What changed in this filing

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Item 9A. Controls and Procedures

2023-03-01 compared with 2022-03-01 · 239 added, 348 removed, 1172 unchanged (33% of the section changed)

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Changes in Internal Control over Financial Reporting

During the year ended December 31, 2022, we implemented a new enterprise resource planning (“ERP”) system that replaced legacy systems in which our financial transactions were processed and recorded.

The new ERP system is a significant component of our disclosure controls and procedures.

As a result of this implementation, we modified certain existing internal controls over financial reporting and will continue to evaluate the operating effectiveness of related controls in subsequent periods.

Except for the implementation of the new ERP system, there were no changes in our internal control over financial reporting identified in connection with the evaluation described above that occurred during the year ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Report of Independent Registered Public Accounting Firm

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In our opinion, Forward Air Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets as of December 31, 2021 and 2020, the related consolidated statements of comprehensive income, shareholders' equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “financial statements”) and our report date d March 1, 2022 expressed an unqualified opinion thereon.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets as of December 31, 2022 and 2021, the related consolidated statements of comprehensive income, shareholders' equity, and cash flows for each of the three years in the period ended December 31, 2022, and the related notes and financial statement schedule listed in the Index at Item 15(a) (collectively referred to as the “financial statements”) and our report dated March 1, 2023 expressed an unqualified opinion thereon.

Basis for Opinion

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The information required by this item is incorporated herein by reference to the 2023 Proxy Statement.

Principle Accounting Fees and Services

Principal Accounting Fees and Services

The information required by this item is incorporated herein by reference to the 2023 Proxy Statement.

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The response to this portion of Item 15 is submitted as a separate section of this report.

EXHIBIT INDEX

3.1 Restated Charter of the registrant (incorporated herein by reference to Exhibit 3 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 28, 1999 (File No.

3.2 Amended and Restated Bylaws of the registrant

4.1 Form of Forward Air Corporation Common Stock Certificate (incorporated herein by reference to Exhibit 4.1 to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 1998 filed with the Securities and Exchange Commission on November 16, 1998 (File No.

4.2 Description of Capital Stock

10.1 * Forward Air Corporation 2005 Employee Stock Purchase Plan (incorporated herein by reference to the registrant's Proxy Statement filed with the Securities and Exchange Commission on April 20, 2005 (File No.

10.2 Air Carrier Certificate, effective August 28, 2003 (incorporated herein by reference to Exhibit 10.5 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2003 filed with the Securities and Exchange Commission on March 11, 2004 (File No.

10.3 Form of Director Indemnification Agreement (incorporated herein by reference to Exhibit 10.4 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2017 filed with the Securities and Exchange Commission on February 23, 2018 (File No.

10.4 * Form of Non-Qualified Stock Option Agreement under the registrant's Amended and Restated Stock Option and Incentive Plan (incorporated herein by reference to Exhibit 10.16 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2010 filed with the Securities and Exchange Commission on February 24, 2011 (File No.

10.5 * Forward Air Corporation Amended and Restated Stock Option and Incentive Plan, as further amended and restated on February 7, 2013 (incorporated herein by reference to Exhibit 10.1 to the registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on February 13, 2013 (File No.

10.6 First Amendment to the Forward Air Corporation Amended and Restated Stock Option and Incentive Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016, filed with the Securities and Exchange Commission on April 27, 2016 (File No.

10.7 * Form of Nonqualified Stock Option Agreement under the registrant’s Amended and Restated Stock Option and Incentive Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 12, 2016 (File No.

10.8 * Form of CEO Nonqualified Stock Option Agreement under the registrant’s Amended and Restated Stock Option and Incentive Plan (incorporated herein by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on February 12, 2016 (File No.

10.9 * Form of Non-Employee Director Restricted Stock Units Agreement under the registrant’s Amended and Restated Non- Employee Director Stock Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 10, 2016 (File No.

10.10 * Form of Non-Employee Director Restricted Stock Agreement under the registrant’s Amended and Restated Non-Employee Director Stock Plan (incorporated herein by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 10, 2016 (File No.

10.11 * Form of Employee Restricted Share Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2016 filed with the Securities and Exchange Commission on July 27, 2016))

10.12 * Form of CEO Nonqualified Stock Option Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.41 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2017)

10.13 * Form of Nonqualified Stock Option Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.44 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2017)

10.14 * Form of Performance Share Agreement under the registrant’s 2016 Omnibus Compensation Plan (incorporated herein by reference to Exhibit 10.45 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2017)

10.15 * Form of Notice of Grant of Performance Shares under the registrant’s 2016 Omnibus Compensation Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 27, 2017)

10.16 * Forward Air Corporation 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 27, 2017 (File No.

10.17 * Amended and Restated Non-Employee Director Stock Plan (incorporated herein by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 27, 2017 (File No.

10.18 Credit Agreement dated September 29, 2017 among Forward Air Corporation and Forward Air, Inc., as the borrowers, the subsidiaries of the borrowers identified therein as the guarantors, Bank of America, N.A., U.S.

Bank National Association and the other lenders party thereto (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on October 3, 2017)

10.18A First Amendment dated April 16, 2020 to Credit Agreement dated September 29, 2017 by and among Forward Air Corporation and Forward Air, Inc., as borrowers, certain subsidiaries of the borrowers as guarantors, Bank of America, N.A., as administrative agent and lender, U.S.

Bank National Association, as lender, and the other lenders party thereto (incorporated herein by reference to Exhibit 10.1 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 1, 2020)

10.18B Second Amendment dated July 20, 2021 to Credit Agreement dated September 29, 2017 by and among Forward Air Corporation and Forward Air, Inc., as borrowers, certain subsidiaries of the borrowers as guarantors, Bank of America, N.A., as administrative agent and lender, U.S.

Bank National Association, as lender and the other lenders part thereto (incorporated herein by reference to Exhibit 10.3 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on August 10, 2021)

10.18C Third Amendment, dated December 29, 2021, to the Credit Agreement dated September 29, 2017 by and among Forward Air Corporation and Forward Air, Inc., as borrowers, certain subsidiaries of the borrowers as guarantors, Bank of America, N.A., as administrative agent and lender, U.S.

Bank National Association, as lender and the other lenders part thereto (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 5, 2022)

10.19 * Form of CEO Nonqualified Stock Option Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 26, 2018)

10.20 * Form of CEO Performance Share Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.5 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 26, 2018)

10.21 * Form of CEO Restricted Stock Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.6 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 26, 2018)

10.22 * Employment Agreement, dated June 6, 2018, between Forward Air Corporation and Thomas Schmitt (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 12, 2018)

10.23 * Restrictive Covenants Agreement, dated June 6, 2018, between Forward Air Corporation and Thomas Schmitt (incorporated herein by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 12, 2018)

10.24 * Waiver and Acknowledgment, dated June 11, 2018 between Forward Air Corporation and Bruce Campbell (incorporated herein by reference to Exhibit 10.3 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 12, 2018)

10.25 Consulting Agreement effective May 7, 2019, between Forward Air Corporation and Bruce A.

Campbell (incorporated herein by reference to Exhibit 10.2 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 25, 2019)

10.26 Form of Performance Share Agreement (Total Shareholder Return) under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.3 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 25, 2019)

10.27 Form of Performance Share Agreement (EBITDA per Share) under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.4 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 25, 2019)

10.28 * Scott E.

Schara Offer Letter, dated as of July 23, 2020 (incorporated herein by reference to Exhibit 10.1 to the registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on July 27, 2020)

10.29 * Amended and Restated Consulting Agreement effective July 28, 2020, between Forward Air Corporation and Matthew J.

Jewell (incorporated herein by reference to Exhibit 10.2 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 31, 2020)

10.3 Advisory Agreement effective April 5, 2021, between Forward Air Corporation and Michael J.

Morris (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 4, 2021)

10.31 Amendment No.

1 dated October 29, 2021 to Advisory Agreement, dated October 29, 2021, between Forward Air Corporation and Michael J.

Morris (incorporated herein by reference to Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 8, 2021)

10.32 Rebecca J.

Garbrick Offer Letter dated as of June 21, 2021 (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 25, 2021 (File No.

