information and for complying with our disclosure obligations under the SEC’s Regulation FD. Such disclosures typically will be included within the Investor Relations section of our website. Accordingly, investors should monitor the Investor Relations section of our website, in addition to following our press releases, SEC filings and public conference calls and webcasts.

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						58						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						58						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

ANNEX ~~A-RECONCILIATION~~A - RECONCILIATION OF NON-GAAP MEASURES

Consolidated Net Income to Adjusted EBITDA ex. Truckload Twelve Months Ended December 31,
(in millions)

2017

2016

Net income attributable to common shareholders

$312.4

$63.1

Distributed and undistributed net income

27.8

5.9

Noncontrolling interests

20.0

15.5

Net income

360.2

84.5

Loss on conversion of convertible senior notes

0.5

0.2

Loss on debt extinguishment

36.0

69.7

Other interest expense

283.8

360.9

Income tax (benefit) provision

(99.5)

22.3

Depreciation & amortization expense

658.4

643.4

Unrealized loss (gain) on foreign currency option and forward contracts

49.4

(36.0)

EBITDA

$1,288.8

$1,145.0

Transaction & integration costs

59.9

73.1

Rebranding costs

18.4

30.1

Adjusted EBITDA

$1,367.1

$1,248.2

Adjusted EBITDA divested NA Truckload business

–

80.1

Adjusted EBITDA ex. Truckload

$1,367.1

$1,168.1

~~Note:~~Consolidated Reconciliation of Net Income (Loss) to Adjusted EBITDA ~~was prepared assuming 100% ownership of~~
(in millions)




	2018			2017			2016			2015			2014
Net income (loss) attributable to common shareholders		$390			$312			$63			$(246	)		$(107	)
Preferred stock beneficial conversion charge		—			—			—			52			40
Distributed and undistributed net income		32			28			6			3			3
Net income (loss) attributable to noncontrolling interests		22			20			16			(1	)		—
Net income (loss)		444			360			85			(192	)		(64	)



Debt commitment fees		—			—			—			20			15
Debt extinguishment loss		27			36			70			—			—
Other interest expense		217			284			361			187			28
Loss on conversion of convertible senior notes		—			1			—			10			6
Income tax provision (benefit)		122			(99	)		22			(91	)		(26	)
Accelerated amortization of trade names		—			—			—			2			3
Depreciation and amortization expense		716			658			643			363			95
Unrealized (gain) loss on foreign currency option and forward contracts		(20	)		49			(36	)		3			—
EBITDA		$1,506			$1,289			$1,145			$302			$57



Transaction, integration and rebranding costs		33			78			103			201			24
Restructuring costs		21			—			—			—			—
Litigation costs		26			—			—			—			—
Gain on sale of equity investment		(24	)		—			—			—			—
Gain on sale of intermodal equipment		—			—			—			(10	)		—
Adjusted EBITDA		$1,562			$1,367			$1,248			$493			$81


				77				©2019 XPO Logistics ~~Europe.~~, Inc.

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Consolidated Reconciliation of GAAP Net Income and Net Income Per Share to

Adjusted Net Income and Adjusted Net Income Per Share
(in millions, except per share data)

(in millions, except per share data) Twelve Months Ended December 31,

2017

2016

GAAP net income attributable to common shareholders

$312.4

$63.1

Loss on conversion of convertible senior notes

0.5

0.2

Loss on debt extinguishment

36.0

69.7

Unrealized loss (gain) on foreign currency option and forward contracts

49.4

(36.0)

Depreciation & amortization from updated purchase price allocation of acquired assets

-

(5.8)

Transaction & integration costs

59.9

73.1

Rebranding costs

18.4

30.1

Income tax associated with the adjustments above

(55.1)

(49.8)

Impact of tax reform act

(173.1)

-

Othertax-related adjustments

(2.3)

(15.7)

Impact of noncontrolling interests on above adjustments

(3.3)

(2.0)

Allocation of undistributed earnings

5.7

(5.4)

Adjusted net income attributable to common shareholders

$248.5

$121.5

Adjusted basic earnings per share

$2.16

$1.10

Adjusted diluted earnings per share

$1.95

$1.00

Weighted-average common shares outstanding

Basic weighted-average common shares outstanding

114.9

110.2

Diluted weighted-average common shares outstanding

127.8

122.8

©~~2018~~ ~~XPO Logistics,~~




	2018			2017
GAAP net income attributable to common shareholders		$390			$312
Debt extinguishment loss		27			36
Unrealized (gain) loss on foreign currency option and forward contracts		(20	)		49
Transaction, integration and rebranding costs		33			78
Restructuring costs		21			–
Litigation costs		26			–
Gain on sale of equity investment		(24	)		–
Loss on conversion of convertible senior notes		–			1
Income tax associated with the adjustments above		(15	)		(55	)
Impact of tax reform act		–			(173	)
Discrete and other tax-related adjustments		–			(2	)
Impact of noncontrolling interests on above adjustments		(2	)		(3	)
Allocation of undistributed earnings		(4	)		6

Adjusted net income attributable to common shareholders		$432			$249



Adjusted basic earnings per share		$3.51			$2.16
Adjusted diluted earnings per share		$3.19			$1.95
Weighted-average common shares outstanding
Basic weighted-average common shares outstanding		123			115
Diluted weighted-average common shares outstanding		135			128


				78				©2019 XPO Logistics, Inc.

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Reconciliation of Cash Flows from Operating Activities to Free Cash Flow
(in millions)




	2018			2017
Cash flows provided by operating activities		$1,102			$785
Payment for purchases of property and equipment		(551	)		(504	)
Proceeds from sales of assets		143			118

Free Cash Flow		$694			$399

Reconciliation of Revenue to Organic Revenue
(in millions)




	2018			2017
Revenue		$17,279			$15,381
Fuel		(1,788	)		(1,441	)
Foreign exchange rates		(251	)		–

Organic revenue		$15,240			$13,940



Organic revenue growth^(a)		9.3	%

(a): Organic revenue growth is calculated as the relative change in year-over-year organic revenue, expressed as a percentage of 2017 organic revenue.

Reconciliation of Total Debt to Net Debt to Adjusted EBITDA Ratio
(in millions)




Total debt	$4,269
Less: Cash and cash equivalents	(502	)

Net debt	$3,767



Adjusted EBITDA	$1,562
Net debt to adjusted EBITDA ratio	2.41

~~ANNEX A-RECONCILIATION OF NON-GAAP MEASURES~~

~~Continued from page 59~~

Consolidated Cash Flows Provided by Operating Activities to Free Cash Flow
(in millions) Twelve Months Ended December 31,

2017

2016

Cash flows provided by operating activities

$

798.6

$

625.4

Payment for purchases of property and equipment

(503.8)

(483.4)

Proceeds from sales of assets

79.1

68.9

Free Cash Flow

$

373.9

$

210.9

Consolidated Revenue to Total Organic Revenue
(in millions) Three Months Ended December 31, Twelve Months Ended December 31,
2017 2016 2017 2016

Revenue
$4,193.9 $3,676.6 $15,380.8 $14,619.4

North American Truckload
– (37.9) – (431.9)

Fuel
(414.0) (321.3) (1,441.0) (1,197.8)

Foreign Exchange Rates
(117.3) – (10.0) –

Total Organic Revenue
$3,662.5 $3,317.4 $13,929.8 $12,989.7

Organic Revenue Growth
10.4% 7.2%

Reconciliation of Transportation Operating Income to Adjusted EBITDA

(in millions)

Twelve Months Ended December 31,
2017 2016

Operating income
$538.8 $438.0

Total depreciation & amortization
439.4 449.1

EBITDA
$978.2 887.1

Transaction & integration costs
33.0 23.1

Rebranding costs
17.2 26.9

Adjusted EBITDA
$1,028.4 $937.1




	2018	2017
Operating income	$646	$547
Other income (expense)	41	20
Total depreciation and amortization	461	447

EBITDA	$1,148	$1,014



Transaction, integration and rebranding costs	13	51
Restructuring costs	12	–
Litigation costs	26	–

Adjusted EBITDA	$1,199	$1,065


~~Consolidated Net Debt to Adjusted EBITDA Ratio~~	79	©2019 XPO Logistics, Inc.

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XPO Logistics North American Less-Than-Truckload
Adjusted Operating Ratio
(in millions)




	2018		2017
Revenue (excluding fuel surcharge revenue)	$3,230		$3,140
Fuel surcharge revenue	552		455

Revenue	3,782		3,595
Salaries, wages and employee benefits	1,754		1,697
Purchased transportation	400		438
Fuel and fuel-related taxes	293		234
Depreciation and amortization	243		233
Other operating expenses	476		453
Maintenance	102		107
Rents and leases	44		42
Purchased labor	12		14

Operating income	458		377

Operating ratio	87.9	%	89.5	%

Transaction, integration and rebranding costs	–		19
Restructuring costs	3		–
Amortization expense	33		34
Other income	29		12

Adjusted operating income	$523		$442

Adjusted operating ratio	86.2	%	87.7	%


	~~December 31, 2017~~


~~Total debt~~		~~$4,521.2~~

~~Less: Cash and cash equivalents~~		~~(396.9)~~

~~Less: Potential proceeds from forward sale agreements~~		~~(350.0)~~


~~Net Debt~~		~~$3,774.3~~


~~Adjusted EBITDA~~		~~$1,367.1~~

~~Net Debt to Adjusted EBITDA ratio~~		~~2.76~~


						60						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						60						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Non-GAAP Financial Measures

~~This document contains certainnon-GAAP~~ financial measures as defined under the rules of the SEC, including adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) for the twelve-month periods ended December 31, 2017 and 2016 on a consolidated basis and for our transportation segment free cash flow for the twelve-month periods ended December 31, 2017 and 2016; adjusted net income attributable to common shareholders and adjusted earnings per share (basic and diluted) (“adjusted EPS”) for the twelve-month periods ended December 31, 2017 and 2016; total organic revenue for the three and twelve-month periods ended December 31, 2017 and 2016; and net debt as of December 31, 2017.

We believe that the above adjusted financial measures facilitate analysis of our ongoing business operations because they exclude items that may not be reflective of, or are unrelated to, XPO and its business segments’ core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses. In particular, adjusted EBITDA, adjusted net income attributable to common shareholders and adjusted EPS include adjustments for acquisition costs and related integration, transformation and rebranding initiatives as well as other adjustments that management has determined are not reflective of its business segments’ core operating activities.

As required by the rules of the Securities and Exchange Commission ("SEC"), we provide reconciliations of the non-GAAP financial measures contained in this proxy statement to the most directly comparable measure under GAAP, which are set forth in the financial tables above.

XPO's non-GAAP financial measures for the year ended December 31, 2018 used in this proxy statement include: earnings before interest, taxes, depreciation and amortization ("EBITDA") and adjusted EBITDA on a consolidated basis; free cash flow; adjusted net income attributable to common shareholders and adjusted earnings per share (basic and diluted) ("adjusted EPS"); adjusted operating income and adjusted operating ratio for our North American less-than-truckload business; organic revenue growth on a consolidated; and net debt as of December 31, 2018.

We believe that the above adjusted financial measures facilitate analysis of our ongoing business operations because they exclude items that may not be reflective of, or are unrelated to, XPO and its business segments' core operating performance, and may assist investors with comparisons to prior periods and assessing trends in our underlying businesses. Other companies may calculate these non-GAAP financial measures differently, and therefore our measures may not be comparable to similarly titled measures of other companies. These non-GAAP financial measures should only be used as supplemental measures of our operating performance.

Adjusted EBITDA, adjusted net income attributable to common shareholders and adjusted EPS include adjustments for transaction, integration and rebranding costs, restructuring costs, litigation costs for independent contractor matters and the gain on sale of an equity investment. Transaction and integration adjustments are generally incremental costs that result from an actual or planned acquisition and include transaction ~~costs, restructuring~~ costs, acquisition and integration consulting fees, internal salaries and wages (to the extent the individuals are assigned full-time to integration and transformation activities) and certain costs related to integrating and converging IT systems. Rebranding adjustments primarily relate ~~primarily~~ to the rebranding of the XPO Logistics name on our truck fleet and buildings. Restructuring costs primarily relate to severance costs associated with business optimization initiatives. Litigation costs refer to settlement and related costs associated with independent contractor claims in our last mile business. The gain on sale of an equity investment relates to the sale of a non-strategic equity ownership interest in a private company. Management uses these non-GAAP financial measures in making financial, operating and planning decisions and evaluating XPO's and each business segment's ongoing performance.

©2019 XPO Logistics ~~name on our truck fleet and buildings. These adjustments are consistent with how management views our businesses. Management uses thesenon-GAAP~~ ~~financial measures in making financial, operating and planning decisions and evaluating XPO’s and each business segment’s ongoing performance.~~

We believe that free cash flow is an important measure of our ability to repay maturing debt or fund other uses of capital that we believe will enhance stockholder value. We believe that adjusted EBITDA improves comparability from period to period by removing the impact of our capital structure (interest and financing expenses), ~~asset base (depreciation and amortization), tax impacts and other adjustments as set out in the attached tables that management has determined are not reflective of normalized operating activities.~~

We believe that adjusted net income attributable to common shareholders and adjusted EPS improve the comparability of our operating results from period to period by removing the impact of certain costs and gains that management has determined are not reflective of our core operating activities. We believe that total organic revenue is an important measure because it excludes the impact of the following items: foreign currency exchange rate fluctuations, acquisitions and divestitures, and fuel surcharges. Specifically, our total organic revenue reflects adjustments to (i) exclude revenue from our North American truckload unit, which was sold in October 2016, (ii) exclude the estimated revenue attributable to fuel, and (iii) apply a constant foreign exchange rate to both periods (based on average rates during the monthly periods). We believe that net debt is an important measure because it account for the impact of cash and cash equivalents as well as the potential proceeds from our forward sale agreements.

Other companies may calculate adjusted EBITDA differently, and therefore our measure may not be comparable to similarly titled measures of other companies. Free cash flow, adjusted EBITDA, adjusted net income attributable to common shareholders, adjusted EPS, total organic revenue and net debt are not measures of financial performance or liquidity under United States generally accepted accounting principles (“GAAP”) and should not be considered in isolation or as an alternative to revenue, net income, cash flows provided (used) by operating activities, total debt and other measures determined in accordance with GAAP. Items excluded from adjusted EBITDA are significant and necessary components of the operations of our business, and, therefore, adjusted EBITDA should only be used as a supplemental measure of our operating performance.

As required by SEC rules, we provide reconciliations of these historical measures to the most directly comparable measure under GAAP, which are set forth in the financial tables attached to this document. With respect to our 2018 financial targets of adjusted EBITDA, our 2017-2018 cumulative target for free cash flow and our expected organic revenue growth each of which is a~~non-GAAP~~Inc. ~~measure, a reconciliation of thenon-GAAP~~ ~~measure to the corresponding GAAP measure is not available without unreasonable effort due to the variability and complexity of the reconciling items described below that we exclude from thenon-GAAP~~ target measure. The variability of these items may have a significant impact on our future GAAP financial results and, as a result, we are unable to prepare the forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP that would be required to produce such a reconciliation.


						61						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						61						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~Electronic Voting Instructions~~

~~Available 24 hours a day, 7 days a week!~~

~~Instead of mailing your proxy, you may choose one of the voting methods outlined below to vote your proxy.~~

~~VALIDATION DETAILS ARE LOCATED BELOW IN THE TITLE BAR.~~

~~Proxies submitted by the Internet or telephone must be received by 1:00 a.m., EDT, on May 17, 2018.~~

~~Vote by Internet~~

~~• Go to~~~~www.envisionreports.com/XPO~~

~~• Or scan the QR code with your smartphone~~

~~• Follow the steps outlined on the secure website~~

~~Vote by telephone~~

~~• Call toll free 1-800-652-VOTE (8683) within the USA, US territories & Canada on a touch tone telephone~~

~~• Follow the instructions provided by the recorded message~~

~~Using a~~~~black ink~~ ~~pen, mark your votes with an~~X ~~as shown in this example. Please do not write outside the designated areas.~~

☒

q~~IF YOU HAVE NOT VOTED VIA THE INTERNET~~OR ~~TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.~~q

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -


~~The Board recommends a voteFOR~~ ~~all nominees listed below.~~

~~1. Election of Directors:~~

~~For~~

~~Against~~

~~Abstain~~

~~For~~

~~Against~~

~~Abstain~~

~~For~~

~~Against~~

~~Abstain~~

~~01 - Bradley S. Jacobs~~

☐

~~02 - Gena L. Ashe~~

☐

~~03 - AnnaMaria DeSalva~~

☐

~~04 - Michael G. Jesselson~~

☐

~~05 - Adrian P. Kingshott~~

☐

~~06 - Jason D. Papastavrou~~

☐

~~07 - Oren G. Shaffer~~

☐

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period by removing the impact of our capital structure (interest and financing expenses), asset base (depreciation and amortization), tax impacts and other adjustments as set out in the attached tables that management has determined are not reflective of core operating activities and thereby assist investors with assessing trends in our underlying businesses. We believe that adjusted net income attributable to common shareholders and adjusted EPS improve the comparability of our operating results from period to period by removing the impact of certain costs and gains that management has determined are not reflective of our core operating activities. We believe that adjusted operating income and adjusted operating ratio for our North American less-than-truckload business improve the comparability of our operating results from period to period by (i) removing the impact of certain transaction, integration, restructuring and rebranding costs and amortization expenses and, (ii) including the impact of pension income incurred in the reporting period as set out in the attached tables. We believe that organic revenue is an important measure because it excludes the impact of the following items: foreign currency exchange rate fluctuations and fuel surcharges.

With respect to our 2019 financial targets for adjusted EBITDA and free cash flow, each of which is a non-GAAP measure, a reconciliation of the non-GAAP measure to the corresponding GAAP measure is not available without unreasonable effort due to the variability and complexity of the reconciling items described below that we exclude from the non-GAAP target measure. The variability of these items may have a significant impact on our future GAAP financial results and, as a result, we are unable to prepare the forward-looking balance sheet, statement of income and statement of cash flow, prepared in accordance with GAAP that would be required to produce such a reconciliation.


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~~The Board recommends a voteFOR~~ ~~proposals 2 and 3, and1 YEAR~~ ~~for proposal 4.~~

   For    Against    Abstain          For    Against    Abstain 1 Year 2 Years 3 Years Abstain

2. Ratification of independent auditors.
   ☐    ☐    ☐
3.

Advisory vote to approve
executive compensation.
   ☐    ☐    ☐ 4. Frequency of advisory vote on executive compensation. ☐ ☐ ☐ ☐

~~The Board recommends a voteAGAINST~~ ~~proposals 5 and 6.~~

~~For~~

~~Against~~

~~Abstain~~

~~For~~

~~Against~~

~~Abstain~~

~~5. Stockholder proposal regarding sustainability reporting.~~

☐

~~6. Stockholder proposal regarding compensation clawback policy.~~

☐

~~Authorized Signatures — This section must be completed for your vote to be counted. — Date and Sign Below~~

Please date and sign exactly as your name(s) appear(s) hereon. When signing as Executor, Administrator, Trustee, Guardian or Attorney, please give full title as such. If a corporation, please sign in full corporate name by president or other authorized corporate officer. If a partnership, please sign in partnership name by authorized person. Joint owners should each sign.


~~Date (mm/dd/yyyy) — Please print date below.~~	~~Signature 1 — Please keep signature within the box.~~	~~Signature 2 — Please keep signature within the box.~~

~~/ /~~

~~IF VOTING BY MAIL, YOUMUST~~ ~~COMPLETE SECTIONS A~~ANNEX B - ~~C ON BOTH SIDES OF THIS CARD.~~

~~YOUR VOTE IS IMPORTANT~~

~~Regardless of whether you plan to attend the Annual Meeting of Stockholders, you can be sure your shares are represented at the Meeting by promptly returning your proxy in the enclosed envelope.~~

~~Important Notice Regarding the Availability of Proxy Materials for the~~

~~Annual Meeting of Stockholders to be Held on May 17, 2018~~

~~This Proxy Statement and our Annual Report on Form 10-K for the Year Ended~~

~~December 31, 2017 are available at~~~~www.edocumentview.com/XPO~~.

q ~~IF YOU HAVE NOT VOTED VIA~~AMENDMENT TO THE ~~INTERNET~~OR ~~TELEPHONE, FOLD ALONG THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE.~~ q

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		+

~~Proxy — XPO LOGISTICS, INC.~~

~~PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 17, 2018~~

~~THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF~~ XPO LOGISTICS, INC. 2016 OMNIBUS INCENTIVE COMPENSATION PLAN

~~The undersigned hereby acknowledges receipt~~

XPO LOGISTICS, INC.
AMENDMENT NO. 1 TO THE
2016 OMNIBUS INCENTIVE COMPENSATION PLAN

THIS AMENDMENT NO. 1 (this "Amendment") to the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan, is made and adopted by the Board of Directors (the "Board") of XPO Logistics, Inc., a Delaware corporation (the "Company"), effective as of the Effective Date (as defined below). All capitalized terms used but not otherwise defined herein shall have the respective meanings ascribed to such terms in the Plan (as defined below).

WHEREAS, the Company has previously adopted, and the Company's stockholders have previously approved, the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan (as amended from time to time, the "Plan");

WHEREAS, pursuant to Section 7(a) of the Plan, the Board has the authority to amend the Plan, subject to certain limitations;

WHEREAS, the Board believes it is in the best interests of the Company and its stockholders to amend the Plan as set forth herein; and

WHEREAS, this Amendment shall become effective upon the approval of this Amendment by the Company's stockholders at the annual meeting of stockholders held on May 15, 2019 (the date of such approval, the "Effective Date").

NOW, THEREFORE, BE IT RESOLVED, that the Plan is hereby amended as follows, effective as of the Effective Date:

1.: The first sentence of Section 4(a) of the Plan is hereby deleted and replaced in its entirety with the following:

"Subject to adjustment as provided in SECTION 4(b), the maximum aggregate number of Shares that may be delivered pursuant to Awards granted under the Plan shall be equal to 5,400,000, (the "Plan Share Limit"), of which 3,400,000 Shares may be delivered pursuant to Incentive Stock Options granted under the Plan (such amount, the "Plan ISO Limit")."

2.: The first sentence of Section 10(b) of the Plan is hereby deleted and replaced in its entirety with the following:

"No Award shall be granted under the Plan after May 15, 2029."

3.: The Section 6(i) of the Plan is hereby deleted and replaced in its entirety with the following:

"Dividends and Dividend Equivalents. In the sole and plenary discretion of the Committee, an Award, other than an Option or SAR or a Cash Incentive Award, may provide the Participant with dividends or dividend equivalents, payable in cash, Shares, other securities, other Awards or other property, on such terms and conditions as may be determined by the Committee in its sole and plenary discretion, including, (i) payment directly to the Participant, or (ii) reinvestment in additional Shares, Restricted Shares or other Awards; provided, however, that no dividend or dividend equivalent may be delivered or paid in respect of an Award prior to the vesting of such Award."

4.: The first sentence of Section 6(b)(iii) of the Plan is hereby deleted and replaced with the following:

"Subject to Section 6(j), each Option shall be vested and exercisable at such times, in such manner and subject to such terms and conditions as the Committee may, in its sole and plenary discretion, specify in the applicable Award Agreement or thereafter."

5.: The last sentence of Section 6(c)(iii) of the Plan is hereby deleted and replaced with the following:

"Subject to Section 6(j), each SAR shall be vested and exercisable at such times, in such manner and subject to such terms and conditions as the Committee may, in its discretion, specify in the applicable Award Agreement or thereafter."

6.: The Section 6(j) of the Plan is hereby deleted and replaced in its entirety with the following:

"Minimum Vesting Provision. All Awards granted hereunder shall be subject to a designated vesting period of at least one year following the date of grant, except that up to five percent of shares available for grant under the Plan may be granted without regard to this requirement and the Committee may accelerate the vesting with respect to any such Awards."

7.: This Amendment shall be and is hereby incorporated into and forms a part of the Plan.
8.: Except as expressly provided herein, all terms and conditions of the Plan shall continue in full force and effect.


				82				©2019 XPO Logistics, Inc. Notice of Annual Meeting and Proxy Statement and hereby constitutes and appoints Bradley S. Jacobs and Karlis P. Kirsis, and each of them, its true and lawful agents and proxies, with full power of substitution in each, to attend the Annual Meeting of Stockholders

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ANNEX C - XPO LOGISTICS, INC. 2016 OMNIBUS INCENTIVE COMPENSATION PLAN

XPO LOGISTICS, INC.
2016 OMNIBUS INCENTIVE COMPENSATION PLAN

SECTION 1. Purpose. The purpose of this XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan (the "Plan") is to promote the interests of the Company and its stockholders by (a) attracting and retaining exceptional directors, officers, employees and consultants (including prospective directors, officers, employees and consultants) of the Company (as defined below) and its Affiliates (as defined below) and (b) enabling such individuals to participate in the long-term growth and financial success of the Company. This Plan is intended to replace the Prior Company Plan and the Prior Con-way Plan (each as defined below and, together, the "Prior Plans"), which Prior Plans shall be frozen with respect to future grants on the Approval Date (as defined below). The Prior Company Plan (as originally adopted and prior to its amendment and restatement in 2012) previously replaced and superseded the Option Plan (as defined below). Notwithstanding the foregoing, any awards granted under the Prior Plans or the Option Plan shall remain in effect pursuant to their respective terms.

SECTION 2. Definitions. As used herein, the following terms shall have the meanings set forth below:

"Affiliate" means (a) any entity that, directly or indirectly, is controlled by, controls or is under common control with, the Company and/or (b) any entity in which the Company has a significant equity interest, in either case, as determined by the Committee.

"Approval Date" means December 20, 2016, the date on which the Plan is approved by the Company's stockholders.

"Award" means any award that is permitted under SECTION 6 and was granted under the Plan or the Prior Plans and any award that is permitted under Article 6 of the Option Plan and was granted under the Option Plan.

"Award Agreement" means any written or electronic agreement, contract or other instrument or document evidencing any Award, which may (but need not) require execution or acknowledgment by a Participant.

"Applicable Exchange" means the New York Stock Exchange LLC or any other national stock exchange or quotation system on which the Shares may be listed or quoted.

"Board" means the Board of Directors of the Company.

"Cash Incentive Award" means an Award (a) that is granted pursuant to SECTION 6(g) of the Plan, (b) that is settled in cash and (c) the value of which is set by the Committee and is not calculated by reference to the Fair Market Value of Shares.

"Change of Control" shall (a) have the meaning set forth in an Award Agreement;provided,however, that except in the case of a transaction described in subparagraph (b)(iii) below, any definition of Change of Control set forth in an Award Agreement shall provide that a Change of Control shall not occur until consummation or effectiveness of a change in control of the Company, rather than upon the announcement, commencement, stockholder approval or other potential occurrence of any event or transaction that, if completed, would result in a change in control of the Company, or (b) if there is no definition set forth in an Award Agreement, mean the occurrence of any of the following events:

(i) during any period, individuals who were directors of the Company on the first day of such period (the "Incumbent Directors") cease for any reason to constitute a majority of the Board;provided,however, that any individual becoming a director subsequent to the first day of such period whose election, or nomination by the Board for election by the Company's stockholders, was approved by a vote of at least a majority of the Incumbent Directors shall be considered as though such individual were an Incumbent Director, but excluding for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board (including without limitation any settlement thereof);

(ii) the consummation of (A) a merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company (each of the events referred to in this clause (A) being hereinafter referred to as a "Reorganization") or (B) the sale or other disposition of all or substantially all of the assets of the Company to an entity that is not an Affiliate (a "Sale"), in each case, if such Reorganization or Sale requires the approval of the Company's stockholders under the law of the Company's jurisdiction of organization (whether such approval is required for such Reorganization or Sale or for the issuance of securities of the Company in such Reorganization or Sale), unless, immediately following such Reorganization or Sale, (1) individuals and entities who were the "beneficial owners" (as such term is defined in Rule 13d-3 under the Exchange Act (or a successor rule thereto)) of the securities eligible to vote for the election of the Board ("Company Voting Securities") outstanding immediately prior to the consummation of such


			83	©2019 XPO Logistics, Inc. on Thursday, May 17, 2018, and any adjournment or postponement thereof, and to vote on the matters indicated all the shares of Common Stock, par value $0.001 per share, or Series A Convertible Perpetual Preferred Stock, par value $0.001 per share, that the undersigned would be entitled to vote if personally present.
~~PLEASE MARK, SIGN AND DATE THIS PROXY CARD ON THE REVERSE SIDE AND RETURN IT PROMPTLY USING THE ENCLOSED REPLY ENVELOPE.~~	~~THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE BOARD OF DIRECTORS’ RECOMMENDATIONS.~~	~~CONTINUED AND TO BE SIGNED ON REVERSE SIDE~~	~~PLEASE PROMPTLY COMPLETE, DATE, SIGN AND MAIL THIS PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE.~~

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Reorganization or Sale continue to beneficially own, directly or indirectly, more than 50% of the combined voting power of the then outstanding voting securities of the corporation or other entity resulting from such Reorganization or Sale (including a corporation that, as a result of such transaction, owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries) (the "Continuing Company") in substantially the same proportion as the voting power of such Company Voting Securities among the holders thereof immediately prior to the Reorganization or Sale (excluding, for such purposes, any outstanding voting securities of the Continuing Company that such beneficial owners hold immediately following the consummation of the Reorganization or Sale as a result of their ownership prior to such consummation of voting securities of any corporation or other entity involved in or forming part of such Reorganization or Sale other than the Company), (2) no "person" (as such term is used in Section 13(d) of the Exchange Act) (each, a "Person") (excluding (x) any employee benefit plan (or related trust) sponsored or maintained by the Continuing Company or any corporation controlled by the Continuing Company and (y) any one or more Specified Stockholders) beneficially owns, directly or indirectly, 30% or more of the combined voting power of the then outstanding voting securities of the Continuing Company and (3) at least 50% of the members of the board of directors of the Continuing Company (or equivalent body) were Incumbent Directors at the time of the execution of the definitive agreement providing for such Reorganization or Sale or, in the absence of such an agreement, at the time at which approval of the Board was obtained for such Reorganization or Sale;

(iii) the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company unless such liquidation or dissolution is part of a transaction or series of transactions described in paragraph (ii) above that does not otherwise constitute a Change of Control; or

(iv) any Person, corporation or other entity or "group" (as used in Section 14(d)(2) of the Exchange Act) (other than (A) the Company, (B) any trustee or other fiduciary holding securities under an employee benefit plan of the Company or an Affiliate, (C) any company owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of the voting power of the Company Voting Securities or (D) any one or more Specified Stockholders, including any group in which a Specified Stockholder is a member) becomes the beneficial owner, directly or indirectly, of securities of the Company representing 30% or more of the combined voting power of the Company Voting Securities;provided,however, that for purposes of this subparagraph (iv), the following acquisitions shall not constitute a Change of Control: (w) any acquisition directly from the Company, (x) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or an Affiliate, (y) any acquisition by an underwriter temporarily holding such Company Voting Securities pursuant to an offering of such securities or any acquisition by a pledgee of Company Voting Securities holding such securities as collateral or temporarily holding such securities upon foreclosure of the underlying obligation or (z) any acquisition pursuant to a Reorganization or Sale that does not constitute a Change of Control for purposes of subparagraph (ii) above.

"Code" means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute thereto, and the regulations promulgated thereunder.

"Committee" means the Compensation Committee of the Board or a subcommittee thereof, or such other committee of the Board as may be designated by the Board to administer the Plan.

"Company" means XPO Logistics, Inc., a corporation organized under the laws of Delaware, together with any successor thereto.

"Deferred Share Unit" means a deferred share unit Award that represents an unfunded and unsecured promise to deliver Shares in accordance with the terms of the applicable Award Agreement.

"Exchange Act" means the Securities Exchange Act of 1934, as amended from time to time, or any successor statute thereto, and the regulations promulgated thereunder.

"Exercise Price" means (a) in the case of each Option, the price specified in the applicable Award Agreement as the price-per-Share at which Shares may be purchased pursuant to such Option or (b) in the case of each SAR, the price specified in the applicable Award Agreement as the reference price-per-Share used to calculate the amount payable to the applicable Participant pursuant to such SAR.

"Fair Market Value" means, except as otherwise provided in the applicable Award Agreement, (a) with respect to any property other than Shares, the fair market value of such property determined by such methods or procedures as shall be established from time to time by the Committee and (b) with respect to Shares as of any date, (i) the closing per-share sales price of the Shares as reported by the Applicable Exchange for such stock exchange for such date or if there were no sales on such date, on the closest preceding date on which there were sales of Shares or (ii) in the event there shall be no public market for the Shares on such date, the fair market value of the Shares as determined in good faith by the Committee.

"Incentive Stock Option" means an option to purchase Shares from the Company that (a) is granted under SECTION 6(b) of the Plan and (b) is intended to qualify for special Federal income tax treatment pursuant to Sections 421 and 422 of the Code, as now constituted or subsequently amended, or pursuant to a successor provision of the Code, and which is so designated in the applicable Award Agreement.


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"Independent Director" means a member of the Board (a) who is neither an employee of the Company nor an employee of any Affiliate, and (b) who, at the time of acting, is a "Non-Employee Director" under Rule 16b-3.

"Nonqualified Stock Option" means an option to purchase Shares from the Company that (a) is granted under SECTION 6(b) of the Plan and (b) is not an Incentive Stock Option.

"Option" means an Incentive Stock Option or a Nonqualified Stock Option or both, as the context requires.

"Option Plan" means the Express-1 Expedited Solutions, Inc. Amended and Restated 2001 Stock Option Plan.

"Participant" means any director, officer, employee or consultant (including any prospective director, officer, employee or consultant) of the Company or its Affiliates who is eligible for an Award under SECTION 5 and who is selected by the Committee to receive an Award under the Plan or who receives a Substitute Award pursuant to SECTION 4(c).

"Performance Compensation Award" means any Award designated by the Committee as a Performance Compensation Award pursuant to SECTION 6(e) of the Plan.

"Performance Criteria" means the criterion or criteria that the Committee shall select for purposes of establishing the Performance Goal(s) for a Performance Period with respect to any Performance Compensation Award, Performance Unit or, if applicable, Cash Incentive Award under the Plan.

"Performance Formula" means, for a Performance Period, the one or more objective formulas applied against the relevant Performance Goal to determine, with regard to the Performance Compensation Award, Performance Unit or, if applicable, Cash Incentive Award of a particular Participant, whether all, some portion but less than all, or none of such Award has been earned for the Performance Period.

"Performance Goal" means, for a Performance Period, the one or more goals established by the Committee for the Performance Period based upon the Performance Criteria.

"Performance Period" means the one or more periods of time as the Committee may select over which the attainment of one or more Performance Goals shall be measured for the purpose of determining a Participant's right to and the payment of a Performance Compensation Award, Performance Unit or, if applicable, Cash Incentive Award.

"Performance Unit" means an Award under SECTION 6(f) of the Plan that has a value set by the Committee (or that is determined by reference to a valuation formula specified by the Committee or the Fair Market Value of Shares), which value may be paid to the Participant by delivery of such property as the Committee shall determine, including without limitation, cash or Shares, or any combination thereof, upon achievement of such Performance Goals during the relevant Performance Period as the Committee shall establish at the time of such Award or thereafter.

"Prior Company Plan" means the XPO Logistics, Inc. Amended and Restated 2011 Omnibus Incentive Compensation Plan.

"Prior Con-way Plan" means the Con-way Inc. 2012 Equity and Incentive Plan.

"Restricted Share" means a Share that is granted under SECTION 6(d) of the Plan that is subject to certain transfer restrictions, forfeiture provisions and/or other terms and conditions specified herein and in the applicable Award Agreement.

"RSU" means a restricted stock unit Award that is granted under SECTION 6(d) of the Plan and is designated as such in the applicable Award Agreement and that represents an unfunded and unsecured promise to deliver Shares, cash, other securities, other Awards or other property in accordance with the terms of the applicable Award Agreement.

"Rule 16b-3" means Rule 16b-3 as promulgated and interpreted by the SEC under the Exchange Act or any successor rule or regulation thereto as in effect from time to time.

"SAR" means a stock appreciation right Award that is granted under SECTION 6(c) of the Plan and that represents an unfunded and unsecured promise to deliver Shares, cash, other securities, other Awards or other property equal in value to the excess, if any, of the Fair Market Value per Share over the Exercise Price per Share of the SAR, subject to the terms of the applicable Award Agreement.

"SEC" means the Securities and Exchange Commission or any successor thereto and shall include the staff thereof.

"Shares" means shares of common stock of the Company, $0.001 par value, or such other securities of the Company (a) into which such shares shall be changed by reason of a recapitalization, merger, consolidation, split-up, combination, exchange of shares or other similar transaction or (b) as may be determined by the Committee pursuant to SECTION 4(b).

"Specified Stockholder" means Bradley S. Jacobs, Jacobs Private Equity LLC and its Affiliates, or any other entity or organization controlled, directly or indirectly, by Bradley S. Jacobs.

"Subsidiary" means any entity in which the Company, directly or indirectly, possesses 50% or more of the total combined voting power of all classes of its stock.

"Substitute Awards" shall have the meaning specified in SECTION 4(c).