10.33 Form of CEO Nonqualified Stock Option Agreement under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.35 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 202 2 )

10.34 Form of Non-Qualified Stock Option Agreement under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.3 6 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 202 2 )

10.35 Form of Performance Share Agreement (Total Shareholder Return) under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.3 7 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 202 2 )

10.36 * Forward Air Corporation Executive Severance and Change in Control Plan Amended and Restated, effective as of October 25, 2021 (incorporated herein by reference to Exhibit 10.3 8 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 1, 202 2 )

10.37 Separation and General Release Agreement between Scott E.

Schara and Forward Air Corporation (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 filed with the Securities and Exchange Commission on May 09, 2022)

21.1 Subsidiaries of the registrant

23.1 Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm

31.1 Certification of Chief Executive Officer Pursuant to Exchange Act Rule 13a-14(a) (17 CFR 240.13a-14(a))

31.2 Certification of Chief Financial Officer Pursuant to Exchange Act Rule 13a-14(a) (17 CFR 240.13a-14(a))

32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2 Certification of Chief Financial Officer Pursuant to 18 U.S.C.

Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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104 Cover Page Interactive File (formatted in Inline XBRL and contained in Exhibit 101).

*Denotes a management contract or compensatory plan or arrangement.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

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(1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments.

The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Self-Insurance Loss Reserves

Description of the Matter The liability for self-insurance loss reserves totaled $68.7 million at December 31, 2022 which includes self-insurance reserves for vehicle liability claims.

The long-term portion of this liability was included in “Other long-term liabilities,” and the remainder was included in “Insurance and claims” on the Company’s Balance Sheet.

The long-term portion of this liability was included in “Other long-term liabilities,” and the remainder was included in “Insurance and claims accruals” on the Company’s Consolidated Balance Sheet.

As more fully described in Note 1 to the consolidated financial statements, the self-insurance reserves include estimates for both known claims and future claims development and are based on company-specific and industry data, as well as general economic information.

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The Company utilizes actuarial analyses to evaluate open claims and estimate the ongoing development exposure.

The most significant assumptions used in the estimation process include determining the trend in loss costs, the severity of claims, and the expected costs to settle unpaid claims.

The most significant assumptions used in the estimation process include determining the trend in loss costs, the expected consistency in the frequency and severity of claims incurred but not yet reported, changes in the timing of the reporting of losses from the loss date to the notification date, and the expected costs to settle unpaid claims.

How We Addressed the Matter in Our Audit We tested internal controls over management’s review of the completeness and accuracy of data inputs used in the actuarial analysis and review of the actuarial assumptions and reserve calculations.

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221,028 208,085

Other receivables 8,097 —

Other receivables, less allowance of $ — in 2022 and $ — in 2021

Prepaid expenses 24,774 22,283

Other current assets 12,691 7,026

Current assets held for sale — 21,002

Total current assets 304,315 282,807

Property and equipment, net 219,095 189,867

Property and equipment, net of accumulated depreciation and amortization of $ 220,669 in 2022 and $ 200,867 in 2021

249,080 219,095

Operating lease right-of-use assets 141,865 148,198

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Other assets 51,831 46,254

Noncurrent assets held for sale — 53,097

Total assets $ 1,208,076 $ 1,117,823

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Current portion of operating lease liabilities 47,106 47,532

Current liabilities held for sale — 25,924

Total current liabilities 169,398 164,692

Finance lease obligations, less current portion 15,844 9,571

Operating lease liabilities, less current portion 101,409 80,346

Long-term debt, less current portion and debt issuance costs 106,588 155,466

Operating lease liabilities, less current portion 98,865 101,409

Other long-term liabilities 59,044 49,624

Deferred income taxes 51,093 43,407

Noncurrent liabilities held for sale — 34,575

Commitments and contingencies (Note 9) — —

Shareholders’ equity:

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Discontinued operation — ( 0.37 ) ( 1.05 )

Net income per share 1

Net income per basic share 1

$ 7.17 $ 3.87 $ 0.84

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Discontinued operation — ( 0.37 ) ( 1.05 )

Net income per share $ 3.85 $ 0.84 $ 3.04

Net income per diluted share $ 7.14 $ 3.85 $ 0.84

Dividends per share:

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Stock options exercised 89 1 4,236 — 4,237

Other — — ( 1 ) ( 1 ) ( 2 )

Common stock issued under employee stock purchase plan 15 — 664 — 664

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Other receivables 8,097 ( 8,097 ) —

Prepaid expenses, other current assets and other assets ( 8,002 ) ( 9,424 ) ( 4,662 )

Other current and noncurrent assets ( 12,943 ) ( 8,002 ) ( 9,424 )

Accounts payable, accrued expenses and other long-term liabilities 12,574 17,179 23,854

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Financing activities:

Proceeds from revolving credit facility 195,000 65,000 20,000

Payments on revolving credit facility ( 150,000 ) ( 20,000 ) —

Proceeds from credit facility — 195,000 65,000

Payments on credit facility ( 49,000 ) ( 150,000 ) ( 20,000 )

Repayments of finance lease obligations ( 6,054 ) ( 2,423 ) ( 1,446 )

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Payment of minimum tax withholdings on share-based awards ( 3,330 ) ( 3,115 ) ( 3,508 )

Contributions from (distributions to) subsidiary held for sale 3,385 ( 12,640 ) 7,924

Contributions from subsidiary held for sale — 3,385 ( 12,640 )

Net cash used in financing activities of continuing operations ( 146,122 ) ( 31,502 ) ( 39,094 )

Net (decrease) increase in cash of continuing operations ( 2,938 ) ( 24,495 ) 39,092

Net increase (decrease) in cash and cash equivalents of continuing operations 8,506 ( 2,938 ) ( 24,495 )

Cash from discontinued operation:

Net cash (used in) provided by operating activities of discontinued operation ( 4,635 ) ( 11,439 ) 13,472

Net cash used in operating activities of discontinued operation — ( 4,635 ) ( 11,439 )

Net cash provided by (used in) investing activities of discontinued operation — 8,020 ( 1,201 )

Net cash (used in) provided by financing activities of discontinued operation — ( 3,385 ) 12,640

(Decrease) increase in cash and cash equivalents ( 2,938 ) ( 24,495 ) 39,092

Net increase (decrease) in cash and cash equivalents 8,506 ( 2,938 ) ( 24,495 )

Cash and cash equivalents at beginning of period of continuing operations 37,316 40,254 64,749

Cash at beginning of period of discontinued operation — — —

(Decrease) increase in cash and cash equivalents ( 2,938 ) ( 24,495 ) 39,092

cash at beginning of period of discontinued operation — — —

Net increase (decrease) in cash and cash equivalents 8,506 ( 2,938 ) ( 24,495 )

cash at end of period of discontinued operation — — —

Cash and cash equivalents at end of period of continuing operations $ 45,822 $ 37,316 $ 40,254

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Expedited Freight and Intermodal.

The Company conducts business in the United States and Canada.

The Company conducts business in the United States, Canada, and Mexico.

The Expedited Freight segment provides expedited regional, inter-regional and national less-than-truckload (“LTL ” ), truckload and final mile services.

Expedited Freight also offers customers local pick-up and delivery and other services including shipment consolidation and deconsolidation, warehousing, customs brokerage and other handling.

Expedited Freight also offers customers local pick-up and delivery and other services including shipment consolidation and deconsolidation, warehousing, customs brokerage and other handling services.

The Intermodal segment provides first- and last-mile high value intermodal container drayage services both to and from seaports and railheads.

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Pool provided high-frequency handling and distribution of time sensitive products to numerous destinations within a specific geographic region.

As a result of the strategy to divest of Pool, the results of operations for Pool are presented as a discontinued operation in the Consolidated Statements of Comprehensive Income for all periods presented.

In addition, assets and liabilities were reflected as “Assets and liabilities held for sale ” in the Consolidated Balance Sheets for the prior period.

As a result of the strategy to divest of Pool, the results of operations for Pool were presented as a discontinued operation in the Consolidated Statements of Comprehensive Income for the prior periods.

Unless otherwise noted, amounts, percentages and discussion for all periods reflect the results of operations, financial condition and cash flows from the Company’s continuing operations.

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Cash as of December 31, 2022 and 2021 of $ 30,743 and $ 22,308 , respectively, consisted of cash on hand and bank deposits.

Cash equivalents as of both December 31, 2021 and 2020 of $ 15,008 consisted of money market deposits.

Cash equivalents as of December 31, 2022 and 2021 of $ 15,079 and $ 15,008 , respectively, consisted of money market deposits.

The Company considers all investments with an original maturity of three months or less to be cash and cash equivalents.

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Cloud Computing Costs

The Company capitalizes the costs of incurred during the implementation stage for cloud computing or hosting arrangements.

The Company capitalizes the costs incurred during the implementation stage for cloud computing or hosting arrangements.