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"Treasury Regulations" means all proposed, temporary and final regulations promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).

SECTION 3. Administration.

(a) Composition of the Committee. The Plan shall be administered by the Committee, which shall be composed of one or more directors, as determined by the Board;provided that, to the extent necessary to comply with the rules of the Applicable Exchange and Rule 16b-3 and to satisfy any applicable requirements of Section 162(m) of the Code and any other applicable laws or rules, the Committee shall be composed of two or more directors, all of whom shall be Independent Directors and all of whom shall (i) qualify as "outside directors" under Section 162(m) of the Code and (ii) meet the independence requirements of the Applicable Exchange.

(b) Authority of the Committee. Subject to the terms of the Plan and applicable law, and in addition to the other express powers and authorizations conferred on the Committee by the Plan, the Committee shall have sole and plenary authority to administer the Plan, including the authority to (i) designate Participants, (ii) determine the type or types of Awards to be granted to a Participant, (iii) determine the number of Shares to be covered by, or with respect to which payments, rights or other matters are to be calculated in connection with, Awards, (iv) determine the terms and conditions of any Awards, (v) determine the vesting schedules of Awards and, if certain performance criteria must be attained in order for an Award to vest or be settled or paid, establish such performance criteria and certify whether, and to what extent, such performance criteria have been attained, (vi) determine whether, to what extent and under what circumstances Awards may be settled or exercised in cash, Shares, other securities, other Awards or other property, or canceled, forfeited or suspended and the method or methods by which Awards may be settled, exercised, canceled, forfeited or suspended, (vii) determine whether, to what extent and under what circumstances cash, Shares, other securities, other Awards, other property and other amounts payable with respect to an Award shall be deferred either automatically or at the election of the holder thereof or of the Committee, (viii) interpret, administer, reconcile any inconsistency in, correct any default in and/or supply any omission in, the Plan and any instrument or agreement relating to, or Award made under, the Plan, the Prior Plans or the Option Plan, (ix) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan, (x) accelerate the vesting or exercisability of, payment for or lapse of restrictions on, Awards, (xi) amend an outstanding Award or grant a replacement Award for an Award previously granted under the Plan, the Prior Plans or the Option Plan if, in its sole discretion, the Committee determines that (A) the tax consequences of such Award to the Company or the Participant differ from those consequences that were expected to occur on the date the Award was granted or (B) clarifications or interpretations of, or changes to, tax law or regulations permit Awards to be granted that have more favorable tax consequences than initially anticipated and (xii) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan.

(c) Committee Decisions. Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Award shall be within the sole and plenary discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon all Persons, including the Company, any Affiliate, any Participant, any holder or beneficiary of any Award and any stockholder.

(d) Indemnification. No member of the Board, the Committee or any employee of the Company (each such person, a "Covered Person") shall be liable for any action taken or omitted to be taken or any determination made in good faith with respect to the Plan or any Award. Each Covered Person shall be indemnified and held harmless by the Company from and against (i) any loss, cost, liability or expense (including attorneys' fees) that may be imposed upon or incurred by such Covered Person in connection with or resulting from any action, suit or proceeding to which such Covered Person may be a party or in which such Covered Person may be involved by reason of any action taken or omitted to be taken under the Plan or any Award Agreement and (ii) any and all amounts paid by such Covered Person, with the Company's approval, in settlement thereof, or paid by such Covered Person in satisfaction of any judgment in any such action, suit or proceeding against such Covered Person;provided that the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding, and, once the Company gives notice of its intent to assume the defense, the Company shall have sole control over such defense with counsel of the Company's choice. The foregoing right of indemnification shall not be available to a Covered Person to the extent that a court of competent jurisdiction in a final judgment or other final adjudication, in either case not subject to further appeal, determines that the acts or omissions of such Covered Person giving rise to the indemnification claim resulted from such Covered Person's bad faith, fraud or willful criminal act or omission or that such right of indemnification is otherwise prohibited by law or by the Company's Restated Certificate of Incorporation or Amended and Restated Bylaws, in each case, as may be amended from time to time. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which Covered Persons may be entitled under the Company's Restated Certificate of Incorporation or Amended and Restated Bylaws, as a matter of law, or otherwise, or any other power that the Company may have to indemnify such persons or hold them harmless.

(e) Delegation of Authority to Officers. The Committee may delegate, on such terms and conditions as it determines in its sole and plenary discretion, to one or more officers of the Company the authority to make grants of Awards to officers (other than any officer subject to Section 16 of the Exchange Act), employees and consultants of the Company


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and its Affiliates (including any prospective officer (other than any such officer who is expected to be subject to Section 16 of the Exchange Act), employee or consultant) and all necessary and appropriate decisions and determinations with respect thereto.

(f) Awards to Independent Directors. Notwithstanding anything to the contrary contained herein, the Board may, in its sole and plenary discretion, at any time and from time to time, grant Awards to Independent Directors or administer the Plan with respect to such Awards. In any such case, the Board shall have all the authority and responsibility granted to the Committee herein.

SECTION 4. Shares Available for Awards; Cash Payable Pursuant to Awards.

(a) Shares and Cash Available. Subject to adjustment as provided in SECTION 4(b), the maximum aggregate number of Shares that may be delivered pursuant to Awards granted under the Plan shall be equal to 3,400,000, (the "Plan Share Limit"), of which 3,400,000 Shares may be delivered pursuant to Incentive Stock Options granted under the Plan (such amount, the "Plan ISO Limit"). If, after the effective date of the Plan, any Award is forfeited (or otherwise expires, terminates or is canceled without the delivery of all Shares subject thereto), then, in any such case, any number of Shares subject to such Award that were not issued with respect to such Award shall not be treated as issued for purposes of reducing the Plan Share Limit. Notwithstanding the foregoing and for the avoidance of doubt, if Shares issued upon exercise, vesting or settlement of an Award are, or Shares owned by a Participant are, surrendered or tendered to the Company in payment of the Exercise Price of an Award (including any SAR) or any taxes required to be withheld in respect of an Award or if any Award based on the Fair Market Value of a Share is settled other than wholly by delivery of Shares (including cash settlement), in any such case, in accordance with the terms and conditions of the Plan and any applicable Award Agreement, such surrendered or tendered Shares or Awards not settled with Shares shallnot again become available to be delivered pursuant to Awards under the Plan or increase the Plan ISO Limit. With respect to Awards that are intended to qualify as "qualified performance-based compensation" under Section 162(m) of the Code, subject to adjustment as provided in SECTION 4(b), (1) in the case of Awards that are settled in Shares, the maximum aggregate number of Shares with respect to which Awards may be granted to any Participant in any fiscal year of the Company under the Plan shall be 2,500,000 (such amount, the "Annual Individual Plan Share Limit"), and (2) in the case of Awards that are settled in cash based on the Fair Market Value of a Share, the maximum aggregate amount of cash that may be paid pursuant to Awards granted to any Participant in any fiscal year of the Company under the Plan shall be equal to the per-Share Fair Market Value as of the relevant vesting, payment or settlement date multiplied by the Annual Individual Plan Share Limit. In the case of all Awards other than those described in the preceding sentence, the maximum aggregate amount of cash and other property (valued at its Fair Market Value) other than Shares that may be paid or delivered pursuant to Awards under the Plan to any Participant in any fiscal year of the Company shall be equal to $10,000,000. The maximum value of Shares available to be granted pursuant to Awards to any Independent Director under the Plan in any fiscal year of the Company shall be equal to $350,000 as of the applicable date of grant. Subject to adjustment as provided in Section 4(b), the maximum number of Shares available to be granted under the Plan pursuant to Incentive Stock Options to any Participant in any fiscal year of the Company shall be equal to 2,500,000 (the "Annual Individual ISO Limit").

(b) Adjustments for Changes in Capitalization and Similar Events.

(i) In the event of any extraordinary dividend or other extraordinary distribution (whether in the form of cash, Shares, other securities or other property), recapitalization, rights offering, stock split, reverse stock split, split-up or spin-off, the Committee shall equitably adjust any or all of (A) the number of Shares or other securities of the Company (or number and kind of other securities or property) with respect to which Awards may be granted, including (1) the Plan Share Limit, (2) the Plan ISO Limit, (3) the Annual Individual Plan Share Limit, and (4) the Annual Individual ISO Limit, and (B) the terms of any outstanding Award, including (1) the number of Shares or other securities of the Company (or number and kind of other securities or property) subject to outstanding Awards or to which outstanding Awards relate and (2) the Exercise Price, if applicable, with respect to any Award;provided,however, that the Committee shall determine the method and manner in which to effect such equitable adjustment.

(ii) In the event that the Committee determines that any reorganization, merger, consolidation, combination, repurchase or exchange of Shares or other securities of the Company, issuance of warrants or other rights to purchase Shares or other securities of the Company, or other similar corporate transaction or event affects the Shares (including any Change of Control) such that an adjustment is determined by the Committee in its discretion to be appropriate or desirable, then the Committee may (A) in such manner as it may deem appropriate or desirable, equitably adjust any or all of (1) the number of Shares or other securities of the Company (or number and kind of other securities or property) with respect to which Awards may be granted, including (W) the Plan Share Limit, (X) the Plan ISO Limit, (Y) the Annual Individual Plan Share Limit, and (Z) the Annual Individual ISO Limit, and (2) the terms of any outstanding Award, including (X) the number of Shares or other securities of the Company (or number and kind of other securities or property) subject to outstanding Awards or to which outstanding Awards relate and (Y) the Exercise Price, if applicable, with respect to any Award, (B) if deemed appropriate or desirable by the Committee, make provision for a cash payment to the holder of an outstanding Award in consideration for the cancelation of such Award, including, in the case of an outstanding Option or SAR, a cash payment to the holder of such Option or SAR


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in consideration for the cancelation of such Option or SAR in an amount equal to the excess, if any, of the Fair Market Value (as of a date specified by the Committee) of the Shares subject to such Option or SAR over the aggregate Exercise Price of such Option or SAR and (C) if deemed appropriate or desirable by the Committee, cancel and terminate any Option or SAR having a per-Share Exercise Price equal to, or in excess of, the Fair Market Value of a Share subject to such Option or SAR without any payment or consideration therefor.

(c) Substitute Awards. Awards may, in the discretion of the Committee, be granted under the Plan in assumption of, or in substitution for, outstanding awards previously granted by the Company or any of its Affiliates or a company acquired by the Company or any of its Affiliates or with which the Company or any of its Affiliates combines ("Substitute Awards");provided,however, that in no event may any Substitute Award be granted in a manner that would violate the prohibitions on repricing of Options and SARs, as set forth in clauses (i), (ii) and (iii) of SECTION 7(b). The number of Shares underlying any Substitute Awards shall be counted against the Plan Share Limit;provided,however, that Substitute Awards issued in connection with the assumption of, or in substitution for, outstanding awards previously granted by an entity that is acquired by the Company or any of its Affiliates or with which the Company or any of its Affiliates combines shall not be counted against the Plan Share Limit;provided further,however, that Substitute Awards issued in connection with the assumption of, or in substitution for, outstanding stock options intended to qualify for special tax treatment under Sections 421 and 422 of the Code that were previously granted by an entity that is acquired by the Company or any of its Affiliates or with which the Company or any of its Affiliates combines shall be counted against the maximum aggregate number of Shares available for Incentive Stock Options under the Plan.

(d) Sources of Shares Deliverable Under Awards. Any Shares delivered pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares or of treasury Shares.

SECTION 5. Eligibility. Any director, officer, employee or consultant (including any prospective director, officer, employee or consultant) of the Company or any of its Affiliates shall be eligible to be designated a Participant.

SECTION 6. Awards.

(a) Types of Awards. Awards may be made under the Plan in the form of (i) Options, (ii) SARs, (iii) Restricted Shares, (iv) RSUs, (v) Deferred Share Units, (vi) Performance Compensation Awards, (vii) Performance Units (viii) Cash Incentive Awards and (ix) other equity-based or equity-related Awards that the Committee determines are consistent with the purpose of the Plan and the interests of the Company. Awards may be granted in tandem with other Awards. No Incentive Stock Option (other than an Incentive Stock Option that may be assumed or issued by the Company in connection with a transaction to which Section 424(a) of the Code applies) may be granted to a person who is ineligible to receive an Incentive Stock Option under the Code.

(b) Options.

(i) Grant. Subject to the provisions of the Plan, the Committee shall have sole and plenary authority to determine (A) the Participants to whom Options shall be granted, (B) subject to SECTION 4(a), the number of Shares subject to each Option to be granted to each Participant, (C) whether each Option shall be an Incentive Stock Option or a Nonqualified Stock Option and (D) the terms and conditions of each Option, including the vesting criteria, term, methods of exercise and methods and form of settlement. In the case of Incentive Stock Options, the terms and conditions of such grants shall be subject to and comply with such rules as may be prescribed by Section 422 of the Code and any regulations related thereto, as may be amended from time to time. Each Option granted under the Plan shall be a Nonqualified Stock Option unless the applicable Award Agreement expressly states that the Option is intended to be an Incentive Stock Option. If an Option is intended to be an Incentive Stock Option, and if, for any reason, such Option (or any portion thereof) shall not qualify as an Incentive Stock Option, then, to the extent of such nonqualification, such Option (or portion thereof) shall be regarded as a Nonqualified Stock Option appropriately granted under the Plan;provided that such Option (or portion thereof) otherwise complies with the Plan's requirements relating to Nonqualified Stock Options.

(ii) Exercise Price. The Exercise Price of each Share covered by each Option shall be not less than 100% of the Fair Market Value of such Share (determined as of the date the Option is granted);provided,however, in the case of each Incentive Stock Option granted to an employee who, at the time of the grant of such Option, owns stock representing more than 10% of the voting power of all classes of stock of the Company or any Affiliate, the per-Share Exercise Price shall be no less than 110% of the Fair Market Value per Share on the date of the grant. Each Option is, unless otherwise specified by the Committee, intended to qualify as "qualified performance-based compensation" under Section 162(m) of the Code.

(iii) Vesting and Exercise. Each Option shall be vested and exercisable at such times, in such manner and subject to such terms and conditions as the Committee may, in its sole and plenary discretion, specify in the applicable Award Agreement or thereafter. Except as otherwise specified by the Committee in the applicable Award Agreement, each Option may only be exercised to the extent that it has already vested at the time of exercise. Each Option shall be deemed to be exercised when written or electronic notice of such exercise has been given to the Company in accordance with the terms of the Award by the person entitled to exercise the Award and full payment


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pursuant to SECTION 6(b)(iv) for the Shares with respect to which the Award is exercised has been received by the Company. Exercise of each Option in any manner shall result in a decrease in the number of Shares that thereafter may be available for sale under the Option and, except as expressly set forth in SECTION 4(a) and SECTION 4(c), in the number of Shares that may be available for purposes of the Plan, by the number of Shares as to which the Option is exercised. The Committee may impose such conditions with respect to the exercise of each Option, including any conditions relating to the application of Federal or state securities laws, as it may deem necessary or advisable.

(iv) Payment.

(A) No Shares shall be delivered pursuant to any exercise of an Option until payment in full of the aggregate Exercise Price therefor is received by the Company, and the Participant has paid to the Company (or the Company has withheld in accordance with SECTION 9(d)) an amount equal to any Federal, state, local and foreign income and employment taxes required to be withheld. Such payments may be made in cash (or its equivalent) or, in the Committee's sole and plenary discretion, (1) by exchanging Shares owned by the Participant (which are not the subject of any pledge or other security interest), (2) if there shall be a public market for the Shares at such time, subject to such rules as may be established by the Committee, through delivery of irrevocable instructions to a broker to sell the Shares otherwise deliverable upon the exercise of the Option and to deliver cash promptly to the Company, (3) by having the Company withhold Shares from the Shares otherwise issuable pursuant to the exercise of the Option or (4) through any other method (or combination of methods) as approved by the Committee;provided that the combined value of all cash and cash equivalents and the Fair Market Value of any such Shares so tendered to the Company, together with any Shares withheld by the Company in accordance with this SECTION 6(b)(iv) or SECTION 9(d), as of the date of such tender, is at least equal to such aggregate Exercise Price and the amount of any Federal, state, local or foreign income or employment taxes required to be withheld, if applicable.

(B) Wherever in the Plan or any Award Agreement a Participant is permitted to pay the Exercise Price of an Option or taxes relating to the exercise of an Option by delivering Shares, the Participant may, subject to procedures satisfactory to the Committee, satisfy such delivery requirement by presenting proof of beneficial ownership of such Shares, in which case the Company shall treat the Option as exercised without further payment and shall withhold such number of Shares from the Shares acquired by the exercise of the Option.

(v) Expiration. Except as otherwise set forth in the applicable Award Agreement, each Option shall expire immediately, without any payment, upon the earlier of (A) the tenth anniversary of the date the Option is granted (or, in the case of each Incentive Stock Option granted to an employee who, at the time of the grant of such Option, owns stock representing more than 10% of the voting power of all classes of stock of the Company or any Affiliate, the fifth anniversary of the date the Option is granted) and (B) three months after the date the Participant who is holding the Option ceases to be a director, officer, employee or consultant of the Company or one of its Affiliates. In no event may an Option be exercisable after the tenth anniversary of the date the Option is granted.

(i) Grant. Subject to the provisions of the Plan, the Committee shall have sole and plenary authority to determine (A) the Participants to whom SARs shall be granted, (B) subject to SECTION 4(a), the number of SARs to be granted to each Participant, (C) the Exercise Price thereof and (D) the conditions and limitations applicable to the exercise thereof.

(ii) Exercise Price. The Exercise Price of each Share covered by a SAR shall be not less than 100% of the Fair Market Value of such Share (determined as of the date the SAR is granted). Each SAR is, unless otherwise specified by the Committee, intended to qualify as "qualified performance-based compensation" under Section 162(m) of the Code.

(iii) Vesting and Exercise. Each SAR shall entitle the Participant to receive an amount upon exercise equal to the excess, if any, of the Fair Market Value of a Share on the date of exercise of the SAR over the Exercise Price thereof. The Committee shall determine, in its sole and plenary discretion, whether a SAR shall be settled in cash, Shares, other securities, other Awards, other property or a combination of any of the foregoing. Each SAR shall be vested and exercisable at such times, in such manner and subject to such terms and conditions as the Committee may, in its discretion, specify in the applicable Award Agreement or thereafter.

(iv) Other Terms and Conditions. Subject to the terms of the Plan and any applicable Award Agreement, the Committee shall determine, at or after the grant of a SAR, the vesting criteria, term, methods of exercise, methods and form of settlement and any other terms and conditions of any SAR;provided,however, that in no event may any SAR be exercisable after the tenth anniversary of the date the SAR is granted. Any determination by the Committee that is made pursuant to this SECTION 6(c)(iv) may be changed by the Committee from time to time and may govern the exercise of SARs granted or exercised thereafter.


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(v) Substitution SARs. The Committee shall have the ability to substitute, without the consent of the affected Participant or any holder or beneficiary of SARs, SARs settled in Shares (or SARs settled in Shares or cash in the Committee's discretion) ("Substitution SARs") for outstanding Nonqualified Stock Options ("Substituted Options");provided that (A) the substitution shall not otherwise result in a modification of the terms of any Substituted Option, (B) the number of Shares underlying the Substitution SARs shall be the same as the number of Shares underlying the Substituted Options and (C) the Exercise Price of the Substitution SARs shall be equal to the Exercise Price of the Substituted Options. If, in the opinion of the Company's auditors, this provision creates adverse accounting consequences for the Company, it shall be considered null and void.

(vi) Expiration. Except as otherwise set forth in the applicable Award Agreement, each SAR shall expire immediately, without any payment, upon the earlier of (A) the tenth anniversary of the date the SAR is granted and (B) three months after the date the Participant who is holding the SAR ceases to be a director, officer, employee or consultant of the Company or one of its Affiliates. In no event may a SAR be exercisable after the tenth anniversary of the date the SAR is granted.

(d) Restricted Shares and RSUs.

(i) Grant. Subject to the provisions of the Plan, the Committee shall have sole and plenary authority to determine (A) the Participants to whom Restricted Shares and RSUs shall be granted, (B) subject to SECTION 4(a), the number of Restricted Shares and RSUs to be granted to each Participant, (C) the duration of the period during which, and the conditions, if any, under which, the Restricted Shares and RSUs may vest or may be forfeited to the Company and (D) the terms and conditions of each such Award, including the vesting criteria, term, methods of exercise and methods and form of settlement.

(ii) Transfer Restrictions. Restricted Shares and RSUs may not be sold, assigned, transferred, pledged or otherwise encumbered except as provided in the Plan or as may be provided in the applicable Award Agreement;provided,however, that the Committee may in its discretion, determine that Restricted Shares and RSUs may be transferred by the Participant for no consideration. Each Restricted Share may be evidenced in such manner as the Committee shall determine. If certificates representing Restricted Shares are registered in the name of the applicable Participant, such certificates must bear an appropriate legend referring to the terms, conditions and restrictions applicable to such Restricted Shares, and the Company may, at its discretion, retain physical possession of such certificates until such time as all applicable restrictions lapse.

(iii) Payment/Lapse of Restrictions. Each RSU shall be granted with respect to a specified number of Shares (or a number of Shares determined pursuant to a specified formula) or shall have a value equal to the Fair Market Value of a specified number of Shares (or a number of Shares determined pursuant to a specified formula). RSUs shall be paid in cash, Shares, other securities, other Awards or other property, as determined in the sole and plenary discretion of the Committee, upon the lapse of restrictions applicable thereto, or otherwise in accordance with the applicable Award Agreement. If a Restricted Share or an RSU is intended to qualify as "qualified performance-based compensation" under Section 162(m) of the Code, unless the grant of such Restricted Share or RSU is contingent on satisfaction of the requirements for the payment of "qualified performance-based compensation" under Section 162(m) of the Code (whether pursuant to SECTION 6(e) of this Plan or any other plan), all requirements set forth in SECTION 6(e) must be satisfied in order for the restrictions applicable thereto to lapse.

(e) Performance Compensation Awards.

(i) General. The Committee shall have the authority, at the time of grant of any Award, to designate such Award (other than an Option or SAR) as a Performance Compensation Award in order for such Award to qualify as "qualified performance-based compensation" under Section 162(m) of the Code. Options and SARs granted under the Plan shall not be included among Awards that are designated as Performance Compensation Awards under this SECTION 6(e).

(ii) Eligibility. The Committee shall, in its sole discretion, designate within the first 90 days of a Performance Period (or, if shorter, within the maximum period allowed under Section 162(m) of the Code) which Participants shall be eligible to receive Performance Compensation Awards in respect of such Performance Period. However, designation of a Participant as eligible to receive an Award hereunder for a Performance Period shall not in any manner entitle such Participant to receive payment in respect of any Performance Compensation Award for such Performance Period. The determination as to whether or not such Participant becomes entitled to payment in respect of any Performance Compensation Award shall be decided solely in accordance with the provisions of this SECTION 6(e). Moreover, designation of a Participant as eligible to receive an Award hereunder for a particular Performance Period shall not require designation of such Participant as eligible to receive an Award hereunder in any subsequent Performance Period and designation of one person as a Participant eligible to receive an Award hereunder shall not require designation of any other person as a Participant eligible to receive an Award hereunder in such period or in any other period.


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(iii) Discretion of the Committee with Respect to Performance Compensation Awards. With regard to a particular Performance Period, the Committee shall have discretion to select (A) the length of such Performance Period, (B) the type(s) of Performance Compensation Awards to be issued, (C) the Performance Criteria that shall be used to establish the Performance Goal(s), (D) the kind(s) and/or level(s) of the Performance Goal(s) that is (are) to apply to the Company or any of its Subsidiaries, Affiliates, divisions or operational units, or any combination of the foregoing, and (E) the Performance Formula;provided that any such Performance Formula shall be objective and non-discretionary. Within the first 90 days of a Performance Period (or, if shorter, within the maximum period allowed under Section 162(m) of the Code), the Committee shall, with regard to the Performance Compensation Awards to be issued for such Performance Period, exercise its discretion with respect to each of the matters enumerated in the immediately preceding sentence and record the same in writing.

(iv) Performance Criteria. Notwithstanding the foregoing, the Performance Criteria that shall be used to establish the Performance Goal(s) with respect to Performance Compensation Awards shall be based on the attainment of specific levels of performance of the Company or any of its Subsidiaries, Affiliates, divisions or operational units, or any combination of the foregoing, and shall be limited to the following (whether per share or otherwise): (A) share price, (B) net income, earnings or earnings before or after taxes (including earnings before interest and taxes ("EBIT") or earnings before interest, taxes, depreciation and amortization ("EBITDA")) including, in each case, for the avoidance of doubt, on an adjusted basis, (C) operating income, profit, operating profit or economic profit, (D) capital efficiency, (E) cash flow (including specified types or categories thereof including, but not limited to, operating cash flow and free cash flow), (F) cash flow return on capital, (G) revenues (including specified types or categories thereof), (H) return on stockholders' equity, (I) return on investment or capital, (J) return on assets, (K) gross or net profitability/profit margins, (L) objective measures of productivity or operating efficiency, (M) costs (including specified types or categories thereof), (N) budgeted expenses (operating and capital), (O) market share (in the aggregate or by segment), (P) level or amount of acquisitions (in terms of size, number of transactions or otherwise), (Q) economic value-added, (R), enterprise value, (S) book value, (T) working capital, (U) safety and accident rates, (V) days sales outstanding, (W) customer satisfaction, (X) overall or selected premium or sales, (Y) expense ratio, (Z) gross or unit margin, and (AA) total stockholder return. Such Performance Criteria may be applied on an absolute basis, be relative to one or more peer companies of the Company or indices or any combination thereof or, if applicable, be computed on an accrual or cash accounting basis. To the extent required under Section 162(m) of the Code, the Committee shall, within the first 90 days of the applicable Performance Period (or, if shorter, within the maximum period allowed under Section 162(m) of the Code), define in an objective manner the method of calculating the Performance Criteria it selects to use for such Performance Period.

(v) Modification of Performance Goals. The Committee is authorized to adjust or modify the calculation of a Performance Goal for a Performance Period to the extent permitted under Section 162(m) of the Code (A) in the event of, or in anticipation of, any unusual or extraordinary corporate item, transaction, event or development affecting the Company, or any of its Affiliates, Subsidiaries, divisions or operating units (to the extent applicable to such Performance Goal) or (B) in recognition of, or in anticipation of, any other unusual or nonrecurring events affecting the Company or any of its Affiliates, Subsidiaries, divisions or operating units (to the extent applicable to such Performance Goal), or the financial statements of the Company or any of its Affiliates, Subsidiaries, divisions or operating units (to the extent applicable to such Performance Goal), or of changes in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange, accounting principles, law or business conditions.

(vi) Payment of Performance Compensation Awards.

(A) Condition to Receipt of Payment. A Participant must be employed by the Company or one of its Subsidiaries on the last day of a Performance Period to be eligible for payment in respect of a Performance Compensation Award for such Performance Period. Notwithstanding the foregoing and to the extent permitted by Section 162(m) of the Code, in the discretion of the Committee, Performance Compensation Awards may be paid to Participants who have retired or whose employment has terminated prior to the last day of the Performance Period for which a Performance Compensation Award is made, or to the designee or estate of a Participant who died prior to the last day of a Performance Period.

(B) Limitation. Except as otherwise permitted by Section 162(m) of the Code, a Participant shall be eligible to receive payments in respect of a Performance Compensation Award only to the extent that (1) the Performance Goal(s) for the relevant Performance Period are achieved and certified by the Committee in accordance with SECTION 6(e)(vi)(C) and (2) the Performance Formula as applied against such Performance Goal(s) determines that all or some portion of such Participant's Performance Compensation Award has been earned for such Performance Period.

(C) Certification. Following the completion of a Performance Period, the Committee shall certify in writing whether, and to what extent, the Performance Goals for the Performance Period have been achieved and, if so, to calculate and certify in writing that amount of the Performance Compensation Awards earned for the period based upon the objective Performance Formula. The Committee shall then determine the actual amount of each


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Participant's Performance Compensation Award for the Performance Period and, in so doing, may apply negative discretion as authorized by SECTION 6(e)(vi)(D).

(D) Negative Discretion. In determining the actual amount of an individual Performance Compensation Award for a Performance Period, the Committee may, in its sole and plenary discretion, reduce or eliminate the amount of the Award earned in the Performance Period, even if applicable Performance Goals have been attained and without regard to any employment agreement between the Company and a Participant.

(E) Discretion. Except as otherwise permitted by Section 162(m) of the Code, in no event shall any discretionary authority granted to the Committee by the Plan be used to (1) grant or provide payment in respect of Performance Compensation Awards for a Performance Period if the Performance Goals for such Performance Period have not been attained, (2) increase a Performance Compensation Award for any Participant at any time after the first 90 days of the Performance Period (or, if shorter, the maximum period allowed under Section 162(m) of the Code) or (3) increase the amount of a Performance Compensation Award above the maximum amount payable under SECTION 4(a) of the Plan. For the avoidance of doubt, the provisions of this Section 6(e), including without limitation this Section 6(e)(vi)(E), shall only apply to Awards (other than Options or SARs) that the Committee intends to qualify as "qualified performance-based compensation" under Section 162(m) of the Code.

(F) Form of Payment. In the case of any Performance Compensation Award other than a Restricted Share, RSU or other equity-based Award that is subject to performance-based vesting conditions, such Performance Compensation Award shall be payable, in the discretion of the Committee, in cash or in Restricted Shares, RSUs or fully vested Shares of equivalent value and shall be paid on such terms as determined by the Committee in its discretion. Any Restricted Shares and RSUs shall be subject to the terms of this Plan (or any successor equity-compensation plan) and any applicable Award Agreement. The number of Restricted Shares, RSUs or Shares that is equivalent in value to a dollar amount shall be determined in accordance with a methodology specified by the Committee within the first 90 days of the relevant Performance Period (or, if shorter, within the maximum period allowed under Section 162(m) of the Code).

(f) Performance Units.

(i) Grant. Subject to the provisions of the Plan, the Committee shall have sole and plenary authority to determine the Participants to whom Performance Units shall be granted.

(ii) Value of Performance Units. Each Performance Unit shall have an initial value that is established by the Committee at the time of grant. The Committee shall set Performance Goals in its discretion which, depending on the extent to which they are met during a Performance Period, will determine in accordance with SECTION 4(a) the number and/or value of Performance Units that will be paid out to the Participant.

(iii) Earning of Performance Units. Subject to the provisions of the Plan, after the applicable Performance Period has ended, the holder of Performance Units shall be entitled to receive a payout of the number and value of Performance Units earned by the Participant over the Performance Period, to be determined by the Committee, in its sole and plenary discretion, as a function of the extent to which the corresponding Performance Goals have been achieved.

(iv) Form and Timing of Payment of Performance Units. Subject to the provisions of the Plan, the Committee, in its sole and plenary discretion, may pay earned Performance Units in the form of cash or in Shares (or in a combination thereof) that have an aggregate Fair Market Value equal to the value of the earned Performance Units at the close of the applicable Performance Period. Such Shares may be granted subject to any restrictions in the applicable Award Agreement deemed appropriate by the Committee. The determination of the Committee with respect to the form and timing of payout of such Awards shall be set forth in the applicable Award Agreement. If a Performance Unit is intended to qualify as "qualified performance-based compensation" under Section 162(m) of the Code, all requirements set forth in SECTION 6(e) must be satisfied in order for a Participant to be entitled to payment.

(g) Cash Incentive Awards.

(i) Grant. Subject to the provisions of the Plan, the Committee, in its sole and plenary discretion, shall have the authority to determine (A) the Participants to whom Cash Incentive Awards shall be granted, (B) subject to SECTION 4(a), the number of Cash Incentive Awards to be granted to each Participant, (C) the duration of the period during which, and the conditions, if any, under which, the Cash Incentive Awards may vest or may be forfeited to the Company and (D) the other terms and conditions of the Cash Incentive Awards. Each Cash Incentive Award shall have an initial value that is established by the Committee at the time of grant. The Committee shall set performance goals or other payment conditions in its discretion, which, depending on the extent to which they are met during a specified performance period, shall determine the number and/or value of Cash Incentive Awards that shall be paid to the Participant.


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(ii) Earning of Cash Incentive Awards. Subject to the provisions of the Plan, after the applicable vesting period has ended, the holder of Cash Incentive Awards shall be entitled to receive a payout of the number and value of Cash Incentive Awards earned by the Participant over the specified performance period, to be determined by the Committee, in its sole and plenary discretion, as a function of the extent to which the corresponding performance goals or other conditions to payment have been achieved.

(iii) Payment. If a Cash Incentive Award is intended to qualify as "qualified performance-based compensation" under Section 162(m) of the Code, all requirements set forth in SECTION 6(e) must be satisfied in order for a Participant to be entitled to payment.

(h) Other Stock-Based Awards. Subject to the provisions of the Plan, the Committee shall have the sole and plenary authority to grant to Participants other equity-based or equity-related Awards (including, but not limited to, Deferred Share Units and fully vested Shares) (whether payable in cash, equity or otherwise) in such amounts and subject to such terms and conditions as the Committee shall determine;provided that any such Awards must comply, to the extent deemed desirable by the Committee, with Rule 16b-3 and applicable law.

(i) Dividends and Dividend Equivalents. In the sole and plenary discretion of the Committee, an Award, other than an Option or SAR or a Cash Incentive Award, may provide the Participant with dividends or dividend equivalents, payable in cash, Shares, other securities, other Awards or other property, on a current or deferred basis, on such terms and conditions as may be determined by the Committee in its sole and plenary discretion, including, (i) payment directly to the Participant, (ii) withholding of such amounts by the Company subject to vesting of the Award or (iii) reinvestment in additional Shares, Restricted Shares or other Awards.

(j) Minimum Vesting Provision. Subject to the terms of the Plan and any applicable Award Agreement, all Awards granted hereunder other than SARs, Options or Cash Incentive Awards are subject to a vesting period of at least three years following the date of grant, except that (1) a vesting period of at least one year following the date of grant is permissible if vesting is conditioned upon the achievement of performance goals, (2) any award may vest in part prior to the expiration of any vesting period (except that in no event will any portion of such awards vest prior to the first anniversary of the date of grant), and (3) up to five percent of shares available for grant under the Plan may be granted without regard to these requirements and the Committee may accelerate the vesting with respect to any such awards.

SECTION 7. Amendment and Termination.

(a) Amendments to the Plan. Subject to any applicable law or government regulation, to any requirement that must be satisfied if the Plan is intended to be a stockholder-approved plan for purposes of Section 162(m) of the Code and to the rules of the Applicable Exchange, the Plan may be amended, modified or terminated by the Board without the approval of the stockholders of the Company, except that stockholder approval shall be required for any amendment that would (i) increase the Plan Share Limit or the Plan ISO Limit, (ii) change the class of employees or other individuals eligible to participate in the Plan, (iii) constitute a material increase in the benefits to be provided to eligible employees within the meaning of the New York Stock Exchange rules as of the date hereof, or (iv) result in the amendment, cancelation or action described in clause (i), (ii) or (iii) of the second sentence of SECTION 7(b) being permitted without approval by the Company's stockholders;provided,however, that any adjustment under SECTION 4(b) shall not constitute an increase for purposes of SECTION 7(a)(i). No amendment, modification or termination of the Plan may, without the consent of the Participant to whom any Award shall theretofore have been granted, materially and adversely affect the rights of such Participant (or his or her transferee) under such Award, unless otherwise provided by the Committee in the applicable Award Agreement.

(b) Amendments to Awards. The Committee may waive any conditions or rights under, amend any terms of, or alter, suspend, discontinue, cancel or terminate any Award theretofore granted, prospectively or retroactively;

provided,however, that, except as set forth in the Plan, unless otherwise provided by the Committee in the applicable Award Agreement, any such waiver, amendment, alteration, suspension, discontinuance, cancelation or termination that would materially and adversely impair the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective without the consent of the applicable Participant, holder or beneficiary. Notwithstanding the preceding sentence, in no event may any Option or SAR (i) be amended to decrease the Exercise Price thereof, (ii) be cancelled at a time when its Exercise Price exceeds the Fair Market Value of the underlying Shares in exchange for another Option or SAR or any Restricted Share, RSU, other equity-based Award, award under any other equity-compensation plan or any cash payment or (iii) be subject to any action that would be treated, for accounting purposes, as a "repricing" of such Option or SAR, unless such amendment, cancellation or action is approved by the Company's stockholders. For the avoidance of doubt, an adjustment to the Exercise Price of an Option or SAR that is made in accordance with SECTION 4(b) or SECTION 8 shall not be considered a reduction in Exercise Price or "repricing" of such Option or SAR.

(c) Adjustment of Awards Upon the Occurrence of Certain Unusual or Nonrecurring Events. Subject to SECTION 6(e)(v) and the final sentence of SECTION 7(b), the Committee is hereby authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (including,


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without limitation, the events described in SECTION 4(b) or the occurrence of a Change of Control) affecting the Company, any Affiliate, or the financial statements of the Company or any Affiliate, or of changes in applicable rules, rulings, regulations or other requirements of any governmental body or securities exchange, accounting principles or law (i) whenever the Committee, in its sole and plenary discretion, determines that such adjustments are appropriate or desirable, including, without limitation, providing for a substitution or assumption of Awards, accelerating the exercisability of, lapse of restrictions on, or termination of, Awards or providing for a period of time for exercise prior to the occurrence of such event, (ii) if deemed appropriate or desirable by the Committee, in its sole and plenary discretion, by providing for a cash payment to the holder of an Award in consideration for the cancelation of such Award, including, in the case of an outstanding Option or SAR, a cash payment to the holder of such Option or SAR in consideration for the cancelation of such Option or SAR in an amount equal to the excess, if any, of the Fair Market Value (as of a date specified by the Committee) of the Shares subject to such Option or SAR over the aggregate Exercise Price of such Option or SAR and (iii) if deemed appropriate or desirable by the Committee, in its sole and plenary discretion, by canceling and terminating any Option or SAR having a per-Share Exercise Price equal to, or in excess of, the Fair Market Value of a Share subject to such Option or SAR without any payment or consideration therefor.

SECTION 8. Change of Control.

(a) General. The provisions of this Section 8 shall, subject to Section 4(b), apply notwithstanding any other provision of the Plan to the contrary, except to the extent the Committee specifically provides otherwise in an Award Agreement.

(b) Impact of Change of Control. Upon the occurrence of a Change of Control, except as otherwise provided in Section 8(e), each Award shall be replaced pursuant to Section 4(b) with an award that meets the requirements of this Section 8(b) (any award meeting the requirements of this Section 8(b), a "Replacement Award" and any award intended to be replaced by a Replacement Award, a "Replaced Award"). An Award shall meet the conditions of this Section 8(b) (and hence qualify as a Replacement Award) if: (i) it is of the same type as the Replaced Award; (ii) it has a value equal to the value of the Replaced Award as of the date of the Change of Control; (iii) if the underlying Replaced Award was an equity-based award, it relates to publicly traded equity securities of the Company or the entity surviving the Company following the Change of Control; (iv) it contains terms relating to vesting (including with respect to a termination of employment or service) that are substantially identical to those of the Replaced Award; and (v) its other terms and conditions are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent Change of Control) as of the date of the Change of Control. Without limiting the generality of the foregoing, a Replacement Award may take the form of a continuation of the applicable Replaced Award if the requirements of the preceding sentence are satisfied. If a Replacement Award is granted, the Replaced Award shall not vest upon the Change of Control. The determination whether the conditions of this Section 8(b) are satisfied shall be made by the Committee, as constituted immediately before the Change of Control, in its sole discretion.

(c) Termination of Employment. Upon a termination of employment or service of a Participant occurring upon or during the two years immediately following the date of a Change of Control by reason of death, disability, by the Company without Cause (as defined in Section 8(d)), or, only to the extent specified in an Award Agreement, by the Participant for "Good Reason" (as defined in Section 8(d)), (i) all Replacement Awards held by such Participant shall vest in full, be free of restrictions, and be earned in an amount equal to the full value of such Replacement Award, and (ii) unless otherwise provided in the applicable Award Agreement, notwithstanding any other provision of the Plan to the contrary, any Option or SAR held by the Participant as of the date of the Change of Control that remains outstanding as of the date of such termination of employment or service may thereafter be exercised, until (A) in the case of Incentive Stock Options, the last date on which such Incentive Stock Options would be exercisable in the absence of this Section 8(c), and (B) in the case of Nonqualified Stock Options and SARs, the later of (x) the last date on which such Nonqualified Stock Option or SAR would be exercisable upon the relevant termination of employment in the absence of this Section 8(c) and (y) the earlier of (1) the first anniversary of such termination of employment or service and (2) expiration of the term of such Nonqualified Stock Option or SAR.

(d) Definitions. The following terms shall have the following meanings for purposes of this Section 8 only:

(j) Unless otherwise determined by the Committee and set forth in an applicable Award Agreement, "Cause" shall mean (A) the Participant's dereliction of duties or gross negligence or failure to perform his duties or refusal to follow any lawful directive of the officer to whom he reports; (B) the Participant's abuse of or dependency on alcohol or drugs (illicit or otherwise) that adversely affects his performance of duties for the Company; (C) the Participant's commission of any fraud, embezzlement, theft or dishonesty or any deliberate misappropriation of money or other assets of the Company; (D) the Participant's breach of any fiduciary duties of the Company; (E) any act, or failure to act, by the Participant in bad faith to the detriment of the Company; (F) the Participant's failure to cooperate in good faith with a governmental or internal investigation of the Company or any of its directors, managers, officers or employees, if the Company requests the Participant's cooperation; (G) the Participant's failure to follow Company policies, including the Company's code of conduct and/or ethics policy, as may be in effect from time to time; or (H) the Participant's conviction of, or plea of nolo contendere to, a felony or any serious crime;provided that in cases where cure is possible, the Participant shall first be provided with a 15-day cure period.


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(e) (ii) Unless otherwise determined by the Committee and set forth in an applicable Award Agreement, "Good Reason" shall mean (A) a material breach by the Company of the Participant's applicable Award Agreement or (B) a reduction in the Participant's base salary;provided that the Company shall first be provided with a 30-day cure period following receipt of written notice from the Participant setting forth in reasonable detail the specific conduct of the Company that is alleged to constitute Good Reason, to cease and to cure, any conduct specified in such written notice;provided,further, that such notice shall be provided to the Company within 45 days of the occurrence of the conduct alleged to constitute Good Reason and if, at the end of the cure period, the circumstance alleged to constitute Good Reason has not been remedied the Participant will be entitled to terminate his employment for Good Reason during the 30-day period that follows the end of the cure period. If the Participant does not terminate employment or service during such 30-day period, he will not be permitted to terminate his employment for Good Reason as a result of such event or condition.

(f) Awards not Replaced. Notwithstanding the foregoing, unless otherwise provided in the applicable Award Agreement, in the event that an Award shall not be replaced pursuant to Section 4(b) with a Replacement Award meeting the requirements of Section 8(b), any such Award that is (i) an outstanding Option or SAR then held by a Participant that is unexercisable or otherwise unvested shall automatically become exercisable or otherwise vested, as the case may be, as of immediately prior to the Change of Control, (ii) a Performance Unit, Cash Incentive Award or Award designated as a Performance Compensation Award shall be paid out as if the date of the Change of Control were the last day of the applicable Performance Period and "target" performance levels had been attained and (iii) not described in clause (i) or (ii) of this Section 8(e) then held by a Participant that is unexercisable, unvested or still subject to restrictions or forfeiture, shall automatically be exercisable and vested and all restrictions and forfeiture provisions related thereto shall lapse as of immediately prior to such Change of Control. Notwithstanding the foregoing, if any Award is subject to Section 409A of the Code, this Section 8 shall be applicable only to the extent specifically provided in the Award Agreement and permitted pursuant to Section 11(e). Nothing in this Section 8 shall preclude the Company from settling upon a Change of Control an Award if it is not replaced by a Replacement Award, to the extent effectuated in accordance with Treas. Reg. § 1.409A-3(j)(ix).

SECTION 9. General Provisions.

(a) Nontransferability. Except as otherwise specified in the applicable Award Agreement, during the Participant's lifetime each Award (and any rights and obligations thereunder) shall be exercisable only by the Participant, or, if permissible under applicable law, by the Participant's legal guardian or representative, and no Award (or any rights and obligations thereunder) may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant otherwise than by will or by the laws of descent and distribution, and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Affiliate;provided that (i) the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance and (ii) the Board or the Committee may permit further transferability, on a general or specific basis, and may impose conditions and limitations on any permitted transferability;provided,however, that Incentive Stock Options shall not be transferable in any way that would violate Section 1.422-2(a)(2) of the Treasury Regulations and in no event may any Award (or any rights and obligations thereunder) be transferred in any way in exchange for value. All terms and conditions of the Plan and all Award Agreements shall be binding upon any permitted successors and assigns.

(b) No Rights to Awards. No Participant or other Person shall have any claim to be granted any Award, and there is no obligation for uniformity of treatment of Participants or holders or beneficiaries of Awards. The terms and conditions of Awards and the Committee's determinations and interpretations with respect thereto need not be the same with respect to each Participant and may be made selectively among Participants, whether or not such Participants are similarly situated.

(c) Share Certificates. All certificates for Shares or other securities of the Company or any Affiliate delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan, the applicable Award Agreement or the rules, regulations and other requirements of the SEC, the Applicable Exchange and any applicable Federal or state laws, and the Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.

(d) Withholding.

(i) Authority to Withhold. A Participant may be required to pay to the Company or any Affiliate, and the Company or any Affiliate shall have the right and is hereby authorized to withhold from any Award, from any payment due or transfer made under any Award or under the Plan or from any compensation or other amount owing to a Participant, the amount (in cash, Shares, other securities, other Awards or other property) of any applicable withholding taxes in respect of an Award, its exercise or any payment or transfer under an Award or under the Plan and to take such other action as may be necessary in the opinion of the Committee or the Company to satisfy all obligations for the payment of such taxes.

(ii) Alternative Ways to Satisfy Withholding Liability. Without limiting the generality of clause (i) above, subject to the Committee's discretion, a Participant may satisfy, in whole or in part, the foregoing withholding liability by delivery


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of Shares owned by the Participant (which are not subject to any pledge or other security interest) having a Fair Market Value equal to such withholding liability or by having the Company withhold from the number of Shares otherwise issuable pursuant to the exercise of the Option or SAR, or the lapse of the restrictions on any other Award (in the case of SARs and other Awards, if such SARs and other Awards are settled in Shares), a number of Shares having a Fair Market Value equal to such withholding liability.

(e) Section 409A.

(i) It is intended that the provisions of the Plan comply with Section 409A of the Code, and all provisions of the Plan shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A of the Code. Each payment under any Award shall be treated as a separate payment for purposes of Section 409A of the Code. In no event may a Participant, directly or indirectly, designate the calendar year of any payment to be made under any Award.

(ii) No Participant or the creditors or beneficiaries of a Participant shall have the right to subject any deferred compensation (within the meaning of Section 409A of the Code) payable under the Plan to any anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment or garnishment. Except as permitted under Section 409A of the Code, any deferred compensation (within the meaning of Section 409A of the Code) payable to any Participant or for the benefit of any Participant under the Plan may not be reduced by, or offset against, any amount owing by any such Participant to the Company or any of its Affiliates.

(iii) If, at the time of a Participant's separation from service (within the meaning of Section 409A of the Code), (A) such Participant shall be a specified employee (within the meaning of Section 409A of the Code and using the identification methodology selected by the Company from time to time) and (B) the Company shall make a good faith determination that an amount payable pursuant to an Award constitutes deferred compensation (within the meaning of Section 409A of the Code) the payment of which is required to be delayed pursuant to the six-month delay rule set forth in Section 409A of the Code in order to avoid taxes or penalties under Section 409A of the Code, then the Company shall not pay such amount on the otherwise scheduled payment date but shall instead pay it on the first business day after such six-month period. Such amount shall be paid without interest, unless otherwise determined by the Committee, in its sole discretion, or as otherwise provided in any applicable employment agreement between the Company and the relevant Participant.

(iv) Notwithstanding any provision of the Plan to the contrary, in light of the uncertainty with respect to the proper application of Section 409A of the Code, the Company reserves the right to make amendments to any Award as the Company deems necessary or desirable to avoid the imposition of taxes or penalties under Section 409A of the Code. In any case, a Participant shall be solely responsible and liable for the satisfaction of all taxes and penalties that may be imposed on such Participant or for such Participant's account in connection with an Award (including any taxes and penalties under Section 409A of the Code), and neither the Company nor any of its Affiliates shall have any obligation to indemnify or otherwise hold such Participant harmless from any or all of such taxes or penalties.

(f) Award Agreements. Each Award hereunder shall be evidenced by an Award Agreement, which shall be delivered to the Participant and shall specify the terms and conditions of the Award and any rules applicable thereto, including the effect on such Award of the death, disability or termination of employment or service of a Participant and the effect, if any, of such other events as may be determined by the Committee.

(g) No Limit on Other Compensation Arrangements. Nothing contained in the Plan shall prevent the Company or any Affiliate from adopting or continuing in effect other compensation arrangements, which may, but need not, provide for the grant of options, restricted stock, shares, other types of equity-based awards (subject to stockholder approval if such approval is required) and cash incentive awards, and such arrangements may be either generally applicable or applicable only in specific cases.

(h) No Right to Employment. The grant of an Award shall not be construed as giving a Participant the right to be retained as a director, officer, employee or consultant of or to the Company or any Affiliate, nor shall it provide a Participant with any rights to continued service on the Board. Further, the Company or an Affiliate may at any time dismiss a Participant from employment or discontinue any directorship or consulting relationship, free from any liability or any claim under the Plan, unless otherwise expressly provided in the Plan or in any Award Agreement.

(i) No Rights as a Stockholder. No Participant or holder or beneficiary of any Award shall have any rights as a stockholder with respect to any Shares to be distributed under the Plan until he or she has become the holder of such Shares. In connection with each grant of Restricted Shares, except as provided in the applicable Award Agreement, the Participant shall be entitled to the rights of a stockholder (including the right to vote) in respect of such Restricted Shares. Except as otherwise provided in SECTION 4(b), SECTION 7(c) or the applicable Award Agreement, no adjustments shall be made for dividends or distributions on (whether ordinary or extraordinary, and whether in cash, Shares, other securities or other property), or other events relating to, Shares subject to an Award for which the record date is prior to the date such Shares are delivered.


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(j) Governing Law. The validity, construction and effect of the Plan and any rules and regulations relating to the Plan and any Award Agreement shall be determined in accordance with the laws of the State of Delaware, without giving effect to the conflict of laws provisions thereof.

(k) Severability. If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any Person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be construed or deemed stricken as to such jurisdiction, Person or Award and the remainder of the Plan and any such Award shall remain in full force and effect.

(l) Other Laws; Restrictions on Transfer of Shares. The Committee may refuse to issue or transfer any Shares or other consideration under an Award if, acting in its sole and plenary discretion, it determines that the issuance or transfer of such Shares or such other consideration might violate any applicable law or regulation or entitle the Company to recover the same under Section 16(b) of the Exchange Act, and any payment tendered to the Company by a Participant, other holder or beneficiary in connection with the exercise of such Award shall be promptly refunded to the relevant Participant, holder or beneficiary. Without limiting the generality of the foregoing, no Award granted hereunder shall be construed as an offer to sell securities of the Company, and no such offer shall be outstanding, unless and until the Committee in its sole and plenary discretion has determined that any such offer, if made, would be in compliance with all applicable requirements of the Federal and any other applicable securities laws.

(m) No Trust or Fund Created. Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Affiliate, on one hand, and a Participant or any other Person, on the other. To the extent that any Person acquires a right to receive payments from the Company or any Affiliate pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company or such Affiliate.

(n) Recoupment of Awards. Any Award Agreement may provide for recoupment by the Company of all or any portion of an Award if the Company's financial statements are required to be restated due to noncompliance with any financial reporting requirement under the Federal securities laws or as otherwise determined by the Committee. This SECTION 9(n) shall not be the Company's exclusive remedy with respect to such matters.

(o) No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award, and the Committee shall determine whether cash, other securities or other property shall be paid or transferred in lieu of any fractional Shares or whether such fractional Shares or any rights thereto shall be canceled, terminated or otherwise eliminated.

(p) Requirement of Consent and Notification of Election Under Section 83(b) of the Code or Similar Provision. No election under Section 83(b) of the Code (to include in gross income in the year of transfer the amounts specified in Section 83(b) of the Code) or under a similar provision of law may be made unless expressly permitted by the terms of the applicable Award Agreement or by action of the Committee in writing prior to the making of such election. If an Award recipient, in connection with the acquisition of Shares under the Plan or otherwise, is expressly permitted under the terms of the applicable Award Agreement or by such Committee action to make such an election and the Participant makes the election, the Participant shall notify the Committee of such election within ten days of filing notice of the election with the Internal Revenue Service (or any successor thereto) or other governmental authority, in addition to any filing and notification required pursuant to regulations issued under Section 83(b) of the Code or any other applicable provision.

(q) Requirement of Notification Upon Disqualifying Disposition Under Section 421(b) of the Code. If any Participant shall make any disposition of Shares delivered pursuant to the exercise of an Incentive Stock Option under the circumstances described in Section 421(b) of the Code (relating to certain disqualifying dispositions) or any successor provision of the Code, such Participant shall notify the Company of such disposition within ten days of such disposition.

(r) Headings and Construction. Headings are given to the Sections and subsections of the Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof. Whenever the words "include", "includes" or "including" are used in this Plan, they shall be deemed to be followed by the words "but not limited to".

SECTION 10. Term of the Plan.

(a) Effective Date. The Plan shall be effective as of the Approval Date.

(b) Expiration Date. No Award shall be granted under the Plan after the tenth anniversary of the Approval Date. Unless otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award granted hereunder, and the authority of the Board or the Committee to amend, alter, adjust, suspend, discontinue or terminate any such Award or to waive any conditions or rights under any such Award, shall nevertheless continue thereafter.


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C		~~Non-Voting Items~~


~~Change of Address~~~~— Please print new address below.~~				~~Comments~~~~— Please print your comments below.~~

MMMMMMMMMMMM MMMMMMMMMMMMMMM C123456789 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000000000.000000 ext 000004 ENDORSEMENT_LINE______________ SACKPACK_____________ Your vote matters – here’s how to vote! You may vote online or by phone instead of mailing this card. Votes submitted electronically must be MR A SAMPLE DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 ADD 5 ADD 6 received by 1:00am EDT on May 15, 2019 Online GIof ntoo welwewct.reonnviicsivoontrienpgo, rts.com/XPO or delete QR code and control # scan the QR code — login details are located in the shaded bar below. Phone Call toll free 1-800-652-VOTE (8683) within the USA, US territories and Canada Save paper, time and money! Sign up for electronic delivery at www.envisionreports.com/XPO Using a black ink pen, mark your votes with an X as shown in this example. Please do not write outside the designated areas. q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q + The Board of Directors recommends a vote FOR all nominees listed below 1. Election of Directors: 01 - Bradley S. Jacobs For Against Abstain For Against Abstain For Against Abstain 02 - Gena L. Ashe 03 - Marlene M. Colucci 04 - AnnaMaria DeSalva 05 - Michael G. Jesselson 06 - Adrian P. Kingshott 07 - Jason D. Papastavrou 08 - Oren G. Shaffer The Board of Directors recommends a vote FOR proposals 2, 3 and 4 For Against Abstain For Against Abstain 2. Ratification of independent auditors for fiscal year 2019. 3. Approval of amendments to the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan. 4. Advisory vote to approve executive compensation. The Board of Directors recommends a vote AGAINST proposals 5 and 6 ForAgainst Abstain For Against Abstain 5. Stockholder proposal regarding appointment of independent chairman of the board. 6. Stockholder proposal regarding ways to strengthen the prevention of workplace sexual harassment. Please sign exactly as name(s) appears hereon. Joint owners should each sign. When signing as attorney, executor, administrator, corporate officer, trustee, guardian, or custodian, please give full title. Date (mm/dd/yyyy) — Please print date below. Signature 1 — Please keep signature within the box. Signature 2 — Please keep signature within the box. MMMMMMM C 1234567890 J N T 1 7 4 6 4 MR A SAMPLE (THIS AREA IS SET UP TO ACCOMMODATE 140 CHARACTERS) MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND MR A SAMPLE AND + 1 U P X 4 031MUH MMMMMMMMM B Authorized Signatures — This section must be completed for your vote to count. Please date and sign below. A Proposals 2019 Annual Meeting of Stockholders Proxy Card1234 5678 9012 345


∎		~~IF VOTING BY MAIL, YOUMUST~~ ~~COMPLETE SECTIONS A - C ON BOTH SIDES OF THIS CARD.~~ YOUR VOTE IS IMPORTANT Regardless of whether you plan to attend the Annual Meeting of Stockholders, you can be sure your shares are represented at the meeting by promptly returning your proxy in the enclosed envelope. Important Notice Regarding the Internet Availability of Proxy Materials for the Annual Meeting of Stockholders to be Held on May 15, 2019: The Proxy Statement and our Annual Report on Form 10-K for the Year Ended on December 31, 2018 are available at www.edocumentview.com/XPO q IF VOTING BY MAIL, SIGN, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED ENVELOPE. q + PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON MAY 15, 2019 This Proxy is solicited on behalf of the Board of Directors of XPO Logistics, Inc. The undersigned hereby acknowledges receipt of the XPO Logistics, Inc. Notice of Annual Meeting and Proxy Statement and hereby constitutes and appoints Bradley S. Jacobs and Karlis P. Kirsis, and each of them, its true and lawful agents and proxies, with full power of substitution in each, to attend the Annual Meeting of Stockholders of XPO Logistics, Inc. on Wednesday, May 15, 2019, and any postponement or adjournment thereof, and to vote on the matters indicated all shares of Common Stock, par value $0.001 per share, or Series A Convertible Perpetual Preferred Stock, par value $0.001 per share, that the undersigned would be entitled to vote if personally present. THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE BOARD OF DIRECTORS’ RECOMMENDATIONS. PLEASE PROMPTLY COMPLETE, SIGN AND DATE THIS PROXY ON THE REVERSE SIDE AND MAIL IN THE ENCLOSED POSTAGE-PAID ENVELOPE. Change of Address — Please print new address below. Comments — Please print your comments below. + C Non-Voting Items XPO Logistics, Inc. Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.envisionreports.com/XPO		+

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

~~(Rule 14a-101)~~

~~INFORMATION REQUIRED IN PROXY STATEMENT~~

~~SCHEDULE 14A INFORMATION~~

Proxy Statement Pursuant to Section 14(a) of
the

Securities Exchange Act of 1934

~~Filed by the Registrant ☒ Filed by a Party other than the Registrant ☐~~

~~Check the appropriate box:~~

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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

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Definitive Proxy Statement

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Definitive Additional Materials

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o

Soliciting Material ~~Pursuant to § 240.14a-12~~under §240.14a-12

~~XPO LOGISTICS, INC.~~

~~(Name of Registrant as Specified in its Charter)~~

~~(Name of Person(s) Filing Proxy Statement if other than the Registrant)~~

~~Payment of Filing Fee (Check the appropriate box):~~


			XPO LOGISTICS, INC.
☒(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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	1)(1)	Title of each class of securities to which transaction applies:
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	3)(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
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☐		Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
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XPO LOGISTICS, INC.

Five American Lane

Greenwich, Connecticut 06831

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

~~NOTICE OF ANNUAL MEETING OF STOCKHOLDERS~~

To Be Held on May ~~17, 2018~~15, 2019

To the ~~stockholders~~Stockholders of XPO Logistics, Inc.:

Notice is hereby given that the ~~annual meeting~~2019 Annual Meeting of ~~stockholders~~Stockholders (the "Annual Meeting") of XPO Logistics, Inc. ("XPO" or the "company") will be held on ~~Thursday,~~Wednesday, May ~~17, 2018~~15, 2019 at 10:00 a.m. Eastern Daylight Time at Doral Arrowwood, 975 Anderson Hill Road, Rye Brook, NY 10573 for the following purposes as more fully described in the ~~proxy statement:~~Company's Proxy Statement accompanying this notice (the "Proxy Statement"):

∎

~~To elect seven (7) members of our Board of Directors for a term to expire at the 2019 annual meeting of stockholders or until their successors are duly elected and qualified;~~

∎

~~To ratify the appointment of KPMG LLP as our independent registered public accounting firm for fiscal year 2018;~~

∎

~~To conduct an advisory vote to approve the executive compensation of our named executive officers (“NEOs”) as disclosed in this proxy statement;~~

∎

~~To consider an advisory vote on the frequency of future advisory votes to approve executive compensation;~~

∎

~~To consider and act upon a stockholder proposal regarding an annual sustainability report, if properly presented at the annual meeting;~~

∎

~~To consider and act upon a stockholder proposal regarding the company’s executive compensation clawback policy, if properly presented at the annual meeting; and~~

∎

~~To consider and transact such other business as may properly come before the annual meeting or any adjournments or postponements thereof.~~

■: To elect eight (8) members of our Board of Directors for a term to expire at the 2020 annual meeting of stockholders or until their successors are duly elected and qualified;
■: To ratify the appointment of KPMG LLP as our independent registered public accounting firm for fiscal year 2019;
■: To approve an amendment to the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan to increase the number of available shares thereunder by 2,000,000 to a total of 5,400,000, extend the term of the plan and make certain other changes;
■: To conduct an advisory vote to approve the executive compensation of our named executive officers ("NEOs") as disclosed in the Proxy Statement;
■: To consider and act upon a stockholder proposal regarding the requirement that the chairman of the Board be an independent director, if properly presented at the Annual Meeting;
■: To consider and act upon a stockholder proposal regarding ways to strengthen the prevention of workplace sexual harassment and align senior executive compensation incentives, if properly presented at the Annual Meeting; and
■: To consider and transact such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof.

Only stockholders of record of our common stock, par value $0.001 per share, and our Series A Convertible Perpetual Preferred Stock, par value $0.001 per share, as of the close of business on April ~~6, 2018~~12, 2019 are entitled to receive notice of, and to vote at, the ~~annual meeting~~Annual Meeting or any adjournment or postponement of the ~~annual meeting.~~Annual Meeting.

Please note that if you plan to attend the ~~annual meeting~~Annual Meeting in person, you will need to register in advance and receive an admission ticket in order to be admitted. Please follow the instructions on pages~~4-8~~ 6-10 of the ~~proxy statement.~~Proxy Statement.

Your vote is important. Whether or not you plan to attend the ~~annual meeting~~Annual Meeting in person, it is important that your shares be represented. We ask that you vote your shares as soon as possible.


By Order of the Board of Directors,

Bradley S. Jacobs Chairman and Chief Executive Officer
Greenwich, Connecticut April 22, 2019

~~By Order of the Board of Directors,~~

~~Bradley S. Jacobs~~

~~Chairman and Chief Executive Officer~~

~~Greenwich, Connecticut~~

~~April 18, 2018~~

Important Notice Regarding the Availability of Proxy Materials for the

Annual Meeting of Stockholders to Be Held on May ~~17, 2018:~~15, 2019:

~~This~~The Proxy Statement and our Annual Report on Form10-K for the Year Ended December 31, ~~2017~~

2018
are available atwww.edocumentview.com/XPO.


		©2019 ~~2018~~ XPO Logistics, Inc.


~~ANNEX A - RECONCILIATION OFNON-GAAP~~ ~~MEASURES~~			59

~~Important Notice Regarding the Availability of Proxy Materials for the~~

~~Annual Meeting of Stockholders to Be Held on May 17, 2018 :~~

~~This Proxy Statement and our Annual Report on Form10-K~~

~~are available atwww.edocumentview.com/XPO~~.


		©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~




Wednesday, May 15, 2019 at 10:00 a.m. Eastern Daylight Time	Doral Arrowwood 975 Anderson Hill Road Rye Brook, NY 10573	You can vote if you were a stockholder of record as of the close of business on April 12, 2019

Board ~~is not aware~~Vote
Recommendation

Page Reference
(for more detail)

PROPOSAL 1: Election of ~~any matter that will be presented for a vote at the 2018 annual meeting of stockholders other than those shown below.~~


	~~Board Vote~~ ~~Recommendation~~	~~Page Reference~~ ~~(for more detail)~~
~~PROPOSAL 1: Election of Directors~~ ~~To elect seven (7)~~Directors To elect eight (8) members of our ~~Board of Directors for a term to expire at the 2019 annual meeting of stockholders or until their successors are duly elected and qualified~~	~~FOR~~ ~~each Director~~ ~~Nominee~~	~~9-19,~~ 50
~~PROPOSAL 2:~~~~Ratification of Appointment of Independent Public Accounting Firm~~ ~~To ratify the appointment of KPMG LLP as our independent registered public accounting firm for fiscal year 2018~~	~~FOR~~	~~48-49,~~ 51
~~PROPOSAL 3:~~~~Advisory Vote to Approve Executive Compensation~~ ~~To conduct an advisory vote to approve the executive compensation of our named executive officers (“NEOs”) as disclosed in this proxy statement~~	~~FOR~~	~~23-45,~~ 52
~~PROPOSAL 4~~:~~Advisory Vote on Frequency of Future Advisory Votes to Approve Executive Compensation~~ ~~To consider an advisory vote on the frequency of future advisory votes to approve executive compensation~~	~~ONE YEAR~~	53
~~PROPOSAL 5:~~~~Stockholder Proposal Regarding an Annual Sustainability Report~~ ~~To issue an annual sustainability report regarding environmental, social and governance-related issues affecting the company~~	~~AGAINST~~	~~54-55~~
~~PROPOSAL 6:~~~~Stockholder Proposal Regarding the Company’s Executive Compensation Clawback Policy~~ ~~To adopt an amendment to the clawback policy to allow the company to recoup compensation under certain conditions~~	~~AGAINST~~	~~56-57~~


						1						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						1						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


~~PROXY STATEMENT SUMMARY~~

~~How to Cast Your Vote~~

~~If you are a registered stockholder (i.e., you hold your shares in your own name), you can vote by proxy in three convenient ways:~~

∎

~~By telephone:~~~~Call toll-free1-800-652-VOTE~~ ~~(8683) and follow the instructions.~~

∎

~~By internet:~~~~Go towww.envisionreports.com/XPO~~ ~~and follow the instructions.~~

∎

~~By mail:~~ ~~Complete, sign, date and return your proxy card in the provided envelope.~~

~~Telephone and internet voting facilities for stockholders of record will be available 24 hours a day and will close at 1:00 a.m. Eastern Daylight Time on May 17, 2018.~~

~~If you are the beneficial owner of shares, please follow the voting instructions provided by your broker, trustee or other nominee.~~

Board of Directors ~~Nominees~~

~~The following table provides summary information about each director nominee. Each director is elected annually by~~for a ~~majority of~~term to expire at the ~~votes cast. The average age of our director nominees is 60 years and the average tenure is 5.1 years.~~

Committee
Memberships

    Name



  Age

        Director
Since



Occupation

      Independent

AC

    CC

    NCGC

    AcqC

    Bradley S. Jacobs


61

2011


Chairman and Chief Executive Officer, XPO Logistics, Inc.

    Gena L. Ashe


56

2016


Former Senior Vice President, Chief Legal Officer and Corporate Secretary, Adtalem Global Education Inc.

Y

C

    AnnaMaria DeSalva


49

2017


Former Global Chief Communications Officer, E.I. du Pont de Nemours & Co. (DuPont)

Y

    Michael G. Jesselson


66

2011


Lead Independent Director, XPO Logistics, Inc. President and Chief Executive Officer, Jesselson Capital Corporation

Y

✓

✓

    Adrian P. Kingshott


58

2011


Chief Executive Officer, AdSon LLC

Y

✓

C

✓

    Jason D. Papastavrou*


55

2011


Founder and Chief Investment Officer, ARIS Capital Management, LLC

Y

✓

✓

✓

C

    Oren G. Shaffer*


75

2011


Former Vice Chairman and Chief Financial Officer, Qwest Communications International, Inc.

Y

C



~~AC =~~~~Audit Committee~~
~~CC =~~~~Compensation Committee~~

~~NCGC =~~ ~~Nominating and Corporate~~

~~Governance Committee~~

~~AcqC =~~~~Acquisition Committee~~

~~C =~~ ~~Committee Chair~~

✓ =~~Committee Member~~

* = ~~Audit Committee Financial Expert~~


						2						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						2						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~Governance and Compensation Highlights~~



~~Board Independence~~		~~Six of our eight current directors are independent; the Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee consist entirely of independent directors.~~

~~Board Leadership~~		In 2016, our Board added a robust lead independent director position to its leadership structure to complement the roles of our independent committees and independent committee chairs in providing effective Board oversight. These independent structures work in conjunction with the dual roles served by our Chairman and Chief Executive Officer. The Board believes that the Board and company’s leadership structure functions well for our company and is in the best interests of our stockholders based on the current strategy and ownership structure.

~~Board Refreshment~~		Our Board is committed to practices that create an effective mix of useful expertise and fresh perspectives, including the thoughtful refreshment of the Board when appropriate. In 2015, the Board initiated a process to seek out highly qualified director candidates who bring relevant experience to the Board and reflect our company’s growing scale and diversity. This resulted in the addition of three new directors, one in 2015, one in 2016 and one in 2017. We regularly review our Board practices and composition.

~~Committee Chair Rotations~~		As part of its annual review of Board committee composition and committee chair assignments, in March 2016, the Board reconstituted the committees and rotated committee chairs in order to enhance the effective functioning of the committees and bring fresh perspectives to committee processes.

~~Annual Director Elections~~		~~All directors are elected annually forone-year~~ ~~terms or until their successors are elected and qualified.~~

~~Majority Voting for Director Elections~~		~~Our bylaws provide for a majority voting standard in uncontested elections, and further require that a director who fails to receive a majority vote must tender his or her resignation to the Board.~~

~~Board Evaluations~~		~~Our Board evaluates committee and director performance and practices regularly.~~

~~Risk Oversight and Financial Reporting~~		~~Our Board seeks to provide robust oversight of current and potential risks facing our company and its business and demonstrate strong financial reporting practices.~~

~~Clawback Policy~~		~~Our NEOs are subject to clawback provisions with respect to annual and long-term cash incentive compensation.~~

~~Lock-up~~ ~~Restrictions~~		~~Our NEOs are subject tolock-up~~ ~~restrictions that generally prohibit the sale of any equity awarded by our company until September 2, 2018.~~

~~Stock Ownership Guidelines~~		~~In 2016, our Board established stock ownership guidelines for our NEOs and other executive officers to further align their interests with those of our stockholders.~~

~~No Hedging or Pledging of Company Securities~~		~~Under our insider trading policy, our company’s directors and executive officers, including the NEOs, are prohibited from pledging and hedging transactions involving our company’s securities.~~


						3						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						3						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~PROXY STATEMENT~~

This proxy statement sets forth information relating to the solicitation of proxies by the Board of Directors (our “Board of Directors” or our “Board”) of XPO Logistics, Inc. (“XPO” or our “company”) in connection with our company’s 20182020 annual meeting of stockholders or ~~any adjournment or postponement~~until their successors are duly elected and qualified

FOR
each Director
Nominee

11-24, 59

PROPOSAL 2: Ratification of the ~~annual meeting. This proxy statement is being furnished~~Appointment of our Independent Public Accounting Firm
To ratify the appointment of KPMG LLP as our independent registered public accounting firm for fiscal year 2019

FOR

57-58, 60

��

PROPOSAL 3: Approval of an Amendment to the Company's Incentive Compensation Plan
To approve an amendment to the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan to increase the number of available shares thereunder by 2,000,000 to a total of 5,400,000, extend the term of the plan and make certain other changes

FOR

61-68, 82-97

PROPOSAL 4: Advisory Vote to Approve Executive Compensation
To conduct an advisory vote to approve the executive compensation of our named executive officers ("NEOs") as disclosed in this Proxy Statement

FOR

PROPOSAL 5: Stockholder Proposal Regarding the Requirement that the Chairman of the Board be an Independent Director
To adopt a requirement that the chairman of the Board be an independent director

AGAINST

70-71

PROPOSAL 6: Stockholder Proposal Regarding Ways to Strengthen Prevention of Workplace Sexual Harassment and Align Senior Executive Compensation Incentives
To adopt measures to strengthen the company's prevention of workplace sexual harassment and align senior executive compensation incentives

AGAINST

72-74


				1				©2019 XPO Logistics, Inc.




Board and Committee Independence		Seven of our eight current directors are independent.
		The Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee consist entirely of independent directors.

Independent Board Oversight and Leadership Roles		In 2016, our Board added a robust lead independent director position to its leadership structure to complement the roles of our independent committees and independent committee chairmen in providing effective Board oversight. In 2019, our Board added the position of an independent vice chairman to its leadership structure to provide support on key governance matters and shareholder engagement to our chairman, lead independent director and the Board. These independent structures work in conjunction with the dual roles served by our chairman and chief executive officer. The Board believes the Board and company's leadership structure functions well for our company and is in the best interests of our stockholders based on the company's current strategy and ownership structure.

Board Refreshment		Our Board is committed to creating an effective mix of useful expertise and fresh perspectives among its members, including through the thoughtful refreshment of the Board when appropriate. In 2015, the Board initiated a process to seek out highly qualified director candidates who bring relevant experience to the Board and reflect our company's growing scale and diversity. This resulted in the addition of four new directors, one in 2015, one in 2016, one in 2017 and one in 2019.

Committee Rotations		As part of its annual review of Board committee composition and committee chairmen assignments, in May 2018 and again in March 2019, the Board reconstituted its committees in order to enhance the effective functioning of the committees and bring fresh perspectives to committee processes.

Annual Director Elections		All directors are elected annually for one-year terms or until their successors are elected and qualified.

Majority Voting for Director Elections		Our bylaws provide for a majority voting standard in uncontested elections, and further require that a director who fails to receive a majority vote must tender his or her resignation to the Board.

Board Evaluations		Our Board regularly reviews committee and director performance and practices through an annual process of self-evaluation.

Risk Oversight and Financial Reporting		Our Board seeks to provide robust oversight of current and potential risks facing our company through regular deliberations and participation in management meetings. Our Audit Committee supports strong financial reporting oversight through regular meetings with management and dialogue with our auditors.

Active Participation		Our Board held 14 meetings during 2018 and each person currently serving as a director attended at least 86% of the meetings of our Board and any Board committee on which he or she served.