Costs incurred in the preliminary project stage and post-implementation stage, which includes maintenance and training costs, are expensed as incurred.

Capitalized software costs are amortized over the straight-line method over three to five years and are recorded in “Prepaid expenses” in the Consolidated Balance Sheets.

Capitalized software costs are amortized over the straight-line method over three to five years and are recorded in “Prepaid expenses” and "Other assets" in the Consolidated Balance Sheets.

Forward Air Corporation

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If the Company elects to perform a qualitative assessment and determines the fair value of its reporting units more likely than not exceed the carrying value of their net assets, no further evaluation is necessary.

For reporting units where the Company performs a one-step quantitative assessment, the Company compares the fair value of each reporting unit, which is determined based on a combination of an income approach using a discounted cash flow model, and a market approach, which considers comparable companies, to its respective carrying value of net assets, including goodwill.

If the fair value of the reporting unit exceeds its carrying value of net assets, the goodwill is not considered impaired.

If the carrying value of net assets is higher than the fair value of the reporting unit, the impairment charge is the amount by which the carrying value exceeds the reporting unit’s fair value.

For reporting units where the Company performs a one-step quantitative assessment, the Company compares the estimated fair value of each reporting unit, which is determined based on a combination of an income approach using a discounted cash flow model, and a market approach, which considers comparable companies, to its respective carrying value of net assets, including goodwill.

If the estimated fair value of the reporting unit exceeds its carrying value of net assets, the goodwill is not considered impaired.

If the carrying value of net assets is higher than the estimated fair value of the reporting unit, the impairment charge is the amount by which the carrying value exceeds the reporting unit’s estimated fair value.

The Company reviews its long-lived assets, which include intangible assets subject to amortization, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

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The Company also evaluates the amortization periods assigned to its intangible assets to determine whether events or changes in circumstances warrant revised estimates of useful lives.

Assets to be disposed of by sale are reported at the lower of the carrying amount or fair value, less estimated costs to sell.

Assets to be disposed of by sale are reported at the lower of the carrying amount or estimated fair value, less estimated costs to sell.

The results of the Company’s goodwill impairment analyses conducted as of June 30, 2022, 2021 and 2020 indicated that no reduction in the carrying amount of the Company’s goodwill was required.

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Acquisitions — 34,754 34,754

Acquisition adjustment — 4,678 4,678

Balance as of December 31, 2022 $ 169,288 $ 136,896 $ 306,184

2 unchanged sentences

As of December 31, 2022, approximately $ 227,041 of goodwill is deductible for tax purposes.

The Company amortizes certain acquired identifiable intangible assets on a straight-line basis over their estimated useful lives, which range from one year to 20 years.

The acquired intangible assets have a weighted-average useful life as follows:

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

The Company amortizes certain acquired identifiable intangible assets on a straight-line basis over their estimated useful lives, which range from one year to 20 years.

The acquired intangible assets have a weighted-average useful life as follows:

Intangible Assets Weighted-Average Useful Life

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Acquisitions 21,655 272 — 21,927

Acquisition adjustment ( 5,162 ) ( 692 ) — ( 5,854 )

Balance as of December 31, 2022 $ 267,870 $ 8,756 $ 1,500 $ 278,126

15 unchanged sentences

Accrued expenses $ 54,291 $ 61,621

Self-Insurance Loss Reserves

The Company’s licensed motor carrier contracts with independent contractor fleets, owner-operators and other third-party transportation capacity providers for most of the transportation services.

The Company’s independent contractor fleet owners and owner-operators lease their equipment to the Company’s motor carrier (“Leased Capacity Providers”) and own,

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

operate and maintain their own tractors and employ their own drivers.

Self-Insurance Loss Reserves

The Company’s licensed motor carrier contracts with independent contractor fleets, owner-operators and other third-party transportation capacity providers for most of the transportation services.

The Company’s independent contractor fleet owners and owner-operators lease their equipment to the Company (“Leased Capacity Providers”) and own, operate and maintain their own tractors and employ their own drivers.

Department of Transportation (“DOT”) regulations, the Company is liable for bodily injury and property damage caused by the Leased Capacity Providers and employee drivers while they are operating equipment under the Company’s various motor carrier authorities.

1 unchanged sentence

For vehicle liability, the Company retains a portion of the risk.

Below is a summary of the Company’s risk retention on vehicle liability insurance coverage maintained by the Company through $ 10,000 :

Below is a summary of the Company’s risk retention on vehicle liability insurance coverage maintained by the Company through $ 10,000 (in thousands):

Risk Retention Frequency Layer Policy Term

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10/1/2022 to 10/1/2023

LTL business $ 6,000 Policy Term Aggregate³ $ 3,000 to $ 5,000

10/1/2021 to 10/1/2022

LTL, Truckload and Intermodal businesses $ 5,000 Policy Term Aggregate³ $ 5,000 to $ 10,000

3 unchanged sentences

¹ Excluding the Final Mile business, which is primarily a brokered service.

² For each and every accident, the Company is responsible for damages and defense up to these amounts, regardless of the number of claims associated with any accident.

³ During the Policy Term, the Company is responsible for damages and defense within the stated Layer up to the stated, aggregate amount of Company Risk Retention before insurance will respond.

² For each and every accident/incident, the Company is responsible for damages and defense up to these amounts, regardless of the number of claims associated with any accident/incident.

³ During the Policy Term, the Company is responsible for damages and defense within the stated Layer up to the stated, aggregate amount of Company Risk Retention before insurance will contribute.

Also, from time to time, when brokering freight, the Company may face claims for the “negligent selection” of outside, contracted carriers that are involved in accidents, and the Company maintains third-party liability insurance coverage with a $ 100 deductible per occurrence for most of its brokered services.

7 unchanged sentences

Failure to establish sufficient insurance reserves and adequately estimate for future insurance claims may cause unfavorable differences between actual self-insurance costs and the reserve estimates.

As of December 31, 2021 and 2020, the Company recorded insurance reserves of $ 65,649 and $ 68,647 , respectively, inclusive of reserves in excess of the self-insured retention limit that are expected to be reimbursed from insurance carriers.

As of December 31, 2021, $ 21,172 was recorded in “Insurance and claims accruals” and $ 44,477 w as recorded in “Other long-term liabilities” in the Consolidated Balance Sheets.

As of December 31, 2022 and 2021, the Company recorded self-insurance loss reserves of $ 68,654 and $ 65,649 , respectively, inclusive of reserves in excess of the self-insured retention limit that are expected to be reimbursed from insurance carriers.

As of December 31, 2022, $ 19,961 was recorded in “Insurance and claims accruals” and $ 48,693 was recorded in “Other long-term liabilities” in the Consolidated Balance Sheets.

As of December 31, 2021 and 2020, the Company recognized a receivable for insurance proceeds and a corresponding claims payable for vehicle liability and workers’ compensation claims in excess of the self-insured retention limit.

As of December 31, 2021 and 2020, the Company recorded $ 28,667 and $ 35,088 , respectively, in “Other assets” and “Other long-term liabilities” in the Consolidated Balance Sheets.

As of December 31, 2021, $ 21,172 was recorded in “Insurance and claims accruals” and $ 44,477 was recorded in “Other long-term liabilities” in the Consolidated Balance Sheets.

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

As of December 31, 2022 and 2021, the Company recognized a receivable for insurance proceeds and a corresponding claims payable for vehicle liability and workers’ compensation claims in excess of the self-insured retention limit.

As of December 31, 2022 and 2021, the Company recorded $ 29,087 and $ 28,667 , respectively, in “Other assets” and “Other long-term liabilities” in the Consolidated Balance Sheets.

Revenue Recognition

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These factors, discretion in the amount of consideration and the selection of drivers and other vendors, support revenue recognized on a gross basis.

The Company accounts for leases u nder Accounting Standards Codification 842, Leases, (“ASC 842”), where lessees are required to record an asset (right-of-use asset or finance lease asset) and a lease liability.

The Company accounts for leases under Accounting Standards Codification 842, Leases, (“ASC 842”), where lessees are required to record an asset (right-of-use asset or finance lease asset) and a lease liability.

ASC 842 allows for two types of leases for recognition purposes:

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The incremental borrowing rate is estimated based on the contractual lease term and the Company’s applicable borrowing rate.

Forward Air Corporation

Notes to Consolidated Financial Statements (Continued)

December 31, 2022

(In thousands, except per share data)

Business Combinations

3 unchanged sentences

For tangible assets, significant judgements, include, but are not limited to, current market values, physical and functional obsolescence of the assets, and remaining useful lives.