				2				©2019 XPO Logistics, Inc.

					Committee Memberships


Name	Director Since	Age	Occupation	Independent	AC	CC	NCGC	AcqC

Bradley S. Jacobs	2011	62	Chairman and Chief Executive Officer, XPO Logistics, Inc.
Gena L. Ashe	2016	57	President and Chief Executive Officer, GLA Legal Advisory Group, LLC	Y	✓			✓

Marlene M. Colucci	2019	56	Executive Director of The Business Council	Y		✓		✓
AnnaMaria DeSalva	2017	50	Vice Chairman, XPO Logistics, Inc. Senior Advisor, DowDuPont; Former Chief Communications Officer, E.I. du Pont de Nemours & Co.	Y			C

Michael G. Jesselson	2011	67	Lead Independent Director, XPO Logistics, Inc. President and Chief Executive Officer, Jesselson Capital Corporation	Y	✓	✓	✓
Adrian P. Kingshott	2011	59	Chief Executive Officer, AdSon, LLC	Y		C		✓

Jason D. Papastavrou*	2011	56	Founder and Chief Investment Officer, ARIS Capital Management, LLC	Y	✓	✓	✓	C
Oren G. Shaffer*	2011	76	Former Vice Chairman and Chief Financial Officer, Qwest Communications International, Inc.	Y	C


AC = Audit Committee CC = Compensation Committee		NCGC = Nominating and Corporate Governance Committee AcqC = Acquisition Committee		C = Committee Chairman ✓ = Committee Member * = Audit Committee Financial Expert


				3				©2019 XPO Logistics, Inc.


				4				©2019 XPO Logistics, Inc.




				In 2018, ~~at 10:00 a.m. Eastern Daylight Time at Doral Arrowwood, 975 Anderson Hill Road, Rye Brook, NY 10573.~~ ~~This proxy statement~~Mr. Jacobs, Mr. Cooper and ~~form of proxy are first being mailed on or about April 18, 2018, to our stockholders of record as~~Mr. Harik voluntarily declined a portion of the ~~close~~long-term incentive payout otherwise due to them in respect of ~~business on April 6,~~ 2018 ~~(the “Record Date”).~~ valued at $4 million in total.

		~~Questions And Answers About Our Annual Meeting~~ The following questions and answers address some questions you may have regarding the annual meeting. These questions and answers may not include all the information that may be important to you as a stockholder		No NEOs received full target bonus payouts for 2018.

				Four of our ~~company. Please refer~~six NEOs received no bonus for 2018.

				Mr. Jacobs and Mr. Cooper voluntarily declined their full 2018 cash bonuses.




				Award cannot be earned until after the four-year performance period ending December 31, 2022

				No overlapping payment periods with other outstanding awards - the final tranche of the 2016 cash-settled PRSU grant to each of Mr. Jacobs, Mr. Cooper and Mr. Harik is scheduled to pay out in the first quarter of 2020, if performance is achieved

				Requires achievement of both of the following high-growth stretch goals:


				5				©2019 XPO Logistics, Inc.

©2019 XPO Logistics, in “street name”), you will need to bring a copy of your voting instruction card or statement reflecting your share ownership as of the Record Date, as well as an admission ticket as outlined below. Street name stockholders who wish to vote at the annual meeting will need to obtain a proxy from the broker, dealer, commercial bank, trust company or other nominee that holds their shares.Inc.

Table of Contents

"street name"), and you wish to vote at the Annual Meeting will need to obtain a proxy from the broker, dealer, commercial bank, trust company or other nominee that holds your shares.

						4						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						4						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Do I need a ticket to attend the ~~annual meeting?~~Annual Meeting?

~~Yes, you will need an admission ticket to enter the annual meeting.~~


		Member of Audit Committee ■ Member of Acquisition Committee ~~AnnaMaria DeSalva~~		~~Director since 2017~~
		~~Age:~~49
		Ms. DeSalva has served as a director of the company since September 19, 2017. She is a senior corporate affairs advisor to leading innovative companies. Ms. DeSalva served as chief communications officer of E.I. du Pont de Nemours & Co. (DuPont) from March 2014 to January 31, 2018 and in the subsequent period is serving as senior advisor to the CEO and to the management team as they prepare for the separation of new publicly traded companies. Previously, she served as head of corporate affairs for biopharmaceutical innovation at Pfizer; was an advisor to the U.S. Food and Drug Administration; and led the global healthcare practice of Hill & Knowlton. For Bristol-Myers Squibb, she led global public affairs for the oncology business and served as the director of the Bristol-Myers Squibb Foundation. Ms. DeSalva serves on the board of governors of Argonne National Laboratory of the U.S. Department of Energy, and is a member of its compensation and nominating committees; as well as the boards of directors of the~~non-profit~~ Project Sunshine and the William & Mary Alumni Association. She is a graduate of The College of William & Mary in Williamsburg, Va.; and has completed the Harvard School of Public Health’s executive education program in risk communication, and the Advanced Health Leadership Program jointly offered by the University of California at Berkeley and Pompeu University in Barcelona, Spain.
		~~Board Committees:~~~~None~~
		~~Other Public Company Boards:~~~~None~~
		*~~Ms. DeSalva brings to the Board:~~*
		~~• Significant experience in marketing and public relations, having previously served in senior communications roles at several public companies; and~~
		~~• Expertise in managing significant public company merger transactions, with an emphasis on effective external stakeholder engagement.~~

		Other Public Company Boards: None
~~Michael G. Jesselson~~	~~Director since 2011~~ ~~Lead Independent Director since 2016~~
~~Age:~~66
Mr. Jesselson has served as director of the company since September 2, 2011, and as lead independent director since March 20, 2016. He has served as president and chief executive officer of Jesselson Capital Corporation since 1994. Mr. Jesselson served as a director of American Eagle Outfitters, Inc. (NYSE: AEO) from November 1997 to May 2017, most recently as its lead independent director. Prior to that, he worked at Philipp Brothers, a division of Engelhard Industries from 1972 to 1981, then at Salomon Brothers Inc. in the financial trading sector. He is a director of~~C-III~~ Capital Partners LLC, Clarity Capital and other private companies, as well as numerous philanthropic organizations. Mr. Jesselson also serves as the chairman of Bar Ilan University in Israel. He attended New York University School of Engineering.
~~Board Committees:~~
~~• Member of Compensation Committee~~
~~• Member of Nominating and Corporate Governance Committee~~
~~Other Public Company Boards:~~~~None~~
*~~Mr. Jesselson brings to the Board:~~*
• Significant experience with public company corporate governance issues through prior service on the board of directors of American Eagle Outfitters, including as its lead independent director; and
~~• Extensive investment expertise.~~



		~~Adrian P. Kingshott~~		~~Director since 2011~~
		~~Age:~~58
		Mr. Kingshott has served as a director of the company since September 2, 2011. He has served as the chief executive officer of AdSon LLC since October 2005 and as managing director of Spotlight Advisors, LLC since September 2015. He has been a senior advisor to Headwaters Merchant Bank since 2013. Previously, with Goldman Sachs, he was~~co-head~~ of the firm’s Global Leveraged Finance business and held other positions over a 17-year tenure. More recently, Mr. Kingshott was a managing director and portfolio manager at Amaranth Advisors, LLC. He is an adjunct professor of Global Capital Markets and Investments at Fordham University’s Gabelli School of Business. He holds a master of business administration degree from Harvard Business School and a master of jurisprudence degree from Oxford University. Mr. Kingshott is a member of the board of directors of Centre Lane Investment Corp.
		~~Board Committees:~~
		~~• Chairman of Compensation Committee~~
		~~• Member of Audit Committee~~
		~~• Member of Acquisition Committee~~
		~~Other Public Company Boards:~~~~None~~
		*~~Mr. Kingshott brings to the Board:~~*
		~~• More than 25 years of experience in the investment banking and investment management industries; and~~
		~~• Expertise with respect to corporate governance, acquisition transactions, debt and equity financing and corporate financial management issues.~~


						11						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						11						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


Marlene M. Colucci	Director since 2019
Age: 56
Ms. Colucci has served as a director of the company since February 7, 2019. She has served as the executive director of The Business Council in Washington, D.C. since July 2013. Previously, she was executive vice president of public policy for the American Hotel & Lodging Association from September 2005 to June 2013, where she provided guidance on regulatory matters. From September 2003 to June 2005, she served in the White House as special assistant to President George W. Bush in the Office of Domestic Policy. In this role, she developed labor, transportation and postal reform policies and advised the president and his staff on related matters. Earlier, Ms. Colucci served as deputy assistant secretary with the U.S. Department of Labor's Office of Congressional and Intergovernmental Affairs. Her law career includes more than 12 years with the firm of Akin Gump Strauss Hauer & Feld LLP, where she served as senior counsel. She holds a juris doctorate degree from the Georgetown University Law Center.
	~~Jason D. Papastavrou, Ph.D.~~	~~Director since 2011~~
	~~Age:~~55
	Dr. Papastavrou has served as a director of the company since September 2, 2011. He founded ARIS Capital Management, LLC in 2004 and serves as its chief investment officer. Previously, Dr. Papastavrou was the founder and managing director of the Fund of Hedge Funds Strategies Group of Banc of America Capital Management (BACAP), president of BACAP Alternative Advisors, and a senior portfolio manager with Deutsche Asset Management. He was a tenured professor at Purdue University School of Industrial Engineering, and holds a doctorate in electrical engineering and computer science from the Massachusetts Institute of Technology. Dr. Papastavrou serves on the board of directors of United Rentals, Inc. (NYSE: URI).
	~~Board Committees:~~
	~~• Chairman of Acquisition Committee~~
	~~• Member of Audit Committee~~
	~~• Member of Compensation Committee~~
	~~• Member of Nominating and Corporate Governance Committee~~
	~~Other Public Company Boards:~~~~United Rentals, Inc. (since 2005)~~
	*~~Dr. Papastavrou brings to the Board:~~*
	~~• Financial expertise related to his qualifications as an “audit committee financial expert” under SEC regulations; and~~
	~~• Extensive experience with finance and risk-related matters, from holding senior positions at investment management firms.~~


		~~Oren G. Shaffer~~		~~Director since 2011~~
		~~Age:~~75
		Mr. Shaffer has served as a director of the company since September 2, 2011. From 2002 to 2007, Mr. Shaffer was vice chairman and chief financial officer of Qwest Communications International, Inc. (now CenturyLink, Inc.). Previously, Mr. Shaffer was president and chief operating officer of Sorrento Networks, Inc., executive vice president and chief financial officer of Ameritech Corporation, and held senior executive positions with The Goodyear Tire & Rubber Company, where he also served on the board of directors. Additionally, Mr. Shaffer is a director on the board of Terex Corporation (NYSE: TEX). He holds a master’s degree in management from the Sloan School of Management, Massachusetts Institute of Technology, and a degree in finance and business administration from the University of California, Berkeley.
		~~Board Committees:~~
		~~• Chairman of Audit Committee~~
		~~Other Public Company Boards:~~~~Terex Corporation (since 2007)~~
		*~~Mr. Shaffer brings to the Board:~~*
		~~• Senior financial, operational and strategic experience with various large companies;~~
		~~• Corporate governance expertise from serving as director of various public companies; and~~
		~~• Financial expertise related to his qualifications as an “audit committee financial expert” under SEC regulations.~~


						12						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						12						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


				13				©2019 XPO Logistics, Inc.


AnnaMaria DeSalva		Director since 2017
Age: 50		Vice Chairman since 2019
Ms. DeSalva has served as a director of the company since September 19, 2017, and vice chairman of the Board since February 7, 2019. She is a senior corporate affairs advisor to leading companies. Ms. DeSalva served as chief communications officer of E.I. du Pont de Nemours & Co. (DuPont) from March 2014 to January 31, 2018 and currently serves as senior advisor to the CEO of DowDuPont. Previously, she served as vice president of corporate affairs for biopharmaceutical innovation at Pfizer; was an advisor to the U.S. Food and Drug Administration; and led the global healthcare practice of Hill & Knowlton. For Bristol-Myers Squibb, she led global public affairs for the oncology business and served as the director of the Bristol-Myers Squibb Foundation. Ms. DeSalva serves on the board of governors of Argonne National Laboratory of the U.S. Department of Energy and is a member of its compensation and nominating committees; as well as the boards of directors of the non-profit Project Sunshine and the William & Mary Alumni Association. She is a graduate of The College of William & Mary in Williamsburg, Virginia; and has completed the Harvard School of Public Health's executive education program in risk communication, and the Advanced Health Leadership Program jointly offered by the University of California at Berkeley and Pompeu University in Barcelona, Spain.

Board Committees: ■ Chairman of Nominating and Corporate Governance Committee
Other Public Company Boards: None

*Ms. DeSalva brings to the Board:* ■ Significant experience in corporate affairs, regulatory affairs and corporate social responsibility, having previously served in senior leadership roles at several public companies; and ■ Expertise in managing significant public company merger transactions, with an emphasis on effective change management and external stakeholder engagement.


Michael G. Jesselson		Director since 2011
Age: 67		Lead Independent Director since 2016
Mr. Jesselson has served as director of the company since September 2, 2011, and as lead independent director since March 20, 2016. He has been president and chief executive officer of Jesselson Capital Corporation since 1994. Mr. Jesselson served as a director of American Eagle Outfitters, Inc. (NYSE: AEO) from November 1997 to May 2017, most recently as its lead independent director. Prior to that, he worked at Philipp Brothers, a division of Engelhard Industries from 1972 to 1981, then at Salomon Brothers Inc. in the financial trading sector. He is a director of C-III Capital Partners LLC, Clarity Capital and other private companies, as well as numerous philanthropic organizations. Mr. Jesselson also serves as the chairman of Bar Ilan University in Israel. He attended New York University School of Engineering.

Board Committees: ■ Member of Audit Committee ■ Member of Compensation Committee ■ Member of Nominating and Corporate Governance Committee
Other Public Company Boards: None

*Mr. Jesselson brings to the Board:* ■ Significant experience with public company corporate governance issues through prior service on the board of directors of American Eagle Outfitters, including as its lead independent director; and ■ Extensive investment expertise.


				14				©2019 XPO Logistics, Inc.


Adrian P. Kingshott		Director since 2011
Age: 59
Mr. Kingshott has served as a director of the company since September 2, 2011. He has served as the chief executive officer of AdSon, LLC since October 2005, managing director of Spotlight Advisors, LLC since September 2015 and a member of the board of directors of Centre Lane Investment Corp. since May 2011. Mr. Kingshott was a senior advisor to Headwaters Merchant Bank from 2013 until June 2018. Previously, with Goldman Sachs, he was co-head of the firm's Global Leveraged Finance business and held other positions over a 17-year tenure. More recently, Mr. Kingshott was a managing director and portfolio manager at Amaranth Advisors, LLC. He is an adjunct professor of Global Capital Markets and Investments at Fordham University's Gabelli School of Business. He holds a master's degree in business administration from Harvard Business School and a master of jurisprudence degree from Oxford University.

Board Committees: ■ Chairman of Compensation Committee ■ Member of Acquisition Committee
Other Public Company Boards: None

*Mr. Kingshott brings to the Board:* ■ More than 25 years of experience in the investment banking and investment management industries; and ■ Expertise with respect to corporate governance, acquisition transactions, debt and equity financing and corporate financial management issues.


Jason D. Papastavrou, Ph.D.		Director since 2011
Age: 56
Dr. Papastavrou has served as a director of the company since September 2, 2011. He founded ARIS Capital Management, LLC in 2004 and serves as its chief investment officer. Previously, Dr. Papastavrou was the founder and managing director of the Fund of Hedge Funds Strategies Group of Banc of America Capital Management (BACAP), president of BACAP Alternative Advisors, and a senior portfolio manager with Deutsche Asset Management. He was a tenured professor at Purdue University School of Industrial Engineering and holds a doctorate in electrical engineering and computer science from the Massachusetts Institute of Technology. Dr. Papastavrou serves on the board of directors of United Rentals, Inc. (NYSE: URI).

Board Committees: ■ Chairman of Acquisition Committee ■ Member of Audit Committee ■ Member of Compensation Committee ■ Member of Nominating and Corporate Governance Committee
Other Public Company Boards: United Rentals, Inc. (since 2005)

*Dr. Papastavrou brings to the Board:* ■ Financial expertise related to his qualifications as an "audit committee financial expert" under SEC regulations; and ■ Extensive experience with finance and risk-related matters, from holding senior positions at investment management firms.


				15				©2019 XPO Logistics, Inc.


Oren G. Shaffer		Director since 2011
Age: 76
Mr. Shaffer has served as a director of the company since September 2, 2011. From 2002 to 2007, Mr. Shaffer was vice chairman and chief financial officer of Qwest Communications International, Inc. (now CenturyLink, Inc.). Previously, Mr. Shaffer was president and chief operating officer of Sorrento Networks, Inc., executive vice president and chief financial officer of Ameritech Corporation, and held senior executive positions with The Goodyear Tire & Rubber Company, where he also served on the board of directors. Additionally, Mr. Shaffer is a director on the board of Terex Corporation (NYSE: TEX). He holds a master's degree in management from the Sloan School of Management, Massachusetts Institute of Technology, and a degree in finance and business administration from the University of California, Berkeley.

Board Committees: ■ Chairman of Audit Committee
Other Public Company Boards: Terex Corporation (since 2007)

*Mr. Shaffer brings to the Board:* ■ Senior financial, operational and strategic experience with various large companies; ■ Corporate governance expertise from serving as director of various public companies; and ■ Financial expertise related to his qualifications as an "audit committee financial expert" under SEC regulations.


				16				©2019 XPO Logistics, Inc.



	Bradley S. Jacobs	Gena L. Ashe	Marlene M. Colucci	AnnaMaria DeSalva	Michael G. Jesselson	Adrian P. Kingshott	Jason D. Papastavrou, Ph.D.	Oren G. Shaffer

BUSINESS OPERATIONSexperience provides a practical understanding of developing, implementing and assessing our operating plan and business strategy.

CORPORATE GOVERNANCEexperience bolsters Board and management accountability, transparency and a focus on stockholder interests.

CUSTOMER SERVICEexperience brings an important perspective to our Board given the importance of customer service to our business model.

ENVIRONMENTAL SUSTAINABILITY AND CORPORATE RESPONSIBILITYexperience allows our Board's oversight to guide our long-term value creation for stockholders in a way that is responsible and sustainable.

EFFECTIVE CAPITAL ALLOCATIONexperience is crucial to our Board's evaluation of our financial statements and capital structure.

CRITICAL ANALYSIS OF CORPORATE FINANCIAL STATEMENTS AND CAPITAL STRUCTURESassists our directors in understanding and overseeing our financial reporting and internal controls.

HUMAN RESOURCE MANAGEMENTexperience allows our Board to further our company's goals in making XPO an inclusive and attractive employment environment and aligning human resources objectives with our strategic and operational priorities.

MULTINATIONAL CORPORATE MANAGEMENTexperience is important, given the global nature of our business strategy and operations.

SALES AND MARKETINGexperience helps our Board assist with our business strategy and with developing new products and operations.

MERGERS AND ACQUISITIONS, INTEGRATION AND OPTIMIZATIONexperience helps our company identify the optimal targets for M&A activity to achieve our strategic objectives and realize synergies and growth.

TRANSPORTATION AND LOGISTICS INDUSTRYexperience is important in understanding and reviewing our business and strategy.

RISK MANAGEMENTexperience is critical to our Board's role in overseeing the risks facing our company.

TALENT MANAGEMENT AND ENGAGEMENTexperience helps XPO attract, motivate and retain top candidates for leadership roles.

TECHNOLOGY AND INFORMATION SYSTEMSexperience is relevant as we continually seek to enhance our customer experience and internal operations.


				17				©2019 XPO Logistics, Inc.

Role of the Board and Board Leadership Structure

Our business and affairs are managed under the direction of our Board of Directors, which is our company’s ultimate decision-making body, except with respect to those matters reserved to our stockholders. Our Board’s primary responsibility is to seek to maximize long-term stockholder value. Our Board establishes our overall corporate policies, selects and evaluates our senior management team, which is charged with the conduct of our business, monitors the performance of our company and management, and provides advice and counsel to management. In fulfilling the Board’s responsibilities, our directors have full access to our management, internal and external auditors and outside advisors.

Furthermore, our Board of Directors is committed to independent Board oversight. Our current Board leadership structure includes an executive Chairman as well as a lead independent director. The positions of Chairman of the Board and Chief Executive Officer are both currently held by Mr. Jacobs. Our Board believes that this combination of roles is appropriate because the structure enables decisive leadership and ensures clear accountability in the context of strong Board practices and a Board culture that facilitates independent oversight. Our Board believes the dual roles function well for our company based on our current strategy, governance and ownership structure.

In addition, our Board of Directors has approved a set of Corporate Governance Guidelines (the “Guidelines”), which provide that the independent directors may appoint a lead independent director who presides over executive sessions of the independent directors, and who shall serve a term of at least one year. On March 20, 2016, the independent directors appointed Mr. Jesselson to serve as lead independent director. The position of lead independent director has been structured to serve as an effective balance to the dual roles served by Mr. Jacobs. The lead independent director presides at all meetings of the Board of Directors at which the Chairman is not present and presides at all executive sessions of the independent directors. The Guidelines require that the independent directors meet at least once a year without members of management present, and the lead independent director is empowered to call additional meetings of the independent directors as necessary. In practice, in 2017, our independent directors met in executive sessions much more frequently. The lead independent director also serves as a liaison between the Chairman and the independent directors. Together with the Chairman, the lead independent director develops and approves Board meeting agendas, meeting schedules and meeting materials to be distributed to our Board of Directors in order to assure sufficient time for informed discussion of issues. The lead independent director is also available to meet with significant stockholders as appropriate and required.

~~Further information regarding the position of lead independent director is set forth in the Guidelines. The Guidelines are available on the company’s corporate website atwww.xpo.com~~ ~~under the Investors tab.~~

Our Board of Directors held seven meetings during 2017. In 2017, each person serving as a director attended at least 86% of the meetings of our Board of Directors and any Board committee on which he or she served. In addition, our Board of Directors also acted five times during 2017 via unanimous written consent.

Our directors are expected to attend the annual meeting. Any director who is unable to attend the annual meeting is expected to notify the Chairman of the Board in advance of the annual meeting. Each person who was then serving as a director attended the 2017

Our Board of Directors provides overall risk oversight with a focus on the most significant risks facing our company. The management of the risks that we face in the conduct of our business is primarily the responsibility of our senior management team. Our senior management team periodically reviews with our Board of Directors any significant risks facing our company. Our business, strategy, operations, policies, controls and prospects are regularly discussed by our Board of Directors and management team, including discussions as to current and potential risks and approaches for assessing, monitoring, mitigating and controlling risk exposure. Our Board of Directors has delegated responsibility for the oversight of specific risks to the committees of the Board as follows:
	18	©2019 XPO Logistics, Inc.

Committees of the Board and Committee Membership

Name

Audit Committee

Compensation Committee

Nominating and Corporate
Governance Committee ~~and the~~

Acquisition Committee. Our Board of Directors may eliminate or create additional committees as it deems appropriate. Each of our Board Committees have written charters that are in compliance with applicable SEC rules and the NYSE Listed Company Manual. These charters are available at
Committee

~~www.xpo.com~~Gena L. Ashe

~~. You may obtain a printed copy of any of these charters by sending a request to: Investor Relations, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831.~~✓

✓

Marlene M. Colucci

The Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee are composed entirely of independent directors within all applicable standards (as further discussed below). Our Board of Directors’ general policy is to review and approve committee assignments annually. The Nominating and Corporate Governance Committee is responsible, after consultation with our Chairman of the Board and Chief Executive Officer and consideration of appropriate member qualifications, to recommend to our Board of Directors all committee assignments, including designations of the chairs. Each committee is authorized to retain its own outside counsel and other advisors as it desires.

~~The following table sets forth the current membership of each of our Board committees as of the Record Date. Mr. Jacobs and Ms. DeSalva do not serve on any Board committees.~~


		~~Compensation~~	~~Nominating and Corporate~~	~~Acquisition~~
~~Name~~	~~Audit Committee~~	~~Committee~~	~~Governance Committee~~	~~Committee~~

~~Gena L. Ashe~~			C

~~Louis DeJoy~~				✓

~~Michael G. Jesselson~~		✓	✓

~~Adrian P. Kingshott~~	✓	C		✓

Jason D. Papastavrou*	✓	✓	✓	C

Oren G. Shaffer*	C

~~C =~~~~Committee Chair~~	✓= ~~Committee Member~~		* = ~~Audit Committee Financial Expert~~

~~A brief summary of the committees’ responsibilities follows:~~

~~Audit Committee.~~ Our Audit Committee has been established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to assist our Board of Directors in fulfilling its responsibilities in a number of areas, including, without limitation, oversight of: (i) our accounting and financial reporting processes, including our systems of internal controls and disclosure controls, (ii) the integrity of our financial statements, (iii) our compliance with legal and regulatory requirements, (iv) the qualifications and independence of our independent registered public accounting firm, (v) the performance of our independent registered public accounting firm and internal audit function and (vi) related party transactions. Each member of the Audit Committee satisfies all applicable independence standards, has not participated in the preparation of our financial statements at any time during the past three years, and is able to read and understand fundamental financial statements. During 2017, the Audit Committee was comprised of the following three directors: Mr. Shaffer (Chair), Mr. Kingshott and Dr. Papastavrou. The Audit Committee met seven times during 2017 and, in addition, acted once via unanimous written consent. Our Board of Directors has determined that Mr. Shaffer and Dr. Papastavrou each qualify as an “audit committee financial expert” as defined under Item 407(d)(5) of Regulation~~S-K~~ ~~under the Exchange Act.~~

~~Compensation Committee.~~ The primary responsibilities of the Compensation Committee are, among other things: (i) to oversee the administration of our compensation programs, (ii) to review the compensation of our executive management and annual bonus compensation, (iii) to review company contributions to qualified and~~non-qualified~~ plans, and (iv) to prepare any report on executive compensation required by SEC rules and regulations. During 2017, the Compensation Committee was comprised of the following three directors: Mr. Kingshott (Chair), Mr. Jesselson and Dr. Papastavrou. The Compensation Committee met five times during 2017 and, in addition, acted five times via unanimous written consent.

~~Nominating and Corporate Governance Committee.~~ The primary responsibilities of the Nominating and Corporate Governance Committee are, among other things: (i) to identify individuals qualified to become Board members and recommend that our Board of Directors select such individuals to be presented for stockholder consideration at the annual meeting or to be appointed by the Board of Directors to fill a vacancy, (ii) to make recommendations to our Board of Directors concerning committee appointments, (iii) to develop, recommend to our Board of Directors and annually review the Guidelines and oversee corporate governance matters, and (iv) to oversee an annual evaluation of our Board of Directors and committees. During 2017, the Nominating and Corporate Governance Committee was comprised of the following three directors: Ms. Ashe (Chair), Mr. Jesselson and Dr. Papastavrou. The Nominating and Corporate Governance Committee met twice during 2017.

©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

✓

AnnaMaria DeSalva

Michael G. Jesselson

✓

Adrian P. Kingshott

✓

Jason D. Papastavrou*

✓

Oren G. Shaffer*

C =Committee chairman

✓

~~Acquisition Committee.~~ ~~The Acquisition~~ =Committee is responsible for reviewing and approving acquisition, divestiture and related transactions proposed by our management in which the total consideration to be paid or received by us, for any particular transaction, does not exceed the limits that may be established by our Board of Directors from time to time. During 2017, the Acquisitionmember

* =Audit Committee ~~was comprised of the following three directors: Dr. Papastavrou (Chair)~~Financial Expert


				19				©2019 XPO Logistics, ~~Mr. DeJoy and Mr. Kingshott. The Acquisition Committee did not meet during 2017.~~Inc.

Name						Total ($)


Gena L. Ashe⁽³⁾	$	80,645	$	191,546	—	$	272,192
Louis DeJoy⁽⁴⁾	$	28,228	$	0	—	$	28,228
AnnaMaria DeSalva⁽⁵⁾	$	84,354	$	191,546	—	$	275,900
Michael G. Jesselson⁽⁶⁾	$	100,000	$	191,546	—	$	291,546
Adrian P. Kingshott⁽⁷⁾	$	90,000	$	191,546	—	$	281,546
Jason D. Papastavrou⁽⁸⁾	$	90,000	$	191,546	—	$	281,546
Oren G. Shaffer⁽⁹⁾	$	100,000	$	191,546	—	$	291,546

(1): Compensation information for Mr. Jacobs, who is a NEO of our company, is disclosed in this Proxy Statement under the heading "Executive Compensation—Compensation Tables." Mr. Jacobs did not receive additional compensation for his service as a director.
(2): The amounts reflected in this column represent the grant date fair value of the awards made in 2018, as computed in accordance with Financial Accounting Standards Board Accounting Standards Codification 718 "Compensation—Stock Compensation" ("ASC 718"). For further discussion of the assumptions used in the calculation of the grant date fair value, please see "Notes to Consolidated Financial Statements—Note 14. Stock-Based Compensation" of our company's Annual Report on Form 10-K for the year ended December 31, 2018. The values reported in this column represent 2,071 restricted stock units ("RSUs") granted to each of our directors on January 2, 2018. Each current director serving on January 2, 2019, also received a grant of 3,249 RSUs on such date for service as a director in 2019; these grants are not reflected in the table above.
(3): As of December 31, 2018, Ms. Ashe held 8,757 RSUs. Does not include €65,000 of fees paid to Ms. Ashe for her service as vice-chairman of the Supervisory Board of XPO Logistics S.A., our majority-owned subsidiary.
(4): Mr. DeJoy ceased to be a director of the company on May 17, 2018.
(5): As of December 31, 2018, Ms. DeSalva held 2,071 RSUs. As of the Record Date, Ms. DeSalva beneficially owns a total of 2,881 shares of our common stock as disclosed in this proxy statement under the heading "Security Ownership of Certain Beneficial Owners and Management."

   Fees Earned or      Stock Awards⁽²⁾      Option Awards      Total
  Name


Paid in Cash ($)


($)


($)


($)

  Gena L. Ashe⁽³⁾



$90,000



$173,489

     –


$263,489

  Louis DeJoy⁽⁴⁾



$75,000



$173,489

     –


$248,489

  AnnaMaria DeSalva⁽⁵⁾



$21,196



$49,847

     –


$71,043

  Michael G. Jesselson⁽⁶⁾



$100,000



$173,489

     –


$273,489

  Adrian P. Kingshott⁽⁷⁾



$90,000



$173,489

     –


$263,489

  Jason D. Papastavrou⁽⁸⁾



$90,000



$173,489

     –


$263,489

  Oren G. Shaffer⁽⁸⁾



$100,000



$173,489

     –


$273,489

(6): As of December 31, 2018, Mr. Jesselson held 24,000 stock options and 6,041 RSUs. As of the Record Date, Mr. Jesselson beneficially owns a total of 347,764 shares of our common stock as disclosed in this proxy statement under the heading "Security Ownership of Certain Beneficial Owners and Management."
(7): As of December 31, 2018, Mr. Kingshott held 24,000 stock options and 16,799 RSUs. As of the Record Date, Mr. Kingshott beneficially owns a total of 134,013 shares of our common stock as disclosed in this proxy statement under the heading "Security Ownership of Certain Beneficial Owners and Management."
(8): As of December 31, 2018, Dr. Papastavrou held 24,000 stock options and 19,299 RSUs. As of the Record Date, Dr. Papastavrou beneficially owns a total of 242,888 shares of our common stock as disclosed in this proxy statement under the heading "Security Ownership of Certain Beneficial Owners and Management."
(9): As of December 31, 2018, Mr. Shaffer held 24,000 stock options and 21,799 RSUs. As of the Record Date, Mr. Shaffer beneficially owns a total of 66,799 shares of our common stock as disclosed in this proxy statement under the heading "Security Ownership of Certain Beneficial Owners and Management."

Compensation Committee, Nominating and Corporate Governance Committee and Acquisition Committee each receive an additional cash retainer of $25,000, $15,000, $15,000 and $15,000, respectively, payable quarterly in arrears. No other fees are paid to our directors for their attendance at or participation in meetings of our Board or its committees. We also reimburse our directors for expenses incurred in the performance of their duties, including reimbursement for air travel and hotel expenses.

~~Under the revisednon-employee~~ ~~director annual compensation program, in 2017, Mr. Jesselson received aone-time~~ cash retainer for his service as lead independent director in 2016 in an amount equal to the pro rata portion of an annualized retainer of $15,000, calculated from the date of his appointment on March 20, 2016. In addition, in 2017, Ms. Ashe received a~~one-time~~ grant of Time-Based RSUs for her service as a director in 2016 in an amount equal to the pro rata portion of an annual grant of $175,000, calculated from the date of her appointment on March 21, 2016 and determined by dividing the pro rata portion of $175,000 by the average of the closing prices of the company’s common stock on the ten trading days immediately preceding the~~one-time~~ ~~grant date. Thisone-time~~ ~~grant vested on January 1, 2018. The above compensation was received for services rendered in 2016 and is not included in the table above.~~

~~Also, in 2017, Ms. DeSalva received aone-time~~ grant of Time-Based RSUs for her service as a director in 2017 in an amount equal to the pro rata portion of an annual grant of $175,000, calculated from the date of her appointment on September 19, 2017 and determined by dividing the pro rata portion of $175,000 by the closing price of the company’s common stock on the~~one-time~~ ~~grant date. Thisone-time~~ ~~grant vested date on January 3, 2018 and is included in the table above.~~

~~In 2016, our Board adopted stock ownership guidelines and stock retention requirements that apply to ournon-employee~~ ~~directors and executive officers.Non-employee~~ directors are subject to a stock ownership guideline of six (6) times the annual cash retainer. To determine compliance with these guidelines, generally, common shares held directly or indirectly, and unvested restricted stock units subject solely to time-based vesting, count towards meeting the stock ownership guidelines. Stock options, whether vested or unvested, and equity-based awards subject to performance-based vesting conditions, are not counted towards meeting the stock ownership guidelines until they have settled or been exercised, as applicable. Until the guidelines are met, 70% of the net shares (after tax withholding) received upon settlement of equity-based awards are required to be retained by the director. As of the Record Date, each of our~~non-employee~~ directors other than Ms. DeSalva, who joined the Board in September 2017, was in compliance with our stock ownership guidelines. Ms. DeSalva will be required to reach the necessary ownership threshold no later than three years from the date of her appointment as a director of the company.

Compensation Committee Interlocks and Insider Participation

None of the members of our Compensation Committee has been an officer or employee of our company. During our last completed fiscal year, none of our executive officers served as a member of the compensation committee of any entity that has one or more executive officers serving on our Compensation Committee.


~~S-K.~~ We intend to satisfy the disclosure requirements under applicable SEC rules relating to amendments to the Code of Business Ethics or waivers from any provision thereof applicable to our principal executive officer, our principal financial officer and principal accounting officer by posting such information on our website pursuant to SEC rules.	21	©2019 XPO Logistics, Inc.

~~The Guidelines and our Code of Business Ethics are available on our websiteat www.xpo.com. In addition, you may obtain a printed copy of these documents, without charge, by sending a request to: Investor Relations, XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831.~~

~~Exclusive Forum Bylaw Amendment~~

In March 2017, our Board of Directors approved an amendment of our bylaws in order to provide that certain types of stockholder litigation be litigated exclusively in the Chancery of Court of the State of Delaware, which is our state of incorporation. In adopting the amendment and determining that doing so is in the best interests of our company and our stockholders, our Board considered various factors, including, among others: prevailing market practice and perspectives on such provisions; the importance to our company and our stockholders of reducing litigation costs and preventing corporate resources from being unnecessarily diverted to address duplicative, costly and wasteful multi-forum litigation; the value of facilitating consistency and predictability in litigation outcomes for the benefit of our company and our stockholders; that our company is incorporated under the laws of the state of Delaware; that adopting such an exclusive forum provision covering specified claims does not materially change the substantive legal claims available to stockholders; Section 115 of the Delaware General Corporation Law and case law developments upholding the authority of the board of directors to adopt such a provision and confirming its validity and enforceability; and case law developments outside of Delaware enforcing such provisions.

Director Independence

Under the Guidelines, our Board of Directors is responsible for making independence determinations annually with the assistance of the Nominating and Corporate Governance Committee. Such independence determinations are made by reference to the independence standard under the Guidelines and the definition of “independent director” under Section 303A.02 of the NYSE Listed Company Manual. Our Board of Directors has affirmatively determined that each person who served as a director during any part of 2017, except Mr. Jacobs, our Chairman of the Board and Chief Executive Officer, and Mr. DeJoy, satisfies the independence standards under the Guidelines and the NYSE Listed Company Manual.

In addition to the independence standards provided in the Guidelines, our Board of Directors has determined that each director who serves on our Audit Committee satisfies standards established by the SEC providing that, in order to qualify as “independent” for the purposes of membership on that committee, members of audit committees may not (1) accept directly or indirectly any consulting, advisory or other compensatory fee from our company other than their director compensation, or (2) be an affiliated person of our company or any of its subsidiaries. Our Board of Directors has also determined that each member of the Compensation Committee satisfies the NYSE standards for independence of Compensation Committee members, which became effective on July 1, 2013. Additionally, our Board of Directors has determined that each member of the Nominating and Corporate Governance Committee satisfies the NYSE standards for independence. In making the independence determinations for each director, our Board of Directors and the Nominating and Corporate Governance Committee analyzed certain relationships of the directors that were not required to be disclosed pursuant to Item 404(a) of Regulation~~S-K.~~ For Ms. Ashe and Ms. DeSalva, those relationships included ordinary course commercial transactions between our company and entities for which they previously served as executives. For Mr. Jesselson, those relationships included ordinary course commercial transactions between our company and an entity for which Mr. Jesselson is the president.