Consideration is typically paid in the form of cash paid upon closing or contingent consideration paid upon satisfaction of a future obligation.

Consideration is typically paid in the form of cash paid upon closing while contingent consideration is paid upon the satisfaction of a future obligation.

If contingent consideration is included as a component of the consideration, the Company values the consideration as of the acquisition date.

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

Income taxes are accounted for under the asset and liability method.

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Diluted net income (loss) per common share assumes the exercise of outstanding stock options and the vesting of performance share awards using the treasury stock method when the effects of such assumptions are dilutive.

A reconciliation of net income (loss) attributable to Forward Air and weighted-average common shares outstanding for purposes of calculating basic and diluted net income (loss) per share during the years ended December 31, 2021, 2020 and 2019 is as follows:

Forward Air Corporation

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(In thousands, except per share data)

2022 2021 2020

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Discontinued operation — ( 0.37 ) ( 1.05 )

Net income per share 1

Net income per basic share 1

$ 7.17 $ 3.87 $ 0.84

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Discontinued operation — ( 0.37 ) ( 1.05 )

Net income per share $ 3.85 $ 0.84 $ 3.04

Net income per diluted share $ 7.14 $ 3.85 $ 0.84

1 Rounding may impact summation of amounts.

Forward Air Corporation

Notes to Consolidated Financial Statements (Continued)

December 31, 2022

(In thousands, except per share data)

The number of shares that were not included in the calculation of net income (loss) per diluted share because to do so would have been anti-dilutive for the years ended December 31, 2022, 2021 and 2020 are as follows:

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The fair value of the restricted shares is the quoted market value of the Company’s common stock on the grant date, and the share-based compensation expense is recognized on a straight-line basis over the vesting period.

For certain performance shares, the fair value is the quoted market value of the Company’s common stock on

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

the grant date less the present value of the expected dividends not received during the relevant period.

For certain performance shares, the fair value is the quoted market value of the Company’s common stock on the grant date less the present value of the expected dividends not received during the relevant period.

For these performance shares, the share-based compensation expense is recognized on a straight-line basis over the three-year vesting period based on the projected assessment of the level of performance that will be achieved.

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Promptly upon its detection of the incident, the Company initiated response protocols, launched an investigation and engaged the services of cybersecurity and forensics professionals.

The Company has also engaged with the appropriate law enforcement authorities.

The Company also engaged with the appropriate law enforcement authorities.

The Company continued to cooperate with law enforcement in connection with the criminal investigation into those responsible for the Ransomware Incident.

For the year ended December 31, 2021 and 2020, expenses related to the Ransomware Incident were $ 434 and $ 1,560 , respectively, which were recorded in “Other operating expenses” in the Consolidated Statements of Comprehensive Income.

For the year ended December 31, 2022 and 2021, expenses related to the Ransomware Incident were zero and $ 434 , respectively, which were recorded in “Other operating expenses” in the Consolidated Statements of Comprehensive Income.

Expenses include costs to investigate and remediate the Ransomware Incident and legal and other professional services related to the incident.

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The adoption of the standard did not have a material impact on the Company’s results of operations, financial condition, or cash flows.

Forward Air Corporation

Notes to Consolidated Financial Statements (Continued)

December 31, 2022

(In thousands, except per share data)

New Accounting Pronouncements to be Adopted

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Discontinued Operation and Held for Sale

As previously disclosed, on April 23, 2020, the Company made a decision to divest of Pool.

The Pool business met the criteria for held for sale classification.

As a result, the assets and liabilities of Pool were presented separately under the captions “Current assets held for sale”, “Noncurrent assets held for sale”, “Current liabilities held for sale” and “Noncurrent liabilities held for sale” in the Consolidated Balance Sheets as of December 31, 2020.

The results of Pool were reclassified to “Loss from discontinued operation, net of tax” in the Consolidated Statements of Comprehensive Income for the years ended December 31, 2021, 2020 and 2019.

Certain corporate overhead and other costs previously allocated to Pool for segment reporting purposes did not qualify for classification within discontinued operation and have been reallocated to continuing operations.

These costs were reclassified to the eliminations column in the segment reconciliation in Note 12, Segment Reporting .

As previously disclosed, on April 23, 2020, the Company made a decision to divest of Pool and the sale was completed on February 12, 2021.

As a result, the results of Pool were classified to “Loss from discontinued operation, net of tax” in the Consolidated Statements of Comprehensive Income for the years ended December 31, 2021 and 2020.

Certain corporate overhead and other costs previously allocated to Pool for segment reporting purposes did not qualify for classification within discontinued operation and were allocated to continuing operations.

These costs were classified to the eliminations column in the segment reconciliation in Note 12, Segment Reporting.

Held for Sale

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

Upon meeting the criteria for held for sale classification and in each subsequent reporting period, the Company evaluated whether Pool’s estimated fair value, less costs to sell, exceeded the net carrying value.

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The fair value was based on the estimated eleven-month period of the earnings before interest, taxes, depreciation and amortization and was calculated using a Monte Carlo simulation model.

Forward Air Corporation

Notes to Consolidated Financial Statements (Continued)

December 31, 2022

(In thousands, except per share data)

The weighted average assumptions under the Monte Carlo simulation model were as follows:

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In exchange for the services performed by the Company under the TSA, the Company received a monthly service charge.

For the year ended December 31, 2021, the Company recognized $ 747 , in “Other operating expenses ” in the Consolidated Statements of

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

Comprehensive Income, for the services performed under the TSA.

For the year ended December 31, 2021, the Company recognized $ 747 , in “Other operating expenses ” in the Consolidated Statements of Comprehensive Income, for the services performed under the TSA.

The TSA ended in October 2021 when all services were completed.

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The Company is reimbursed by TOG FAS Holdings LLC within 60 days from the end of the month in which the payment is remitted.

As of December 31, 2021, the Company recorded a receivable in the amount o f $ 8,097 in “Other receivables ” in Consolidated Balance Sheets for the reimbursement due to the Company.

The Company evaluates the collectability of the receivable at least quarterly and if the Company is aware of the inability of TOG FAS Holdings LLC to meet its financial obligations to the Company, the Company will record a specific reserve in order to reduce the receivable to the amount the Company reasonably believes will be collected.

The Company believes collectibility of the receivable is probable as of December 31, 2021.

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

Summarized Held for Sale and Discontinued Operation Financial Information

A summary of the carrying amounts of major classes of assets and liabilities, which are included in assets and liabilities held for sale in the Consolidated Balance Sheets, is as follows:

Current assets:

Accounts receivable, less allowance of $ 86 in 2020

Other current assets 1,262

Total current assets held for sale $ 21,002

Property and equipment $ 48,905

Less accumulated depreciation and amortization 28,890

Net property and equipment 20,015

Operating lease right-of-use assets 46,865

Other acquired intangibles, net of accumulated amortization of $ 12,679 in 2020

Deferred income taxes 3,253

Other assets 3,321

Valuation allowance on assets held for sale ( 22,978 )

Total noncurrent assets held for sale $ 53,097

Current liabilities:

Accounts payable $ 4,002

Accrued expenses 5,070

Other current liabilities 27

Current portion of operating lease liabilities 16,825

Total current liabilities held for sale $ 25,924

Operating lease liabilities, less current portion $ 30,024

Other long-term liabilities 4,551

Total noncurrent liabilities held for sale $ 34,575

As of December 31, 2021, the Company recorded a receivable in the amount o f $ 8,097 in “Other receivables ” in the Consolidated Balance Sheets for the reimbursement due to the Company.

The Company evaluated the collectability of the receivable at least quarterly and if the Company was aware of the inability of TOG FAS Holdings LLC to meet its financial obligations to the Company, the Company recorded a specific reserve in order to reduce the receivable to the amount the Company reasonably believes will be collected.

As of December 31, 2022, the outstanding receivable balance was collected in full.

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

Summarized Discontinued Operation Financial Information

A summary of the results of operations classified as a discontinued operation, net of tax, in the Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020 is as follows:

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Total operating expenses — 25,159 179,768

(Loss) income from discontinued operation ( 7,383 ) ( 38,335 ) 6,408

Loss from discontinued operation — ( 7,383 ) ( 38,335 )

Loss on sale of business — ( 2,860 ) —

(Loss) income from discontinued operation before income taxes ( 10,243 ) ( 38,335 ) 6,408

Loss from discontinued operation before income taxes — ( 10,243 ) ( 38,335 )

Income tax (benefit) expense — ( 11 ) ( 9,301 )

(Loss) income from discontinued operation, net of tax $ ( 10,232 ) $ ( 29,034 ) $ 4,777

Loss from discontinued operation, net of tax $ — $ ( 10,232 ) $ ( 29,034 )

Expedited Freight

In April 2019, the Company acquired certain assets and liabilities of FSA Network, Inc., doing business as FSA Logistix (“FSA”), for $ 26,798 , net of cash acquired of $ 202 , and an earn-out of up to $ 15,000 .

FSA, with management offices in Fort Lauderdale, Florida and Southlake, Texas, specializes in last mile logistics for a wide range of American companies, including national retailers, manufacturers, eTailers and third-party logistics companies.

FSA has operations in the East, Midwest, Southwest and West regions.

The acquisition of FSA provides the Company with the opportunity to expand its final mile service offering into additional geographic markets, form relationships with new customers, add volumes to existing locations and generate synergies within the Company.

The acquisition was financed by cash flow from operations.

The results of operations of FSA has been included in the Company’s consolidated financial statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Expedited Freight reportable segment.

The purchase agreement for FSA included an earn-out up to $ 15,000 based on the achievement of certain revenue milestones over two one-year periods, beginning May 1, 2019.

The estimated fair value of the earn-out liability on the date of acquisition was $ 11,803 .

The fair value was based on the estimated two-year performance of the acquired customer revenue and was calculated using a Monte Carlo simulation model.

The assumptions under the Monte Carlo simulation model were as follows for the year ended December 31, 2020 and 2019:

December 31, 2020 December 31, 2019

Risk-free rate 1.4 % 2.2 %

Revenue discount rate 3.2 % 4.4 %

Revenue volatility 8.0 % 5.0 %

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

The fair value of the earn-out liability was adjusted at each reporting period based on changes in the expected cash flows and related assumptions used in the Monte Carlo simulation model.

During the year ended December 31, 2021, 2020 and 2019, the fair value of the earn-out changed by ($ 52 ), $ 379 and ($ 33 ), respectively, and the change in fair value was recorded in “Other operating expenses ” in the Consolidated Statements of Comprehensive Income.

The first one-year period ended in the second quarter of 2020 and the Company paid $ 5,284 based on the terms of the purchase agreement.

The second one-year period ended in the second quarter of 2021 and the Company paid $ 6,813 in the third quarter of 2021 based on the terms of the purchase agreement.

As of December 31, 2020 , the fair value of the earn -out liability was $ 6,865 , which was reflected in “Other current liabilities ” in the Consolidated Balance Sheets.

In January 2020, the Company acquired certain assets and liabilities of Linn Star Holdings, Inc., Linn Star Transfer, Inc.

and Linn Star Logistics, LLC (collectively, “Linn Star”) for $ 55,931 , net of cash acquired of $ 1,308 .

Linn Star, headquartered in Cedar Rapids, Iowa, specializes in last mile logistics and in-home installation services for a range of national retailers and manufacturers.

Linn Star has operations primarily in the Midwest and Southwest regions.

The acquisition of Linn Star supports the Company’s strategic growth plan by expanding the footprint of the Final Mile business into additional markets.

The acquisition was financed by cash flows from operations.

The results of operations of Linn Star have been included in the Company’s consolidated financial statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Expedited Freight reportable segment.

On October 11, 2020, the Company acquired certain assets of CLW Delivery, Inc.

(“CLW”) for $ 5,500 .

CLW, headquartered in Johnson City, Tennessee, specializes in last mile logistics and in-home installation services for national retailers and manufacturers.

The acquisition of CLW supports the Company’s strategic growth plan by expanding the footprint of the Final Mile business into additional markets.

The acquisition was financed by cash flows from operations.

The results of operations of CLW have been included in the Company’s consolidated financial statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Expedited Freight reportable segment.

In May 2021, the Company acquired certain assets and liabilities of J&P Hall Express Delivery (“J&P”) for $ 7,670 .

1 unchanged sentence

The acquisition of J&P supports the Company’s strategic growth plan by expanding pickup and delivery, less-than-truckload, truckload, less than container load, container freight station warehousing, and airport transfer services across the Southeastern United States.

The acquisition was financed by cash flow from operations.

The acquisition was funded using cash flows from operations.

The results of J&P have been included in the Company’s Consolidated Financial Statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Expedited Freight reportable segment.

In July 2019, the Company acquired certain assets and liabilities of O.S.T.

Logistics, Inc.

Trucking Co., Inc.

(collectively, “O.S.T.”) for $ 12,000 .

O.S.T., headquartered in Baltimore, Maryland, provides intermodal drayage services.

has locations in Florida, Georgia, South Carolina and Virginia.

The acquisition of O.S.T.

supports the Company’s strategic growth plan by expanding the footprint of the Intermodal business into additional markets.

The acquisition was financed by cash flows from operations.

The results of operations of O.S.T.

have been included in the Company’s consolidated financial statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Intermodal reportable segment.

In February 2021, the Company acquired certain assets and liabilities of Proficient Transport Incorporated and Proficient Trucking, Inc.

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The acquisition of Proficient Transport supports the Company’s strategic growth plan by expanding the intermodal footprint in Georgia, Illinois, North Carolina, and Texas, and introduces a new location in Ohio.

The acquisition was financed by cash flows from operations.

The acquisition was funded using cash flows from operations.

The results of Proficient Transport have been included in the Company’s Consolidated Financial Statements as of and from the date of acquisition.

1 unchanged sentence

The purchase agreement for Proficient Transport included an earn-out up to $ 2,000 based on the achievement of certain revenue milestones over a one-year period, beginning March 1, 2021.

The estimated fair value of the earn-out liability on the date of acquisition was $ 829 .

The fair value was based on the estimated one-year performance of the acquired customer

The estimated fair value of the earn-out liability

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

revenue and was calculated using the option pricing method.

on the date of acquisition was $ 829 .

The fair value was based on the estimated one-year performance of the acquired customer revenue and was calculated using the option pricing method.

The assumptions used to calculate the estimated fair value of the earn-out under the option pricing method were as follows:

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The fair value of the earn-out liability was adjusted at each reporting period based on changes in the expected cash flows and related assumptions used in the option pricing method.

During the year ended December 31, 2021, the fair value of the earn-out changed by ($ 444 ) , and the change in the fair value was recorded in “Other operating expenses” in the Consolidated Statements of Comprehensive Income.

During the years ended December 31, 2022 and 2021, the fair value of the earn-out changed by ($ 294 ) and ($ 444 ), respectively , and the change in the fair value was recorded in “Other operating expenses” in the Consolidated Statements of Comprehensive Income.

The one-year period ended in the first quarter of 2022 and the Company paid $ 91 in the second quarter of 2022 based on the terms of the purchase agreement.

As of December 31, 2021, the fair value of the earn-out liabili ty was $ 385 , which was reflected in “Other current liabilities” in the Consolidated Balance Sheets.

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In addition, BarOle has a larger terminal location, which allows for further expansion in the future.

The acquisition was financed by cash flows from operations.

The acquisition was funded using cash flows from operations.

The results of BarOle have been included in the Company’s Consolidated Financial Statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Intermodal reportable segment.

In May 2022, the Company acquired certain assets and liabilities of Edgmon Trucking, LLC (“Edgmon”) for $ 40,993 and a potential earn-out of up to $ 5,000 , based on the achievement of certain profit contribution milestones over a nineteen month period, beginning May 31, 2022.

The estimated fair value of the earn-out liability on the date of acquisition was immaterial.

The fair value was based on the estimated certain profit contribution during the nineteen month period and was calculated using the option pricing method.

Edgmon, headquartered in Kent, Washington, operates a terminal in Kent and a yard in Seattle, servicing both the Port of Seattle and the Port of Tacoma.

The acquisition of Edgmon marks the Company’s first Intermodal location on the West Coast, a key area of expansion in the Intermodal strategic growth plan.

The acquisition was funded using cash flows from operations.

The results of Edgmon have been included in the Company’s Consolidated Financial Statements as of and from the date of acquisition.

The associated goodwill has been included in the Company’s Intermodal reportable segment.