				23				©2019 XPO Logistics, Inc.

Table of Contents


CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS	19	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
	19	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


~~CERTAIN RELATIONSHIPS AND~~

Under its written charter, the Audit Committee of our Board of Directors is responsible for reviewing and approving or ratifying any transaction between our company and a related person (as defined in Item 404 of Regulation S-K) that is required to be disclosed under the rules and regulations of the SEC. Our management is responsible for bringing any such transaction to the attention of the Audit Committee. In approving or rejecting any such transaction, the Audit Committee considers the relevant facts and circumstances, including the material terms of the transaction, risks, benefits, costs, availability of other comparable services or products and, if applicable, the impact on a director's independence.

Since January 1, 2018, we have not been a participant in any transaction or series of similar transactions in which the amount exceeded or will exceed $120,000 and in which any current director, executive officer, holder of more than 5% of our capital stock, or any member of the immediate family of the foregoing, had or will have a material interest, except for the transactions described below or as previously disclosed in this Proxy Statement.

During the year ended December 31, 2018, the company leased office space from three entities partially owned and controlled by Mr. Louis DeJoy, a member of our Board of Directors until May 17, 2018. In September 2014, in conjunction with the company's acquisition of New Breed Holding Company, XPO, through certain subsidiaries, entered into four commercial lease agreements covering a total of approximately 142,991 square feet of office space located in High Point, North Carolina, with the entities affiliated with Mr. DeJoy; these lease agreements were set to expire at various dates in 2019. In September 2017, the company entered into four new commercial lease agreements with the entities affiliated with Mr. DeJoy, amending and replacing the 2014 lease agreements. The 2017 lease agreements cover a total of approximately 222,060 square feet of office space located in High Point, North Carolina, and are set to expire on September 30, 2025. Each of the 2017 lease agreements provide the company, as tenant, with one five-year option period to extend the lease term. The company made rent payments associated with these lease agreements in an aggregate amount of $1.86 million for the year ended December 31, 2018. In addition, the company paid operating expenses in connection with these leased properties of $0.47 million for the year ended December 31, 2018.


	25	©2019 XPO Logistics, Inc.


~~RELATED PARTY TRANSACTIONS~~

Under its written charter, the Audit Committee of our Board of Directors is responsible for reviewing and approving or ratifying any transaction between our company and a related person (as defined in Item 404 of Regulation~~S-K)~~ that is required to be disclosed under the rules and regulations of the SEC. Our management is responsible for bringing any such transaction to the attention of the Audit Committee. In approving or rejecting any such transaction, the Audit Committee considers the relevant facts and circumstances, including the material terms of the transaction, risks, benefits, costs, availability of other comparable services or products and, if applicable, the impact on a director’s independence.

Since January 1, 2017, we have not been a participant in any transaction or series of similar transactions in which the amount exceeded or will exceed $120,000 and in which any current director, executive officer, holder of more than five percent of our capital stock, or any member of the immediate family of the foregoing, had or will have a material interest, except for the transactions described below or as previously disclosed in this proxy statement.

Pursuant to the Retirement and Release Agreement dated December 7, 2015 between the company and Louis DeJoy, a member of our Board of Directors, the company issued Mr. DeJoy 9,687 shares of the company’s common stock on January 3, 2017.

Also during the year ended December 31, 2017, the company leased office space from three entities partially owned and controlled by Louis DeJoy. In September 2014, in conjunction with the company’s acquisition of New Breed Holding Company, XPO, through certain subsidiaries, entered into four commercial lease agreements covering a total of approximately 142,991 square feet of office space located in High Point, North Carolina, with the entities affiliated with Mr. DeJoy; these lease agreements were set to expire at various dates in 2019. In September 2017, the company entered into four new commercial lease agreements with the entities affiliated with Mr. DeJoy amending and replacing the 2014 lease agreements. The 2017 lease agreements cover a total of approximately 222,060 square feet of office space located in High Point, North Carolina and are set to expire on September 30, 2025. Each of the 2017 lease agreements provide the company, as tenant, with one five-year option period to extend the lease term. The company made rent payments associated with these lease agreements in an aggregate amount of $2.0 million for the year ended December 31, 2017. In addition, the company paid operating expenses in connection with these leased properties of $0.3 million for the year ended December 31, 2017.


						20						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						20						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Table of Contents

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth information concerning the beneficial ownership of our voting securities as of the Record Date by: (i) each person who is known by us, based solely on a review of public filings, to be the beneficial owner of more than 5% of any class of our outstanding voting securities, (ii) each director, (iii) each NEO, and (iv) all executive officers and directors as a group. None of the foregoing persons beneficially owned any shares of equity securities of our subsidiaries as of the Record Date.

Under applicable SEC rules, a person is deemed to be the “beneficial owner” of a voting security if such person has (or shares) either investment power or voting power over such security or has (or shares) the right to acquire such security within 60 days by any of a number of means, including upon the exercise of options or warrants or the conversion of convertible securities. A beneficial owner’s

Under applicable SEC rules, a person is deemed to be the "beneficial owner" of a voting security if such person has (or shares) either investment power or voting power over such security or has (or shares) the right to acquire such security within 60 days by any of a number of means, including upon the exercise of options or warrants or the conversion of convertible securities. A beneficial owner's percentage ownership is determined by assuming that options, warrants and convertible securities that are held by the beneficial owner, but not those held by any other person, and which are exercisable or convertible within 60 days, have been exercised or converted.

Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to all voting securities shown as being owned by them. Unless otherwise indicated, the address of each beneficial owner in the table below is care of XPO Logistics, Inc., Five American Lane, Greenwich, Connecticut 06831.

Name of Beneficial Owner			Percentage of Common Stock Outstanding(1)	Shares of Series A Preferred Stock Beneficially Owned(2)	Percentage of Series A Preferred Stock Outstanding


Beneficial Ownership of 5% or more:
Orbis Investment Management Limited⁽³⁾ Orbis House, 25 Front Street Hamilton Bermuda HM11	20,537,128		22.3%	—	—
Jacobs Private Equity, LLC	19,285,714	⁽⁴⁾	17.3%	67,500	94.9%
Spruce House Investment Management LLC⁽⁵⁾ 435 Hudson Street, 8th Floor, New York, NY 10014	12,842,055		13.9%	—	—
The Vanguard Group⁽⁶⁾ 100 Vanguard Blvd., Malvern, PA 19355	11,136,516		12.1%	—	—
BlackRock, Inc.⁽⁷⁾ 55 East 52nd street New York, NY 10055	11,095,856		12.0%	—	—
Directors:
Gena L. Ashe	8,757	⁽⁸⁾	*	—	—
Marlene M. Colucci	—		—	—	—
AnnaMaria DeSalva	2,881		*	—	—
Michael G. Jesselson	347,764	⁽⁹⁾	*	725⁽¹⁰⁾	1.0%
Adrian P. Kingshott	134,013	⁽¹¹⁾	*	300	*
Jason D. Papastavrou	242,888	⁽¹²⁾	*	650⁽¹³⁾	*
Oren G. Shaffer	66,799	⁽¹⁴⁾	*	—	—
NEOs:
Bradley S. Jacobs⁺	19,799,601	⁽¹⁵⁾	17.7%	67,500	94.9%
Troy A. Cooper	178,396	⁽¹⁶⁾	*	—	—
Kenneth R. Wagers III	7,006	⁽¹⁷⁾	*	—	—
Sarah J.S. Glickman	2,842	⁽¹⁸⁾	*	—	—
Mario A. Harik	220,163	⁽¹⁹⁾	*	—	—
John J. Hardig	115,598	⁽²⁰⁾	*	—	—
Current Directors and Executive Officers as a Group: (11 People)	21,004,106	⁽²¹⁾	18.7%	69,175	97.3%

*: Less than 1%
+: Director and Executive Officer


				26				©2019 XPO Logistics, Inc.

Table of Contents

(1): For purposes of this column, the number of shares of the class outstanding reflects the sum of: (i) 92,233,726 shares of our common stock that were outstanding as of the Record Date, (ii) the number of shares of our common stock into which the outstanding shares of our preferred stock held by the relevant person, if any, were convertible on the Record Date, (iii) the number of shares of our common stock, if any, which the relevant person could acquire on exercise of options or warrants within 60 days of the Record Date, and (iv) the number of RSUs, if any, held by the relevant person that are or will become vested within 60 days of the Record Date.
(2): Each share of our Series A Preferred Stock that was outstanding on the Record Date has an initial liquidation preference of $1,000 per share and is convertible into approximately 143 shares of our common stock at an effective conversion price of $7.00 per share of our common stock. Our Series A Preferred Stock votes together as a single class with our common stock on an as-converted basis, except with respect to certain matters that impact the rights of holders of our Series A Preferred Stock, in which case our Series A Preferred Stock votes separately as a single class.
(3): Based on Amendment No. 5 to the Schedule 13G filed on February 14, 2019 by Orbis Investment Management Limited ("OIML"), Orbis Investment Management (U.S.), L.P. ("OIMUS") and Allan Gray Australia Pty Ltd ("AGAPL"), which reported that, as of December 31, 2018, OIML beneficially owned 20,340,427 shares of our common stock, OIMUS beneficially owned 187,566 shares of our common stock, and AGAPL beneficially owned 9,135 shares of our common stock. The group has sole voting and sole dispositive power over such shares of our common stock.
(4): Consists of 9,642,857 shares of our common stock issuable upon conversion of 67,500 shares of our Series A Preferred Stock, and 9,642,857 shares of our common stock issuable upon the exercise of 9,642,857 warrants at an exercise price of $7.00 per share of common stock. Mr. Jacobs has indirect beneficial ownership of the shares of our common stock and our Series A Preferred Stock beneficially owned by JPE as a result of being its managing member. In addition, Mr. Jacobs beneficially owns 263,887 shares of our common stock held directly following the vesting of equity incentive awards and 250,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date. See footnote (15) below.
(5): Based on Amendment No. 3 to the Schedule 13G filed on December 19, 2018, filed by Spruce House Investment Management LLC, Spruce House Capital LLC, The Spruce House Partnership LP, Zachary Sternberg, and Benjamin Stein, which reported that, as of December 19, 2018, Spruce House Investment Management LLC beneficially owned 12,750,000 shares of our common stock, Spruce House Capital LLC beneficially owned 12,750,000 shares of our common stock, The Spruce House Partnership LP beneficially owned 12,750,000 shares of our common stock, Zachary Sternberg beneficially owned 12,795,000 shares of our common stock and Benjamin Stein beneficially owned 12,797,055 shares of our common stock. Spruce House Investment Management LLC, Spruce House Capital LLC, The Spruce House Partnership LP, Zachary Sternberg and Benjamin Stein have shared voting and dispositive power over 12,750,000 shares of our common stock. Zachary Sternberg has sole voting and dispositive power over 45,000 shares of our common stock. Benjamin Stein has sole voting and dispositive power over 47,055 shares of our common stock.
(6): Based on Amendment No. 4 to the Schedule 13G filed on March 11, 2019 by The Vanguard Group, which reported that, as of December 31, 2018, The Vanguard Group beneficially owned 11,136,516 shares of our common stock with sole voting power over 96,490 shares of our common stock, shared voting power over 26,392 shares of our common stock, sole dispositive power over 11,017,569 shares of our common stock and shared dispositive power over 118,947 shares of our common stock.
(7): Based on the Schedule 13G filed on April 10, 2019 by BlackRock, Inc., which reported that, as of March 31, 2019, BlackRock, Inc. beneficially owned 11,095,856 shares of our common stock, with sole voting power over 10,258,515 shares of our common stock and sole dispositive power over 11,095,856 shares of our common stock.
(8): Consists of 8,757 RSUs that are or will become vested within 60 days of the Record Date.
(9): Includes: (i) 15,000 shares of our common stock held in an individual retirement account of Michael G. Jesselson, (ii) 10,000 shares of our common stock owned by Mr. Jesselson's spouse, (iii) 12,000 shares of our common stock beneficially owned by the SJJ Irrevocable Trust, of which Mr. Jesselson is a trustee, (iv) 12,000 shares of our common stock beneficially owned by the RAJ Irrevocable Trust, of which Mr. Jesselson is a trustee, (v) 12,000 shares of our common stock beneficially owned by the JJJ Irrevocable Trust, of which Mr. Jesselson is a trustee, (vi) 10,000 shares of our common stock beneficially owned by Michael G. Jesselson and Linda Jesselson, Trustees UID 6/30/93 FBO Maya Ariel Ruth Jesselson, (vii) 103,570 shares of our common stock issuable upon conversion of 725 shares of our Series A Preferred Stock, which shares of our Series A Preferred Stock are beneficially owned by the Michael G. Jesselson 12/18/80 Trust and the Michael G. Jesselson 4/8/71 Trust, of which trusts Mr. Jesselson is the beneficiary, (viii) 103,572 shares of our common stock issuable upon the exercise of 103,572 warrants at an exercise price of $7.00 per share of our common stock, which warrants are beneficially owned by the Michael G. Jesselson 12/18/80 Trust and the Michael G. Jesselson 4/8/71 Trust, of which trusts Mr. Jesselson is the beneficiary, (ix) 21,322 shares of our common stock issuable upon the exercise of 21,322 warrants at an exercise price of $7.00 per share of our common stock, which warrants are beneficially owned by Michael G. Jesselson and Linda Jesselson, Trustees UID 6/30/93 FBO Maya Ariel Ruth Jesselson, (x) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (xi) 6,041 RSUs that are or will become vested within 60 days of the Record Date.
(10): See clause (vii) of footnote (9).
(11): Includes: (i) 42,857 shares of our common stock issuable upon conversion of 300 shares of our Series A Preferred Stock, (ii) 42,857 shares of our common stock issuable upon the exercise of 42,857 warrants at an exercise price of $7.00 per share of our common stock, (iii) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable on within 60 days of the Record Date, and (iv) 16,799 RSUs that are or will become vested within 60 days of the Record Date.
(12): Includes: (i) 1,375 shares of our common stock beneficially owned by the Brett A. Athans Declaration of Trust, of which Dr. Papastavrou is the trustee, (ii) 92,857 shares of our common stock issuable upon conversion of 650 shares of our Series A Preferred Stock, which shares of Series A Preferred Stock are beneficially owned by Springer Wealth Management LLC, of which Dr. Papastavrou is the owner of 100% of the equity securities, (iii) 92,857 shares of our common stock issuable upon the exercise of 92,857 warrants at an exercise price of $7.00 per share of our common stock, which warrants are beneficially owned by Springer Wealth Management LLC, of which Dr. Papastavrou is the owner of 100% of the equity securities, (iv) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (v) 19,299 RSUs that are or will become vested within 60 days of the Record Date.
(13): See clause (ii) of footnote (12).
(14): Includes: (i) 8,500 shares of our common stock issuable upon the exercise of 8,500 warrants at an exercise price of $7.00 per share of common stock, (ii) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (iii) 21,799 RSUs that are or will become vested within 60 days of the Record Date.
(15): Mr. Jacobs has indirect beneficial ownership of the shares of our common stock and our Series A Preferred Stock beneficially owned by JPE as a result of being its managing member. See footnote (4). Also includes 263,887 shares of our common stock held directly by Mr. Jacobs following the vesting of equity incentive awards and 250,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.
(16): Includes: (i) 10,000 shares of our common stock issuable upon the exercise of 10,000 warrants at an exercise price of $7.00 per share of common stock, and (ii) 25,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.
(17): Mr. Wagers' employment as chief operating officer of the company was terminated without cause effective March 11, 2019.
(18): Includes 2,842 RSUs that are or will become vested within 60 days of the Record Date.
(19): Includes 135,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.
(20): Mr. Hardig stepped down from his position as chief financial officer on August 15, 2018. The information provided herein is based on the last Form 4 filed by Mr. Hardig on February 21, 2018.
(21): Includes: (i) 9,882,142 shares of our common stock issuable upon conversion of 69,175 shares of our preferred stock, (ii) 9,921,965 shares of our common stock issuable upon the exercise of 9,921,965 warrants at an exercise price of $7.00 per share of our common stock, (iii) 506,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (iv) 75,537 RSUs that are or will become vested within 60 days of the Record Date.

   Shares of    Percentage of Shares of Series    Percentage of
   Common Stock    Common Stock A Preferred Stock    Series A Preferred
  Name of Beneficial Owner


Beneficially Owned


Outstanding⁽¹⁾

Beneficially Owned⁽²⁾


Stock Outstanding

  Beneficial Ownership of 5% or more:

  Orbis Investment Management Limited⁽³⁾

  Orbis House, 25 Front Street

  Hamilton Bermuda HM11
   19,845,091    16.5% –        –

  Jacobs Private Equity, LLC



19,285,714

⁽⁴⁾



13.8%

67,500



94.4%

  The Vanguard Group⁽⁵⁾
  100 Vanguard Blvd.

  Malvern, PA 19355
   10,740,976    8.9% –        –
  Spruce House Investment Management LLC⁽⁶⁾
  435 Hudson Street, 8^th Floor, New York, NY 10014
   7,797,055    6.5% –        –
  Directors:

  Gena L. Ashe
   6,686 ⁽⁷⁾    * –        –
  Louis DeJoy
   1,134,686 ⁽⁸⁾    * –        –
  AnnaMaria DeSalva
   810    * –        –
  Michael G. Jesselson
   345,693 ⁽⁹⁾    * 725 ⁽¹⁰⁾    1.0%
  Adrian P. Kingshott
   131,942 ⁽¹¹⁾    * 300    *
  Jason D. Papastavrou
   240,817 ⁽¹²⁾    * 650 ⁽¹³⁾    *
  Oren G. Shaffer
   64,728 ⁽¹⁴⁾    * –        –
  NEOs:

  Bradley S. Jacobs+
   19,799,601 ⁽¹⁵⁾    14.1% 67,500    94.4%
  Troy A. Cooper
   178,396 ⁽¹⁶⁾    * –        –
  John J. Hardig
   165,598 ⁽¹⁷⁾    * –        –
  Scott B. Malat
   171,525 ⁽¹⁸⁾    * –        –
  Mario A. Harik
   220,163 ⁽¹⁹⁾    * –        –
  Current Executive Officers and

  Directors as a Group:(12 People)
   22,460,646 ⁽²⁰⁾    15.9% 69,175    96.7%

*	~~Less than 1%~~Inc.

~~Director and Executive Officer~~

Table of Contents

~~(1)~~

For purposes of this column, the number of shares of the class outstanding reflects the sum of: (i) 120,597,574 shares of our common stock that were outstanding as of the Record Date, (ii) the number of shares of our common stock into which the outstanding shares of our preferred stock held by the relevant person, if any, were convertible on the Record Date, (iii) the number of shares of our common stock, if any, which the relevant person could acquire on exercise of options or warrants within 60 days of the Record Date, and (iv) the number of RSUs, if any, held by the relevant person that are or will become vested within 60 days of the Record Date.


	21	©
EXECUTIVE COMPENSATION~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~	21	©

~~(2)~~

Each share of our Series A Preferred Stock that was outstanding on the Record Date has an initial liquidation preference of $1,000 per share and is convertible into approximately 143 shares of our common stock at an effective conversion price of $7.00 per share of our common stock. Our Series A Preferred Stock votes together as a single class with our common stock on an~~as-converted~~ ~~basis, except with respect to certain matters that impact the rights of holders of our Series A Preferred Stock, in which case our Series A Preferred Stock votes separately as a single class.~~

~~(3)~~

Based on Amendment No. 4 to the Schedule 13G filed on February 14, 2018 by Orbis Investment Management Limited (“OIML”), Orbis Investment Management (U.S.), LLC (“OIMUS”) and Allan Gray Australia Pty Ltd (“AGAPL”), which reported that, as of December 31, 2017, OIML beneficially owned 19,592,121 shares, OIMUS beneficially owned 248,657 shares, and AGAPL beneficially owned 4,313 shares. The group has sole voting and sole dispositive power over such shares.

~~(4)~~

Consists of 9,642,857 shares of our common stock issuable upon the exercise of 9,642,857 warrants at an exercise price of $7.00 per share of common stock, and 9,642,857 shares of our common stock issuable upon conversion of 67,500 shares of our Series A Preferred Stock. Mr. Jacobs has indirect beneficial ownership of the shares of our common stock and our Series A Preferred Stock beneficially owned by JPE as a result of being its Managing Member. In addition, Mr. Jacobs beneficially owns 263,887 shares of our common stock held directly following the vesting of equity incentive awards and 250,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date. See footnote⁽¹⁵⁾ ~~below.~~

~~(5)~~

Based on Amendment No. 2 to the Schedule 13G filed on February 9, 2018 by The Vanguard Group, which reported that, as of December 31, 2017, The Vanguard Group beneficially owned 10,740,976 shares with sole voting power over 60,850 shares, shared voting power over 17,538 shares, sole dispositive power over 10,672,069 shares and shared dispositive power over 68,907 shares.

~~(6)~~

Based on Amendment No. 2 to the Schedule 13G filed on February 14, 2017, filed by Spruce House Investment Management LLC, Spruce House Capital LLC, The Spruce House Partnership LP, Zachary Sternberg, and Benjamin Stein, which reported that, as of December 31, 2016, Spruce House Investment Management LLC beneficially owned 7,750,000 shares, Spruce House Capital LLC beneficially owned 7,750,000 shares, The Spruce House Partnership LP beneficially owned 7,750,000 shares, Zachary Sternberg beneficially owned 7,795,000 shares and Benjamin Stein beneficially owned 7,797,055 shares. Spruce House Investment Management LLC, Spruce House Capital LLC, The Spruce House Partnership LP, Zachary Sternberg and Benjamin Stein have shared voting and dispositive power over 7,750,000 shares of common stock. Zachary Sternberg has sole voting and dispositive power over 45,000 shares. Benjamin Stein has sole voting and dispositive power over 47,055 shares.

~~(7)~~

~~Consists of 6,686 RSUs that are or will become vested within 60 days of the Record Date.~~

~~(8)~~

Includes: (i) 192,086 shares of our common stock beneficially owned by The Louis DeJoy Family Partnership, LLC, of which Mr. DeJoy is the managing member, and (ii) 484,340 shares of our common stock owned by the Louis DeJoy and Aldona Z. Wos Family Foundation, of which Mr. DeJoy is the president.

~~(9)~~

Includes: (i) 12,000 shares of our common stock beneficially owned by the SJJ Irrevocable Trust, of which Mr. Jesselson is a trustee, (ii) 12,000 shares of our common stock beneficially owned by the RAJ Irrevocable Trust, of which Mr. Jesselson is a trustee, (iii) 12,000 shares of our common stock beneficially owned by the JJJ Irrevocable Trust, of which Mr. Jesselson is a trustee, (iv) 10,000 shares of our common stock beneficially owned by the Michael G. Jesselson and Linda Jesselson 6/30/93 Trust, of which Mr. Jesselson is a trustee, (v) 10,000 shares of our common stock owned by Mr. Jesselson’s spouse, (vi) 103,572 shares of our common stock issuable upon the exercise of 103,572 warrants at an exercise price of $7.00 per share of our common stock, which warrants are beneficially owned by the Michael G. Jesselson 12/18/80 Trust and the Michael G. Jesselson 4/8/71 Trust, of which trusts Mr. Jesselson is the beneficiary, (vii) 21,322 shares of our common stock issuable upon the exercise of 21,322 warrants at an exercise price of $7.00 per share of our common stock, which warrants are beneficially owned by the Michael G. Jesselson and Linda Jesselson, Trustees UID 6/30/93 FBO Maya Ariel Ruth Jesselson, of which Mr. Jesselson is the beneficiary, (viii) 103,571 shares of our common stock issuable upon conversion of 725 shares of our Series A Preferred Stock, which shares of our Series A Preferred Stock are beneficially owned by the Michael G. Jesselson 12/18/80 Trust and the Michael G. Jesselson 4/8/71 Trust, of which trusts Mr. Jesselson is the beneficiary, (ix) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (x) 3,970 RSUs that are or will become vested within 60 days of the Record Date.

~~(10)~~

~~See clause (viii) of footnote~~⁽⁹⁾.

~~(11)~~

Includes: (i) 42,857 shares of our common stock issuable upon the exercise of 42,857 warrants at an exercise price of $7.00 per share of our common stock, (ii) 42,857 shares of our common stock issuable upon conversion of 300 shares of our Series A Preferred Stock, (iii) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable on within 60 days of the Record Date, and (iv) 14,728 RSUs that are or will become vested within 60 days of the Record Date.

~~(12)~~

Includes: (i) 1,375 shares of our common stock beneficially owned by the Brett A. Athans Declaration of Trust, of which Dr. Papastavrou is the trustee, (ii) 92,857 shares of our common stock issuable upon the exercise of 92,857 warrants at an exercise price of $7.00 per share of our common stock, which warrants are beneficially owned by Springer Wealth Management LLC, of which Dr. Papastavrou is the owner of 100% of the equity securities, (iii) 92,857 shares of our common stock issuable upon conversion of 650 shares of our Series A Preferred Stock, which shares of Series A Preferred Stock are beneficially owned by Springer Wealth Management LLC, of which Dr. Papastavrou is the owner of 100% of the equity securities, (iv) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (v) 17,228 RSUs that are or will become vested within 60 days of the Record Date.

~~(13)~~

~~See clause (iii) of footnote~~⁽¹²⁾.

~~(14)~~

Includes: (i) 8,500 shares of our common stock issuable upon the exercise of 8,500 warrants at an exercise price of $7.00 per share of common stock, (ii) 24,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (iii) 19,728 RSUs that are or will become vested within 60 days of the Record Date.

~~(15)~~

Mr. Jacobs has indirect beneficial ownership of the shares of our common stock and our Series A Preferred Stock beneficially owned by JPE as a result of being its Managing Member. See footnote (4). Also includes 263,887 shares of our common stock held directly by Mr. Jacobs following the vesting of equity incentive awards and 250,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.

~~(16)~~

Includes: (i) 10,000 shares of common stock issuable upon the exercise of 10,000 warrants at an exercise price of $7.00 per share of common stock, and (ii) 25,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.

~~(17)~~

~~Includes 50,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.~~

~~(18)~~

Includes: (i) 12,750 shares of our common stock issuable upon the exercise of 12,750 warrants at an exercise price of $7.00 per share of common stock, and (ii) 48,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.

~~(19)~~

~~Includes 135,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date.~~

~~(20)~~

Includes: (i) 9,934,715 shares of our common stock issuable upon the exercise of 9,934,715 warrants at an exercise price of $7.00 per share of our common stock, (ii) 9,882,142 shares of our common stock issuable upon conversion of 69,175 shares of our preferred stock, (iii) 604,000 shares of our common stock issuable upon the exercise of options that are or will become exercisable within 60 days of the Record Date, and (iv) 62,340 RSUs that are or will become vested within 60 days of the Record Date.


						22						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						22						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


~~EXECUTIVE COMPENSATION~~

Compensation Discussion and Analysis

This Compensation Discussion and Analysis describes XPO’s executive compensation program for 2017. The Compensation Committee of our Board (referred to as the “Committee” in this section) oversees our executive compensation program and practices. In this section, we explain how and why the Committee made its 2017 compensation decisions for the following NEOs:

~~NEO~~

��

~~TITLE~~

~~Bradley S. Jacobs~~

~~Chairman and Chief Executive Officer~~

~~Troy A. Cooper~~

~~Chief Operating Officer~~

~~John J. Hardig~~

~~Chief Financial Officer~~

~~Scott B. Malat~~

~~Chief Strategy Officer~~

~~Mario A. Harik~~

~~Chief Information Officer~~

This Compensation Discussion and Analysis describes XPO's executive compensation program for 2018. The Compensation Committee of our Board of Directors (the "Committee") oversees our executive compensation program and practices. In this section, we explain how and why the Committee made its 2018 compensation decisions for the following NEOs:




		NEO				TITLE
		Bradley S. Jacobs				Chairman and Chief Executive Officer
		Troy A. Cooper				President
		Mario A. Harik				Chief Information Officer
		Kenneth R. Wagers III				Former Chief Operating Officer and Interim President, LTL North America (served until March 11, 2019)
		John J. Hardig				Former Chief Financial Officer (served until August 15, 2018)
		Sarah J.S. Glickman				Acting Chief Financial Officer

Executive Summary

~~2017~~2018 Performance Highlights

In 2018, XPO delivered a year of record results. Under the leadership of our NEOs, our company's revenue exceeded $17 billion for the first time, driven in part by 9.3% organic revenue growth*. Additionally, we reported:

■: Adjusted net income attributable to common shareholders* of $432 million, compared with $249 million for 2017, reflecting a 73% increase over 2017;
■: An absolute five-year total stockholder return ("TSR") of 117%, well above the respective TSRs of the S&P 500 (50%), the S&P 400 MidCap (34%) and the Dow Jones Transportation Average (33%);
■: Adjusted EBITDA* of $1.562 billion — a 14.3% increase over 2017 and a record level of full-year adjusted EBITDA for our company, although short of target; and
■: Strong free cash flow* of $694 million, surpassing our target of approximately $625 million.

These results were achieved, in large part, through our NEOs' disciplined execution of our growth strategy in leading our organization. Since its founding in 2011, XPO has become one of the ten largest transportation and logistics companies in the world. We create value by operating as a highly efficient, integrated network of people, technology and physical assets, and by cross-selling our services to help our customers succeed. We hold less than a 2% share of a trillion-dollar addressable market, and our service range provides us with growth opportunities regardless of macro conditions. In 2018, our sales organization won a record $3.8 billion of business. At year-end 2018, 90 of our top 100 customers were using two or more XPO service lines, and 55 of the 100 were using five or more of our services. Four years ago, these numbers were close to zero.

The significant progress made by our NEOs in 2018 has placed XPO in a better position to create long-term value today than at any time in our history. One of our most compelling competitive advantages is our proprietary technology. We invested $498 million in our global technology organization in 2018 and delivered a number of industry firsts. These included XPO Connect, our digital freight marketplace with multimodal transportation architecture, and XPO Direct, a national, shared-space distribution network linked by our proprietary warehouse management system. Both of these innovations capitalize on our density and scale — with XPO Direct, for example, large customers essentially rent our capacity for contract logistics, last mile, less-than-truckload, labor, technology, transportation and storage without taking on large fixed costs.

Our NEOs, together with our Board of Directors, are also stewards of our company's culture. As a service business, the safety and satisfaction of our workforce is integral to our strategy. In 2018, we greatly expanded our employee policies for pregnant women and family bonding, and provided supplemental health and wellness services for women and families through a virtual clinic, all at no additional cost to our employees. Our NEOs are committed to a purpose-driven culture; this is reflected in part by the record level of interest we saw from job candidates in 2018: over 80,000 applications received in a typical month.

Furthermore, our NEOs serve as disciplined allocators of our capital on behalf of our stockholders. In December 2018, when our stock price declined we chose to suspend M&A activity for the time being in favor of a stock buy-back strategy, as we felt this strategy would provide the best return on capital.

* See Annex A for a reconciliation of this non-GAAP measure.

~~Throughout 2017, our NEOs executed our strategy for high growth and high returns, successfully meeting rigorous financial performance goals and continuing to grow~~
		28	©2019 XPO as one of the ten largest logistics companies in the world. During this period, we continued to execute our strategy and optimize our operations as a highly efficient, integrated network of people, technology and physical assets; we enhanced our leadership positions in high-growth sectors such as last mile logistics andLogistics~~e-commerce~~, Inc. order fulfillment; we helped more than 50,000 customers manage their goods more efficiently throughout their supply chains; we refinanced all of our bank debt at lower rates; and we completed a public equity offering that has provided additional funding for future acquisitions. Our success is a result of having strong leadership, excellent operators, a motivated workforce engaged in our vision, a culture of accountability and meticulous growth plans for each line of business. As of December 31, 2017, our network encompassed over 95,000 employees and 1,455 locations in 32 countries, primarily in North America and Europe.
	~~For the full year 2017, our company:~~

Table of Contents

∎

~~Reported net income attributable to common stockholders of $312.4 million, compared with $63.1 million for 2016;~~

∎

~~Achieved an absolute total stockholder return (“TSR”) of 112%, well above the TSRs of the S&P 500 (22%) and the Dow Jones Transportation Average (19%); and~~

∎

Created approximately $6.7 billion of stockholder value in 2017, measured based on the price per share of our common stock of $91.59 and $43.16 on December 29, 2017 and December 30, 2016, respectively.

The significant progress made by our NEOs in 2017 has put us in a position of considerable strength to continue to execute our strategy for high growth and high returns in 2018 and beyond. Our focus remains on further enhancing the value we bring to customers, while optimizing our existing operations by growing our sales force, implementing advanced technology, cross-selling our services, leveraging our company-wide capacity and considering strategic acquisitions.

In 2018, we will continue to benefit from the numerous efficiencies we implemented throughout 2017 in procurement, real estate, back-office operations and workplace technologies. We have more savings to realize in each of these areas. We will also achieve further savings with cross-dock and warehouse automation, labor productivity, and the global adoption of best practices. We are marketing our services with a high-caliber sales organization that draws on our total supply chain offering to help customers operate more efficiently. On the technology front, we have exciting developments underway with intelligent machines, customer service mobility, our digital freight marketplace and the use of dynamic data science.

We have met or exceeded every financial target we have issued from 2012 through 2017. We expect our 2018 performance to once again outpace the industry and deliver at least 17% adjusted EBITDA growth. Our full-year target for adjusted EBITDA is at least $1.6 billion for 2018. We expect our 2017–2018 cumulative free cash flow to be approximately $1 billion, which is $100 million higher than our original target.


						23						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						23						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~2017~~2018 Profit Growth

The fourth quarter of 2017 marked the company’s seventh consecutive profitable quarter and the completion of the sixth year in a row in which we met or exceeded our financial targets. Key financial highlights are summarized below.

~~(in millions, except per share data)~~

* As defined in Annex A

The preeminent focus of our company’s leadership team is to deliver meaningful value to our stockholders through the execution of our strategy. Our operational excellence and effective implementation of our strategy over the past five-plus years has resulted in significant outperformance in stockholder return. XPO’s 112% TSR over 2017 ranked first among its peers and outperformed both the S&P 500 and Dow Jones Transportation Average indices (refer to the list of peers delineated under “The Committee’s
	29	©2019 XPO Logistics, Inc.

Result of Stockholder Advisory Vote and Stockholder Outreach

We conducted our annual stockholder advisory vote on executive compensation at our 2017 annual meeting of stockholders on May 10, 2017. While this vote was not binding on our company, our Board or the Committee, we believe that it is important for our stockholders to have an opportunity to vote on this proposal on an annual basis as a means to express their views on our executive compensation philosophy, our executive compensation program and policies, and our decisions regarding executive compensation, all as disclosed in our proxy statement. At our 2017 annual meeting, approximately 62.2% of the votes cast on the advisory vote on executive compensation were in favor of our NEO compensation program.	We were disappointed by the significant percentage of negative votes, even though the advisory vote obtained majority support. In response, we organized a stockholder outreach effort to gather direct, constructive feedback about executive compensation and other governance matters. We asked twelve of our most significant stockholders – who collectively held 56% of our outstanding common stock – to discuss executive compensation and other governance matters with us. Four of these stockholders responded with interest in having a dialogue on executive compensation and subsequently engaged in discussions with representatives of the company, including our Chief Human Resources Officer, our Senior Vice President, Corporate Counsel, and our Senior Vice President of Compensation and Benefits, and, in one case, upon the request of one stockholder, the Chair of the Committee.	~~The following themes emerged from these stockholder discussions in relation to executive compensation:~~
			30	©2019 XPO Logistics, Inc.

Role of Management


				31				©2019 XPO Logistics, Inc.

KEY OBJECTIVES OF OUR EXECUTIVE COMPENSATION PROGRAM

Align executive
compensation
with long-term
stockholder value

■

We place significant emphasis on long-term, forward-looking, performance-based compensation that is dependent on appreciation in our stock price, and that requires attainment of financial and strategic goals.

■

Our long-term focus promotes unified emphasis on the execution of our strategy, which we believe will create long-term stockholder value.

■

Long-term incentives can be granted either during the Committee's annual review of compensation determinations or during pivotal periods within the year to galvanize sustainable growth over a multi-year period.

Strongly correlate pay with financial and individual performance

■

The Committee considers four key company metrics in determining the total reward for our NEOs (among other supplemental measures). The Committee monitors progress against these metrics through regular engagement with the CEO and open attendance at companywide quarterly operating review meetings:

1 Adjusted EBITDA

2 Organic Revenue Growth

3 Free Cash Flow

4 TSR

■

Additionally, the Committee considers individual NEO performance and contributions to financial and non-financial goals in determining annual incentive payouts.

■

The Committee also certifies performance attainment of outstanding performance-based stock grants previously awarded to the NEOs.

Attract, retain and
motivate high-
performing
executive talent

■

We operate in a highly competitive market for executive talent; as such, we believe it's essential to attract, retain and motivate executives with market-competitive pay opportunities that tie the majority of pay to at-risk elements.

■

In order to inform its decision-making, the Committee reviews market analysis of total reward levels for our NEO positions at companies with a similar revenue size to ours, across diverse industries, using data from a compensation consultant that specializes in general industry compensation surveys. Semler Brossy provides additional supporting analysis to the Committee using the prior year's annual proxy statement disclosures of our peer group companies.

■

XPO continues to attract top talent at executive levels to lead key positions throughout the company, as ~~it establishes, reviews~~we strive to be the best in the industry at delivering high-quality service to our customers, increasing value for our stockholders and ~~evaluates~~demonstrating the highest regard for our employees. Numerous executives from highly regarded companies in the Fortune 500 have been hired into key positions at XPO as business unit leaders and corporate leaders.


				32				©2019 XPO Logistics, Inc.

HOW WE MEET THESE OBJECTIVES: ENSURING SOUND GOVERNANCE IN EXECUTIVE COMPENSATION

The company has adopted a compensation governance framework that includes the components described below, each of which the Committee believes reinforces the company's executive compensation ~~packages~~philosophy and objectives.

Significant Emphasis on Variable Compensation:Our executive compensation program is heavily weighted towards variable compensation, including long-term incentives, such as performance-based awards and annual short-term cash incentives.

Substantial Portion of Compensation Subject to Creation of Stockholder Value:Performance-based awards are, and have been, subject to meaningful stock price and/or earnings-related performance goals measured over service-based vesting periods. All of the outstanding equity awards granted to Mr. Jacobs, Mr. Cooper and Mr, Harik are performance-based. The Committee also continually reviews the full portfolio of XPO stock holdings for each NEO to ensure that there is a sufficient amount of compensation "at risk" and aligned with stockholder returns and value creation, while sustaining the NEOs' focus on the company's strategic objectives.

Stock Ownership Policies:We have a strong ownership culture among our executives and the Board has adopted stock ownership guidelines and stock retention requirements that support and encourage this culture. We believe that maintaining equity ownership in our company will mitigate a number of risks, including risks related to executive retention and undue risk-taking.

Share-based awards to our NEOs are generally subject to lock-up restrictions (as described in more detail below under the header "Lock-up Restrictions on Equity Awards") and we believe that the combination of the stock ownership policies ~~including~~and lock-up restrictions is a highly effective method of creating meaningful and lasting executive stock ownership levels.

■

For new executives: the multiple of annual salary creates near-term guidance to build and maintain a meaningful ownership position.

■

For longer-serving executives: the lock-up restrictions ensure that executives' ownership of our stock continues to build.

Policy Guidelines

Our guidelines are expressed as a multiple of each executive's annual base salary:

Multiple of Annual Salary

CEO

Other NEOs

Generally, compliance with our stock ownership guidelines is determined using the aggregate count of shares of common stock held directly or indirectly by the NEO and unvested restricted stock units subject solely to time-based vesting. Stock options, whether vested or unvested, and equity-based awards subject to performance-based vesting conditions are not counted toward meeting the stock ownership guidelines until they have settled or been exercised, as applicable.

Until the stock ownership guidelines are met, an executive is required to retain 70% of the net shares (after tax withholding) received upon settlement of equity-based awards. A newly-appointed executive is required to reach the stock ownership guidelines no later than three years from the date of his or her appointment.

As of the Record Date, Mr. Jacobs, Mr. Cooper and Mr. Harik were in compliance with our stock ownership guidelines and, in particular, Mr. Jacobs exceeded the guidelines by a significant degree.

Ms. Glickman is required to meet the guidelines no later than August 2021, three years from her appointment as acting chief financial officer.

Lock-up Restrictions on Equity Awards:Lock-up restrictions generally prohibit the sale of any shares of our common stock delivered pursuant to equity awards granted by our company.

■

As of March 31, 2019, Mr. Jacobs, Mr. Cooper, and Mr. Harik hold approximately 465,000 vested shares, subject to lock-up restrictions through September 2, 2020.

■

The agreement in effect with Mr. Wagers, whose employment was terminated on March 11, 2019, includes a lock-up restriction until May 1, 2021 for the portion of his equity award that vested in connection with his termination.

■

Ms. Glickman's performance stock units, granted in August 2018 in recognition of her taking on the acting chief financial officer role, are subject to a lock-up of 90 days following vesting.


				33				©2019 XPO Logistics, Inc.

Clawback Policy:Our NEOs are subject to clawback restrictions with respect to long-term and annual short-term incentive compensation. The Committee is focused on mitigating risk associated with the company's compensation program for NEOs and believes that clawback provisions are an important tool.

Long-Term Incentive

The employment agreements for Mr. Jacobs, Mr. Cooper, Mr. Wagers and Mr. Harik include a clawback provision under which the NEO may be required, upon certain triggering events, to repay all or a portion of long-term incentive compensation that was previously paid (including proceeds from previously-exercised and vested equity-based awards), and to forfeit unvested equity-based awards. These clawback provisions are generally triggered if the executive officer:

■

Has engaged in fraud or other willful misconduct that contributes materially to any significant financial restatements or material loss to our company or any of our affiliates;

■

Is terminated for cause (as defined in the employment agreement); or

■

Breaches the restrictive covenants that are applicable under his employment agreement.

While Ms. Glickman did not enter into a formal employment agreement with the company related to her role as acting chief financial officer, all equity awards issued as compensation to Ms. Glickman contain the same clawback provisions applicable to engagement in fraud or other willful misconduct, or breaches of applicable restrictive covenants.

Annual Short-Term Incentive

In addition, if Mr. Jacobs, Mr. Cooper, Mr. Wagers or Mr. Harik has engaged in fraud or other willful misconduct that contributes materially to any financial restatements or material loss to the company or any of its affiliates, the company may require repayment by them of any cash bonus or annual bonus previously paid (net of any taxes paid by them on such bonus), or cancel any earned but unpaid cash bonus or annual bonus, or adjust the future compensation, in order to recover an appropriate amount with respect to the ~~design~~restated financial results or the material loss.

Furthermore, a portion of the 2016 short-term incentive award for each of Mr. Jacobs and Mr. Cooper continues to be subject to repayment if they leave the company for any reason (other than following a change in control) prior to April 2019.

As acting chief financial officer, Ms. Glickman is subject to the clawback provisions of the Sarbanes-Oxley Act. Consequently, her short-term incentive is subject to clawback if there is material non-compliance with applicable financial reporting standards that require the company to restate its financials.

Additional Provision

To the extent that the rules adopted by the SEC under the Dodd-Frank Wall Street Reform and Consumer Protection Act are broader than the clawback provisions contained in the employment agreements that are applicable to Mr. Jacobs, Mr. Cooper or Mr. Harik, they will each be subject to additional clawback provisions pursuant to such rules as described under the heading "Employment Agreements with NEOs–Clawbacks."

Restrictive Covenants:Our NEOs are subject to comprehensive non-competition and other restrictive covenants.

No Stock Option Repricing or Discounted Exercise Price:Our company's equity incentive plan does not permit either stock option repricing without stockholder approval or stock option grants with an exercise price below fair market value.

No Golden Parachute Excise Tax Gross-ups:XPO does not provide golden parachute excise tax gross-ups.

No Pledging or Hedging of Company Stock:Under our insider trading policy, our company's directors and executive officers, including the NEOs, are prohibited from pledging or holding company securities in a margin account without pre-clearance. In addition, such persons are prohibited from engaging in hedging transactions without pre-clearance, such as prepaid variable forwards, equity swaps, collars and exchange funds or any other transactions that are designed to or have the effect of hedging or offsetting any decrease in the market value of equity securities.

No Exceptional Perquisites:Our NEOs have no guaranteed bonuses, no supplemental pension or retirement savings beyond what is provided broadly to all XPO employees and no additional perquisites such as personal use of company aircraft, executive health services, club memberships, relocation assistance, stipends or financial planning services.

Independent Compensation Consultant:The Committee retains an independent compensation consultant who performs services only for the Committee, as previously discussed in "Our Executive Compensation Governance Framework".


				34				©2019 XPO Logistics, Inc.

KEY FACTORS CONSIDERED IN DETERMINING EXECUTIVE COMPENSATION

The company's financial results relative to publicly disclosed targets for 2018.

■

As part of the company's budget and forecast processes for 2018, our senior executives set goals which were reviewed by the Board, on several key measures (namely, the first three in the "Key Measures" chart below). Performance against these measures was considered by the Committee when determining 2018 annual incentives for the NEOs. In addition, TSR performance—both in absolute and relative terms—was a significant factor in the Committee's decision-making process.

■

Overall, under the skilled leadership of our ~~executive compensation program. In particular, our CEO,~~NEOs, XPO generated record results in 2018 on multiple financial measures despite underperformance against certain targets:

KEY MEASURES

Measure

2018 Target

2018 Achievement

Adjusted EBITDA*

Approximately
$1.585 billion

$1.562 billion
(+14.3% versus 2017)

Organic Revenue Growth*

Expectation: 5% – 8%

✓

Up 9.3% versus 2017

Free Cash Flow*

Approximately $625 million

✓

$694 million

Annual TSR

Expectation: Alignment
with relevant indices

XPO: –38%
S&P 500 Index: –4%
Dow Jones US Transportation Average: –12%
S&P 400 Midcap: –11%

* See Annex A for a reconciliation of this non-GAAP measure.

■

The Committee also certified goal attainment associated with previously-awarded PRSUs granted in February 2016 to Mr. Jacobs, ~~provides recommendations as~~Mr. Cooper and Mr. Harik. The third tranche of these awards was due to ~~proposed compensation actions with respect to our executive team, but not with respect to his own compensation. The Committee carefully~~vest and independently reviews the recommendations of management, without members of management present, and consults its independent advisor before making its final determinations. We believe this process ensures that our executive compensation program effectively aligns with our compensation philosophy and our stockholders’ interests.

~~Role of the Committee’s Independent Compensation Consultant~~

~~The Committee directly retained Semler Brossy as its independent advisor~~settle in 2011 and continues to work with it on all compensation governance matters. During 2017, Semler Brossy supported the Committee in: reviewing the reasonableness of the 2017 compensation packages and long-term incentive grants for the NEOs and our other senior officers; providing analysis and guidanceFebruary 2019 based on the ~~CEO’s pay level relative to performance; reviewing~~achievement of an Adjusted Cash Flow Per Share goal of $5.38 associated with the 2018 performance year. This goal was surpassed and the award was settled in cash in February 2019; however, the payout amount was reduced at the request of Mr. Jacobs, Mr. Cooper and Mr. Harik, as described further throughout this Compensation Discussion and ~~Analysis~~Analysis.

The current value of realized and future realizable payouts of previously awarded stock compensation.

■

Stock-based compensation represents a significant portion of the ~~related tables~~total annual realizable pay for our NEOs and, ~~narratives; assessing~~as a result, the ~~risks associated~~Committee evaluated the current value of XPO stock holdings for each NEO to determine the appropriate balance between short-term cash incentives and long-term equity, and to assess whether there is sufficient compensation that is "at risk" of forfeiture and value fluctuation based on the company's performance. For Mr. Jacobs, Mr. Cooper and Mr. Harik, the Committee focused on the current value of the 2016 PRSUs held by each executive, as the third tranche was due to settle in February 2019 (neither Mr. Wagers nor Ms. Glickman were in their respective roles at XPO in 2016 in order to receive this award).

■

Over the course of 2018, the XPO stock portfolio of our NEOs experienced a negative return, in line with the ~~company’s overall~~experience of all our stockholders. Despite this direct alignment, the Committee further reduced the compensation ~~policies and practices; monitoring trends and evolving market practices~~opportunity of the NEOs for 2018, particularly in ~~executive compensation; and providing general advice and support~~response to the requests by Mr. Jacobs, Mr. Cooper and Mr. Harik to voluntarily decline a significant portion of their pay, as described throughout this Compensation Discussion and Analysis.


				35				©2019 XPO Logistics, Inc.

Analysis of total reward levels for our NEO positions relative to core peer group and general industry.

■

The Committee, with input from management and ~~Committee Chair.~~ Semler Brossy, reviewed the peer group used in evaluating executive compensation to ensure the selected companies continue to reflect certain characteristics comparable to XPO, and determined that no changes were required at this time. The peers comprising the 2018 peer group represent most of our publicly traded competitors in the transportation and logistics industry, have annual revenue greater than 25% of XPO's and, in the Committee's view, were reasonable given the revenue of XPO in 2018.

■

While we monitor the structure of our peers' pay programs, the Committee does not ~~provide any other services~~target a specific percentile positioning against the peer group. In addition, the Committee does not target a specific mix between cash and equity or short-term and long-term compensation relative to the ~~Committee or the company.~~

~~As part~~mix used by peer group companies. The peer group for 2018 consisted of the annual performance evaluation of its independent compensation consultant, the Committee considered Semler Brossy’s independence in light of applicable SEC rules and NYSE listing standards. After taking into account: (i) Semler Brossy’s absence of relationships with management and the members of the Committee, (ii) Semler Brossy’s internal policies, and (iii) other information provided to the Committee by Semler Brossy, the Committee determined that Semler Brossy’s work did not raise any conflicts of interest that would prevent it from serving as an independent compensation consultant to the Committee.following companies:


						26						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						26						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~Our Compensation Philosophy~~

Our executive compensation philosophy is to align the interests of our NEOs with the interests of our stockholders and to ensure that the total compensation paid to our NEOs is reasonable, competitive and provides appropriate incentives to motivate and retain our executive leadership.


~~KEY OBJECTIVES OF OUR EXECUTIVE COMPENSATION PROGRAM~~
1	~~Align executive compensation with long-term stockholder value~~	∎	We place significant emphasis on long-term, forward-looking, performance-based compensation that is dependent on the successful growth of our stock price, and that requires attainment of rigorous financial and strategic execution goals.
1		∎	~~Our long-term focus promotes unified emphasis on the execution of our strategy, which we believe will create long-term stockholder value.~~
2	~~Strongly correlate pay with financial and individual performance~~	∎	The Committee considers four key company metrics in determining the total reward for our NEOs (among other supplemental measures), and monitors progress against these metrics through regular engagement with the CEO throughout the year, and open attendance at companywide quarterly operating review meetings: 1 ~~Adjusted EBITDA (as defined in Annex A)~~ 2 ~~Organic Revenue Growth (as defined in Annex A)~~ 3 ~~Free Cash Flow (as defined in Annex A)~~ 4 ~~TSR~~
		∎	~~Additionally, individual NEO performance and contributions relative to both financial andnon-financial~~ ~~leadership goals are considered in determining annual incentive payouts as described under the heading “Assessment of Other NEOs’ Performance and Contributions for 2017.”~~
		∎	The Committee also reviews and certifies performance attainment on outstanding performance-based stock grants previously awarded to the NEOs, which are pegged to a variety of financial indicators, including stock price, adjusted earnings per share and adjusted free cash flow per share.
3	~~Attract, retain and motivate high- performing executive talent~~	∎	We operate in a highly competitive market for executive talent; as such, we believe it is essential to attract, retain and motivate a high-performing executive team with market-competitive pay opportunities that deliver the majority of pay in~~at-risk~~ ~~elements.~~
		∎	In order to inform its decision-making, the Committee reviews market analysis of total reward levels for our NEO positions at similarly sized companies (from a revenue perspective) across diverse industries, using data from proprietary competitive analysis provided by Willis Towers Watson (“WTW”), a compensation consultant that specializes in conducting general industry compensation surveys. Semler Brossy also provides supporting analysis using the prior year’s annual proxy statement disclosures of our peer group companies.
		∎	XPO continues to attract top talent at executive levels to lead key positions throughout the company, as we strive to be the best in the industry at delivering high-quality service to our customers, increasing value for our stockholders, and demonstrating the highest regard for our employees. Numerous executives from highly regarded companies in the Fortune 500 have been hired into key leadership positions at XPO in both business unit and corporate functions in 2017.

~~HOW WE MEET THESE OBJECTIVES: ENSURING SOUND GOVERNANCE IN EXECUTIVE COMPENSATION~~

The company has adopted a compensation governance framework that includes the components described below, each of which the Committee believes reinforces the company’s executive compensation philosophy and objectives.

~~Significant Emphasis on Variable Compensation:~~Our executive compensation program is heavily weighted towards variable compensation, including long-term incentives, such as cash-settled PRSUs and annual short-term cash incentives. See “Executive Compensation Structure–Total Reward Component Mix”.

~~Substantial Portion of Compensation Subject to Creation of Stockholder Value:~~All of the long-term incentive awards granted to our NEOs are subject to meaningful stock price and/or earnings-related performance goals with service-based vesting periods. Collectively, our NEOs hold approximately 690,000 vested shares, subject to~~lock-up~~ ~~restrictions through September 2, 2018.~~


						27						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						27						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~Stock Ownership Guidelines and Stock Retention Requirements:~~Our Board has established stock ownership guidelines for our NEOs to further align the interests of our executives with those of our stockholders. In addition, we believe that maintaining equity ownership in our company will mitigate a number of risks, including risks related to executive retention and undue risk- taking. The following guidelines for equity ownership are expressed as a multiple of each executive’s annual base salary:

~~NEO~~

~~Stock Ownership Requirement~~

~~(as a multiple of annual base salary)~~

~~CEO~~

~~Other NEOs~~

~~To determine compliance with these guidelines, generally, the following count towards meeting the stock ownership guidelines:~~

∎

~~Common shares held directly or indirectly, and~~

∎

~~Unvested restricted stock units subject solely to time-based vesting.~~

~~Stock options, whether vested or unvested, and equity-based awards subject to performance-based vesting conditions, are not~~
~~counted towards meeting the stock ownership guidelines until they have settled or been exercised, as applicable.~~

~~Until the guidelines are met, 70% of the net shares (after tax withholding) received upon settlement of equity-based awards are~~
~~required to be retained by the executive.~~

~~Currently, each of our NEOs is in compliance with our stock ownership guidelines and, in particular, Mr. Jacobs exceeds the~~
~~guidelines by a very significant degree, thereby closely aligning the interests of our NEOs with the interests of our stockholders.~~

~~Lock-up~~ ~~Restrictions on All Equity Awards:~~~~Our NEOs have been subject tolock-up~~ ~~restrictions that generally prohibit the sale of any shares of our common stock delivered pursuant to equity awards granted by our company after 2013 until September 2, 2018.~~

~~Clawback Policy:~~Our NEOs are subject to clawback restrictions with respect to long-term and annual short-term incentive compensation. The Committee is focused on mitigating risk associated with the company’s compensation program for NEOs and believes that clawback provisions are an important tool.

~~Long-Term Incentive~~

~~Each NEO’s employment agreement includes a clawback provision under which the NEO may be required, upon certain triggering~~
~~events, to repay all or a portion of long-term incentive compensation that was previously paid (including proceeds from previously-~~
~~exercised and vested equity-based awards), and to forfeit unvested equity-based awards. These clawback provisions are generally~~
~~triggered if the NEO:~~

∎

~~Has engaged in fraud or other willful misconduct that contributes materially to any significant financial restatements or material~~
~~loss to our company or any of our affiliates;~~

∎

~~Is terminated for Cause (as defined in the employment agreement); or~~

∎

~~Breaches the restrictive covenants that are applicable under his employment agreement.~~

~~Annual Short-Term Incentive~~

In addition, if the NEO has engaged in fraud or other willful misconduct that contributes materially to any financial restatements or material loss to the company or any of its affiliates, the company may require repayment by the NEO of any cash bonus or annual bonus previously paid (net of any taxes paid by the NEO on such bonus), or cancel any earned but unpaid cash bonus or annual bonus, or adjust the future compensation of the NEO, in order to recover an appropriate amount with respect to the restated financial results or the material loss. Furthermore, a portion of the NEOs’ 2016 short-term incentive award continues to be subject to repayment if the NEO leaves the Company for any reason (other than following a change in control) prior to April 2019.

~~Additional Provision~~

To the extent that the rules adopted by the SEC under the Dodd-Frank Wall Street Reform and Consumer Protection Act are broader than the clawback provisions contained in the employment agreements that are applicable to our NEOs, our NEOs will be subject to additional clawback provisions pursuant to such rules as described under the heading “Employment Agreements with NEOs—Clawbacks”.

~~Restrictive Covenants:Our NEOs are subject to comprehensivenon-competition~~ ~~and other restrictive covenants.~~

~~No Stock Option Repricing or Discounted Exercise Price:Our company’s equity incentive plan does not permit either stock option repricing without stockholder approval or stock option grants with an exercise price below fair market value.~~

~~No TaxGross-Ups:~~~~Our company does not provide taxgross-ups~~ ~~on any benefits or perquisites, including severance payments and other benefits received in connection with, or following, a change in control.~~


						28						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						28						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


9		~~No Pledging or Hedging of Company Stock:Under our insider trading policy, our company’s directors and executive officers, including the NEOs, are prohibited from pledging or holding company securities in a margin account withoutpre-clearance.~~ ~~In addition, such persons are prohibited from engaging in hedging transactions withoutpre-clearance,~~ such as prepaid variable forwards, equity swaps, collars and exchange funds or any other transactions that are designed to or have the effect of hedging or offsetting any decrease in the market value of equity securities.
10		No~~Exceptional Perquisites:~~Our NEOs have no guaranteed bonuses, no supplemental pension or retirement savings beyond what is provided broadly to all XPO employees, and no additional perquisites such as executive health services, club memberships, relocation assistance, stipends or financial planning services.
11		~~Independent Compensation Consultant:~~ ~~The Committee retains an independent compensation consultant who performs services only for the Committee, as discussed more fully in “Our Executive Compensation Governance Framework”.~~

~~Executive Compensation Structure~~

Our executive compensation program consists of three primary elements: base salary, annual short-term incentive awards and long-term incentive awards. Each of these elements is described in more detail below:


~~ELEMENT~~		~~OBJECTIVE~~	~~MECHANICS~~
1	~~Base Salary~~	~~Provide a competitive fixed component of compensation for services performed during the year, commensurate with the scope and scale of role.~~	Reviewed against the executive’s experience and responsibilities, and for competitiveness against XPO’s peer group and broader market data as described below under “The Committee’s Compensation Decision-Making Process”.
2	~~Annual Short-Term Incentive~~	~~Offer an annual cash compensation opportunity based upon achievement of both financial and strategic objectives at the company, business unit and individual levels.~~	Target bonuses are established as a percentage of base salary, with the ultimate outcome based on individual and company performance (including a focus on TSR), and are subject to clawback under certain conditions.
3	~~Long-Term Incentive~~	~~Align the interests of our executives with those of our stockholders through the use of long- term incentive awards that reward executives for achievement ofpre-determined~~ ~~financial goals and increases in our stock price over time.~~	The NEOs were granted PRSUs in 2016 with performance goals based on annual adjusted cash flow per share for the multi-year period from 2016 to 2019. The PRSUs are subject to clawback under certain conditions. ~~No additional long-term incentive grants have been made to our NEOs since 2016.~~


~~TOTAL REWARD COMPONENT MIX~~
Because the Committee feels strongly that executive compensation should be tightly linked to both company and individual performance, the executive compensation for our NEOs is heavily weighted towards equity-based and variable cash incentive awards. The Committee believes that the mix outlined below is appropriate to drive execution of our long-term strategy and to further align the interests of our NEOs with those of our stockholders.

~~CEO’s 2017 Target Total Reward Mix~~		~~Other NEOs’ 2017 Target Total Reward Mix~~
~~Note: Long-Term Incentive reflects annualized cash PRSU grant-date value~~

∎ ~~At target, 90% of our CEO’s 2017 total reward is incentive-based, and 80% is based on the achievement of long-term performance goals~~		∎ ~~For other NEOs, on average, 75% of the 2017 target total reward is incentive-based, and 50% is based on achievement of long-term performance goals~~


						29						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						29						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

~~The Committee’s Compensation Decision-Making Process~~

The Committee believes that its holistic approach to evaluating individual and company performance promotes greater alignment than overly formulaic programs, which may skew incentives. Using discretion to make its determinations on the NEOs’ total pay levels allows the Committee to enforce a balanced, multi-dimensional approach to executive compensation that incorporates a review of achievement against goals established at the beginning of the year, as described below.

~~KEY FACTORS CONSIDERED IN DETERMINING EXECUTIVE COMPENSATION~~

~~The company’s financial results relative to Board-reviewed and publicly disclosed targets for 2017~~

∎ Overall, under the persistent leadership of our NEOs, XPO generated record results in 2017 on nearly all financial measures, reaching or exceeding the high-growth financial targets established by management and the Board.

∎ ~~As part of the company’s budget and forecast processes, management set goals, reviewed and agreed to by the Board, on several key measures, as outlined below in Key Measures1-3.~~ Achievement against these measures was considered by the Committee when determining 2017 annual incentives for the NEOs. In addition, TSR performance—both in absolute and relative terms—forms a strong underpinning to the Committee’s decision-making framework.

~~Measure~~

~~2017 Forecast~~

~~Achievement~~

~~Key~~

~~Measures~~

1. Adjusted EBITDA, excluding our divested North American truckload unit *

~~$1.365 billion~~

✓

~~$1.367 billion~~

~~(+17% versus 2016)~~

2. Organic Revenue Growth*

~~Mid-single~~ ~~digit year over year growth~~

✓

~~Up 7% versus 2016~~

3. Free Cash Flow*

~~At least $350 million~~

✓

~~$374 million~~

~~(+77% versus 2016)~~

4. ~~Annual TSR~~

~~Expectation: Alignment with relevant indices~~

✓

~~XPO: 112%~~

~~Dow Jones Transportation Average: 19%~~

~~S&P 500 Index: 22%~~

~~Ranked #1 relative to peer group~~

* As defined in Annex A

∎~~Gating threshold to establish eligibility for short-term incentive payout:~~In March 2017, for each NEO, the Committee established a target annual cash incentive award for 2017 under the terms of our 2016 Omnibus Incentive Compensation Plan. Pursuant to the terms of the awards, the Committee set a performance goal that the company’s adjusted EBITDA for 2017 must equal or exceed approximately 75% of the forecasted adjusted EBITDA for 2017 in order for each NEO to become eligible for any short-term incentive award. Therefore, achievement of this EBITDA threshold, which ultimately occurred, was a requirement for payment of any annual short-term incentive in 2017.

∎ The Committee also evaluated and certified goal attainments associated with previously-awarded stock grants that had vesting events relevant to performance year 2017, representing a strong composite profile of overall company performance:

~~Measure~~

~~2017 Performance Goal~~

~~Achievement~~

~~Certification of Performance for Prior Equity Awards~~

~~Adjusted Free Cash Flow Per Share~~

~~$3.96~~

✓

~~Surpassed goal~~

~~Adjusted Earnings Per Share~~

~~$2.75~~

✓

~~Surpassed goal~~

~~Stock Price at $60 or above for 20 consecutive trading days prior to April 2, 2018~~

~~Achieve minimum target share price~~

✓

~~Surpassed $60 stock~~

~~price goal well in advance~~

~~of the April 2, 2018 date~~

Peer

Ticker

2018 Annual Revenue
($ in millions)

©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

United Parcel Service, Inc.

UPS

$71,861

FedEx Corp.

FDX

$65,450

Union Pacific Corp.

UNP

$22,832

C.H. Robinson Worldwide, Inc.

CHRW

$16,631

CSX Corp.

CSX

$12,250

Norfolk Southern Corp.

NSC

$11,458

J.B. Hunt Transport Services, Inc.

JBHT

$8,615

Ryder Systems, Inc.

$8,409

Expeditors International of Washington, Inc.

EXPD

$8,138

Knight-Swift Transportation

KNX

$5,344

YRC Worldwide, Inc.

YRCW

$5,092

XPO Logistics, Inc. (as reported)

XPO

$17,279

Percent Rank

.71

■

2Semler Brossy analyzed competitive pay levels of comparable NEOs at our peer companies using the most recent annual proxy statement disclosures. As a supplement to this data, management provided a competitive market analysis retrieved from the Willis Towers Watson general industry executive compensation survey, which offered insights into the lower quartile, median and upper quartile of all compensation components for executive positions spanning 34 companies, ranging from $15 billion to $20 billion in revenue. Given the significant number of senior executives hired into our company from diverse industries, management felt that comparing our NEOs to the NEOs of other companies of similar revenue size would provide a more comprehensive and multi-dimensional view of the market landscape.

~~The current value of realized and future realizable payouts of previously awarded stock compensation~~

∎ ~~The Committee evaluated the current values of the PRSUs granted in 2016 for each NEO at various stock price levels.~~

∎ ~~In particular, attention was focused on the current value of theone-quarter~~ ~~tranche of the 2016 PRSUs that was due to settle in February 2018 upon the Committee’s certification.~~

∎ The Committee considered the substantial appreciation in the value of this PRSU award relative to the sizing of the 2017 short-term annual incentive and moderated the short-term annual incentive payout percentage relative to target opportunity, despite the record results noted above for 2017.

~~In addition, no incremental equity compensation was granted for performance in 2017, in light of:~~

• The significant grant value and current value of the 2016 PRSU awards, which were granted in connection with the NEOs’ February 2016 employment agreements and were intended to cover a multi-year period; and

~~• The current value of other vested and unvested equity awards held by the NEOs, which are restricted from sale until September 2, 2018 and hold sufficient retentive value at present.~~

~~Analysis of total reward levels for our NEO positions relative to core peer group and general industry~~

∎ The Committee, with input from management and Semler Brossy, reviewed and approved the peer group used in evaluating executive compensation to ensure that the selected companies continue to reflect certain characteristics comparable to XPO.

∎ ~~These peer group characteristics include being in the transportation and logistics industry and having annual revenue greater thanone-quarter~~ ~~of XPO’s revenue. The peers comprising the 2017 peer group represent most of our publicly traded competitors and, in the Committee’s view, were reasonable given the revenue scale of XPO in 2017.~~

∎ While we monitor the structure of our peers’ pay programs, the Committee does not target a specific percentile positioning against the peer group. In addition, the Committee does not target a specific mix between cash and equity or short-term and long-term compensation relative to the mix used by peer group companies. The peer group for 2017 consisted of the following logistics and distribution or trucking companies:

~~Peer Name~~

~~Ticker Symbol~~

~~2017 Annual Revenue~~
~~($ in millions)~~

~~United Parcel Service, Inc.~~

~~UPS~~

~~$65,872~~

~~FedEx Corp.~~

~~FDX~~

~~$60,319~~

~~Union Pacific Corp.~~

~~UNP~~

~~$21,240~~

~~C.H. Robinson Worldwide, Inc.~~

~~CHRW~~

~~$14,869~~

~~CSX Corp.~~

~~CSX~~

~~$11,408~~

~~Norfolk Southern Corp.~~

~~NSC~~

~~$10,551~~

~~Ryder System, Inc.~~

~~$7,330~~

~~J.B. Hunt Transport Services, Inc.~~

~~JBHT~~

~~$7,190~~

~~Expeditors International of Washington, Inc.~~

~~EXPD~~

~~$6,921~~

~~YRC Worldwide, Inc.~~

~~YRCW~~

~~$4,891~~

~~Swift Transportation Co.~~

~~SWFT~~

~~XPOLogistics, Inc. (as reported)~~

~~XPO~~

~~$15,381~~

~~Percent Rank~~

~~64P~~

* 2017 annual revenue data not available due to the merger of Swift Transportation Co. and Knight Transportation, Inc. in 2017.

∎ For 2017, based on the advice of Semler Brossy, the Committee removed two companies from the peer group (Hub Group Inc. and Landstar Systems, Inc.) and added five companies (CSX Corp., FedEx Corp., Norfolk Southern Corp., Union Pacific Corp. and United Parcel Service, Inc.). These actions were undertaken to ensure that the size of companies in the peer group accurately reflected XPO’s significant increase in scale following the integration of our completed acquisitions.

∎ Semler Brossy analyzed competitive pay levels of comparable NEOs using the most recent annual proxy statement disclosures for our peer group companies. To supplement this data, management provided a competitive market analysis retrieved from the WTW general industry executive compensation survey, which offered insight into the lower quartile, median and upper quartile of all compensation components for executive positions spanning 39 companies that ranged from $15 billion to $20 billion in total net revenues, excluding companies in the Banking industry. Given the significant number of senior executives hired into the company across diverse industries, management felt that comparing our NEOs to other companies of similar size and scale would provide a more comprehensive and multi-dimensional view of the market landscape.

∎ The analysis across these two data sets was reviewed with the Committee, and demonstrated lower quartile alignment with respect to total cash compensation and more competitive levels of pay when incorporating current value of the annualized PRSU grant from 2016.

■

The analysis across these two data sets was reviewed by the Committee during its 2018 decision-making process, with two key results: the analysis demonstrated lower quartile alignment with respect to total cash compensation and more competitive levels of pay when the current value of the annualized PRSU grant from 2016 was incorporated.


31		©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
31	4	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~	NEOs' individual performance and contributions to the company throughout 2018. ■ The Committee, in consultation with our CEO (except with respect to his own performance assessment), assessed the performance of each NEO. ■ For 2018, the Committee determined that our company either accomplished or exceeded some of its key financial and strategic objectives for the year, while falling short on others, and applied rigorous consideration of the negative 38% stockholder return for 2018, particularly in relation to relevant indices. ■ While each of the NEOs was determined to have contributed meaningfully to the company's record financial achievements and significant year-over-year growth with respect to revenue, net income, EPS, adjusted EBITDA and free cash flow in 2018, the company did not fully meet its internal growth expectations, which was the basis for our external guidance to stockholders, established at the beginning of the year; as a result, NEOs received between 0% and 65% of their respective annual target cash incentives. ■ In determining the 2018 total reward for each NEO, the Committee's goal was to make a balanced assessment of the accomplishments and the challenges faced, in addition to considering the size and scope of their role and the NEO's degree of involvement in driving operational and financial outcomes for certain business units and/or the company as a whole. ■ In light of the below-target earnings performance in the later part of 2018, both Mr. Jacobs and Mr. Cooper voluntarily declined to receive a bonus, which the Committee strongly considered when they weighed the accomplishments noted in the next two sections below against the company's two main, broader challenges of: (i) missing earnings targets for two consecutive quarters and (ii) experiencing a steeper decline in stockholder return compared to relevant indices.


				36				©2019 XPO Logistics, Inc.

Table of Contents

Executive Compensation Program Changes for 2019

Gating Threshold to Establish Eligibility for Short-Term Incentive Payout

For the 2019 performance year, the Committee set the following performance goal: the company's adjusted EBITDA must equal or exceed 90% of the forecasted adjusted EBITDA for 2019 in order for each NEO, who remained employed on the date of payment, to become eligible for any short-term incentive award. Therefore, achievement of this EBITDA threshold will be a requirement for payment of any annual short-term incentive in 2019.

Maximum Amount of Bonus

Short-term incentive payouts will continue to be evaluated based on a framework of key performance measures that are of preeminent importance to the company and our stockholders – as described above for 2018 – as well as the individual contributions of each NEO in his or her respective role. Starting in 2019, cash bonuses will be subject to a payout range of 0% to 200% of target.


4	~~NEOs’ Individual Performance and Contributions to the Company during 2017~~
	∎	~~The Committee, in consultation with our CEO (except with respect to his own performance assessment), assessed the performance of each NEO.~~
	∎	For 2017, the Committee determined that our company accomplished and exceeded its key financial and strategic objectives for the year, as outlined above in key factor number one. Under the leadership and guidance of our NEOs, in 2017 we met rigorous financial performance goals, grew the company with exceptionally strong TSR, and continued to optimize our existing operations.
	∎	~~Each of the NEOs was determined to have contributed significantly to the company’s achievements during 2017.~~
	∎	In determining the 2017 total reward for the NEOs, the Committee’s goal was to recognize and reward each NEO’s performance, while also awarding short-term incentive awards that had the effect of relatively balancing total cash compensation across the group of NEOs, with consideration to each NEO’s job responsibilities and position.
	∎	In determining Mr. Jacobs’ 2017 total reward, the Committee considered the strong financial results achieved by the company under Mr. Jacobs’ leadership, including achievements in addition to the measures noted above, such as EPS and net income growth. The Committee also considered Mr. Jacobs’ achievements on other 2017 strategic objectives, including those summarized in the table below.