Forward Air Corporation

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Assets acquired and liabilities assumed as of the acquisition date are presented in the following table:

Linn Star CLW Proficient Transport J&P BarOle

April 21, 2019 July 14, 2019 January 12, 2020 October 11, 2020 February 28, 2021 May 30, 2021 November 30, 2021

Proficient Transport J&P BarOle Edgmon

February 28, 2021 May 30, 2021 November 30, 2021 May 31, 2022

Tangible assets:

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Accounts receivable 4,171 1,940 2,657 4,963

Other receivables 1,491 — — — — — —

Prepaid expenses and other current assets — 32 — —

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Net assets acquired $ 16,339 $ 7,670 $ 35,436 $ 40,993

The preliminary purchase price for BarOle has been allocated to assets acquired and liabilities assumed based on the the Company’s best estimates and assumptions using the information available as of the acquisition date through the date of this filing.

The provisional measurements of identifiable assets and liabilities, and the resulting goodwill related to these acquisitions are subject to adjustments in subsequent periods as the Company finalizes its purchase price allocation, including the third-party valuations.

The Company expects to finalize the valuation as soon as practicable, but no later than one year from the acquisition date.

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

The preliminary purchase price for Edgmon has been allocated to assets acquired and liabilities assumed based on the Company’s best estimates and assumptions using the information available as of the acquisition date through the date of this filing.

The provisional measurements of identifiable assets and liabilities, and the resulting goodwill related to this acquisition, is subject to adjustments in subsequent periods as the Company finalizes its purchase price allocation, including third-party valuations.

During the year ended December 31, 2022, the Company recorded measurement period adjustments to the provisional amounts initially recorded for acquired net working capital, acquired property and equipment and acquired customer relationships and non-compete agreements related to the BarOle acquisition.

The measurement period adjustment resulted in a $ 63 increase to net working capital, a $ 1,113 increase to acquired property and equipment and a combined $ 5,854 decrease to acquired customer relationships and non-compete agreements, with a corresponding net increase to goodwill.

The Company expects to finalize the Edgmon valuation as soon as practicable, but no later than one year from the acquisition date.

The estimated useful life of acquired intangible assets as of the acquisition date are summarized in the following table:

Estimated Useful Lives

Proficient Transport J&P BarOle Edgmon

Customer relationships 8 years 12 years 9 years 9 years

Non-compete agreements 1 year 5 years 5 years 5 years

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

The estimated useful life of acquired intangible assets as of the acquisition date are summarized in the following table:

Estimated Useful Lives

Linn Star CLW Proficient Transport J&P BarOle

Customer relationships 15 years 10 years 15 years 7 years 8 years 12 years 8 years

Non-compete agreements 5 years 3 years 1 year 5 years 1 year 5 years 5 years

In November 2022, the Company acquired certain assets and liabilities of Chickasaw Container Services, Inc.

(“CCS”), a privately held intermodal drayage provider.

The acquisition included two operating terminals in Mobile, Alabama and Memphis, Tennessee and will allow the company to expand intermodal drayage operations in the Mobile market while bolstering an already strong presence in the Memphis market.

In addition to drayage services, CCS also provides container storage and sales.

The Company paid $ 25,733 using cash on hand from operations.

The preliminary purchase price was allocated based on the estimated fair values as of the acquisition date.

The Company recorded $ 21,262 related to intangible assets and $ 4,471 related to tangible assets.

The Company expects to finalize the valuations as soon as practicable, but no later than one year from the respective acquisition date.

The results of CCS have been included in the Company's Consolidated Financial Statements as of and from the date of acquisition.

The associated goodwill has been included in the Company's Intermodal reportable segment.

Long-term debt consisted of the following as of December 31, 2022 and 2021:

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Such increases to the Facility may be in the form of additional revolving credit loans, term loans or a combination thereof, and are contingent upon there being no events of default under the Facility.

As of December 31, 2021 and 2020, the Company had $ 272,466 and $ 94,174 , respectively, of available borrowing capacity under the Facility.

As of December 31, 2022 and December 31, 2021, the Company had $ 279,966 and $ 272,466 respectively, of available borrowing capacity under the Facility.

The Facility contains covenants that, among other things, restrict the ability of the Company, without the approval of the required lenders, to engage in certain mergers, consolidations, asset sales, dividends and stock repurchases, investments, and other transactions or to incur liens or indebtedness in excess of agreed thresholds, as set forth in the credit agreement.

Forward Air Corporation

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(In thousands, except per share data)

other transactions or to incur liens or indebtedness in excess of agreed thresholds, as set forth in the credit agreement.

The Company also has to fulfill financial covenants with respect to a leverage ratio and an interest coverage ratio.

Company also has to fulfill financial covenants with respect to a leverage ratio and an interest coverage ratio.

As of December 31, 2022, the Company was in compliance with the aforementioned covenants.

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Interest is payable in arrears for each loan that is based on the BSBY rate on the last day of the interest period applicable to each loan, and interest is payable in arrears on loans not based on the BSBY rate on the last day of each quarter.

The interest rate on the outstanding borrowings under the revolving credit facility was 1.43 % and 3.25 % as of December 31, 2021 and December 31, 2020, respectively.

Previously, under the Facility, interest accrued on the amounts outstanding under the Facility, at the Company’s option, at either (1) London Interbank Offered Rate (“LIBOR ” ) rate, not less than 1.00 %, plus a margin ranging from 2.25 % to 2.75 % based on the Company’s leverage ratio, or (2) base rate, which cannot be less than 3.00 %.

The base rate was the highest of (i) the federal funds rate, not less than zero , plus 0.50 %, (ii) the administrative agent’s prime rate and (iii) the LIBOR rate, not less than 1.00 %, plus 1.00 %, plus a margin ranging from 0.25 % to 0.75 % based on the Company’s leverage ratio.

Interest was payable in arrears for each loan that was based on the LIBOR rate on the last day of the interest period applicable to each loan, and interest was payable in arrears on loans not based on the LIBOR rate on the last day of each quarter.

The interest rate on the outstanding borrowings under the revolving credit facility was 4.85 % and 1.43 % as of December 31, 2022 and 2021, respectively.

Letters of Credit

The Company has an arrangement under the Facility to issue letters of credit, which guarantee the Company’s obligations for potential claims exposure for insurance coverage.

As of December 31, 2021 and December 31, 2020, outstanding letters of credit totaled $ 20,034 and $ 18,326 , respectively.

As of both December 31, 2022 and December 31, 2021, outstanding letters of credit totaled $ 20,034 .

Interest Payments

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Cash Dividends

During the fourth quarter of 2020 and each quarter of 2021, the Company’s Board of Directors declared and the Company has paid a quarterly cash dividend of $ 0.21 per common share.

During the first, second and third quarters of 2020, each quarter of 2019, the Company’s Board of Directors declared and the Company has paid a quarterly cash dividend of $ 0.18 per common share.

On February 8, 2022, the Company’s Board of Directors declared a quarterly cash dividend of $ 0.24 per common share that will be paid in the first quarter of 2022.

For each quarter of 2022, the Company’s Board of Directors declared and the Company has paid a quarterly cash dividend of $ 0.24 per common share.

For each quarter of 2021, the Company’s Board of Directors declared and the Company paid a quarterly cash dividend of $ 0.21 per common share.

On February 7, 2023, the Company’s Board of Directors declared a quarterly cash dividend o f $ 0.24 per common share that will be paid in the first quarter of 2023.

Share Repurchase Program

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The 2019 Repurchase Plan expires when the shares authorized for repurchase are exhausted or the 2019 Repurchase Plan is canceled.

During the year ended December 31, 2022, the Company repurchased through open market transactions 600 s hares of common stock for $ 62,771 , or an average of $ 104.53 per share, and during the year ended December 31, 2021, the Company repurchased through open market transactions 535 shares of common stock for $ 48,989 , or an average of $ 91.46 per share.

All shares received wer e retired upon receipt, and the excess of the purchase price over the par value per share was recorded to “Retained Earnings” in the Consolidated Balance Sheets.

As of December 31, 2022, the remaining shares permitted to be repurchased under the 2019 Repurchase Plan were approximately 2,233 shares.

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

During the year ended December 31, 2021, the Company repurchased through open market transactions 535 shares of common stock for $ 48,989 , or an average of $ 91.46 per share, and during the year ended December 31, 2020, the Company repurchased through open market transactions 787 shares of common stock for $ 45,248 , or an average of $ 57.53 per share.

All shares received were retired upon receipt, and the excess of the purchase price over the par value per share was recorded to “Retained Earnings” in the Consolidated Balance Sheets.

As of December 31, 2021, the remaining shares permitted to be repurchased under the 2019 Repurchase Plan were approximately 2,833 shares.

Stock Incentive Plan

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The weighted average grant-date fair value of the stock option awards granted under the Plan and the weighted average assumptions under the Black-Scholes option-pricing model were as follows for the years ended December 31, 2022, 2021 and 2020.

The Company did not grant stock options during the year ended December 31, 2019.

2022 December 31,

2021 December 31,

Weighted average grant-date fair value $ 28.91 $ 18.36 $ 14.79

4 unchanged sentences

Expected life of awards (years) 5.6 5.8 5.9

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

Stock option transactions during the year ended December 31, 2022 on a continuing operations basis were as follows:

5 unchanged sentences

Outstanding as of December 31 376 $ 66.13

As of December 31, 2021 , the weighted average remaining contractual life of stock options both outstanding and exercisable was approximately three years .

Forward Air Corporation

Notes to Consolidated Financial Statements (Continued)

December 31, 2022

(In thousands, except per share data)

As of December 31, 2022 , the weighted average remaining contractual life of stock options outstanding was approximately three years and exercisable was approximately two years .

The total fair value of stock options vested during 2022, 2021, 2020 was $ 855 , $ 922 , and $ 1,377 , respectively.

6 unchanged sentences

376 $ 66.13 280 $ 57.13

$ 75.05 - $ 75.05 39,139 6.1 75.05 — —

342,540 $ 58.44 267,483 $ 55.01

As of December 31, 2022 , the total intrinsic value of outstanding and exercisable stock options was $ 14,642 and $ 13,390 , respectively.

The total intrinsic value of stock options exercised during 2022, 2021 and 2020 was $ 142 , $ 2,137 and $ 1,568 , respectively.

Stock option transactions during the year ended December 31, 2021 on a discontinued operation basis were as follows:

Number of Shares Weighted Average Exercise Price

Outstanding as of January 1 14 $ 52.15

Exercised ( 14 ) 52.15

Forfeited or Canceled — —

Outstanding as of December 31 — $ —

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

The total fair value of stock options vested during 2020 and 2019 was $ 58 , and $ 56 , respectively.

There were no stock options vested during 2021.The total intrinsic value of stock options exercised during 2021 and 2019 was $ 458 , and $ 193 , respectively.

There were no stock options exercised during 2020.

Restricted Shares

18 unchanged sentences

(In thousands, except per share data)

Restricted share transactions on a discontinued operation basis for the year ended December 31, 2021 were as follows:

Number of Shares Weighted Average Grant Date Fair Value

Outstanding as of January 1 8 $ 60.83

Vested ( 4 ) 60.54

Forfeited ( 4 ) 63.62

Outstanding as of December 31 — $ —

The weighted average grant-date fair value of the restricted shares granted under the Plan during the years ended December 31, 2020 and 2019 were $ 63.24 and $ 59.07 , respectively.

The total fair value of restricted shares that vested during 2021, 2020 and 2019 was $ 364 , $ 625 , and $ 270 , respectively.

Performance Shares

17 unchanged sentences

Weighted average risk-free interest rate 1.6 % 0.2 % 1.4 %

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

Performance award transactions for the year ended December 31, 2022 on a continuing operations basis were as follows assuming target levels of performance:

7 unchanged sentences

The excess tax benefit realized for tax deductions in the United States related to the exercise of stock options, vesting of restricted stock and vesting of performance awards under the Pl an was $ 1,012 , $ 911 , and $ 2,340 for the years ended December 31, 2022, 2021 and 2020, respectively, on a continuing operations basis.

The excess tax benefit realized for tax deductions in the United States related to the exercise of stock options, vesting of restricted stock and vesting of performance awards under the Plan was $ 95 , $ 75 , and $ 95 for the years ended December 31, 2021, 2020 and 2019, respectively, on a discontinued operation basis.

Forward Air Corporation

Notes to Consolidated Financial Statements (Continued)

December 31, 2022

(In thousands, except per share data)

Employee Stock Purchase Plan

11 unchanged sentences

Employee stock purchase plan activity and related information was as follows on a discontinued operation basis:

FORWARD AIR CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

December 31, 2021

(In thousands, except per share data)

December 31, 2022 December 31, 2021 December 31, 2020

43 unchanged sentences

$ 67,647 $ 38,872 $ 16,593

A reconciliation of income taxes computed at the U.S.

federal statutory income tax rate (21.0% for 2021 , 2020 and 2019 ) to the provision for income taxes reflected in the Company’s Consolidated Statements of Comprehensive Income for the years ended December 31, 2021 , 2020 and 2019 is as follows:

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

A reconciliation of income taxes computed at the U.S.

federal statutory income tax rate (21.0% for 2022, 2021 and 2020) to the provision for income taxes reflected in the Company’s Consolidated Statements of Comprehensive Income for the years ended December 31, 2022, 2021 and 2020 is as follows:

2022 2021 2020

35 unchanged sentences

The Company assessed the likelihood that its deferred tax assets would be recovered from estimated future taxable income and available tax planning strategies.

In making this assessment, all available evidence was considered including economic climate, as well as reasonable tax planning strategies.

The Company believes it is more likely than not that it will realize its remaining net deferred tax assets, net of the valuation allowance, in future years.

In making this assessment, all available evidence was considered including economic climate, as well as reasonable tax planning

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

The Company believes it is more likely than not that it will realize its remaining net deferred tax assets, net of the valuation allowance, in future years.

As a result of the Towne acquisition, the Company had approximately $ 2,000 of federal net operating losses which the Company fully utilized in 2020.

As of December 31, 2021, the Company had state net operating loss carryforwards of $ 13,819 , and as of both December 31, 2020 and 2019, the Company had state net operating loss carryforwards of $ 16,926 , that expire between 2021 and 2032.

As of December 31, 2022, 2021 and 2020 the Company had state net operating loss carryforwards of $ 13,574 , $ 13,819 and $ 16,926 , respectively, that expire between 2022 and 2033.

The state net operating loss carryforwards are limited to the future taxable income of separate legal entities.

The valuation allowance on the state net operating loss carryforwards stayed the same in 2021, 2020 and 2019.

There was no change in the valuation allowance for the state net operating loss carryforwards in 2022, 2021 and 2020.

A reconciliation of the beginning and ending amount of unrecognized tax benefits as of and during the years ended December 31, 2022 and 2021 is as follows:

27 unchanged sentences

The Company’s lease agreements do not contain any residual value guarantees or restrictive covenants.

The Company has contracts with Leased Capacity Providers.

Since the contracts explicitly identify the tractors operated by the Leased Capacity Providers, the Company determined the contracts contain an embedded lease.

The compensation of Leased Capacity Providers, as specified in the contract, is variable based upon a rate per shipment and a rate

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

The Company has contracts with Leased Capacity Providers.

Since the contracts explicitly identify the tractors operated by the Leased Capacity Providers, the Company determined the contracts contain an embedded lease.

The compensation of Leased Capacity Providers, as specified in the contract, is variable based upon a rate per shipment and a rate per mile.

The variable amounts are excluded from the calculation of the right-of-use lease asset and corresponding operating lease liability and are disclosed as variable lease costs.

4 unchanged sentences

Finance lease assets Property and equipment, net 1

23,209 13,797

Total leased assets $ 165,074 $ 161,995

52 unchanged sentences

As of December 31, 2022, the Company had unconditional purchase obligations of $ 11,694 to purchase forklifts and other equipment during 2023.

Contingencies

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

Contingencies

The Company is party to various legal claims and actions incidental to its business, including claims related to vehicle liability, workers’ compensation, property damage and employee medical benefits.

4 unchanged sentences

For vehicle liability, the Company retains a portion of the risk.

Below is a summary of the Company’s risk retention on vehicle liability insurance coverage maintained by the Company through $ 10,000 :

Below is a summary of the Company’s risk retention on vehicle liability insurance coverage maintained by the Company up to $ 10,000 (in thousands):

Risk Retention Frequency Layer Policy Term

4 unchanged sentences

10/1/2022 to 10/1/2023

LTL business $ 6,000 Policy Term Aggregate³ $ 3,000 to $ 5,000

10/1/2021 to 10/1/2022

LTL, Truckload and Intermodal businesses $ 5,000 Policy Term Aggregate³ $ 5,000 to $ 10,000

3 unchanged sentences

¹ Excluding the Final Mile business, which is primarily a brokered service.

² For each and every accident, the Company is responsible for damages and defense up to these amounts, regardless of the number of claims associated with any accident.

³ During the Policy Term, the Company is responsible for damages and defense within the stated Layer up to the stated, aggregate amount of Company Risk Retention before insurance will respond.