The ~~Committee’s~~Committee's Assessment of CEO Performance and Contributions for 2018

METRIC

ASSESSMENT OF ACHEIVEMENT

PROFIT GROWTH

XPO achieved record revenue, net income, EPS, adjusted EBITDA and free cash flow. Key financial highlights for full year 2018, as compared with 2017, include:

■

A year-over-year revenue increase of $1.9 billion, including 9.3% organic revenue growth*


1 ■ Growth in adjusted net income attributable to common shareholders* of 73% to $432 million ■ Growth in GAAP diluted EPS and adjusted diluted EPS* of 18% and 64%, respectively ■ Adjusted EBITDA* growth of 14.3% to $1.562 billion ■ Significant free cash flow* generation of $694 million ■ Three-year and five-year TSRs of 109% and 117%, respectively *See Annex A for a reconciliation of this non-GAAP measure.	~~PROFIT GROWTH~~	The fourth quarter of 2017 marked the company’s seventh consecutive profitable quarter and the completion of the sixth year in a row in which we met or exceeded our financial targets. Record achievements were generated in adjusted EBITDA, revenue, cash flow and EPS. Key financial highlights for full year 2017 include:
		∎	~~Adjusted EBITDA, excluding our divested North American truckload unit*, increased 17% year-over-year to $1.37 billion~~
		∎	~~Adjusted net income growth* of 104.5% year-over-year to $248.5 million~~
		∎	~~Overall year-over-year revenue increase of $761.4 million (7% organic revenue growth* since 2016)~~
		∎	~~Free cash flow* achievement of $374 million, 77% higher than 2016~~
		∎	~~Adjusted EPS* increase of 95% and GAAP EPS increase of more than 360% versus 2016~~
		∎	~~One-year~~ ~~TSR of 112%, along with three-year and five-year returns of 124% and 427% respectively~~
		* As defined in Annex A
2	~~BUSINESS~~ ~~GROWTH~~	~~Mr. Jacobs successfully managed the company’s rapid growth while earning multiple accolades inside and outside of the industry, including:~~
		∎	~~XPO’s rise to #191 on the Fortune 500, while being recognized as the fastest-growing U.S. transportation company on the list (after first ranking in the Fortune 500 in 2016)~~
		∎	~~XPO named the top performer on Forbes’ Global 2000 list of the world’s largest companies~~
		∎	~~XPO named the largest logistics company in the world by~~~~Transport Topics~~~~, based on 2016 net revenue~~
3	~~LEADERSHIP OF~~ ~~THE COMPANY~~	~~Under Mr. Jacobs’ leadership, we continued to build a global culture and a deep bench ofbest-in-class~~ ~~operators leading our lines of business, all focused on driving results.~~
		∎	~~Mr. Jacobs has led the company to a position as the industry’s foremost champion of technology, creating the foundation for an important competitive moat~~
		∎	~~Fortune~~~~magazine named XPO one of the “World’s Most Admired Companies”~~
		∎	~~Forbes~~~~magazine named XPO one of “America’s Best Employers” in its annual survey of more than 30,000 workers from all industries~~
		∎	~~Numerous executives from highly regarded companies in the Fortune 500 were hired into key leadership positions at XPO in both business unit and corporate roles~~


						32						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						32						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

BUSINESS GROWTH

Mr. Jacobs successfully led the company to strong, continued growth and numerous accolades in 2018, including:

Based on the accomplishments noted above, Mr. Jacobs’ short-term incentive was awarded at 120% of target opportunity. The Committee believes that this decision appropriately aligns Mr. Jacobs’ 2017 short-term pay with 2017 performance. Additionally, as with all other NEOs, Mr. Jacobs did not receive an additional equity award for performance in 2017.


						33						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						33						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

LEADERSHIP OF THE COMPANY

Under Mr. Jacobs' leadership, we continued to build a purpose-driven culture across all of our lines of business. For 2018:

■

Barron's ranked Mr. Jacobs #10 on its list of World's Best CEOs

■

Fortune named XPO one of the World's Most Admired Companies in 2018 and again in 2019, and #1 in its sector

■

Fortune named XPO to its Fortune Future 50 list of companies best positioned for breakout growth

■

Forbes named XPO one of the top-performing US companies on the Global 2000

■

Additionally, Mr. Jacobs led disciplined decision-making on capital allocation on behalf of our stockholders, pivoting from M&A to accretive share buy-backs in December 2018 when our stock price declined.

��


				37				©2019 XPO Logistics, Inc.

EMPLOYEE ENGAGEMENT

■

Mr. Jacobs conducts quarterly employee engagement surveys, which are sent to 50,000 of our employees across our global workforce. In these surveys, Mr. Jacobs solicits feedback on employee satisfaction and encourages the submission of ideas for improvement. Employee satisfaction ratings and the percentage of satisfied employees remained high, with an average rating above 7 out of 10 throughout all of 2018.

■

Mr. Jacobs hosts quarterly live town halls with employees around the world to discuss business priorities and answer questions; these were conducted each quarter in 2018.

■

Mr. Jacobs led the company in creating a more comprehensive benefits package for women and families in 2018, including a significant expansion of the company's existing pregnancy accommodations policy that is progressive for any industry.

BOARD ENGAGEMENT

■

Throughout 2018, Mr. Jacobs continued to engage Board members in internal business reviews, enabling real-time interaction.

■

Our Board members are invited to attend business reviews and hear, firsthand, the status of each major business and function against quarterly and annual business goals.

■

Directors engage in discussions with management on strategy, as well as immediate issues that may affect the business.


				38				©2019 XPO Logistics, Inc.


				39				©2019 XPO Logistics, Inc.

ELEMENT

OBJECTIVE

MECHANICS

Base Salary

Provide a competitive fixed component of compensation for services performed during the year, commensurate with the scope and scale of role.

Established relative to the executive's experience and responsibilities, and to maintain competitiveness against XPO's peer group and broader market data as described under "The Committee's Compensation Decision-Making Process."

Annual Short-Term Incentive

Offer an annual cash compensation opportunity based upon achievement of both financial and strategic objectives at the company, business unit and individual levels.

Established as a percentage of base salary, with outcomes based on individual and company performance; subject to clawback under certain conditions.

Long-Term Incentive

Offer long-term incentive awards ~~for 2017, the Committee considered the overall performance of the company, the company’s~~that reward achievement of ~~its strategic objectives, the importance of each NEO’s position~~pre-determined financial goals and increases in ~~relation~~our stock price over time.

Intended to tie executive pay to the ~~holistic operation~~long-term interests of stockholders, with outcomes based on stock price movement and, in the ~~company, and the CEO’s assessment~~case of ~~each NEO’s~~ performance ~~and contributions to the company. Below are highlights of the NEO achievements for 2017:~~


stock units, other financial performance factors.	~~NEO~~	~~2017 ACHIEVEMENTS~~
	~~TROY A. COOPER~~ *~~Chief Operating Officer~~*	~~As Chief Operating Officer and, for the first half of 2017, Chief Operating Officer and Chief Executive Officer for Europe, Mr. Cooper:~~
	~~STI Outcome vs. Target:120%~~	∎	Focused on accelerating the growth and momentum of the company and its transportation segment. This required a particular emphasis on driving sales organizational change and effectiveness in small freight shipping, Europe and the global strategic account management organization
		∎	~~Oversaw operations, resulting in strong returns and record earnings, particularly across the company’s transportation segment, including:~~
			•	~~Full-year revenue increase of 4%, to $9.8 billion;~~
			•	~~Adjusted EBITDA* increase of 10%, to $1.028 billion; and~~
			•	~~Operating income increase of 23%, to $538.8 million for full year and increase of 58%, to $132.8 million for the fourth quarter~~
		∎	~~Expanded the company’s position as the largeste-commerce~~ fulfillment provider in Europe and the largest last mile provider for heavy goods in North America, leading to 21% North American revenue growth in last mile in the fourth quarter and the launch of last mile operations in Europe
		∎	Accomplished numerous key strategic initiatives, including harmonizing the company’s North America transport businesses under one management structure and upgrading the sales organization across North America and Europe
			* As defined in Annex A
	~~JOHN J. HARDIG~~ *~~Chief Financial Officer~~*	As Chief Financial Officer, Mr. Hardig has led the company’s cost management initiatives and identified long-term cost management opportunities throughout the organization, resulting in significant savings. In 2017, Mr. Hardig:
	~~STI Outcome vs. Target:116%~~	∎	~~Presided over an increase in the company’s cash flow from operations and free cash flow to record levels~~
		∎	~~Renegotiated the terms of outstanding loans to reflect the company’s significant growth in size, financial stability and free cash flow~~
		∎	~~Actively managed the company’s real estate portfolio~~
		∎	~~Established a shared services model for the company’s financial operations with lower-cost locations throughout the United States, Europe and Asia~~
		∎	~~Streamlined the company’s financial operations through the implementation of more efficient systems and processes~~
		∎	~~Achieved an annual run rate of over $120 million in procurement savings~~
		∎	~~Evaluated multiple acquisition opportunities to ensure that any impending transaction is optimal for the company’s business model and long-term earnings potential~~
	~~SCOTT B. MALAT~~	~~As Chief Strategy Officer, Mr. Malat:~~
	*~~Chief Strategy Officer~~*	∎	~~Engaged with important customers to strengthen company relationships as the key transportation and logistics provider~~
	~~STI Outcome vs. Target:115%~~	∎	~~Took a leading role in the execution of our equity fundraising transaction in July 2017~~
		∎	~~Conducted research and analysis in connection with the company’s efforts to identify, refine and evaluate potential acquisition opportunities~~
		∎	Held over 700 discussions with stockholders throughout 2017 to promote transparency and dialogue surrounding the company’s business strategy, plans for future growth, and its commitment to demonstrating a high regard for all stakeholders


						34						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						34						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~


~~MARIO A. HARIK~~ *~~Chief Information Officer~~*	~~As Chief Information Officer, Mr. Harik:~~
~~STI Outcome vs. Target:115%~~	∎	~~Led the strategy to build and adopt cutting-edge technological solutions for the company’s internal operations to deliverend-to-end~~ ~~logistics solutions to customers~~
	∎	~~Implemented efficient technological solutions that kept the company under the allotted budget for technology in 2017~~
	∎	Furthered the company’s scientific data analysis and data protection initiatives by hiring a new Chief Information Security Officer, IT leads for infrastructure and business units, and over 100 big data scientists
	∎	~~Implemented an industry-first approach to transportation management, supporting customer visibility of all lines of business through a single, unified technology platform~~
	∎	~~Launched Drive XPO, a mobile app for carriers that streamlines the experience of locating, bidding on, securing and transporting loads~~
	∎	Facilitated the implementation of more than 14,000 handheld devices and inspection tablets for small freight drivers and dock workers, enhancing productivity and revenue collection from accessorial services
	∎	~~Launched a new less-than-truckload interface for customers, including tools for delivery management,pick-up~~ ~~management, planning and budgeting~~

Executive Compensation Outcomes for ~~2017~~2018


				40				©2019 XPO Logistics, Inc.



ANNUAL CASH COMPENSATION FOR 2018 PERFORMANCE YEAR
			Target Annual Cash Incentive							Actual Decisions
Executive Officer		Annual Base Salary	Annual Cash Incentive (% of Salary)			Annual Cash Incentive		Total Annual Cash Compensation		Annual Cash Incentive		Total Annual Cash Compensation

Bradley S. Jacobs	$	625,000	100	%	$	625,000	$	1,250,000		–	$	625,000

Troy A. Cooper	$	537,500	100	%	$	537,500	$	1,075,000		–	$	537,500

Mario A. Harik	$	425,000	100	%	$	425,000	$	850,000	$	276,300	$	701,300

Kenneth R. Wagers	$	525,000	100	%	$	525,000	$	1,050,000		–	$	525,000

John J. Hardig	$	515,000	100	%	$	515,000	$	1,030,000		–	$	515,000

Sarah J.S. Glickman	$	425,000	75	%	$	318,750	$	743,750	$	207,200	$	632,200

ANNUAL TOTAL DIRECT COMPENSATION

NEO
Total Earned Cash
    Compensation for 2017

      Annualized Target PRSU
Award at Grant Value

    Total Direct
Compensation /
Total Reward

Bradley S. Jacobs

$1,375,000 $5,000,000 $6,375,000

Troy A. Cooper

$1,182,500 $1,125,000 $2,307,500

John J. Hardig

$1,110,000 $1,000,000 $2,110,000

Scott B. Malat

$1,075,000 $1,000,000 $2,075,000

Mario A. Harik

   $915,000    $812,500 $1,727,500

NEO

Original 2016-2019
    Target PRSU Award

    Annualized Target Award

Bradley S. Jacobs

$20,000,000 $5,000,000

Troy A. Cooper

  $4,500,000 $1,125,000

John J. Hardig

  $4,000,000 $1,000,000

Scott B. Malat

  $4,000,000 $1,000,000

Mario A. Harik

  $3,250,000    $812,500

Long-Term Incentive ~~Program~~

No long-term incentive awards were made to our NEOs in 2017, in light of the continuing effectiveness of the multi-year award granted in 2016 to incentivize superior performance and retention. In 2016, the Committee determined that it would be advisable to make PRSU awards to our leadership team to maximize retention and incentivize a unified focus on execution of our long-term strategy.
	41	©2019 XPO Logistics, Inc.



CASH-SETTLED PERFORMANCE AWARDS GRANTED IN FEBRUARY 2016
		2016 - 2019 PRSU at Grant Value
Executive Officer		Total Amount		Annual Amount(1)	Committee Decision on Voluntary Reduction of Third Tranche Due to Settle in February 2019		Adjusted Annual Amount for 2018 at Grant Price

Bradley S. Jacobs	$	20,000,000	$	5,000,000	–24%	$	3,794,521

Troy A. Cooper	$	4,500,000	$	1,125,000	–24%	$	853,770

Mario A. Harik	$	3,250,000	$	812,500	–24%	$	616,594

John J. Hardig	$	4,000,000	$	1,000,000	Separation Agreement: pro-rata number of units (27,134) from third tranche	$	621,911

(1): Represents the grant value of the target award divided over the four-year performance period.


				42				©2019 XPO Logistics, Inc.

KEY FEATURES OF THE 2019 - 2022 PRSUs

Adjusted Cash Flow Per Share Metric

■

The ~~Committee designed our 2016 long-term equity incentive awards to align~~calculation for the ~~interests of our executives with those of our stockholders by tying a substantial portion of our executives’ compensation to XPO’s stock price over time. The PRSU awards have high-growth~~ adjusted cash flow per share ~~targets~~metric is defined as:
(i) Adjusted EBITDA (determined in accordance with the company's monthly operating reports and ~~payment~~for external reporting purposes, and adjusted for the impact of stock and phantom stock compensation) less any capital expenditures and net interest expense divided by
(ii) Diluted shares outstanding.

■

This metric was selected to align with the company's strategy of driving efficient capital allocation and prudent investments in compelling growth opportunities as we continue to execute our strategy. It's intended to be representative of organic EBITDA growth over an extended period of time. The subtraction of capital expenditures in the calculation eliminates the possibility of artificially or temporarily inflating adjusted EBITDA by increasing capital investments.

■

Given the nature of the calculation, this metric is also responsive to acquisitions and divestitures: an acquisition would increase adjusted EBITDA and either increase interest expense or increase share count, thereby offsetting the benefit of inorganic growth. With a divestiture, adjusted EBITDA and interest expense would decline in tandem, appropriately offsetting each other.

■

In a stock buy-back scenario, share count would decrease but interest expense would likely rise, thereby lowering the adjusted EBITDA calculation and creating a reasonable offset. Additionally, the performance goal requires significant annual growth in adjusted EBITDA (20%) to become probable.

■

There isno upside leverage if the target is exceeded in any given year; the maximum achievement is the target itself (100%).

■

Payouts aretied directly to stock price performance, in direct alignment with stockholder interests. If our stock price increases from grant date to settlement date, the ~~company’s financial performance every single year from 2016~~award will pay out at a higher amount. Conversely, if the stock price declines in that same period, the award will decline in value at the same rate as the stock price.

■

High-growth targets demonstrate management's and the Committee's confidence that the company is well-positioned to ~~2019. The Committee considered these awards as grants that would cover a multi-year~~demonstrate continued progress.

■

Awards aresubject to clawback both during the vesting period and ~~no additional grants have been made since 2016.~~

~~KEY FEATURES OF THE PRSU PROGRAM~~

1 after payout based on the circumstances specified by the terms of the awards.

~~��~~

~~The PRSUs, granted in February 2016, will vest 25% annually over four years only if thepre-determined~~ ~~performance~~
~~goals for adjusted cash flow per share are achieved.~~

•

~~The first and second tranches vested upon the company exceeding adjusted cash flow per share targets of $2.93 for~~
~~2016 and $3.96 for 2017, with certification by the Committee in February 2017 and February 2018, respectively.~~

•

~~Based on XPO’s stock price on the vesting dates, Messrs. Jacobs, Cooper, Hardig, Malat and Harik received cash~~
~~payments specified by the terms of the awards.~~

•

~~The targets for the remaining two years are rigorous, with high double-digit growth rates expected for adjusted cash~~
~~flow per share over the next two years:~~

~~2016: $2.93~~

~~2017: $3.96~~

~~2018: $5.38~~

~~2019: $6.39~~

~~> +35%~~

~~> +36%~~

~~> +19%~~

∎ ~~Using multipleone-year~~ ~~performance periods reinforces the incentive to put forth steady and strong annual performance.~~

∎ This structure also mitigates the risk that our NEOs under-perform for several years and “make up” the goal achievement in the final stretch, as could happen with a single multi-year measurement period.

∎

~~Adjusted cash flow per share, for the purposes of the PRSU awards, means (i) adjusted EBITDA (determined in~~
~~accordance with the company’s monthly operating reports and for external reporting purposes and adjusted for the~~
~~impact of stock and phantom stock compensation) less any capital expenditures and interest divided by (ii) diluted shares~~
~~outstanding.~~

∎

~~The adjusted cash flow per share metric was selected to align with the company’s strategy of driving efficiency as we~~
~~continue to scale up in size and scope.~~


						36						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						36						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Other Long-Term Incentives Awarded in 2018

In connection with recruiting Mr. Wagers, the company granted him a new hire incentive award intended to provide for an annual award value of approximately $1 million per year for 10 years, based on grant price. The award was granted as restricted stock units and, together with salary and cash bonus, reflected market competitive total compensation when viewed on an annualized basis. As a result of his termination on March 11, 2019, Mr. Wagers is no longer entitled to the remaining balance of his award.


				43				©2019 XPO Logistics, Inc.

Table of Contents

In recognition of Ms. Glickman assuming the role of acting chief financial officer, the company granted her a performance-based restricted stock unit award. This award has a performance goal requiring achievement of a closing stock price of $200 per share over a period of 20 consecutive trading days prior to August 2023, with a minimum three-year service condition. In accordance with her offer, Ms. Glickman also received a time-based new hire restricted stock unit award, primarily as a buy-out of stock forfeited from her previous company, with a grant date value of approximately $1.9 million, vesting annually in equal installments over six years. In addition, as part of her offer, a time-based restricted stock unit award for performance year 2018 was granted. This award has a grant date value of $125,457 and vests 50% on the second anniversary and 50% on the third anniversary of the grant date.

Annualized Total Direct Compensation

The table below shows the Committee's compensation decisions for 2018 for the NEOs who were active as of December 31, 2018. This table differs from the SEC-required disclosure in the "Summary Compensation Table", which does not capture previously awarded long-term incentive compensation that is considered by the Committee in its view of total reward opportunity for the NEOs.

The PRSU figures represented below reflect the annualized grant value of the 2016 PRSUs, 25% of which vests annually over the four-year period from the initial grant date. The high-growth 2019 - 2022 PRSUs are stretch-goal awards that are not comprised of annual features in terms of targets or vesting tranches and are, therefore, not included below. However, the realizable value of these stretch-goal awards will be assessed annually by the Committee when determining future years' total reward opportunities.


ANNUALIZED TOTAL DIRECT COMPENSATION OPPORTUNITY
Active Executive Officer as of December 31, 2018	Total Annual Cash Compensation	Annualized 2018 Awards at Grant Value (excluding 2019 – 2022 PRSUs)(1)	Reduced 2016 – 2019 PRSU Annualized Target	Total Direct Compensation

Bradley S. Jacobs	$625,000	$0	$3,794,521	$4,419,521

Troy A. Cooper	$537,500	$0	$853,770	$1,391,270

Mario A. Harik	$701,300	$0	$616,594	$1,317,894

Kenneth R. Wagers III	$525,000	$1,092,210⁽²⁾	$0	$1,617,210

Sarah J.S. Glickman	$632,200	$358,040⁽³⁾	$0	$990,240

(1): Refer to the "Grants of Plan-Based Awards" table for details of the number of 2019 – 2022 PRSUs granted.
(2): Represents the grant value of Mr. Wagers' RSU award granted on April 23, 2018 divided over the vesting period (grant date value of $10,922,100 with a 10-year pro-rata vesting schedule).
(3): Represents the grant value of Ms. Glickman's RSU award granted on June 8, 2018 and April 18, 2019 divided over the vesting period (the June 8, 2018 award has a grant date value of $1,897,324 with a six-year pro-rata vesting schedule; the April 18, 2019 award has a grant date value of $125,457 with a vesting schedule of 50% on the second anniversary and 50% on the third anniversary).


3	∎	The targeted annual award values were determined with reference to each NEO’s contributions to our company as of the grant date, their anticipated contribution to the achievement of our strategic objectives and TSR performance in the future, and prior equity- based awards granted to the NEO. No particular weighting was assigned to any of these considerations.
	∎	~~In granting the PRSUs, the Committee also determined that the structure of the award, with achievement of the final~~ ~~adjusted cash flow per share performance goal not possible until after the end of 2019, provided an important retentive~~ ~~element and increased long-term focus for our NEOs.~~
	∎	~~The PRSUs were intended to cover a multi-year period, and no additional grants have been made since 2016.~~
4	∎	~~There is zero payout if the established financial targets are not attained (i.e., no minimum achievement threshold upon which any portion of the award would be earned).~~
5	∎	~~There is no upside leverage if the target is exceeded in any given year; the maximum achievement is the target itself (100%).~~
6	∎	Payouts are tied directly to stock price performance, in direct alignment with stockholder interests. If our stock price increases from grant date to vesting date, the award will pay out at a higher amount than the original grant. Conversely, if the stock price declines in that same period, the original grant will decline in value at the same rate as the stock price.
7	∎	Going forward, we are aiming for our NEOs to lead a 17% year-over-year increase in adjusted EBITDA in 2018, well beyond the forecast for the industry, with cash generation growing at a faster pace than EBITDA and expected to reach a targeted approximately $625 million over the course of 2018.
	∎	~~These high-growth targets demonstrate management’s and the Committee’s confidence that the company is well-~~ ~~positioned to demonstrate continued progress.~~
8	∎	~~Awards are subject to clawback both during the vesting period and after payout based on the circumstances as specified by the terms of the awards.~~

Other Compensation-Related Items

We believe that it is in the best interests of our company to enter into multi-year employment agreements with our NEOs because the agreements promote long-term retention while allowing the Committee to exercise discretion in designing incentive compensation programs. The material compensation-related terms of these agreements are described under the heading “Employment Agreements with NEOs” and the tables that follow this Compensation Discussion and Analysis.	Effective February 9, 2016, the company entered into new employment agreements with each of the NEOs. Each of these 2016 employment agreements has a term through February 9, 2020, and expires at the end of the term without automatic renewal. The 2016 employment agreements contain comprehensive restrictive covenants which are described under the heading “Employment Agreements with NEOs—Restrictive Covenants”.
		44	©2019 XPO Logistics, Inc.

Tax Considerations

Section 162(m) of the Internal Revenue Code has historically disallowed a federal income tax deduction to public companies for compensation greater than $1 million paid in any tax year to covered executive officers unless the compensation meets the requirements of the “qualified performance-based compensation” exemption under that section. In 2017 and in prior years, certain of our compensation plans were designed to permit us to grant awards that may qualify for the “qualified performance-based compensation” exemption. However, this exemption was eliminated by recent tax legislation, effective for taxable years beginning after December 31, 2017. The legislation also expanded the group of executives covered by Section 162(m). Therefore, we expect that compensation awarded to our covered executive officers in excess of $1 million in 2018 and later tax years will not be deductible by the company unless it qualifies for limited transition relief that applies to certain arrangements in place as of November 2, 2017. Because of uncertainties in the application and interpretation of Section 162(m), and the absence at this juncture of regulatory guidance on the scope of the transition relief, no assurance can be given that awards paid in 2018 and later years that were originally intended to qualify for the “qualified performance-based compensation” exemption, or that were otherwise expected to be deductible prior to the recent tax legislation, will in fact be deductible.

~~We believe that the tax deduction limitation imposed by Section 162(m) should not compromise the company’s~~


~~S-K~~ ~~as set forth above. Based on such review and discussions, the Committee recommended to the Board of Directors that the~~	45	©2019 XPO Logistics, Inc.

~~Compensation Tables~~

Summary Compensation Table


Name and Principal Position		Year	Salary ($)	Bonus(1) ($)	Stock Awards(2) ($)		Option Awards(2) ($)	Non-Equity Incentive Plan Compensation ($)	All Other Compensation(3) ($)		Total ($)

Bradley S. Jacobs(4)	2018		$625,000	–	$12,690,463	(5)	–	–	$12,008	$13,327,471
Chairman and	2017		$625,000	–	–		–	$750,000	$9,021	$1,384,021
Chief Executive Officer	2016		$607,000	$1,375,000	$19,999,992		–	–	$2,456	$21,984,448
Troy A. Cooper	2018		$537,500	–	$2,460,008	(5)	–	–	$12,008	$3,009,516
President	2017		$537,500	–	–		–	$645,000	$9,021	$1,191,521
	2016		$511,539	$1,075,000	$4,499,998		–	–	$2,337	$6,088,874
Mario A. Harik	2018		$425,000	$276,300	$1,230,004	(5)	–	–	$11,857	$1,943,161
Chief Information Officer	2017		$425,000	–	–		–	$490,000	$9,021	$924,021
Kenneth R. Wagers III Former Chief Operating Officer and Interim President, LTL–North America	2018		$363,462	–	$10,922,100	(6)	–	–	$756	$11,286,318
Sarah J.S. Glickman Acting Chief Financial Officer	2018		$246,827	$207,200	$3,528,923		–	–	$73,446	$4,056,396
John J. Hardig	2018		$324,846	–	–		–	–	$34,842	$359,688
Former Chief Financial	2017		$515,000	–	–		–	$595,000	$9,021	$1,119,021
Officer	2016		$498,385	$915,000	$3,999,998		–	–	$2,512	$5,415,895

(1): The amounts reflected in this column for 2018 represent an annual cash bonus award earned in respect of 2018, which is described in more detail under the heading "Executive Compensation Outcomes for 2018–Annual Short-Term Incentive."
(2): The amounts reflected in this column represent the aggregate grant date fair value of the awards made during each respective year, as computed in accordance with FASB ASC Topic 718. For a further discussion of the assumptions used in the calculation of the grant date fair values for each year, see Note 14 to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018. Cash-settled PRSU awards are measured at fair value initially based on the closing price of the Company's common stock at the date of grant and are re-measured to fair value at each reporting date until settlement.
(3): The components of "All Other Compensation" for 2018 are detailed below in the "All Other Compensation" table.
(4): Mr. Jacobs did not receive any additional compensation for his service as a director.
(5): In August 2018, the Committee awarded Mr. Jacobs, Mr. Cooper and Mr. Harik PRSUs that require achievement of both a high-growth performance and stock price goal, and cannot be earned until after the four-year performance period ending December 31, 2022. The stretch goals underlying these PRSUs include: (i) achievement of an average stock price of $225 over a 20-trading day period, and (ii) Adjusted Cash Flow Per Share (as defined in the relevant award agreements) of $14.00 by December 31, 2022. Both goals must be attained for the award to be earned; there is no threshold level of payment for below-target performance and no upside leverage for exceeding the targets, mirroring the same features in previously awarded performance-based equity grants.
(6): Effective March 11, 2019, the company terminated Mr. Wagers' employment, without cause. As a result of his termination without cause, Mr. Wagers received the prorated vesting of 9,292 RSUs.

~~The following table sets forth information concerning the total compensation awarded to, earned by, or paid to our NEOs for the year ended December 31, 2017.~~

Option   Non-Equity
Name and Principal   Stock   Awards⁽²⁾   Incentive Plan All Other
Position

Year

Salary ($)

Bonus⁽¹⁾($)

Awards⁽²⁾($)

($)

Compensation⁽³⁾($)

Compensation⁽⁴⁾ ($)

Total ($)

Bradley S. Jacobs⁽⁵⁾
2017   $625,000   –   –   – $750,000 $9,021 $1,384,021
Chairman and
2016   $607,000   $1,375,000   $19,999,992 ⁽⁶⁾   – – $2,456 $21,984,448
Chief Executive Officer

2015

$495,000

–

$2,948,108

–

$2,325,000

$3,614

$5,771,722

Troy A. Cooper
Chief Operating Officer

2017   $537,500   –   –   – $645,000 $9,021 $1,191,521
2016   $511,539   $1,075,000   $4,499,998 ⁽⁶⁾   – – $2,337 $6,088,874
2015

$350,000

–

$491,361

–

$1,850,000

$3,760

$2,695,121

John J. Hardig
Chief Financial Officer

2017   $515,000   –   –   – $595,000 $9,021 $1,119,021
2016   $498,385   $915,000   $3,999,998 ⁽⁶⁾   – – $2,512 $5,415,895
2015

$395,000

$200,000

$491,361

–

$1,650,000

$32,982

$2,769,343

Scott B. Malat
Chief Strategy Officer

2017   $500,000   –   –   – $575,000 $9,021 $1,084,021
2016   $472,308   $500,000   $3,999,998 ⁽⁶⁾   – – $2,317 $4,974,623
2015

$300,000

$200,000

$491,361

–

$1,650,000

$3,916

$2,645,277

Mario A. Harik
Chief Information Officer

2017

$425,000

–

–

–

$490,000

$9,021

$924,021

⁽¹⁾

~~The amounts reflected in this column for 2015 represent a $200,000one-time~~ discretionary cash incentive award paid on June 30, 2015, to each of Messrs. Hardig and Malat in recognition of their contributions in connection with the company’s acquisition of Norbert Dentressangle SA and the related financing transactions.

⁽²⁾

The amounts reflected in this column represent the aggregate grant date fair value of the awards made during each respective year, as computed in accordance with ASC 718. For a further discussion of the assumptions used in the calculation of the grant date fair values for each year, please see “Notes to Consolidated Financial Statements–Note 13. Stock-Based Compensation” of our company’s Annual Report on Form~~10-K~~

©2019 XPO Logistics, Inc. ~~for the year ended December 31, 2017. Cash-settled PRSU awards are measured at fair value initially based on the closing price of the Company’s common stock at the date of grant and arere-measured~~ ~~to fair value at each reporting date until settlement.~~

⁽³⁾

The amounts reflected in this column for 2017 represent an annual cash bonus award earned in respect of 2017, which is described in more detail under the heading “Executive Compensation Outcomes for 2017–NEO Total Compensation.”

⁽⁴⁾	~~The components of “All Other Compensation” for 2017 are detailed below in the “All Other Compensation” table.~~

⁽⁵⁾	~~Mr. Jacobs did not receive any additional compensation for his services as a director.~~

⁽⁶⁾	~~This amount:~~

~~Reflects the aggregate grant date fair value of the PRSUs granted in 2016–the amount of the PRSU payout in each year is dependent on the company’s stock price at the time the award is settled;~~

~~Assumes the achievement of the applicable performance goals at the target level–there is no payout under these awards if the relevant annual financial target is not met; and~~

~~Reflects full vesting of the award–only 25% of each PRSU award will vest annually if the relevant adjusted cash flow per share goal in each year of the four-year vesting period is achieved.~~

We compensate our NEOs pursuant to the terms of their respective employment agreements, and the information reported in the Summary Compensation Table reflects the terms of such agreements. For more information about our NEOs’ employment agreements, see the discussion in this proxy statement under the heading “Employment Agreements with NEOs.”

Name

Matching
Contributions to
401(k) Plan(1) ($)

Company-
Paid Life
Insurance
Premiums(2) ($)

Perquisites
and Other
Personal
Benefits ($)

Relocation(3) ($)

Relocation
Gross-up(4) ($)

Payout of
Paid Time Off(5) ($)

Total ($)

Bradley S. Jacobs

$11,000

$1,008

–

$12,008

Troy A. Cooper

$11,000

$1,008

–

$12,008

Mario A. Harik

$11,000

$857

–

$11,857

Kenneth R. Wagers III

–

$756

–

$756

Sarah J.S. Glickman

–

$859

–

$52,288

$20,299

–

$73,446

John J. Hardig

$11,000

$672

–

$23,170

$34,842

(1): Amounts in this column represent matching contributions made by XPO to the company's 401(k) plan. Only amounts contributed directly by our NEOs are eligible for matching contributions, and our NEOs are eligible for matching contributions on the same basis as all other eligible employees of our company. The 2018 401(k) matching amounts are larger than in previous years due to an increase in the 401(k) company match percentage that aligns with a Safe Harbor Matching formula for all eligible participants in the XPO Logistics, Inc. 401(k) Plan, as well as an increase in the annual compensation limit as defined by §§ 401(a)(17).
(2): Amounts in this column include the company-paid premiums for basic life insurance.
(3): Amounts in this column reflect relocation benefits provided by the company to Ms. Glickman in connection with her commencement of employment in 2018.
(4): Amounts in this column reflect the tax gross-up provided to Ms. Glickman in respect of the relocation benefits provided by the company.
(5): Amounts in this column reflect a payout of paid time off provided to Mr. Hardig in connection with his termination with the company.

Grants of Plan-Based Awards

Estimated Future Payouts
Under Equity Incentive Plan Awards

All Other
Stock
Awards:
Number of

All Other
Option
Awards:
Number of

Exercise
or Base
Price of

Grant Date
Fair
Value of

Name

Grant
Date

Threshold (#)

Target (#)

Maximum (#)

Shares of
Stock or
Units (#)

Securities
Underlying
Options (#)

Option
Awards
($/Share)

Stock and
Option
Awards(1)

Bradley S. Jacobs

8/16/2018

–

238,095

–

$12,690,463

(2)

Troy A. Cooper

8/16/2018

–

46,154

–

$2,460,008

(2)

Mario A. Harik

8/16/2018

–

23,077

–

$1,230,004

(2)

Kenneth R. Wagers III

4/23/2018

–

105,000

–

$10,922,100

(3)

Sarah J.S. Glickman

6/8/2018

–

23,760

–

17,050

–

$3,528,923

8/9/2018

John J. Hardig

n/a

–

(1): Amounts in this column reflect the grant date fair value of awards calculated in accordance with FASB ASC Topic 718, using the valuation methodology and assumptions set forth in Note 14 to the financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018.
(2): In August 2018, the Committee awarded Mr. Jacobs, Mr. Cooper and Mr. Harik PRSUs that require achievement of both a high-growth performance and stock price goal, and cannot be earned until after the four-year performance period ending December 31, 2022. The stretch goals underlying these PRSUs include: (i) achievement of an average stock price of $225 over a 20-trading day period, and (ii) Adjusted Cash Flow Per Share (as defined in the relevant award agreements) of $14.00 by December 31, 2022. Both goals must be attained for the award to be earned; there is no threshold level of payment for below-target performance and no upside leverage for exceeding the targets, mirroring the same features in previously awarded performance-based equity grants.
(3): Effective March 11, 2019, the company terminated Mr. Wagers' employment, without cause. As a result of his termination without cause, Mr. Wagers received the prorated vesting of 9,292 RSUs.

~~The following table provides additional detail regarding grants of equity andnon-equity~~ ~~plan-based awards. No equity awards were made to NEOs during 2017.~~

All Other
Stock
Awards:
Number of

All Other
Option
Awards:
Number of

Exercise
or Base
Price of

Grant Date
Fair
Value of
Estimated Future Payouts Under Estimated Future Payouts
Non-Equity Incentive Plan Awards⁽¹⁾ Under Equity Incentive Plan Awards⁽²⁾

Shares of   Securities   Option   Stock and
Grant   Stock or   Underlying   Awards   Option
Name

Date

Threshold ($)

Target ($)

Maximum ($)

Threshold (#)

Target (#)

Maximum (#)

Units (#)

Options (#)

($/Sh)

Awards⁽²⁾

Bradley S. Jacobs

n/a

–

625,000

–

–

–

–

–

–

–

–

Troy A. Cooper

n/a

–

537,500

–

–

–

–

–

–

–

–

John J. Hardig

n/a

–

515,000

–

–

–

–

–

–

–

–

Scott B. Malat

n/a

–

500,000

–

–

–

–

–

–

–

–

Mario A. Harik

n/a

–

425,000

–

–

–

–

–

–

–

–

⁽¹⁾

~~Amounts represent the target award for each NEO. For actual payout information, see “Executive Compensation Outcomes for 2017—NEO Total Compensation.”~~

⁽²⁾

~~No equity grants were made to any of the NEOs in 2017.~~

Additional information relevant to the awards that are shown in the above table (including a discussion of the applicable performance criteria and the actual payouts under such awards) is included in the “Compensation Discussion and Analysis” section of this proxy statement.


	Option Awards					Stock Awards

	Number of Securities Underlying Unexercised	Number of Securities Underlying Unexercised	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised	Option	Option	Number of Shares or Units of Stock		Market Value of Shares or Units of Stock		Equity Incentive Plan Awards: Number of Unearned Shares Units or Other Rights That		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares Units or
Name	Options (#) Exercisable	Options (#) Unexercisable	Unearned Options (#)	Exercise Price ($)	Expiration Date	That Have Not Vested (#)		That Have Not Vested ($)(1)		Have Not Vested (#)		Other Rights That Have Not Vested ($)(1)

Bradley S. Jacobs	250,000	–	–	$9.28	11/21/2021	218,150	(2)	$12,443,276	(2)	456,245	(3)	$26,024,214	(3)
Troy A. Cooper	25,000	–	–	$11.46	01/16/2022	49,084	(4)	$2,799,751	(4)	95,238	(5)	$5,432,375	(5)
Mario A. Harik	135,000	–	–	$9.79	11/14/2021	35,449	(6)	$2,022,010	(6)	58,527	(7)	$3,338,380	(7)
Kenneth R. Wagers III	–	–	–	–	–	105,000	(8)	$5,989,200	(8)	–		–
Sarah J.S. Glickman	–	–	–	–	–	17,050	(9)	$972,532	(9)	23,760	(10)	$1,355,270	(10)
John J. Hardig	–	–	–	–	–	27,134	(11)	$1,547,723	(11)	–		–

Note: Vesting of all outstanding equity awards is subject to continued employment by the NEO on the applicable vesting date, subject to certain exceptions in connection with a qualifying termination of employment.