² For each and every accident/incident, the Company is responsible for damages and defense up to these amounts, regardless of the number of claims associated with any accident/incident.

³ During the Policy Term, the Company is responsible for damages and defense within the stated Layer up to the stated, aggregate amount of Risk Retention before insurance will contribute.

6 unchanged sentences

Although, an estimate cannot be made of the range of additional loss that is at least reasonably possible.

During the year ended December 31, 2019, the Company recorded a $ 7,500 reserve for a vehicular claim related to one incident.

On December 15, 2020, the Company detected a Ransomware Incident impacting the Company’s operational and information technology systems, which caused service delays for the Company’s customers.

1 unchanged sentence

Any failure to comply with data privacy, security or other laws and regulations could result in claims, legal or regulatory proceedings, inquires or investigations.

Employee Benefit Plan

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

Employee Benefit Plan

The Company sponsors a qualified defined contribution plan covering substantially all employees.

11 unchanged sentences

• Level 3 - Model-derived valuations in which one or more significant inputs are unobservable.

As previously discussed in Note 3, Acquisitions, the estimated fair value of the earn-out liability was determined using either the Monte Carlo simulation model or the option pricing method.

As previously discussed in Note 3, Acquisitions, the estimated fair value of the earn-out liability was determined using the option pricing method.

The significant inputs used to calculate the estimated fair value are derived from a combination of observable and unobservable market data.

Observable inputs used in either the Monte Carlo simulation model or the option pricing method include the risk-free rate and the revenue volatility while unobservable inputs include the revenue discount rate and the estimated revenue projections.

Observable inputs used in the option pricing method include the risk-free rate and the revenue volatility while unobservable inputs include the revenue discount rate and the estimated revenue projections.

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2022 and 2021 are summarized below:

9 unchanged sentences

As of December 31, 2021, the estimated fair value of the Company’s finance lease obligation, based on current borrowing rates, was $ 14,312 , compared to its carrying value of $ 14,159 .

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis.

Assets are recorded at fair value on a nonrecurring basis as a result of an impairment charge or assets held for sale.

The losses on assets measured at fair value on a nonrecurring, discontinued operation basis are summarized below:

Forward Air Corporation

2 unchanged sentences

(In thousands, except per share data)

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records assets and liabilities at fair value on a nonrecurring basis.

Assets are recorded at fair value on a nonrecurring basis as a result of an impairment charge or assets held for sale.

The losses on assets measured at fair value on a nonrecurring, discontinued operation basis are summarized below:

2022 2021 2020

Earn-out asset impairment charge 1

$ — $ 6,967 $ —

Goodwill impairment charge 1

42 unchanged sentences

As of December 31, 2021 777,987 249,467 90,588 ( 219 ) 1,117,823

A reconciliation from the segment information to the consolidated balances for revenues and total assets is set forth below:

A reconciliation from the segment information to the consolidated balances for revenues is set forth below:

2022 December 31,

7 unchanged sentences

(In thousands, except per share data)

2021 December 31,

Segment assets - continuing operations $ 1,117,823 $ 973,294

Current assets held for sale — 21,002

Noncurrent assets held for sale — 53,097

Consolidated total assets $ 1,117,823 $ 1,047,393

Revenue from the individual services within the Expedited Freight segment for the years ended December 31, 2022, 2021 and 2020 were as follows:

34 unchanged sentences

3 Represents adjustments to billed accounts receivable.

EXHIBIT INDEX

3.2 Amended and Restated Bylaws of the registrant (incorporated herein by reference to Exhibit 3.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on July 31, 2017 (File No.

4.2 Description of Capital Stock

10.11 * Michael J.

Morris Offer Letter dated as of May 24, 2016 (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 26, 2016 (File No.

10.12 * Form of Employee Restricted Share Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2016 filed with the Securities and Exchange Commission on July 27, 2016))

10.13 * Form of CEO Nonqualified Stock Option Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.41 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2017)

10.14 * Form of Nonqualified Stock Option Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.44 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2017)

10.15 * Form of Performance Share Agreement under the registrant’s 2016 Omnibus Compensation Plan (incorporated herein by reference to Exhibit 10.45 to the registrant’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2017)

10.16 * Form of Notice of Grant of Performance Shares under the registrant’s 2016 Omnibus Compensation Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 27, 2017)

10.17 * Executive Mortgage Assistance Agreement (incorporated herein by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 27, 2017)

10.18 * Forward Air Corporation 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 27, 2017 (File No.

10.19 * Amended and Restated Non-Employee Director Stock Plan (incorporated herein by reference to Exhibit 10.2 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 27, 2017 (File No.

10.20 Credit Agreement dated September 29, 2017 among Forward Air Corporation and Forward Air, Inc., as the borrowers, the subsidiaries of the borrowers identified therein as the guarantors, Bank of America, N.A., U.S.

10.20A First Amendment dated April 16, 2020 to Credit Agreement dated September 29, 2017 by and among Forward Air Corporation and Forward Air, Inc., as borrowers, certain subsidiaries of the borrowers as guarantors, Bank of America, N.A., as administrative agent and lender, U.S.

10.20B Second Amendment dated July 20, 2021 to Credit Agreement dated September 29, 2017 by and among Forward Air Corporation and Forward Air, Inc., as borrowers, certain subsidiaries of the borrowers as guarantors, Bank of America, N.A., as administrative agent and lender, U.S.

10.20C Third Amendment, dated December 29, 2021, to the Credit Agreement dated September 29, 2017 by and among Forward Air Corporation and Forward Air, Inc., as borrowers, certain subsidiaries of the borrowers as guarantors, Bank of America, N.A., as administrative agent and lender, U.S.

Bank National Association, as lender and the other lenders part thereto (incorporated herein by reference to Exhibit 10.

1 to the registrant’s Current Report on Form 8 - K filed with the Securities and Exchange Commission on January 5 , 202 2 )

10.21 * Form of CEO Nonqualified Stock Option Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.4 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 26, 2018)

10.22 * Form of CEO Performance Share Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.5 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 26, 2018)

10.23 * Form of CEO Restricted Stock Agreement under the registrant’s 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.6 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 26, 2018)

10.24 * Employment Agreement, dated June 6, 2018, between Forward Air Corporation and Thomas Schmitt (incorporated herein by reference to Exhibit 10.1 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 12, 2018)

10.25 * Restrictive Covenants Agreement, dated June 6, 2018, between Forward Air Corporation and Thomas Schmitt (incorporated herein by reference to Exhibit 10.2 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 12, 2018)

10.26 * Waiver and Acknowledgment, dated June 11, 2018 between Forward Air Corporation and Bruce Campbell (incorporated herein by reference to Exhibit 10.3 to the registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on June 12, 2018)

10.27 Consulting Agreement effective May 7, 2019, between Forward Air Corporation and Bruce A.

Campbell (incorporated herein by reference to Exhibit 10.2 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 25, 2019)

10.28 Form of Performance Share Agreement (Total Shareholder Return) under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.3 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 25, 2019)

10.29 Form of Performance Share Agreement (EBITDA per Share) under the registrant's 2016 Omnibus Incentive Compensation Plan (incorporated herein by reference to Exhibit 10.4 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on April 25, 2019)

10.30 * Scott E.

10.31 * Amended and Restated Consulting Agreement effective July 28, 2020, between Forward Air Corporation and Matthew J.

Jewell (incorporated herein by reference to Exhibit 10.2 to the registrant's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on July 31, 2020)

10.32 Advisory Agreement effective April 5, 2021, between Forward Air Corporation and Michael J.

Morris (incorporated herein by reference to Exhibit 10.1 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on May 4, 2021)

10.33 Amendment No.

1 dated October 29, 2021 to Advisory Agreement, dated October 29, 2021, between Forward Air Corporation and Michael J.

Morris (incorporated herein by reference to Exhibit 10.

4 to the registrant’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission on November 8 , 2021)

10.34 Rebecca J.

10.35 Form of CEO Nonqualified Stock Option Agreement under the registrant's 2016 Omnibus Incentive Compensation Plan

10.36 Form of Non -Q ualified Stock Option Agreement under the registrant's 2016 Omnibus Incentive Compensation Plan

10.37 Form of Performance Share Agreement (Total Shareholder Return) under the registrant's 2016 Omnibus Incentive Compensation Plan

10.38 * Forward Air Corporat ion Executive Severance and Change in Control Plan Amended and Restated , effectiv e as of October 25, 2021