(1): The values reflected in this column were calculated using $57.04, the closing price of a company share on the NYSE on December 31, 2018, the last trading day of our fiscal year 2018.
(2): Consists of 218,150 cash-settled PRSUs which vested on February 9, 2019, upon Committee certification of the achievement of the applicable performance criteria. The number of PRSUs was reduced to 165,555 pursuant to an amendment letter agreement entered into between the company and the executive on December 31, 2018.
(3): Consists of 218,150 cash-settled PRSUs which vest on February 9, 2020, and 238,095 PRSUs which vest on December 31, 2022, subject to achievement of certain performance criteria. PRSUs are reflected at the target level, which is also the threshold and maximum level. The PRSUs noted as vesting on December 31, 2022 require achievement of both a high-growth performance and stock price goal, and cannot be earned until after the four-year performance period ending December 31, 2022. The stretch goals underlying these PRSUs include: (i) achievement of an average stock price of $225 over a 20-trading day period, and (ii) Adjusted Cash Flow Per Share (as defined in the relevant award agreements) of $14.00 by December 31, 2022. Both goals must be attained for the award to be earned; there is no threshold level of payment for below-target performance and no upside leverage for exceeding the targets, mirroring the same features in previously awarded performance-based equity grants.
(4): Consists of 49,084 cash-settled PRSUs which vested on February 9, 2019, upon Committee certification of the achievement of the applicable performance criteria. The number of PRSUs was reduced to 37,250 pursuant to an amendment letter agreement entered into between the company and the executive on December 31, 2018.
(5): Consists of 49,084 cash-settled PRSUs which vest February 9, 2020, and 46,154 PRSUs which vest on December 31, 2022, subject to achievement of certain performance criteria. PRSUs are reflected at the target level, which is also the threshold and maximum level. The PRSUs noted as vesting on December 31, 2022 require achievement of both a high-growth performance and stock price goal, and cannot be earned until after the four-year performance period ending December 31, 2022. The stretch goals underlying these PRSUs include: (i) achievement of an average stock price of $225 over a 20-trading day period, and (ii) Adjusted Cash Flow Per Share (as defined in the relevant award agreements) of $14.00 by December 31, 2022. Both goals must be attained for the award to be earned; there is no threshold level of payment for below-target performance and no upside leverage for exceeding the targets, mirroring the same features in previously awarded performance-based equity grants.
(6): Consists of 35,449 cash-settled PRSUs which vested on February 9, 2019, upon Committee certification of the achievement of the applicable performance criteria. The number of PRSUs was reduced to 26,902 pursuant to an amendment letter agreement entered into between the company and the executive on December 31, 2018.
(7): Consists of 35,450 cash-settled PRSUs which vest on February 9, 2020, and 23,077 PRSUs which vest on December 31, 2022, subject to achievement of certain performance criteria. PRSUs are reflected at the target level, which is also the threshold and maximum level. The PRSUs noted as vesting on December 31, 2022 require achievement of both a high-growth performance and stock price goal, and cannot be earned until after the four-year performance period ending December 31, 2022. The stretch goals underlying these PRSUs include: (i) achievement of an average stock price of $225 over a 20-trading day period, and (ii) Adjusted Cash Flow Per Share (as defined in the relevant award agreements) of $14.00 by December 31, 2022. Both goals must be attained for the award to be earned; there is no threshold level of payment for below-target performance and no upside leverage for exceeding the targets, mirroring the same features in previously awarded performance-based equity grants.


				48				©2019 XPO Logistics, Inc.

(8): Consists of 105,000 RSUs which vest in 10 annual installments beginning on April 23, 2019 through April 23, 2028. Effective March 11, 2019, the company terminated Mr. Wagers' employment, without cause. As a result of his termination without cause, Mr. Wagers received the prorated vesting of 9,292 RSUs.
(9): Consists of 17,050 RSUs which vest in six annual installments beginning on June 8, 2019 through June 8, 2024.
(10): Consists of 23,760 PRSUs which will vest on August 9, 2021, subject to achievement of certain performance criteria. PRSUs are reflected at the target level, which is also the threshold and maximum level.
(11): Consists of 27,134 cash-settled PRSUs which vested on February 9, 2019, upon Committee certification of the achievement of the applicable performance criteria and the terms of Mr. Hardig's separation agreement.

Option Awards

Stock Awards

Name

Number of Shares
Acquired on Exercise (#)

Value Realized on
Exercise ($)(1)

Number of Shares
Acquired on
Vesting (#)

Value Realized on
Vesting ($)(2)

Bradley S. Jacobs

–

471,179

$43,079,896

Troy A. Cooper

–

136,208

$12,456,347

Mario A. Harik

–

70,420

$6,438,501

Kenneth R. Wagers III

–

Sarah J.S. Glickman

–

John J. Hardig

50,000

$3,347,000

105,560

$9,651,351

(1)

The values reflected in this column were calculated using the difference between the closing price of the date of exercise and the exercise price.

(2)

The values reflected in this column were calculated by multiplying the number of shares that vested in 2018 by the closing price of one share of XPO common stock ~~option exercises by our NEOs during 2017.~~

Option Awards Stock Awards

Name

Number of Shares
        Acquired on Exercise (#)

          Value Realized on
Exercise ($)

          Number of Shares
Acquired on
Vesting (#)

          Value Realized on
Vesting ($)⁽¹⁾

  Bradley S. Jacobs
– – 218,150   10,737,343

  Troy A. Cooper
– – 54,083 2,668,315

  John J. Hardig
– – 43,630 2,147,469

  Scott B. Malat
– – 49,344 2,435,968

  Mario A. Harik
– – 35,449 1,744,800

⁽¹⁾

~~The values reflected in this column were calculated by multiplying the number of shares that vested in 2017 by the closing price of a company share~~ on the NYSE on each applicable vesting or settlement date. In the case of the cash-settled PRSUs which settled on February 19, 2018, the closing price of one share of XPO common stock on the NYSE was $91.43.

		49	©2019 XPO Logistics, Inc.


41	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
41	©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Table of Contents

Potential Payments Upon Termination or Change of Control

The following table sets forth the amounts of compensation that would be due to each of our NEOs pursuant to their respective employment agreements, as applicable, upon the termination events as summarized below, as if each such event had occurred on December 31, 2018. The amounts shown below are estimates of the payments that each NEO would receive in certain instances. The actual amounts payable will only be determined upon the actual occurrence of any such event.

Bradley S. Jacobs

Troy A. Cooper

Mario A. Harik

Kenneth R. Wagers III(1)

Sarah J.S. Glickman

John J. Hardig(2)

Termination without Cause:

Cash severance(3)(4)(5)

$312,500

$268,750

$212,500

$262,500

–

Acceleration of equity-based awards(6)

$11,113,731

$2,500,577

$1,805,943

$415,137

$271,225

–

Continuation of medical / dental benefits(7)

$9,989

$7,147

$9,827

$9,989

–

Total

$11,436,220

$2,776,474

$2,028,270

$687,626

$271,225

–

Voluntary Termination with Good Reason:

Cash severance(3)(5)

–

Acceleration of equity-based award

–

Continuation of medical / dental benefits

–

Total

–

Termination for Cause or Voluntary Termination without Good Reason:

Cash severance(3)(5)

–

Acceleration of equity-based awards(6)

–

$1,547,723

Continuation of medical / dental benefits

–

Total

–

$1,547,723

Disability:

Cash severance(3)(5)

–

Acceleration of equity-based award

–

Continuation of medical / dental benefits

–

Total

–

Death:

Cash severance(3)

–

Acceleration of equity-based awards(6)

$38,467,491

$8,232,127

$5,360,391

$5,989,200

$2,327,802

–

Continuation of medical / dental benefits

–

Total

$38,467,491

$8,232,127

$5,360,391

$5,989,200

$2,327,802

–

Change of Control and No Termination:

Cash severance(3)

–

Acceleration of equity-based awards(6)

$38,467,491

$8,232,127

$5,360,391

$5,989,200

$2,327,802

–

Continuation of medical / dental benefits

–

Total

$38,467,491

$8,232,127

$5,360,391

$5,989,200

$2,327,802

–

Change of Control and Termination without Cause or for Good Reason:

Cash severance(3)

$3,125,000

$2,687,500

$2,125,000

$2,625,000

–

Acceleration of equity-based awards(6)

$38,467,491

$8,232,127

$5,360,391

$5,989,200

$2,327,802

–

Continuation of medical / dental benefits(7)

$39,954

$28,587

$39,307

$39,954

–

Total

$41,632,445

$10,948,214

$7,524,698

$8,654,154

$2,327,802

–

(1): Effective March 11, 2019, the company terminated Mr. Wagers' employment, without cause. As a result of his termination without cause, Mr. Wagers received: (i) a cash severance payment of $262,500, and (ii) medical and dental coverage for a period of up to six months. Mr. Wagers also received payment of a sign-on bonus of $285,000. Finally, Mr. Wagers received the prorated vesting of 9,292 RSUs. The amounts reflected in this column represent what Mr. Wagers would have received had he remained employed with the Company through the relevant termination events described in the table above.
(2): Mr. Hardig terminated his employment on August 15, 2018. The values reflected in this column are actual payments made in connection with his separation agreement.
(3): Amounts shown do not include any payments for accrued and unpaid salary, bonuses or vacation.
(4): In the event of a termination by our company without Cause, cash severance payable to each of Mr. Jacobs, Mr. Cooper, Mr. Harik and Mr. Wagers will be reduced, dollar for dollar, by other income earned by such NEO in accordance with the terms of his employment agreement. The calculations of severance pay in the above table use the NEO's base salary effective as of December 31, 2018. Ms. Glickman has not entered into an employment agreement with XPO.

The following table reflects the amounts of compensation that would be due to each of our NEOs pursuant to their respective employment agreements upon the termination events as summarized below, as if each such event had occurred on December 31, 2017. The amounts shown below are estimates of the payments that each NEO would receive in certain instances. The actual amounts payable will only be determined upon the actual occurrence of any such event.

Event

Bradley S. Jacobs


Troy A. Cooper


John J. Hardig


Scott B. Malat


Mario A. Harik

Termination without Cause:

Cash severance^(1)(2)(3)(4)
   $312,500          $268,750          $257,500          $250,000          $212,500

Acceleration of equity-based awards⁽⁵⁾
   $39,416,856          $11,491,523          $8,862,706          $10,487,788          $5,891,069

Continuation of medical / dental benefits⁽⁶⁾
   $9,660          $6,899          $9,660          $9,660          $9,479

Total


39,739,016


$11,767,171


$9,129,866


$10,747,448


$6,113,048

Voluntary Termination with Good Reason:



Cash severance^(1)(2)(4)
   –                  –                  –                  –                  –

Acceleration of equity-based awards⁽⁵⁾
   $21,571,368          $7,018,359          $5,293,627          $6,395,363          $2,991,146

Continuation of medical / dental benefits
   –                  –                  –                  –                  –

Total


$21,571,368


$7,018,359


$5,293,627


$6,395,363


$2,991,146

Termination for Cause or Voluntary Termination without Good Reason:

Cash severance^(1)(2)(4)
   –                  –                  –                  –                  –

Acceleration of equity-based awards
   –                  –                  –                  –                  –

Continuation of medical / dental benefits
   –                  –                  –                  –                  –

Total


–


–


–


–


–

Disability:

Cash severance^(1)(2)(4)
   –                  –                  –                  –                  –

Acceleration of equity-based awards⁽⁵⁾
   –                  $457,950          –                  $523,345          –

Continuation of medical / dental benefits
   –                  –                  –                  –                  –

Total


–


$457,950


–


$523,345


–

Death:

Cash severance⁽²⁾
   –                  –                  –                  –                  –

Acceleration of equity-based awards⁽⁵⁾
   $83,116,002          $21,466,498          $17,660,384          $19,357,638          $12,943,407

Continuation of medical / dental benefits
   –                  –                  –                  –                  –

Total


$83,116,002


$21,466,498


$17,660,384


$19,357,638


$12,943,407

Change of Control and No Termination:



Cash severance⁽²⁾
   –                  –                  –                  –                  –

Acceleration of equity-based awards⁽⁵⁾
   $83,116,002          $21,466,498          $17,660,384          $19,357,638          $12,943,407

Continuation of medical / dental benefits
   –                  –                  –                  –                  –

Total


$83,116,002


$21,466,498


$17,660,384


$19,357,638


$12,943,407

Change of Control and Termination without Cause or for Good Reason:

Cash severance⁽²⁾
   $3,125,000          $2,687,500          $2,575,000          $2,500,000          $2,125,000

Acceleration of equity-based awards⁽⁵⁾
   $83,116,002          $21,466,498          $17,660,384          $19,357,638          $12,943,407

Continuation of medical / dental benefits⁽⁶⁾
   $38,640          $27,594          $38,640          $38,640          $37,917

Total


$86,279,642


$24,181,592


$20,274,024


$21,896,279


$15,106,324

⁽¹⁾

Upon a termination of employment for any reason (other than death), whether with or without Cause, within two years after the payment date, a portion of the NEO’s 2015 and 2016 cash bonuses must be reimbursed to the company. This repayment obligation is not reflected in the amounts shown in this table. The repayment obligation does not apply after a Change of Control.

⁽²⁾

~~Amounts shown do not include any payments for accrued and unpaid salary, bonuses or vacation.~~

⁽³⁾

In the event of a termination by our company without Cause, cash severance payable to the NEO will be reduced, dollar for dollar, by other income earned by such NEO. The calculations of severance pay in the above table use the NEO’s base salary effective as of December 31, 2017.


						42						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						42						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Table of Contents

(5): In the event of a termination for any reason, our company has the right to extend the period during which each of Mr. Jacobs, Mr. Cooper, Mr. Harik and Mr. Wagers is bound by the non-competition covenant in his employment agreement for up to 12 additional months, which would extend the non-compete period from two years to three years following termination. During the period the non-compete is extended, the NEO would be entitled to receive cash compensation equal to his monthly base salary as in effect on the date employment is terminated, reduced dollar for dollar by any other income earned at the time by the NEO. Fully extending the non-compete provision would increase the amounts shown as "Cash Severance" by up to $625,000 for Mr. Jacobs, $537,500 for Mr. Cooper, $425,000 for Mr. Harik and $525,000 for Mr. Wagers. This extended non-compete provision does not apply after a Change of Control. Under the terms of Ms. Glickman's confidential information protection agreement with XPO, if Ms. Glickman's employment is terminated without cause and the 12-month post-termination non-competition covenant under such agreement is not waived by XPO, then Ms. Glickman will be entitled to aggregate cash payments equal to $246,827 during the non-competition period.
(6): The values reflected in this column were calculated using $57.04, the closing price of one XPO share on the NYSE on December 31, 2018, the last trading day of our fiscal year 2018. The amounts shown for PRSUs have been estimated assuming that the applicable performance goals are met at target levels. Although the PRSUs would no longer be subject to a continued service requirement upon the occurrence of a termination by our company without Cause, payment of such award would remain subject to the actual achievement of the applicable performance goals. As of December 31, 2018, none of the NEOs had any unvested stock options.
(7): The amounts of continued medical and dental benefits shown in the table (i) have been calculated based upon our current actual costs of providing the benefits through COBRA and (ii) have not been discounted for the time value of money. In the event of a termination without Cause, continued medical and dental benefits would cease when the NEO commences employment with a new employer.

Each NEO's employment agreement, as applicable, which is described in detail in this Proxy Statement under the heading "Employment Agreements with NEOs," generally provides that, in the event of a termination without Cause (as defined below) either prior to a Change of Control (as defined below) or more than two years following a Change of Control, cash severance payments and continued benefits will be made ratably over the six-month period following the executive's termination (subject to any delays required pursuant to Section 409A of the Code). The employment agreements generally do not provide for payments other than accrued benefits if employment is terminated due to death or disability. Generally, in the event of a termination upon or within two years following a Change of Control, cash severance payments will be made in one lump sum (subject to any delays required pursuant to Section 409A of the Code). The severance payments set forth in the table are generally subject to and conditioned upon the NEO signing an irrevocable waiver and release and continued compliance with certain restrictive covenants.

For more information regarding the payments and benefits to which our NEOs are entitled upon certain termination events or upon a Change of Control, see the discussion in this Proxy Statement under the heading "Employment Agreements with NEOs."

⁽⁴⁾

~~In the event of a termination for any reason, our company has the right to extend the period during which the applicable NEO is bound by thenon-competition~~ ~~covenant in his employment agreement for up to 12 additional months, which would extend thenon-compete~~ ~~period from two years to three years following termination. During the period thenon-compete~~ is extended, the NEO would be entitled to receive cash compensation equal to his monthly base salary as in effect on the date his employment terminated, reduced dollar for dollar by any other income earned at the time by the NEO. Fully extending the~~non-compete~~ provision would increase the amounts shown as “Cash Severance” by up to $625,000 for Mr. Jacobs, $537,500 for Mr. Cooper, $515,000 for Mr. Hardig, $500,000 for Mr. Malat, and $425,000 for Mr. Harik. This extended~~non-compete~~ ~~provision does not apply after a Change of Control.~~

⁽⁵⁾

The values reflected in this column were calculated using $91.59, the closing price of a company share on the NYSE on December 29, 2017, the last trading day of our fiscal year 2017. The amounts shown for PRSUs have been estimated assuming that the applicable performance goals are met at target levels. Although the PRSUs would no longer be subject to a continued service requirement upon the occurrence of a termination by our company without Cause, payment of such award would remain subject to the actual achievement of the applicable performance goals. As of December 31, 2017, none of the NEOs had any unvested RSUs or stock options.

⁽⁶⁾

The amounts of continued medical and dental benefits shown in the table (i) have been calculated based upon our current actual costs of providing the benefits through COBRA and (ii) have not been discounted for the time value of money. In the event of a termination without Cause, continued medical and dental benefits would cease when the NEO commences employment with a new employer.

Each NEO’s employment agreement, which is described in detail in this proxy statement under the heading “Employment Agreements with NEOs,” generally provides that, in the event of a termination without Cause (as defined below) either prior to a Change of Control (as defined below) or more than two years following a Change of Control, cash severance payments and continued benefits will be made ratably over the~~six-month~~ period following the executive’s termination (subject to any delays required pursuant to Section 409A of the Code). The employment agreements generally do not provide for payments other than accrued benefits if employment is terminated due to death or disability. Generally, in the event of a termination upon or within two years following a Change of Control, cash severance payments will be made in one lump sum (subject to any delays required pursuant to Section 409A of the Code). The equity-based awards granted to our NEOs will generally accelerate vesting in the event of a termination due to disability or death or upon a Change of Control, except that the 2014 and 2015 PRSU award agreements do not specifically address vesting in the event that the termination of employment is due to disability and for purposes of these calculations we have assumed no accelerated vesting. The severance payments set forth in the table are generally subject to and conditioned upon the NEO signing an irrevocable waiver and release and continued compliance with certain restrictive covenants.

For more information regarding the payments and benefits to which our NEOs are entitled upon certain termination events or upon a Change of Control, see the discussion in this proxy statement under the heading “Employment Agreements with NEOs.”

CEO Pay Ratio Disclosure

~~As required by SEC rules,~~

As required by Item 402(u) of the SEC's Regulation S-K, we are providing the following information about the relationship of the annual total compensation of our CEO to that of our median employee. The pay ratio and annual total compensation amount disclosed in this section are reasonable estimates that have been calculated using methodologies and assumptions permitted by SEC rules.

Identifying the following information about the relationship of the annual total compensation of our CEO to that of our median employee. The pay ratio and annual total compensation amount disclosed in this section are reasonable estimates that have been calculated using methodologies and assumptions permitted by SEC rules.

Median Employee ~~Determination~~

~~We identified our~~

Our median employee was identified in 2017, and as permitted by item 402(u) of the SEC's Regulation S-K, we determined that the same employee should be used to calculate our CEO pay ratio for 2018 because we reasonably concluded that there have been no significant changes to our employee population or compensation programs that we believe would significantly impact our pay ratio disclosure for 2018. Since our actual 2017 median employee is no longer employed by the company, for 2018, we used another employee whose compensation is substantially similar to the 2017 median employee's compensation, based on the measure used to select the 2017 median employee (as described below).

The median employee was identified by calculating the 2017 cash compensation for all employees excluding the CEO, and excluding employees located in Japan (3), Thailand (320), Taiwan (79), Singapore (277), India (143), Peru (26), Chile (12), Australia (6), Malaysia (32), and Mexico (1,084), who were employed by us on December 31, 2017 (regardless of whether they were employed by us for all of 2017). This employee group included 88,891 employees globally (out of a total of 90,873 employees globally), and included full-time, part-time and seasonal employees. For this purpose, cash compensation for all employees, excluding the CEO, who were employed by us on December 31, 2017. This included 88,891 employees globally, and included all full-time, part-time and seasonal employees. The calculation included employees who were active on December 31, 2017 but not employed for all of 2017 and the calculation did not annualize their compensation. Although the SEC allows companies to exclude up to 5% of their~~non-U.S.~~ ~~employees, we chose to include all employees globally to ensure that all countries had representation in the calculation. Cash~~ compensation included all earnings paid to each employee during the calendar year, including base salary and wages, bonuses, commissions, overtime and holiday or PTO pay. Compensation was converted into U.S. dollars using currency conversion rates as of December 31, 2017.

Annual Compensation of Median Employee Using Summary Compensation Table Methodology

After identifying the median employee as described above, we calculated annual total compensation for this employee using the same methodology we use for our CEO in the 2018 Summary Compensation Table. This compensation calculation includes, where applicable, base salary and wages, bonuses, commissions, overtime, holiday or PTO pay, equity awards, 401(k) company match and company-paid life insurance premiums as applicable. The compensation for our median employee was $36,940 and the compensation for our company's CEO was $13,327,471.

After identifying the median employee as described above, we calculated annual total compensation for this employee using the same methodology we use for our CEO in the 2017 Summary Compensation Table. This compensation calculation includes base salary and wages, bonuses, commissions, overtime, holiday or PTO pay, equity awards, 401(k) company match, and company-paid life insurance premiums as applicable. The compensation for our median employee was $36,885 and the compensation for the CEO was $1,384,021.
	51	©2019 XPO Logistics, Inc.

Table of Contents

~~2017~~2018 Pay Ratio

~~Based on the above information, the ratio of the annual total compensation of our CEO to the median employee is 38:~~

Based on the above information, the ratio of the annual total compensation of our CEO to the median employee is 361:1. The pay ratio reported by other companies may not be comparable to the pay ratio reported above, due to variances in business mix, proportion of seasonal and part-time employees and distribution of employees across geographies. In comparison to peer firms, XPO has a unique business mix with approximately 50% of our employee population working in our supply chain business; in addition, XPO operates globally with approximately 50% of our population located outside of the United States. We seek to attract, incentivize and retain our employees through a combination of competitive base pay, bonus opportunities, 401(k) contributions, the opportunity to participate in our employee stock purchase plan and other benefits.


						43						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~
						43						©~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~

Employment Agreements with NEOs

In the event that any of our NEOs dies during the term of the 2016 Employment Agreement, or if we terminate the NEO’s employment without Cause, either prior to a Change of Control or more than two years following a Change of Control, such NEO will be entitled to: ~~Accrued and unpaid salary, vacation benefits and unreimbursed business expenses;~~	Solely in the case of a termination by the company without Cause: six (6) months’ base salary, at the level in effect on the date of termination, which will be paid in equal installments over the 6 months following the date of termination (subject to any delay required by Section 409A of the Code)
		52	©2019 XPO Logistics, ~~and which generally will be reduced,~~Inc.

~~Failure to follow our company’s code of conduct or ethics policies; and~~

~~Conviction of, or plea of nolo contendere to, a felony or any serious crime;~~

~~provided that, in cases where cure is possible, the NEO has a cure period of 15 days before he or she can be terminated for Cause.~~

~~The 2016 Employment Agreements allow a NEO to terminate employment for Good Reason only upon or during thetwo-year~~ ~~period following a Change of Control. “Good Reason,” for purposes of the 2016 Employment Agreements, generally means, without first obtaining the NEO’s written consent:~~

~~Our material breach of the terms of the NEO’s 2016 Employment Agreement or a reduction in base salary or target bonus;~~

~~Our material diminishment of the NEO’s title, duties, authorities, reporting relationships, responsibilities or position;~~

~~Our requirement that the NEO be based in a location that is more than 50 miles from his initial work location immediately prior to the Change of Control; or~~

With regard to Mr. Jacobs, our requirement that he no longer reports directly to the Board; and with regard to each of Messrs. Cooper, Hardig, Malat, and Harik, our requirement that he reports to someone other than the Chief Executive Officer.

~~In each case, the NEO’s Good Reason right is subject to our company’s30-day~~ ~~cure period.~~

Change of ~~Control.~~Control ~~In the event that, upon or within two years following a Change of Control, Messrs. Jacobs’~~


				53				©2019 XPO Logistics, ~~Cooper’s, Hardig’s, Malat’s, or Harik’s employment is terminated by our company without Cause or such NEO resigns for Good Reason, he will receive:~~Inc.


~~non-disparagement~~ ~~during his employment and thereafter; and~~	~~non-competition~~ ~~during his employment and for a period of two years following his termination for any reason. In addition, we have the option to extend the~~	~~non-competition~~54 ~~period for up to an additional year following a termination for any reason, provided that we continue to pay the NEO’s base salary as in effect on the date of termination during the extended~~	~~non-competition~~ ~~period.~~	©2019 XPO Logistics, Inc.

Equity Compensation Plan Information

~~The following table gives information as of December 31, 2017, with respect to the company’s~~




Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a)			Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights(1) (b)		Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c)


Equity compensation plans approved by security holders		2,824,872	⁽²⁾	$	12.70		3,637,110	⁽³⁾

Equity compensation plans not approved by security holders		–			–		–

Total		2,824,872		$	12.70		3,637,110

(1): The weighted average exercise price is based solely on the outstanding options.
(2): Includes 664,755 stock options outstanding under the XPO Logistics, Inc. Amended and Restated 2011 Omnibus Incentive Compensation Plan, 17,062 stock options outstanding under the Segmentz, Inc. 2001 Stock Option Plan, and 20,501 stock options outstanding under the Con-way Inc. 2006 Equity and Incentive Plan. Also includes an aggregate of 1,547,708 RSUs and PRSUs granted under the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan, 568,074 RSUs and PRSUs granted under the XPO Logistics, Inc. Amended and Restated 2011 Omnibus Incentive Compensation Plan and 6,772 RSUs and PRSUs granted under the Con-way Inc. 2012 Equity and Incentive Plan.
(3): Includes 1,661,605 securities available for issuance under the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan and 1,975,505 securities available for issuance under the XPO Logistics, Inc. Employee Stock Purchase Plan.


				56				©2019 XPO Logistics, Inc.



							2018 ACHIEVEMENTS

			TROY A. COOPER *President*				■ ~~In reviewing~~Promoted to president effective April 23, 2018. ■ Oversaw the ~~CEO’s recommendations~~company's operations, resulting in strong returns and ~~approving~~record earnings, particularly across the ~~NEOs’~~transportation segment, as reflected in these and other full-year financial achievements for the segment in 2018: ■ Revenue increase of 10%, to $11.3 billion ■ Adjusted EBITDA* increase of 13%, to $1.2 billion ■ Operating income increase of 18%, to $646 million ■ Engaged extensively with our less-than-truckload (LTL) business, which delivered strong improvement in adjusted operating ratio. ■ Oversaw the launch of XPO Direct, the company's shared-space distribution model for omnichannel retail and manufacturing customers. ■ Worked with our sales leaders to promote cross-selling and business development in our global salesforce, which won a record $3.8 billion in business during 2018. ■ Helped manage the expansion of our last mile network to 85 hubs in North America. ■ Supported the expansion of our positions as the largest e-commerce fulfillment provider in Europe and the largest last mile provider for heavy goods in North America. ■ Spearheaded the rollout of our company's new values, which promote safety, respect, entrepreneurship, innovation and inclusion across the organization. * See Annex A for a reconciliation of this non-GAAP measure.

			MARIO A. HARIK *Chief Information Officer*				■ Oversaw a technology budget of approximately $500 million, which was deployed strategically to speed innovation companywide. ■ Led the launch of XPO Connect, our cloud-based, digital freight marketplace with fully automated features and self-learning capabilities for transportation transactions. ■ Oversaw strategy and pilot rollout of collaborative GreyOrange robots in XPO warehouses, making our logistics operations safer and more productive. ■ Facilitated four new LTL technology initiatives, including dynamic route optimization, pricing algorithms and AI-based load-building. ■ Implemented voice-enabled tracking of last mile shipments through Google Search and smart speakers, making XPO the first last mile provider to add these functionalities. ■ Significantly enhanced customer support systems, enabling a more seamless, accurate and efficient billing process and overall customer experience.



							2018 ACHIEVEMENTS

			KENNETH R. WAGERS III *Former Chief Operating Officer and Interim President, LTL North America*				■ Realized 18% growth in LTL adjusted operating income* for 2018, and notable LTL revenue growth. ■ Realized a 150 basis point improvement in LTL adjusted operating ratio* to 86.2% in 2018, from 87.7% in 2017. ■ From July through December, led our "LTL 2.0" initiative, resulting in a notable improvement in customer service, on-time delivery and overall customer satisfaction ratings. ■ XPO Logistics awarded National LTL Carrier of the Year by Transplace. * See Annex A for a reconciliation of this non-GAAP measure.

			SARAH J.S. GLICKMAN *Acting Chief Financial Officer*				■ Kept XPO on target to meet cumulative, two-year free cash flow* target of at least $1 billion, including by outperforming on free cash flow* generation of $694 million in 2018. ■ Initiated a $500 million unsecured financing package with lenders. ■ Executed the company's first share repurchase: a $1 billion buy-back authorization by the Board in December 2018. ■ Managed the company's real estate portfolio as its logistics footprint increased 12% year-over-year to 190 million square feet. ■ Oversaw the execution of the company's first comprehensive restructuring effort. ■ Continued to optimize the company's financial operations through ongoing upgrades of processes and systems and the expansion of our finance shared services model. * See Annex A for a reconciliation of this non-GAAP measure.


Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights (a)	Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights⁽¹⁾ (b)	Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) (c)
Equity compensation plans approved by security holders	3,681,354⁽²⁾	$13.15	4,460,289⁽³⁾
Equity compensation plans not approved by security holders	50,000⁽⁴⁾	$14.09	0
Total	3,731,354	$13.21	4,460,289


PROXY STATEMENT SUMMARY			1

~~PROXY STATEMENT~~			4

QUESTIONS AND ANSWERS ABOUT OUR ANNUAL MEETING			4	6

BOARD OF DIRECTORS AND CORPORATE GOVERNANCE			9	11

~~Introduction—~~An Overview of Our Mission and How Our Board Composition is Aligned with Our Strategy			9	11
Directors			9	12
Summary of Qualifications and Experience of Director Nominees		17
Role of the Board and Board Leadership Structure			14	18
Board Risk Oversight			14	18
Committees of the Board and Committee Membership			15	19
Director Compensation			16	20
Compensation Committee Interlocks and Insider Participation			17	21
Corporate Governance Guidelines and ~~Codes~~Code of Business Ethics			17	21
~~Exclusive Forum Bylaw Amendment~~Director Independence			18	22
Director ~~Independence~~Selection Process			18	22
~~Director Selection Process~~Human Resource Management			18	23
~~Human Capital Management~~Board Oversight of Sustainability Matters			19	23
Stockholder Communication with the Board			19	24
Stockholder Proposals for Next ~~Year’s~~Year's Annual Meeting			19	24

CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS			20	25

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		26
EXECUTIVE COMPENSATION		28
Compensation Discussion and Analysis			21	28

~~EXECUTIVE COMPENSATION~~Compensation Committee Report			23	45

Compensation ~~Discussion and Analysis~~Tables			23	46
~~Compensation Committee Report~~			38
~~Compensation Tables~~			39
Employment Agreements with NEOs			44

~~EQUITY COMPENSATION PLAN INFORMATION~~		52
46 Equity Compensation Plan Information
	55
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE			47	56
AUDIT-RELATED MATTERS		57
~~AUDIT-RELATED MATTERS~~			48

Report of the Audit Committee			48	57
Policy RegardingPre-Approval of Services Provided by the Outside Auditors			49	58
Services Provided by the Outside Auditors			49	58

PROPOSALS TO BE PRESENTED AT THE ANNUAL MEETING			50	59

Proposal 1: Election of Directors			50	59
Proposal 2: Ratification of the Appointment of KPMG LLP as our Independent Registered Public Accounting Firm for Fiscal Year ~~2018~~2019		60
51 Proposal 3: Approval of an Amendment to the XPO Logistics, Inc. 2016 Omnibus Incentive Compensation Plan to Increase the Number of Available Shares, Extend the Term of the Plan and Make Certain Other Changes		61
Proposal 3:4: Advisory Vote to Approve Executive Compensation			52	69
~~Proposal 4: Advisory Vote on Frequency of Future Advisory Votes to Approve Executive Compensation~~			53
Proposal 5: Stockholder Proposal Regarding the Requirement that the Chairman of the Board be an ~~Annual Sustainability Report~~Independent Director			54	70
Proposal 6: Stockholder Proposal Regarding ~~the Company’s~~Ways to Strengthen Prevention of Workplace Sexual Harassment and Align Senior Executive Compensation ~~Clawback Policy~~			56

~~OTHER MATTERS~~Incentives			58	72

~~AVAILABILITY OF ANNUAL REPORT AND PROXY STATEMENT~~Other Matters			58	75
ADDITIONAL INFORMATION		76
ANNEX A—RECONCILIATION OF NON-GAAP MEASURES		77
ANNEX B—AMENDMENT TO THE XPO LOGISTICS, INC. 2016 OMNIBUS INCENTIVE COMPENSATION PLAN		82
ANNEX C—XPO LOGISTICS, INC. 2016 OMNIBUS INCENTIVE COMPENSATION PLAN		83
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Stockholders to Be Held on May 15, 2019:
This Proxy Statement and our Annual Report on Form 10-K for the Year Ended December 31, 2018 are available atwww.edocumentview.com/XPO.


ANNUAL CASH COMPENSATION FOR 2017 PERFORMANCE YEAR
NEO	Annual Base Salary	Target STI Award (% of Salary)	Target STI Award in Dollars	Earned STI in Dollars	Total Target Annual Cash Compensation	Total Earned Cash Compensation
Bradley S. Jacobs	$625,000	100%	$625,000	$750,000	$1,250,000	$1,375,000
Troy A. Cooper	$537,500	100%	$537,500	$645,000	$1,075,000	$1,182,500
John J. Hardig	$515,000	100%	$515,000	$595,000	$1,030,000	$1,110,000
Scott B. Malat	$500,000	100%	$500,000	$575,000	$1,000,000	$1,075,000
Mario A. Harik	$425,000	100%	$425,000	$490,000	$850,000	$915,000


ANNUAL TOTAL DIRECT COMPENSATION
NEO	Total Earned Cash Compensation for 2017	Annualized Target PRSU Award at Grant Value	Total Direct Compensation / Total Reward
Bradley S. Jacobs	$1,375,000	$5,000,000	$6,375,000
Troy A. Cooper	$1,182,500	$1,125,000	$2,307,500
John J. Hardig	$1,110,000	$1,000,000	$2,110,000
Scott B. Malat	$1,075,000	$1,000,000	$2,075,000
Mario A. Harik	$915,000	$812,500	$1,727,500


NEO	Original 2016-2019 Target PRSU Award	Annualized Target Award
Bradley S. Jacobs	$20,000,000	$5,000,000
Troy A. Cooper	$4,500,000	$1,125,000
John J. Hardig	$4,000,000	$1,000,000
Scott B. Malat	$4,000,000	$1,000,000
Mario A. Harik	$3,250,000	$812,500


	46	©
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE~~2018~~ ~~XPO Logistics,~~ ~~Inc.~~	46	©


	Fiscal Year Ended December 31,

			2018		2017		2016

Options Granted		0		0		5
Restricted Stock Units Granted		533		658		383
Performance-based Restricted Stock Units Vested		1,086		155		228
Weighted Average Common Shares Outstanding		123,000		115,000		110,000
Volatility Multiplier		2.0		2.0		2.0


TABLE OF CONTENTS

Average stock price of $225 over a 20-trading day period

Average stock price represents an approximate 41% increase in share price per year over the four-year period compared to XPO's closing stock price on December 31, 2018

Adjusted cash flow per share of $14.00 by December 31, 2022

Adjusted cash flow per share performance criteria requires:
–
A 20% compounded annual growth rate in Adjusted EBITDA over the four-year period
–
More than 120% growth in adjusted cash flow per share versus 2018